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Driving Value and Maximizing Your Technology Investment

Demand is back but airlines are scarce on revenue management, IT and industry talent, juggling to refine operations and optimize networks. Making teams efficient, while getting the most ROI from your investment has never been more critical. This session discusses how two PROS customers, Etihad Airways and Avianca, have worked with the PROS Airline Services team to maximize value from their technology investments.

Full Transcript

Lauren Petty: Hi, I'm Lauren Petty. I'm the Director of Professional Services here at PROS. I want to welcome you guys to this session today. We're going to talk about driving value and maximizing your revenue investment. And so, we have I wanted to talk more about our services that we have. We're not, in PS we don't just implement. We focus on adoption too. So, we have consultants, solution architects, and trainers that are here to help you in adopting your solutions long term. So, we have Juan Pablo, who's our business consultant.

Lauren Petty: We have Hasan Tawab, who's one of our customers from Etihad. He is the revenue enablement manager, and we have Esteban Rubio, who's the innovation specialist from Avianca. And so, we're going to start off, and we're going to have Juan Pablo give us a little bit introduction of kind of the background of how these two customers on the panel started needing PROS from an adoption perspective. So let me go to the next slide. Here you go, Juan Pablo.

Juan Pablo: Perfect. Thank you, Lauren. And I see familiar faces. Thank you for being here. So, what happened? A little bit of the background, the pandemic happened, so the staff changed, the headcount was lower, but also figuring out how to forecast, let's be honest, forecast was terribly difficult. So, we were doing things together back then, but slowly depending the region, of course, there were certain recovery, some regions faster than the others. But now it was time back for demand.

Juan Pablo: It was time back for more people, hiring more people, and going back into the best practices because there was a survival mode. It is like, get anything you can catch. It's not forecasted because the government's closed because of the pandemic. So, how can you actually forecast that? But now getting back to a new reality, we are helping the airlines via health check. So, we have one-on-one interactions or a small group talk to understand what are the pain points. So, it's like have the correct solution for the, let's say the sickness after the sickness after the pandemic. And sometimes it was more like I, I, I felt myself like a psychologist listening to all the problems and then trying to get into the solutions that we're going to talk about that. But then we're helping, so with Etihad, Avianca we are still working on some plan, action plan. And I also, I will talk about that a little bit later. So now I'll go back to Lauren.

Lauren Petty: Okay. So, I'm going to ask Hasan what were the main factors that made you realize that you were not maximizing RMA to its full potential?

Hasan Abdul: So, we all know that RMA Advantage is a fairly advanced solution. You know, it requires day-to-day involvement from analysts, managers, and system admins even, or data scientists. During the pandemic, it was, there was, we, we basically didn't use the forecast. We wiped out the forecast from the system. We were using it basically like a capacity optimization tool. But once demand recovered, we realized that was not feasible. We had to start forecasting again. So, I think along with that came the loss in personnel, training them up. So, there was, like, broken business processes as well. So, system configuration, training the users, and setting up the right business processes again. So, I think that's made us realize we needed help from PROS to do all of these things.

Lauren Petty: And Esteban, what were, what were, kind of, the things that you found at Avianca?

Esteban Rubio: It's very interesting for me how similar our situation was with Hasan. During the pandemic, our team was reduced to eight members. Our revenue management team was very, very small. And we found ourselves in a situation where keep using the forecast from PROS didn't make any sense. So, what we did was to develop, like, in-house tools and rules that help us manage our few flights in a leg base context. But then capacity and demand rebounded. And the new analyst that arrived to the team, because the team also expanded, keep using these in-house tools. And it was very difficult to manage our markets this way because it's clear that Avianca preamp post pandemic, it's not a leg base airline. We are a completely original destination airline. So that was the point when we see that we, we saw that we needed to start using again RMA, adapted to our new reality.

Lauren Petty: Okay. And Juan Pablo, you did the health check on both these carriers. So, what specific recommendations did you have after the health check?

Juan Pablo: So, with the health check I focused mainly on three high-level aspects. So, it was people and organization, business processes, and system usage. So of course, we came up with roughly, and it was like a close number if... In most situations around 40 items, short, quick wins, something that they can do independently. And they didn't need us, PROS, but also we have an action plan, mid long-term solution, and that's where they required our help. So, some of our services, consulting services, that was needed. Also, we, it was not only the consulting team, also solution architects, science product management have been involved. So, it's a task lease prioritize with clear responsibility from both ends and continuous work.

Juan Pablo: Two of the most popular of course, both of you and other airlines services out of the health check was a training, refresh training. Of course, you have new people that has to be trained, they can be trained inside, but sometimes that training comes with bad habits, with not really best practices. So, having someone from PROS to go back into what you should be doing, like a specific demand analyst role, flight analyst role and pricing role, and going back to those good forecast management best practices was really necessary. So that was the start baseline to have this refresher training, because that made me easy to come back. And then let's go deep into your specific needs, something that we have already seen together. So, refresh training, one of the most popular services coming up. Another one, and that was critical to have is the PROS Science studies.

Juan Pablo: What we call right now, the forecast tune up. So, before the pandemic, we usually recommend our airlines to reconfigure the PROS science studies. Most of you know them. DCP pattern, seasonality, drift configuration. So, every three to five years before the pandemic, because everything was so balanced around the world, everyone was doing so well. But now everything has changed. We have a new reality. We haven't gone back to what we had previously. So, we have to change those configurations. We have to adapt to the new reality. And every region, again, is different. Every airline is different. So, we have to do that study again based on more recent good data. So those are the two most popular. But we have a list of like fourty... We are still ongoing.

Lauren Petty: And as Juan Pablo was saying refresher training is a big one. You'll notice Lisa is here, she's one of our trainers. So Fuller side aside, if you want to talk to her about training. Esteban how have you implemented the actions that Juan Pablo recommended? How did you action those?

Esteban Rubio: Yes. As Juan Pablo mentioned we end up with a list of items. It was a 42 list of tasks. So, this is like a pretty good indicator of how critical the situation was. But the first step, of course, when we had the list was to prioritize the list to define what was the first thing that we had to do in order to improve as much or generate the best impact into the system. Once we have this prioritized list, us as the system administrator team, started working with each team, with the analyst, with pricing, with inventory, and started to help them understand what was the impact, what was the next step and also help them not also to push and accelerate the process, but also to raise any concern or job to our support team in PROS. Another thing that helps us a lot was working with agile methodology, because this way we could divide each task into a smaller task that could be more accountable. And finally working with these small teams and each member of the admin team help us a lot improve like the engagement and the confidence into a system. And that's basically how we...

Lauren Petty: Yeah.

Esteban Rubio: Address this long list.

Lauren Petty: Yeah, the agile methodology through the roadmap. Well, that's understandable. So, Hasan, what were the challenges that you faced while following the roadmap and how did you overcome them?

Hasan Abdul: So, our biggest challenge to begin with was just the loss of people. And these are very, very experienced people. With a lot of market knowledge, skills, a lot of consulting in-house consulting, implementation of different systems, and conducting different large-scale projects. And this is the sort of in-house knowledge that you can't simply replace with just doing some trainings. So... But obviously with all new people coming in, you have to have... You have to establish a baseline. So, you have to do the refresher training, but that's not sufficient. On top of that, we had a lot of change within our particular airline. We had a lot of change in the leadership. We changed our network strategy a little bit. Bank structure has changed also a little bit.

Hasan Abdul: A lot of departments have been merged, spun off, so when also all these changes are going on it's kind of difficult to do things in a structured and standardized way and it's very hard to make revenue quarter after quarter. If things are chaotic if, for those of you who've seen 3 Body Problem, like the chaotic era, you can't do anything. You're in a survival mode. So, you need kind of a stable era and you need to establish some kind of stability to do things. And I think that was... That was the biggest challenge to kind of recoup the talent and get that knowledge, build up that knowledge, and establish some sort of stability.

Lauren Petty: Yes, I think you've heard and called it stabilizing the boat a lot. So, I've heard that term by Hasan and the team at Etihad. So, Hasan, one of the items on the roadmap, as you said, was refresher training. How did you work with our team on that? Because it was limited, a limited timeframe that your analyst could do it. So how did you work with our team on that?

Hasan Abdul: Yeah. Definitely. Training our user base is crucial. A lot of our analysts that we've hired in the last one and a half to two years don't have an O and D background. They come from Leg SEG airlines. Some are fresh university graduates. So, they need to first understand the system, but also, have the right mentality. I'm sure there's, and I'm not embarrassed to admit this, but we've had cases where analysts were influencing the bid price, for an airline, which is more than 70% connecting traffic, that's disaster. We cannot be, doing network optimization when our analysts are influencing bid prices. So, for them to understand that, they need to get the input right. Forecasting at the class level, DCP level, time window, day of week?

Hasan Abdul: So that's like the first step. And then once we have the, everybody on the same page with the refresher training, which Lisa was conducting, we then decided to do some workshops, kind of scenario-based workshops. So, in an airline day to day, you're introducing new routes, you're changing your schedule, you're introducing new flows. So, all these scenarios, how do you handle demand in those scenarios. So, we came up with like a list of all these scenarios, and then we did workshops, where the people who are managing those markets, they work with the trainer to say, okay, this is what we should do. This is the problem I'm facing. Okay, Australia, we've seen yields go down this, I need to map demand to my lower classes. So, this is the sort of thing that really, really helps to apply that theory into practice. And then of course, the job doesn't end there. Once you train them, you don't just leave them to their own devices, you follow up with them, you sit with them one-to-one, it's a lot of hard patient work. But that's how you get them to buy into doing things the right way. So, it's a continuous process. Yeah.

Lauren Petty: Yep. Okay. And then, what, I guess what are the best practices and lessons learned that you could share with the audience about moving through the roadmap? And then we'll go to Esteban. Yeah.

Hasan Abdul: I think every airline is different. What we've realized kind of, it's important to remember that setting up the system and having the refresher training, that's part of it. But you need kind of the buy-in from your senior management. You need them to understand why it's important to adopt, to drive adoption. As an airline we are like a lot of airlines, we have a lot of targets, pressure from the shareholder, and it's very tempting sometimes to just take shortcuts due that RTDP, or in our case, RAV overrides get the short term results. But you're hurting your long-term forecast. And it takes belief from the management and that, give the confidence to the analysts. It's okay. You might lose some tactical things in the short term, but we're setting things right for the long term. And also, like this, this tool, you're building your organization kind of around it because it's a very involved product, as I've mentioned, but you have your pricing analyst, your flight analyst, demand analyst, market managers interacting around this tool. You have to make sure that you're structured in the right way.

Lauren Petty: Esteban?

Esteban Rubio: Yes, I completely agree with Hasan. For us, one of the success factors was that engagement came from the top leadership of the company. We had our CRO, our directors, our VP completely engaged, and they became like PROS champions, which was like the first time that we saw that in Avianca. So that sends a clear message to a complete team and the organization of where are we going and why ar doing that? Now that we have a more stable system, now we are thinking in new improvements, new things, we are are pretty close to go live with, willingness to pay, working pretty good with the hand in hand with PROS implementation team. And we are still finishing that 42 list of things in parallel. But it's also, again, a good indicator that we are going in the good way, the good path because now we are doing new things. So, my advice for you is definitely, consider a health check. It's one of the best improvements that you can do for your team and for your system.

Lauren Petty: Juan Pablo.

Juan Pablo: It's like you both said, top management involvement is so important. So, we have to have them buy the idea. We have to talk with them. We have to convince them, because otherwise it would be going against the flow. So, I think it was critical for us to continue working to have that buy from top management. And congratulations for both teams and top management working along.

Lauren Petty: Yeah. So, for both of you guys, what service was the most valuable and impactful for your team?

Hasan Abdul: So, I think JP mentioned, those kind of the three main elements of the health checks we have, the people and organization, we have the business process, and we have kind of the system and tools. For us, I think we have to start with, I mean, the most value that we see is from the people and organization. You have to have the right talent in your teams. And you have to structure the organization in the right way so that we are working efficiently. And our analysts know that where they have to influence and they're not over steering the demand, they're not, making it worse. They're applying influences where they need to be applied, in the right way. So, definitely that one is the most valuable for us, but also to an extent, the business process.

Hasan Abdul: And I think that's kind of the step that we are in the middle of right now is to define good business processes, routines, a day in the life calendar, those kinds of things. With systems and tools, I won't say that that's less important. I mean, obviously we have to set up your system in the right way, make sure, do the forecast engine tune-up, make sure all the parameters and everything is set up. But there's a lot of, like, you can have internal people who can be trained to do that and advise you do some, data analysis. So, let's say we are less dependent on PROS, for that piece. Yeah...

Juan Pablo: And also, my allies in both airlines, because without you guys, and supporting me, it would have been much, much difficult. So also, I want to highlight that, like having my two champions here and follow up and putting a lot of pressure internally has also helped. Otherwise, it would have been close to impossible for me to get to the right direction.

Hasan Abdul: I just want to add that it's really great to see that this year in Outperform, we have the professional services team here. I don't think that was the case before. It adds a really, really good, healthy element to the interaction that we have. So, I'm really, really glad that they're here. Thanks for that.

Esteban Rubio: For all of us, it's clear that the airline industry is full of governmental policies, new competitors, and it's a completely changing industry. So, in my side, and for most of you, what I will do to start working with services of PROS is try to answer these three questions. The first one is, our RMA is like reflecting the most recent trends in the forecast. Maybe no,, so you definitely should consider a forecast. The second question is, are we using RMA in the best way, the optimal way? In that case, as I mentioned before, the health check will help you a lot to improve the relationship of the analyst with the system. And the final question is, is our team fully equipped to leverage RMA? In that case, and that's what we did in Avianca, is to have a refreshing training that gives a lot of confidence to the new analyst to start using and understanding what is PROS, and what is required, and what is the advantage of having this kind of system in an airline.

Lauren Petty: Well, and then I guess, Hasan, you've noticed a lot of improvement within long-term adoption of the solution. Could you kind of give us some of the examples and stats?

Hasan Abdul: I mean, obviously, the proof is in the pudding. So, the financial results kind of speak for themselves. But I think internally also we had to implement some metrics. And one of the things is forecast accuracy. So, we've seen, after we implemented the forecast accuracy, by the way, I'm talking about that in the session immediately after this one, we saw an increase of about 30 percentage points over the last six to seven months of forecast accuracy. And that has really translated to increased revenue, especially in the last one quarter, which is out, which we've reported. The other thing which we are tracking is something we call demand-driven availability, which is really the proportion of significant O&D itineraries, which are controlled by the forecast or the bid prices. So are not overridden by these RAV strategies or RTDP rules. And if you want the forecaster to be healthy and work properly, you need to minimize the usage of those overrides. Of course, there will be cases where those are necessary.

Hasan Abdul: For us, if you look back a year, in May last year, we were only 35% of our itineraries were demand-driven. And today that number is over 65. And we have a target of getting to around 75 to 80%. So, I think we've, through these health checks and adoption programs, we've managed to drive these two metrics up and we've seen a corresponding increase in our revenue.

Juan Pablo: Yeah. And you know, something also part of the health check and having the confidence with the one-on-one, they trust you. At least they trusted me. And those numbers, they told me those numbers, like honestly, we're only using 30% of forecast management and the rest of it is availability control. And what you implemented and that clear idea that we're focused on get this metric really helped to shift that usage. But I was, surprised I'm not, because I haven't seen it along with many airlines, but that percentage was real, and they were honest, open honest with me.

Lauren Petty: Esteban, do you have anything to add on, what you've seen at Avianca?

Esteban Rubio: Yes, I think the complete process has been exciting, but also important and critical for Avianca. But I will focus on the first and the last latest thing that we did. The first one is the initial assessment with Juan Pablo. He went directly to our offices in Colombia, and it was not only about meeting Juan Pablo and showing him how we work. It was also like to give the users like a human face of e of PROS and they analyse and the whole team started to ask questions, concerns. And that thing, I think that was the first step that helped us like engage the team, engage the top management and everyone around a project that was mandatory in that moment. And the last one, and the latest one is the refreshing training. It was completely like one month ago with Lisa also. And as I told her this morning, now the users are excited about using PROS because now they understand what is PROS or how everything works. They're completely engaged. They're raising questions. They're working in team. They're working in, as they're communicating a lot. Pricing and inventory are talking again because they were like completely separated. So, I think that training with people who know how system works. They start to develop a better relationship with it and understand how the system will help us to improve their numbers. Sadly, I still do not have numbers to share, but we're pretty excited to what comes next in Avianca in hand with PROS. So, thanks.

Lauren Petty: Well, I think this is the end of our session, but I want to thank Hasan and Esteban on being great partners in working with Juan Pablo on the health check and getting through all those 42 items at Avianca. And I mean, Juan Pablo, thanks for all your hard work on the health check in. If you want to talk to...

Juan Pablo: Thanks for your support as well.

Lauren Petty: If you want to talk to any of us, even our whole professionals, most of our professional service team is here. Please pull us aside, Maropi is in the room, I think Soke is here, Lisa, David's back there. We are happy to talk to you about any of our services. Entere is in here and Yawn. So, I think just pull us aside and we're happy to talk about them. Thanks. Oh, and oh, yes. And in the app, if you go to value added services, it will talk about all our services. So, we have RMGSO services. We also have RTDP services for you guys. So please, take a look at them and talk to your CSM and they'll pull us in to any meetings you guys need.

Juan Pablo: And we have all the services. It's not only the forecast tune-up, etcetera. We have other consulting services or design business processes, performance management, master classes, specific workshops so. Thank you.

Lauren Petty: Yeah, thank you guys.

Juan Pablo: Thank you very much.