Memo

To: Miriam Masullo

From: Abrar Khan Date: Re: 10/31/10 Business intelligence benefits in Airline sector

Airline sectors are going through tough times with raising operating costs and decreased occupancy levels. Airlines are investing heavily into business intelligence projects to better understand their customer behavior and airline operations. Also BI systems are being used in reducing costs and increasing efficiency of its operations. Like any other sector airline sector has many functional systems which are independent to each other. They have separate systems for ticketing, airline operations, baggage handling vendor management and loyalty programs. Alaska airlines implemented BI systems with Siebel analytics to increase revenues by marketing personalized promotions to customers. In implementing BI system their first step was to integrate data from all disparate transactional systems into one enterprise data warehouse. Secondly Alaska airlines worked on integrating metadata information from all their transactional systems, so that data could be related. It used Siebel metadata layer to implement all the business rules, aggregation rules and drills rule in their data warehouse so that business users could easily find pattern using BI systems. Alaska airlines also used BI systems to analyze flight routes which are profitable and those having concerns finding customers.BI systems also helped them forecast occupancy levels and according plan their flight staff, vendors and ground staff needs. Continental airlines implemented BI system with Teradata as backend database integrating all the airline data in one place and reporting tool MicroStrategy that helped it in finding patterns when canceling flights. Using this data Continental wouldnt cancel flights if there was high percentage of frequent fliers on the flight there by keeping good relations with high fliers. Continental airlines uses real time BI systems to find fraud patterns like fictitious booking records, fraudulent lost baggage claims and One Pass account redemption abuse. As potential fraud patterns are found in business intelligence systems they are provided to agents for further analysis. As above business needs like good customer relationship, reducing operating costs and fraud reductions are equally important in every industry so these BI applications can be easily translated and applied to other industries .

Business Intelligence Project Details 1) Alaska Airlines Federated Data warehouse

Sector : Airlines Company : Alaska Airlines Project : Federated Data warehouse BI Approach : Metadata Integration BI Tools : Seibel Analytics

2) Continental Airlines MicroStrategy Implementation

Sector : Airlines Company : Continental Airlines Project : MicroStrategy Implementation BI Approach : Self Service reporting BI Tools : Teradata , MicroStrategy

3) Continental Airlines Real time Business Implementation

Sector : Airlines Company : Continental Airlines Project : Real time Business Implementation BI Approach : Active Data Warehouse BI Tools : Teradata , MicroStrategy BI ROI : Continental has invested approximately $30 million into real-time warehousing Of this amount, $20 million was for hardware and software expenses, and $10 million for personnel costs. Although this investment is significant, the quantifiable benefits from real-time warehousing are magnitudes larger. Specifically, over the last six years, Continental has realized over $500 million in increased revenues and cost savings, resulting in a ROI of over 1,000 percent.

References Alaska Airlines Takes a Direct Route To Customer Insight; Integration and ETL weren't practical, so this midsized airline took a federated approach to analyzing customer data. INTELLIGENT ENTERPRISE, May 1, 2006, ON SITE; Pg. 43, Doug Henschen MicroStrategy Lands Business Intelligence Deal With Continental TECHWEB, February 11, 2009 http://www.fuquaeurope.duke.edu/centers/ccrm/datasets/continental/Continental_Airlines_Case_Study.pdf Continental Airlines Flies High with Real-time Business Intelligence