Erik Mueller, CEO of Grasp Technologies Chats about the New Wave of NDC Innovation
Unpacking the recent rollout of NDC in the industry
The push towards New Distribution Capability (NDC) by American Airlines has evoked a mixture of emotions - both admiration and concern. This innovative step, while daunting, was undeniably necessary for the digital transformation of the marketplace, especially in terms of ticket purchasing processes. The move has spurred the industry towards a more efficient future, even though its implementation has not been without its challenges.
The rollout of NDC has brought a major transformation to the airline industry, creating a new standard that necessitates integration and compliance for its success. However, the transition hasn't been as smooth as anticipated, and the "NDC-ready" claim by some stakeholders has not always proven true, leading to additional workload downstream. But as the industry adapts, this will gradually ease.
Travel management companies (TMCs) have found themselves in a particularly challenging spot. Without proper NDC integration in their online booking tools, they are tasked with creating passive segments to drive data into back office systems. This data is crucial for corporate reporting and duty of care considerations. Furthermore, it's vital for TMCs to support transactions and make changes without having to constantly engage with airlines, a process that's currently not very feasible.
However, this complex puzzle is slowly being pieced together, with efforts from Global Distribution Systems (GDSs), online booking tools, TMCs, and corporations. There is optimism that the new system will eventually lead to increased airline margins and more competitive prices for consumers, which are substantial downstream benefits.
Nonetheless, technological hurdles persist, especially regarding data leakage. It is essential for airlines, TMCs, and corporations to ensure that all passenger name records (PNRs) are transferred to systems duty of care services. Besides, corporations require additional information from these transactions which may not always be captured in the new workflow, potentially affecting procurement and financial reporting.
An alternative solution that has shown promise is graspDIRECT. This approach can mitigate the cost of creating passive segments by generating what's known as supplier transactions, accommodating not just NDC transactions but a broader range of supplier transactions associated with direct bookings.
As we navigate this transformative phase, partnerships are more crucial than ever. Whether it's a consulting group, a technology provider, or a TMC, having a dependable partner to guide through this new landscape is paramount. Corporations should avoid expending excessive effort on solving these problems independently. Instead, they need to understand these challenges and collaborate closely with partners that have managed similar transitions across multiple organizations. This strategy avoids the redundancy of reinventing solutions and helps navigate this exciting yet challenging new era of the airline industry.
We’d welcome the opportunity for enterprises and travel agencies to chat with us about how you’re approaching managing NDC data.