Maximize Revenue by Automating Airline Commission Management
Cornerstone Insight:
Translating complex contracts that vary across deals to a structured framework is key, and automating at the point of sale is the best way to ensure you get paid on every transaction. Triple-check the structure and each entry and consider outsourcing to established specialists.
Who Should Tune In?
Anyone who negotiates deals with airlines: Travel Agencies, whether you’re an Online Travel Agency (OTA), a leisure or host agency, a Travel Management Company (TMC), Corporate Travel Departments (CTDs), and corporate travel buyers – this one’s for you!
You worked hard to negotiate the best contracts to maximize your airline revenue, and now you want to ensure you collect all that you negotiated. This blog discusses the challenges in the current landscape of commission management and the mechanics of how emerging solutions pave the way for more efficient and error-free processes. Let’s dive in!
Benefits of Automation
Implementing automation in airline commission management saves valuable time and resources that would otherwise be spent on manual contract input and commission calculation. A high touchless rate – in our case, 99.2% – ensures accuracy and minimizes the risk of errors, leading to improved commission management outcomes. Additionally, automation is more scalable, as the system can handle transaction volume without increasing the workload for the users.
The Current Challenges
Interpreting Contracts Correctly
Let’s start with the contracts themselves. Here are some of the challenges you are likely finding yourself facing:
Every contract comes with its unique set of terms and conditions. They can run 25-30 pages in a PDF format, requiring manual input into a standardized database to be used at the point of sale. While some might be straightforward, others can be convoluted and open to interpretation. Misinterpretation of these terms or human input errors can lead to significant discrepancies. These mistakes might hamper your relationship with the airlines, leading to costly disputes and possible litigation.
Miscalculating Contracts Resulting in Debit Memos
Any miscalculation, however minor, can result in debit memos. Debit memos reject the commission payment altogether, require that the issues be researched and resubmitted, and can sometimes lead to penalties. It can be a triple whammy – no commission, the cost of research and reconciliation, and potential fees.
High Percentage of Bookings Being Manually Worked
Unless you automate, every booking requires manual entry of multiple fields. This creates operational inefficiencies. Manual processes are not just time-consuming but are also prone to errors.
So what’s the solution?
Automation, of course. As with any software, integration into your systems is as important as the software itself. Be sure you have a comprehensive solution that covers all components. Our nexusCMT product integrates the Farenexus commission tool into our iQCX mid-office system is a good example. A fully integrated system ensures crucial information such as corporate ID numbers and tour codes are accurately captured for commission calculation.
Efficiency through Automation
The software then automatically determines the commission value and autocompletes all the necessary fields. This reduces the need for manual intervention and minimizes the chances of errors. With a touchless rate of 99.2%, NexusCMT, the commission management tool Cornerstone offers in partnership with Farenexus, makes the entire process seamless and effortless.
Integration with Your Mid-Office
Proper integration ensures a smooth workflow from ticketing to commission management. This way, commission data is a seamless part of QC, from document production and other processes to reporting and reconciliation. In Cornerstone’s case, nexusCMT is fully integrated into our iQCX platform, so no special work is required.
Handling NDC Contracts
NDC brings its own set of complexities. Sometimes, the traditional deals don’t apply to NDC orders; sometimes, the underlying data makes applying the contracts “complicated.” Be sure your automation is NDC-ready. Your provider should have tested each carrier’s contract within the automation for EDIFACT and NDC bookings. Be sure to address any outliers as part of the implementation process.
Close the Loop with Analytics
You can’t tell if money is left on the table without the proper reporting. Errors in the booking can mean that some commissionable transactions don’t appear in commission reports. Without automation, the only reliable way to reconcile is to pull detailed airline reports and check each transaction against your commission records. It’s a lot of work to get an uncertain outcome at best.
In Conclusion
Complex contracts and point-of-booking data entry requirements make automation an ideal solution. Add NDC and other challenges, and it’s a must-have to get the full value of your deals while running your operation efficiently.
The partnership between Cornerstone Information Systems’ iQCX and Farenexus’s NexusCMT automates the process of contract management prior to ticketing, bringing efficiency, accuracy, and scalability to the table. Embrace the power of automation and take your airline commission management to new heights with iQCX and NexusCMT.