South African Airways (SAA) has chosen Teradata (a division of NCR) to supply the platform for a new half-terabyte data warehouse which will consolidate a number of its existing data marts, with the aim of increasing the speed of data analysis for end-users.
The new enterprise data warehouse will serve as the foundation for a series of business improvement initiatives in areas including customer relationship management (CRM), revenue management, and financial management. The data warehouse, which is being project-managed, implemented and supported by Teradata reseller Bytes Specialised Solutions, is also expected to provide significant cost savings for SAA by reducing the licensing and support costs involved in operating multiple data marts, as the company has done up until now.
Following the initial stage of the implementation, the new data warehouse will act as a single repository for all passenger name records (PNR), as well as ticketing and departure control data. SAA will also use the Teradata Travel Logical Data Model (a structured data framework) to increase the consistency and quality of its PNR data, thereby improving the overall effectiveness of its data analysis.
For example, this single view of all data will enable SAA to establish and analyse passenger behaviour such as 'show rates', allowing it to predict more accurately which passengers will turn up for flights and which ones will not. While most airlines use aggregated data to determine how they should book for a flight, SAA says it will now be able to forecast demand for each flight with greater precision based on analysis of detailed PNR data. By combining this with ticketing, and flown data also stored in the data warehouse, SAA also expects to be able to optimise profitability of its available seat capacity.
In addition to PNR data, SAA also plans to consolidate customer, financial and operational data onto the data warehouse in the near future, to help the airline develop its CRM strategy by improving customer segmentation and valuation capabilities.
According to Andy Hayward, CIO for SAA: "If SAA is to compete with larger airlines in an aggressive market, it is imperative that we maximise the value of our data assets. The new data warehouse has already enabled us to make significant savings in licensing and support costs, while vastly improving the speed of our data analysis capabilities."
SAA expects to realise considerable operational savings by consolidating its current data-mart architecture - a series of department- or function-specific databases - into a single enterprise-wide data warehouse; the airline has decommissioned thirteen separate data marts. According to Teradata, a study published by AMR Research in 2002 showed that the cost of supporting and maintaining a separate data mart averages between US$1 million and US$2 million per year.