Air India – A Case Study

ES Group 3:

Anurag Aran

Aranya Deb

Argha Ray

Sandeep Arora

A brief History

Tata Airlines founded by JRD Tata in 1932

Tata Airlines nationalized as Air India International in 1946

Indian Airlines commences operations in 1953 for domestic routes

Air India enters Jet Age in 1960 with Boeing 707

Low cost airline Air India Express launched in 2005

Financial distress from 2005

Air India and Indian Airlines merged in 2007

Crisis in 2009

Escalating costs, particularly of ATF (Aviation Turbine Fuel).

Fewer passengers, particularly in the premium class.

Low fares with a gradual shift of passengers from traditional full service airlines to low cost airlines.

Decline in carriage of cargo.

Excess capacity in a ‘falling’ market.

Turnaround Plan (TAP)

Focus on execution, accountability, cost reduction and revenue generation.

Adopt international best practices in airline operation.

FY10 – Focus on “Survival”

FY11 –Business restructuring

FY12 – Focus on Healthy operating margins & deliver the ‘future’ Air India

Project Sangam

Phases

Benefits

Milestones

Project Preparation – Phase of an SAP project where you form the teams and plan for the project.

Blueprint Phase – Phase in which processes, organization structure and data elements are defined.

Realization Phase – Phase in which the processes are configured in the SAP solution

Final Preparation – Phase in which the User Acceptance Testing, End User Training and final data load in the new system takes place

Go-Live – Phase in which the system is rolled-out in the organization and support is provided

Techno Functional Architecture

Implementation Issues

Change in top management

Delays

Lack of Coordination

Implementation Approach

Data Issues

Key Learnings from ERP Implementation

BOB provides the best fit in terms of functionality but integrated ERP implementation is better in terms of handling project management, cost and resource requirement, simplicity of implementation.

Top management support is must for taking ERP implementation initiatives.

Project management and coordination needs to be strengthened before going for BOB implementation.

Change management needs to be handled carefully and objective and benefits of the project should be clearly stated.

Key Learnings from ERP Implementation

Data redundancy issues can come up in a best of breed solution.

A best of breed solution can increase costs for supporting technology acquisition and maintenance costs.

Usability and the ability to collaborate are often diminished with a collection of best of breed.