IATA – ONE Order: How it is Going to Impact Airlines

An IATA initiative known as ONE Order, now in early testing, could bring the biggest changes to the airline industry's order-management systems since e-tickets became a requirement a decade ago.

ONE Order aims to modernize the order management process in the airline industry. This industry-led initiative intends to replace the multiple and rigid booking, ticketing, delivery and accounting methods, using the data communications advances made possible by the implementation of the New Distribution Capability.

ONE Order is transforming order management into a retail-like model by implementing a standard that simplifies data exchange between airlines, distributors and their customers. It offers a single sales record replacing the PNR, EMD and e-ticket. All transactional details – passenger information, flight, ancillaries, third-party purchases and payment – are stored under one unique order ID for improved servicing and transparency.

ONE Order is the IATA initiative to modernise its member airlines’ flight booking and accounting processes, to enable them to align their products even more closely to customers’ needs and substantially simplify the customer’s booking experience.

Under the ONE Order approach, the customer is issued a single reference number for their journey, known as their Order ID that covers all their flight and supplementary product documents (which have previously been handled separately). ONE Order thus allows all the travel products and services for a particular trip – even those of other providers such as partner airlines or third parties such as hotels and car rental companies – to be fully integrated under a single booking reference number.

The adoption of ONE Order has been made possible by IATA’s New Distribution Capability (NDC) standard, which is using the XML standard to modernise the systems communications between airlines and other travel service providers.

Order handling in legacy systems: PNR, ETKT, and EMD

Several key principles have guided the development of ONE Order principles are as follows: 

• All current relevant business data stored within the legacy records (PNR/ETKT/EMD) will be carried over to the order record. Data elements in the order will need to support the current and future needs. 
• The customer will have a single order reference. There will be a single order controlled and managed by the Offer Responsible Airline (ORA). Sub-components of the order may be contributed and controlled by other entities providing additional products or services, such as the interline partner which is the Participating Offer Airline (POA). 
• The reference held in the ORA OMS shall be used to enable access at all points in the value chain to support any required actions on an order. 
• Before and after delivery, the single source of all data related to products and services, e.g. a record of customer data, entitlement and delivery status of services, is held in the ORA OMS. 
• The provider of the service(s) shall update the ORA of any status change to services in the order.
• The owner of an order shall provide real-time access to the relevant part of the order for all involved entities including 3rd parties such as partner airlines, ground handlers and other service providers.
• ONE Order will facilitate improved customer servicing with simpler interactions between the Offer Responsible Airline (ORA), Participating Offer Airlines (POAs), customers, passengers and service providers, with a single order reference. 
• Accounting shall rely on data validated at time of order creation or modification. All relevant data and information required for accounting are adequately captured within the order. 
• Delivery, tracking and accounting will be achieved using order status control indicators.

Passenger Name Record (PNR)

Passenger Name Record (PNR) data is personal information provided by passengers and collected and held by air carriers. It includes information such as the name of the passenger, travel dates, itineraries, seats, baggage, contact details and means of payment.

The PNR directive regulates the transfer of such data to member states' law enforcement authorities and their processing for the prevention, detection, investigation and prosecution of terrorist offences and serious crime. 

Electronic Miscellaneous Document (EMD)

An EMD, or Electronic Miscellaneous Document, allows you to sell and track the usage of charges, for example excess baggage charges, miscellaneous charges, penalty fees, a residual value, lounge access charges, and so on. The EMD is the sole solution for all fees collected outside a ticket. It replaces all existing paper and electronic miscellaneous documents.

With an EMD you can:

• Accept payment for various types of services including air transportation, group deposits, rebooking fees and other charges.
• Issue an electronic document and print it on blank paper (depending on your office profile settings).
• Automatically integrate miscellaneous charges into invoices, sales reports, back office accounting and external systems (reservation systems and Departure Control Systems DCSs).

Order management with ONE Order

The IATA ONE Order program aims at simplifying airline reservation and accounting systems by gradually phasing out PNRs, ETKTs and EMDs and replacing them with modern “internet-era” Order records. Technically, ONE Order will:  Combine information already existing in the PNR, ETKT and EMD into a single order record;

• Extend the NDC program to provide message standards facilitating order delivery and accounting; 
• Enhance the order structure defined by the NDC order within the IATA Airline Industry Data
• Model (AIDM3 ) to cater for delivery and accounting processes;  Define the principles of ownership, management and control of the order elements between entities;  
• Enable monitoring of the order statuses (delivery and accounting) of individual services.
• The ONE Order vision will not happen overnight. However, over time, it will move the industry toward a single airline customer order and as a result will help to remove unnecessary costs inherited from paper-based processes.

ONE Order will result in the gradual disappearance of multiple reservation records as well as e-ticket/EMD concepts to be replaced by a single reference Order. A new standardized and expandable reference will become the single access point for customer orders by third parties (interline partners, distribution channels, ground handling agents and airport staff, among others).

ONE Order will modernize the airline ecosystem to align with digital processes for fulfilment, servicing, delivery and accounting with orders. Thanks to these, ONE Order will facilitate product delivery and settlement between airlines and their partners with simplified and standardized order management processes. All parties will follow the same process to service their customers and their services throughout the whole lifecycle from booking to delivery.

NDC basis of ONE Order initiative

The airline industry has been slow to adopt new and modernized systems, especially in the passenger reservation and ticketing platforms. This is largely due to the interconnections between airlines and the broader ecosystem (travel agents, global distribution systems, etc.) that make large transformational changes complex and lengthy to implement. The increasing threat to airlines becoming marginalized by newer competitors, such as online travel agents, aggregation platforms, and more nimble market players, has required IATA to define new standards to modernize and digitally transform through the NDC and ONE Order programs.

Today, most airlines publish their inventory and related fares to an external inventory system that provides availability and pricing to the broader travel ecosystem. In this highly competitive and regulated airfare market, an airline cannot do much differentiation and personalization across these indirect channels. NDC gives airlines the ability to distribute a more personalized offer (e.g., airfare bundled with hotel, car hire, and other complementary travel services) across these non-direct channels. It also improves the richness of information (e.g., seating, baggage policy, meals, etc.) and content (e.g., images of seats) that airlines can distribute to ensure the passenger has an “apples to apples” view when comparing an airline’s offer to competitors.

The benefits of ONE Order

Enhance delivery of end-to-end travel products: Simplifying interaction between airlines of differing business models drives a more cohesive, end-toned experience for customers. By unifying the interaction processes between airlines and other transportation service providers, the scope of the airline offering to the customer can be increased, independent of the purchasing channel. 

Sell more through simplified delivery and accounting: The number and variety of products brought to market can be increased. This increases revenue and can improves the ability to address customer needs and desires. New product offerings can be brought to market quicker, enabling earlier revenues and lower project costs. 

Improve customer experience: The use of a single identifier for a journey and all related purchases across all entities drives an improved customer experience. Order systems are (typically) customer centric systems as opposed to transaction centric. Airlines can exploit the ability of richer data at a single source to enhance various customer servicing, information and experience capabilities.

Enhance data quality and analytics: Detailed transaction data from offer creation to order management and all servicing transactions is available, combining air and non-air products and services. All data is related to a customer or order, thus easy to assign and analyze. Updates to the order can be made by all relevant delivery parties directly. Data quality is greatly improved due to removal of redundant, overlapping records. 

Reduce cost of finance operations: Reduce the cost of financial transactions and related processes and systems by simplifying manual processes related to revenue allocation and disputes. Financial and settlement statuses could be managed directly within the order, removing the need for various copies and transmissions of data to additional systems.

Reduce cost of commercial systems: Reduce the cost of commercial systems, related business processes as well as projects. This leads to cost reduction within IT and business processes. Through standardization and automation as well as the use of modern interface technologies and harmonized data definitions, airlines can improve the speed to market for new products or interactions with other partners. Further, with the ‘despecialization’ of the airline terms and processes and the alignment to the consumer retailing industry, airlines will have the opportunity to utilize market-standard retail systems for offer and order management.

The airline industry has been slow to adopt new and modernized systems, especially in the passenger reservation and ticketing platforms. This is largely due to the interconnections between airlines and the broader ecosystem (travel agents, global distribution systems, etc.) that make large transformational changes complex and lengthy to implement.

The increasing threat to airlines becoming marginalized by newer competitors, such as online travel agents, aggregation platforms, and more nimble market players, has required IATA to define new standards to modernize and digitally transform through the NDC and ONE Order programs.

Today, most airlines publish their inventory and related fares to an external inventory system that provides availability and pricing to the broader travel ecosystem. In this highly competitive and regulated airfare market, an airline cannot do much differentiation and personalization across these indirect channels.

NDC gives airlines the ability to distribute a more personalized offer (e.g., airfare bundled with hotel, car hire, and other complementary travel services) across these non-direct channels. It also improves the richness of information (e.g., seating, baggage policy, meals, etc.) and content (e.g., images of seats) that airlines can distribute to ensure the passenger has an “apples to apples” view when comparing an airline’s offer to competitors.

ONE Order’s vision is to move towards a single customer order record and modernize airline retailing, delivery, and accounting. IATA says ONE Order is a natural extension of NDC and is based on the following core principles:

• Creating a single, combined travel record: This will create at superset of data currently contained in the Passenger Name Record (PNR), Electronic Ticket (ETKT), and Electronic Miscellaneous Document (EMD).
• Reengineering travel commerce processes: Airlines will move towards adopting processes and systems centered around offer and order management, much like how retailers operate today. This will require a huge shift to transform existing Passenger Reservation Systems (PRSs) to align with newly defined travel commerce processes.
• Establishing efficient billing and real-time synchronization of relevant information between parties: All entities involved in travel and fulfilment, from customers to third-party service providers, will access the single record to get information and make necessary updates to trips. This aims to significantly simplify customer service, revenue accounting, and settlement processes.
• Moving towards customer order profitability: Improving the quality and accuracy of customer revenue information will help airlines understand profitability at an order/customer level. This can play a significant role in evaluating profitability, not just at a flight level, but across the entire the customer journey. It will also enable airlines to be more creative in how they present offers to customers.

IATA will provide the official industry certification program for ONE Order.

ONE Order certification will cover:

• Airlines – any airline that deploys and supports the ONE Order communication messaging and capability
• Vendors and IT providers – any vendor or IT provider that offers ONE Order solutions and services (OMS, Delivery Provider, Accounting) can become ONE Order capable