Customer Service Authorization Development Project for Airline X

Abstract

Airline fares are nowadays built and managed with highly complex algorithms and parameters. In the early stages of commercial aviation, airlines used method called bundled pricing. In a nutshell bundled pricing means that the cost of the ticket includes air transportation and also various different services such as checked-in bag, seat selection and a meal. Tickets were also more flexible in terms of their rules. During the last 20 years or so, more and more airlines have however adopted pricing method called unbundled pricing. This means that the above-mentioned additional services such as checked-in bags are not included in the ticket price anymore. The cost of the ticket is purely just for the air transportation and on some occasions, for some additional services. Mostly these additional services are nowadays sold as ancillaries. For customers, this offers more options as you can basically pay for the services that you need. From the airlines perspective this creates additional revenue streams by selling these additional services as ancillaries. By unbundling fares, there is also more variety when it comes to the ticket rules. In general, the cheaper fares include stricter rules while the more expensive fares offer more flexibility. By nature, most passengers want to purchase lower priced fares if they specifically do not know that they will need the flexibility that higher priced fares offer. This often leads to situations where customers are facing a situation where they need to alter their travel plans, whether that is postponing the trip or cancelling it altogether. This is where airline customer service agents often receive contacts from customers who are in such situations. More often than not, the ticket rules are followed even if in the worst-case scenario this would lead to the customer losing the ticket altogether. The rules are displayed to the customers when tickets are purchased, and the customers agree to them when making purchase decision. However, occasionally, it is beneficial to make an exception into the rules, whether that is to ensure good customer experience or just because of goodwill. For these situations Airline X has created list of different authorizations and a process how these are added into the Passenger Name Record (PNR). This process has had its advantages and disadvantages, while the advantage has been efficiency and user-friendliness, the main disadvantage has been the lack of transparency. In February 2023, Airline X started a project to improve this process and to mitigate the disadvantages. Aim of the project was to ensure that the new process remains efficient and user-friendly while we add transparency and ability to collect quantitative data. This development has been on hold for a long time, and it was important to now transform the process into the modern day. The author of this thesis had a big role in the project. This thesis will firstly introduce the reader briefly into airline fare and fare rules before discussing about the reasons behind the project and the actual process itself.