How PLM made Charter Travel Industry profitable?

How PLM made Charter Travel Industry profitable?

May 9, 2018 1 By engineeringplm

We were reading an case study on TUI Nordic at TechniaTranscat and came to know that TUI Nordic became the first company in the travel industry to adapt PLM.

“PLM is used by all kinds of industries, but we were the first in the travel industry. Our customers wanted travel arrangements that were more personalized travel than we could provide with our previous system. Technia [TechniaTranscat] showed us that PLM can be used to customize travel. Together with Technia [TechniaTranscat] we keep developing our system.”

The fact of the matter is that Product Lifecycle Management is used primarily in manufacturing sector. To use it in a service industry was a bit challenging. The big question was, do you really need a complex solution like PLM in travel industry and can a company afford to maintain it.

The problem with Travel companies is that information is scattered everywhere – in excel sheets, hard paper copies, different web portals. If one had to look for customer profile, travel package, custom offers, flight details etc. – one will have to look at different places. This results in discrepancies in package offerings, billing information, hotel booking etc.

At TUI Nordic –

“More and more, customers were asking for additional services such as paying extra to have more luggage, for a baby carriage, or a golf bag on the flights. Customers wanted to know how much this would cost, what the seating and food options on the plane were, the kind of hotel rooms offered, or the tours and deals available at nearby restaurants. Something had to be done”

Even though the primary use of PLM here will be as a data integrator and data manager, there are other variety of configurations PLM systems can offer. To draw an analogy from PLM in manufacturing industry we can look at the below table.

Terms in Manufacturing Industry Analogy in Travel Industry
Products Travel Destination
Models Holiday Types/ Package type – Honeymoon package, family package etc.
Bill of Materials Package Inclusions
Suppliers Travel Partners – like Hotels, flights, Car Rentals
Variations Different variations of package types – like luxury, economical etc.

Likewise, there are many other analogies like after sales support, feedback management, revision of holiday packages to name a few. A PLM system can be the answer to all these queries.

The next big question is the cost procuring, customizing and maintaining a PLM system buy Travel Companies. As per statista, global travel and tourism industry is 8.27 trillion USD. There are many Charter Travel companies that earn millions in years, yet they are not introduced to the concept of PLM. PLM tools as a whole have also gone a lot of transformations. The new cloud based PLM solutions can be very handy for travel companies who cannot affort a fully hosted solution. Hence the both the scope and capacity exits for the entry of PLM in travel industry.