Web-Based Invoice Management To Help Airlines Cut Costs

About a dozen major carriers have signed up to run invoices for consumables through new system.
The trade organization for international air carriers is launching a Web-based invoice-management system that will allow its members and their trading partners to invoice each other electronically. The system, IATA InvoiceWorks, will run on applications from electronic billing software vendor iPayables Inc.

The International Air Transport Association has tapped professional services firm BearingPoint to implement the system. Charles Beard, a managing director at BearingPoint, says about a dozen major carriers have committed to running invoices for consumables, such as in-flight service items, through InvoiceWorks. He wouldn't disclose which airlines have signed on for the system, which is set to launch in the fourth quarter. IATA's North American members include Delta Air Lines, United Airlines, American Airlines, and US Airways.

Beard says software-enabled business-process reengineering is essential for the financially troubled airline industry. "Airlines are realizing it's not enough just to be the low-fare carrier, they also have to be the low-cost carrier." Beard says InvoiceWorks will cut procurement costs for users, but he couldn't provide an exact figure.

More and more, airlines are realizing they need to adopt the cost-saving strategies that companies in other industries have employed to survive the economic downturn. Delta recently became the first major U.S. airline to send a portion of customer-service operations overseas when it tapped Wipro Technologies to operate a call center on its behalf from India.