Abstract
In medium-to-large aviation firms, it is critical to have a robust IT infrastructure that allows making informed, data-driven decisions to improve business performance and maintain competitive advantage. However, the current market of IS solutions is large and highly networked, which requires carefully exploring and analyzing what types of systems should be chosen for enhancing business continuity. Following the above considerations, this research paper explores the business advantages of the five selected IS solutions and provides relevant frameworks for deployment, cost considerations, as well as general strengths and weaknesses constituents. The analysis shows that depending on the operational activities of a particular department, the choice of the appropriate system would be different, while it is important to maintain system integrity under a single infrastructure. Furthermore, there could be additional issues with cost affordability and planning. Hence, it was recommended to make reasonable choices for IS solutions based on the system analysis and organizational planning, as well as to invest resources in user and administrator training.
In times of massive proliferation of information and communication technologies (ICT), medium-to-large aviation enterprises should maintain competitiveness through the implementation of robust and relevant information systems (IS). Depending on the scope of operations and organizational contribution, the IS functionality applicable for a specific department will vary. Hence, from the organizational standpoint, it is important to choose the best-in-class combination of the IS systems that clearly support business objectives and address existing issues or loopholes, eventually requiring to manage implementation process carefully. It means that focused research on the benefits and risks of deploying IS in the aviation industry is an important effort in both technical benchmarking and organizational planning. Based on the above considerations, the transaction processing system, cloud computing, database management system, customer relationship management, and supply chain management solutions are further investigated as potentially advantageous for improving the competitiveness of the aviation enterprise.
Transaction Processing System
The transaction processing system (TPS) typically represents a module of a larger enterprise management system and is required to process any data transaction in a central database for monitoring and execution. TPS has a significant role in the aviation industry since such systems are commonly used for processing financial transactions among multiple stakeholders, and allow a time delay between the actual and technical process execution. Furthermore, TPS is used to manage and retrieve critical data fed into the central database from both internal and external sources. Considerably, there are several requirements for designing perfect TPS that could satisfy the business needs of the aviation enterprise. First, TPS should feature a high response time considering that customers normally do not expect to wait for a long time before a transaction is completed. Second, TPS should be reliable in terms of functionality, accessibility, and security to ensure that business does not lose revenues because of unstable transaction processing (Spencer, 2019). Finally, TPS should be highly formalized in terms of processing data-related requests or financial transactions, which means that the system should be configured to execute any set of categorized operations in a similar way.
In a medium-to-large aviation company, TPS will have a critical role for several departments after being implemented. For instance, in Human Resources (HR) the use of TPS will decrease the amount of manual work related to the recruitment process through automatization of personal data processing. Furthermore, HR will benefit from TPS in terms of payroll operations, since all payments related to wages and additional compensations to employees will be automated and recorded in a single database. SAP HR is an example of TPS offered by a retail vendor that could be used for the aforementioned process improvements. Hence, recruitment, personal data management, and payroll management should be seen as could be optimized using SAP HR TPS effectively.
Another example is the Reservations department, which handles millions of transactions received from customers daily. Given that each reservation requires confirmation sending on behalf of the company, as well as a strict commitment to process a request as fast as possible, the implementation of TPS should significantly decrease response time. Currently, vendors provide several variations of such systems, while the most prominent is TPS that encapsulates blockchain technology and therefore provides better means of financial security (Wang & Kogan, 2018). However, more common alternatives such as advanced flight reservation or priority booking systems are also available on the market.
The obvious strength of TPS implementation is workforce productivity improvement since routine and manual work related to transaction processing is automized and therefore provides more opportunity to focus on strategic tasks. However, the unexpected system failure might heavily disrupt core business operations of the aviation firms, resulting into delays in processing payments, losing critical transactional data, and temporarily switching back to manual operations. In terms of costs, the risks are high both on the operational and reputational fronts, since TPS functionality is highly related to customer satisfaction and stakeholder engagement (Spencer, 2019). Hence, it is important considering regular system updates and personnel training to ensure that the system is utilized as efficient as possible.
Overall, the implementation of TPS should be initiated bearing in mind the following constraints. First, the system provides competitive advantage only if one is designed and configured based on organizational needs and business realities. For instance, blockchain-based TPS for the Reservations department will be only feasible if customers are well aware of its benefits, which requires conducting preliminary survey (Wang & Kogan, 2018). Second, the influence strategy is best achieved if employees of all departments where the system is deployed are well trained to use it, as well as there is a regular vendor support in terms of system patching and updating. Finally, organizational performance and operational efficiency will be achieved only under a condition of TPS integrity and scalability, meaning that the system is well integrated with the other enterprise subsystems.
Cloud Computing
Cloud computing is a multifaceted IS solution that could be implemented in the aviation industry in several ways. Basically, it stands for having enterprise data collected, stored, and processed on a remote server located outside organizational premises, while its real-life applications are more distinct. For instance, cloud computing technologies used by the aviation enterprise could be merged with similar tools and techniques used by social networking websites and survey companies. Specifically, it is required to sense the target audience in terms of its appreciation of services provided by the company, which assumes generating large datasets that could not be stored using physical computing environment. Alternatively, cloud computing IS solutions are feasible to manage and interpret big data that comes in the forms of high-quality images and video recordings. Recently, it was justified by the use of drones for the airport surveillance and immediate data transfer to cloud servers, where potential security issues are identified and handled (Lykou et al., 2020). Hence, it could be suggested that cloud computing solutions are beneficial for multiple departments within the aviation business operations and therefore should be integrated with the main enterprise framework.
There are several solutions that could be implemented for the better integration of cloud computing based on the following cases. Primarily, the described IS solution should be practiced by the Information Technology department for ensuring sufficient virtual space for different types of data exchanged across internal company systems. Specifically, it means that IT specialists should collaborate with cloud support vendors on the one hand, and internal departments as their customers on the other hand. For instance, IT department might research available market solutions for sales analytics to assist the firm in evaluating and forecasting business performance based on previous success measures and trends. Alternatively, IT department can support Marketing department by providing a cloud-based data mining solution for analyzing consumer behaviors collected through surveys or interviews, suggesting rigorous tools and techniques for interpreting attitudes of passengers. Moreover, HR specialists could benefit from using cloud computing platforms that store mounting employee data on the remote servers and therefore reduce the load on physical servers, which optimizes performance of the core HR systems. Hence, the analysis of cases shows that practical cloud computing applications are most relevant for IT, HR, and Marketing.
Comparing to the traditional physical infrastructure, cloud computing solutions have many strengths such as instant data access, the ability of accessing the data by multiple users at a time, and the luxury of using embedded analytical tools for data interpretation. However, according to the recent research, cloud security remains a major concern for organizations that seek for remote data management and have internal network vulnerabilities (Ramachandran, 2016). Nowadays, major fraud attacks initiated by hackers are aimed to retrieve sensitive data, such as personal information, credit card account details, and confidential documents related to organizational strategy. In case there is insufficient layer-based protection between the cloud and physical server, intruders might initiate a cyberattack that will paralyze operations of the aviation firm, manipulate, and retrieve sensitive data (Ramachandran, 2016). Hence, apart from comparatively high implementation costs, there is also a risk of additional costs associated with responding to cybersecurity incidents.
Based on the previous considerations, the cloud computing solution for the aviation firm is best implemented in the following manner. First, the competitive advantage could be only achieved if the company chooses trusted cloud service provider that uses modern encryption and data processing algorithms, which might eventually come at a higher cost. Second, the influence strategy assumes that all stakeholders are informed or trained about the way how the data is treated and what are the policies and procedures of using cloud services securely. Finally, organizational performance and efficiency improvement strategy should be developed by the IT department as professionals in structuring, managing, and retrieving data based on the formal requirements collected from other departments.
Database Management System
A database management system is best described as a software environment which enables its users to store, maintain, and exchange the data. Such systems evolved as an alternative to the traditional file processing approach and therefore were successfully adopted by the various industries that have to process large amounts of data in an isolated manner. The core advantage of the database approach is data independence, which means that software applications that process the data could be altered in terms of processing logic, while the data itself remains untouched (Coronel & Morris, 2019). More specifically, the organization has a single data repository that could be accessed in multiple ways, while there is no need for the regular data administration or modification performed manually. Another advantage of using database management systems relates to customization of the ways how the data is shared among different users depending on the privilege rights and confidentiality. Oracle is a leading vendor which provides highly secured database management solutions for the organizations. However, there are many other alternatives on the market, which could be eventually used as a basis or designing an in-house system.
Ideally, the framework for the database system deployment assumes singularity, which means that all organizational data is stored on a local or cloud server. Referring back to the previously proposed solutions, the database management system should be a part of the global enterprise resource planning system (ERP) and therefore consolidated with TPS and the other cloud solutions. Meanwhile, it is important considering that different departments might have their own requirements for data confidentiality and processing, which means that the system should have its own pre-defined rules for data sharing and accessibility (Coronel & Morris, 2019). For instance, the data accumulated by commercial departments such as marketing and sales should be separated from the back-office departments such as IT or HR to avoid cybersecurity risks. Hence, it is important to define specific data attributes and properties, which also helps with better encapsulation and structuring.
The obvious strength of using database management systems is the data-driven decision making. Recent scientific perspective on this advantage is known as data warehousing, where the information required for critical organizational decisions is collected through external and internal resources and further interpreted using analytical tools and applications. Alternatively, databases could be easily integrated with web applications, which allows swift data exchange and reduces manual work. However, the major weakness of using databases is the initial design complexity, where software architects are required to consider multiple organizational inputs for the file extensions, folder structuring, and overall security of data processing (Coronel & Morris, 2019). Furthermore, in aviation industry the amount of data generated on a daily basis is enormous, which means that significant efforts are required to ensure data back-up and retrieval in case of security breaches. Therefore, an effective database management effort is expensive, and requires having qualified developers and administrators to ensure that the system brings value to the business.
Despite the aforementioned concerns, the use of database management systems is critical for the aviation business because of large amount of highly unstructured information it has to deal with. The database approach also reduces the risks related to inappropriate data management, as well as improves the quality of organizational decisions based on the data mining and warehousing principles. However, as shown for the previous IS solutions, the effective use of databases requires investments in employee training, given that applications are linked to the data and their efficient use varies based on the acquired technical skills. Hence, the implementation of the database management system requires careful organizational analysis and involvement of skilled developers and software architects, who will regularly support the company in system maintenance and data classification.
Customer Relationship Management System
Customer relationship management (CRM) systems are used by organizations for managing all types of interactions with existing and potential customers. CRMs are designed based on the data analysis collected from the customers using a variety of communication channels, such as corporate website, social networks, news feeds, and marketing materials (Guha et al., 2018). The main purpose of using CRM is to focus on customer retention, which helps the company to drive sales growth and maintain market competition. Therefore, the use of CRM is important for aviation business, where the role of customer opinion and feedback is paramount for the overall business productivity. There are multiple vendors who provide CRM solutions, while the most notable are Salesforce.com, SAP AG, Oracle, and Microsoft Dynamics. However, many companies also prefer using in-house CRMs customized per their own organizational preferences.
The framework for CRM implementation primarily relates to the activities of commercial departments such as sales or marketing, while is also advantageous for the Reservations department. The business logic behind implementation is that the firm should be aware about consumer preferences and therefore constantly work in service improvements. The CRM data could be collected through multiple ways, such as passenger surveys, social network analysis, anonymous feedbacks, mailing, and call center surveys (Guha et al., 2018). It means that CRM system should be integrated with the main database system, where customer data is stored to ensure better service targeting. However, it is also important to cluster CRM activities to improve the notion of regional intelligence, given that customer opinions might be polarized depending on the scope of services provided in different locations.
CRM systems are mostly advantageous because of their ability of using multiple data formats for interpreting customer behaviors through visualization and forecasting. Furthermore, given that such systems are long available on the market, they are easily configurable and could be adjusted to the needs of specific organizational requirements. However, the major weakness of CRMs relates to the ways of collecting and processing data, since in many cases the data analysts deals only with a limited group of respondents and might eventually fail to grasp the full picture of customer opinions (Kim & Wang, 2019). On the contrary, CRM market is currently on the rise, which means that organizations do not have to allocate significant budgets for the system usage and maintenance. Nevertheless, it is important considering training and recruitment costs, since the use of CRM data requires well-developed analytical skills and market awareness, which might be eventually challenging for the aviation industry. Hence, it might eventually require collaborating with external agencies or contractors for effective CRM use during the first stages of implementation to ensure that the system is well adopted by an organization.
Overall, it is noteworthy that the use of CRM brings a competitive advantage for the aviation business in terms of the better customer retention, which eventually attracts more loyal consumers and allows the company to optimize flight services. It is also beneficial in terms of the influence strategy directed externally, since the company will be able to communicate with customers more effectively. Developing new ways of collecting timely customer feedbacks will also improve organizational performance and operational efficiency, since the company will be able to react on potential complaints faster. However, it requires particular investments in searching for professional data analysts and develop new strategies for collecting user feedbacks on the local level, given that the analysis of customer experience requires a representative sample to be analyzed on. Finally, as it was mentioned for the previous solutions, CRM also requires full integration with internal corporate database and therefore requires considering security risks of managing personal data.
Supply Chain Management System
Supply chain management systems (SCMSs) are technical representations of the value chain networks, which include specific functional entities committed to provide resources and information so that objectives of the efficient supplier management and flow parts control. However, nowadays the concept has evolved into having robust systems that provides control over the practices in integrating suppliers, manufacturers, customers and distributors to ensure that the long-term performance of the firm’s supply chain as well as third party engagement is guaranteed. Considerably, the use of well-configured and relevant supply chain systems is paramount for exceptional performance of the aviation firm, where many supply chains such as aircraft materials supply and service supply are used (Somarin et al., 2018). Anaplan, Oracle SCM Cloud, and SAP SCM are some of the op listed supply chain management software of this year, while there many other alternative solutions that could be configured for specific organizational requirements or integrated with existing ERP system used in the company.
Depending on the department which uses SCMS, the underlying framework might significantly vary. Operations and maintenance departments might be considered as organizational units that benefit from the application of SCMS the most, since commonly their task is to establish a multi-tier collaboration with suppliers on the one side and customers on the other side. Considerably, the SCMS they use should be capable of the real-time materials delivery tracking, analytics of supplier performance, visualization tools for the large amount of data, and collecting customer feedbacks through the use of data mining tools and pattern analysis (Somarin et al., 2018). However, back-office departments such as HR might benefit from simpler solutions related to personnel recruitment, selection, training and performance tracking to understand the overall organizational dynamics across various organizational units. Finally, food supply chains used for the catering on board might be a subject for separate systems used by procurement department, aiming to support decision making based on customer preferences and onboard consumption preferences. Hence, the applications of SCMS are multifaceted and could be customized in terms of anticipated size, costs, and target usage.
For the large SCMSs used for operations and maintenance monitoring, the obvious strength is the ability to integrate several specific activities and provide a framework for the continuous supply chain tracking and reporting. The appropriate configuration and implementation of such systems has also its strength in a seamless integration of its components that could be further used for past analysis and forecasting. Nevertheless, the weakness of such large system manifestations is that it requires thorough planning, analysis, and a combination of qualitative and quantitative data collection approach, further emerging into complexities of revamping or adjusting outdated systems (Makarova & Pavlov, 2017). Consequently, it results into high costs of efforts and might not be affordable to the smaller aviation companies without preliminary customization. However, smaller departments like HR might be in more beneficial position if using lightweight solutions such as Oracle PeopleSoft that come at a smaller cost. Finally, depending on the company size, procurement department might also use on-premise systems that are designed and configured in-house, while in this case the potential weakness in system isolation from other providers and the need of manual data integration.
Overall, the competitive advantage of SCMS implementation is organizational ability to construct a comprehensive vision of how various parts of supply chain integrate with one another to ensure cost-effectiveness of business operations and provide visualization of the company operations. Herewith, the influence strategy is to ensure that decisions made by operations and maintenance departments are data-driven, as well as there is a complete understanding of business processes underlying critical supply chain activities. Considerably, organizational performance could be improved by better account of activity tracking and operational efficiency, in its turn, be ensuring better supply chain resiliency and company preparedness to unexpected events. Nevertheless, it is required to keep in mind the cost constraint, which is the highest among all identified IS solutions because of the need of extensive preliminary analysis and investigation, as well as further replacement of the outdated supply chain mechanisms.
Conclusion
In this research, the five IS solutions that could improve competitive advantage, organizational performance, and business excellence of the aviation firm were analyzed considering applicability for specific department, implementational complexity, and organizational planning risks. First, it was found that TPS implementation is advantageous for multiple departments that deal with online transactions, while the major risk is system shutdown that will require reverting back to manual operations. Second, it was identified that cloud computing is a perfect solution for many organizational units to decrease the workload on internal servers, while current security issues might be an obstacle for effective integration. Third, database management systems were evaluated as a solid data storage backbone for the other systems, while it is important to establish clear rules for data definitions, encapsulation, and storage based on the singularity principle. Fourth, it was acknowledged that CRMs should be used by aviation firms for customer sensing and retention. Finally, SCMs provide a powerful base for transparent supply chain management on operations and maintenance level, while normally come at a higher cost comparing to the other IS solutions. Hence, managing constraints is required for the appropriate system deployment.
The following considerations for the future research and implementation were also identified. First, since there are several vendors that provide unified solutions for the chosen IS, for instance, SAP and Oracle, it is worth considering that decision to buy those is better for the system integration. However, in terms of cost-efficiency and time investments it might not always be the best approach, since some systems will require regular patching with different schedules, which might disrupt normal operations. Second, since the cost considerations are normally attributed to the departmental budget, some departments like sales and operations might be more eager to by specific product and integrate it with a central database. It means that the company might consider to develop a master plan which outlines critical stages for selected IS solution implementation gradually before the rollout. Finally, there is a need for having a formal training plan that is developed both for users and system administrators, since the provisions of new systems might be unfamiliar and will require further knowledge acquisition.
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