NDC Change Readiness GuideFor AirlinesEdition 5December 20182© 2018 International Air Transport Association. All rights reserved.DISCLAIMER NOTICEThe information contained in this document is subject to regular review in the light of changing business needs of the industry, government requirements and regulations. The views expressed in this guide are based on the views and opinions of the IATA NDC team. IATA takes no responsibility for the completeness of this document or the various checklists. The airline is responsible for all decisions made based on this document.© 2018 International Air Transport Association. All rights reserved.Table of ContentsForeword.51. Presenting NDC.61.1. What is this document about?.61.1.1. Objective of the document.61.1.2. General structure.61.1.3. How to use this handbook.61.2. Industry context.61.2.1. Consumer expectations.71.2.2. Airline distribution capabilities.71.2.3. Travel agency landscape.71.2.4. Some limitations in todays .landscape.81.3. Evolution of key processes: simplificationand autonomy for airlines.91.3.1. Shopping and booking/orderingworkflow evolution.9 1.3.2. Payment.111.3.3. Ticketing.121.3.4. BSP Reporting.121.3.5. Interlining.14 1.3.6. Servicing.15 1.4. NDC Platform overview.151.4.1. Offer management.151.4.2. Order management.15 1.4.3. Examples of features enabledby NDC.161.4.4. Examples of functions supportedby NDC.161.4.5. Existing features improved/simplified by NDC.161.4.6. Aggregation.161.4.7. NDC general Architecture.171.4.8. A TMC reference Architecture.181.5. The NDC Value Proposition.181.5.1. Revenue Benefits.181.5.2. Cost benefits.191.5.3. Benefits for Travel Agents.191.6. Current status of NDC implementation.201.6.1. Towards Industry Readiness.21 1.6.2. Enlarging the scope.222. Implementing NDC.232.1. Approaching the size, scope and case.23 2.1.1. Size and scope of an NDCimplementation.232.1.2. Approaching the case: key questions,benefits and costs.232.2. Program Management.252.2.1. Check the direct stakeholders.252.2.2. Distribution, Marketing and Sales.252.2.3 Choosing travel agencies.262.2.4. Revenue Management and Pricing.262.2.5. Information Technology.262.2.6. Finance and Revenue Accounting.272.2.7. Program Management.272.2.8 Airline Support and Help Desk.272.3. Business check list.282.3.1. Global Strategy and DistributionVision.282.3.2. Marketing and sales strategy,ancillaries development.292.3.3. Business process engineering.302.3.4. Link with IT.302.3.5. Legal.312.3.6. Project organization/Externalsupport needs.322.3.7. Communication.322.3.8. Project metrics and reporting.324© 2018 International Air Transport Association. All rights reserved.2.4. Platform assessment.332.4.1. Matching Platforms to Capabilities.332.4.2. Completing the PlatformAssessment.332.5. Certification.362.5.1. Goals.362.5.2. Scope Levels 2-4.362.5.3. Certification process.372.5.4. Current results.372.5.5. NDCScale.382.6. NDC Leaderboard Airlines.383. Towards an Enhanced and Simplified AirlineDistribution.393.1. ONE Order: an additional step forward.393.2. NDC and “ONE Order” OrderManagement architecture model .403.3. ONE Order Program Roadmap.413.4. Transitioning to ONE Order.423.5. Going beyond Enhanced andSimplified Airline Distribution.423.6. The Order Group.423.7. Dynamic Offer Creation.434. Conclusion.445. Annexes.455.1. Annexe 1: IATA ressources.455.1.1. General NDC relatedinformation.455.1.2. Reference supports.465.1.3. Reference for developers.46Table of illustrationsFigure 1: Indirect Flight distributionas today.10Figure 2: Indirect Flight Distribution withNDC.10Figure 3: Collect Payment process.11Figure 4: Pass through Payment process.11Figure 5: BSP's processes for current sales.13Figure 6: BSP and NDC Complete workflowfrom Order Create Request toSettlement.13Figure 7: NDC reference architecture.17Figure 8: NDC value proposition.18Figure 9: Content sourcing.24Figure 10: Summary of an NDC Program'smajor steps.35Figure 11: NDC certification scope andlevels.37Figure 12: Certification figures.October 2018.37 Figure 13: From current situation to ONE .Order .39Figure 14: NDC and ONE Order scopein Indirect Distribution.40Figure 15: Key Dates for ONE Order.41© 2018 International Air Transport Association. All rights reserved.New Distribution Capability (NDC) is a key transformation project to modernize airline distribution. It started with the foundation standard approved in October 2012 by IATA as Resolution 787. This was followed, in August 2014, by US Dept of Transformation approval of Resolution 787, and with IATA delivering the first set of official standards on 1 September 2015.The NDC standard enables an airline to make sales offers to travel agents directly in real time, and this will also permit airlines to both define and price their products in any way they wish. For customers, NDC will offer greater transpar-ency and choice when shopping for travel as it will address the growing gap between the rich content, upsell opportunities, personalized of-fers and additional products available on airline websites and more commoditized travel options available through travel agents.This is the 5th version of this guide. It has been updated to reflect the continuously evolving landscape of airline distribution. As more and more airlines are now live with NDC, relevant feedback is being gathered and where appro-priate, shared in this document. IATA's focus has shifted to implementation support, trying to remove remaining blockers to adoption and assisting airlines to achieve large scale market deployment.Building upon previous versions of this guide, more topics have been included to reflect the evolving airline distribution environment. These include details on the latest NDC schema ver-sions, from baseline version 17.2 up to planned changes in version 19.1. Also covered are trav-el agency onboarding (NDCScale) and work undertaken with TMCs in 2018. The content of this guide describes how an airline can exploit the full benefit from the NDC standard. The offer is created by the airline host, allowing airline distribution (direct and indirect) to have a unique source of content. The approach for implementation is modular, exactly fitting the ideal airline strategy. New roles appear, with changes to existing ones (GDSs) with opportunities for new entrants. Going beyond distribution opportunities, NDC can be seen as a major transformation project. Innovative moves for offer creation are now possible: personalization, dynamic pricing, product bundling and upselling. So are innovations for payment. Process flow changes for revenue accounting (with a new relationship with BSP) deliver new positive developments. The purpose of this document is to give a high level understanding of what NDC is and how to get started.Last but not least, NDC is a standard for API distribution. It is currently based upon XML as this has been widely adopted and used across internet airline distribution providers. In September 2018 with the release of standard version 18.2, JSON translation has been included.ForewordYanik HoylesDirector, NDC ProgramIATA 6© 2018 International Air Transport Association. All rights reserved.1. Presenting NDC 1.1. What is this document about? 1.1.1. Objective of the documentThis “Change Readiness Guide” aims to support airlines in planning their NDC enablement. From defining the vision and strategy to initiating the program.It serves as a guideline to support key stake- holders as well as the NDC Program Man- ager within the airline. The goal is to reduce the amount of time required for the Program Manager to gather all information, engage and involve all relevant departments within the airline and prepare all the material required to successfully initiate the program.The information and guidance provided within this manual will help facilitate the various discussions and identify the key steps required for a successful deployment program.This manual is regularly updated with the latest information and best practices learned during the course of the various ongoing NDC deployments.Some of the latest updates on this edition are in the area of: BSP Value proposition NDC at scale including NDC collaborative initiatives One order updates Data privacy considerations Servicing and Support 1.1.2. General structureThis handbook consists of three main sections: The first section presents NDC from a general point of view, with its main principles.The second section provides guidance on the internal organization of an airlines NDCprogram, and highlights the key questions and checks to address in order to start an NDC project.The third section presents future trends and in particular ONE Order.1.1.3. How to use this handbookThis handbook does not mandate any specific way to implement the NDC standards. It is intended as a support tool to the NDC Program Manager to help guide the way. With the help of this Change Readiness Guide, IATA aims to support the successful initiation of the airlines NDC program.Depending on the airline maturity, its use may vary, as the general presentation of the NDC basics might already be known. In this case, this first part can be skipped and used as a reference during the course of the NDC implementation project.This guide should be used by the airline with care and diligence, and always in light of their own situation and environment, and in accordance with any regulatory requirements that they need to take into consideration.1.2. Industry contextNNDC started in a rapidly changing industry environment, as an answer to three main trends in the airline industry, and as a way to align © 2018 International Air Transport Association. All rights reserved.channels and provide transparent distribution.1.2.1. Consumer expectationsConsumers have greater and greater expectations and this concerns also the way they shop, book and pay. They want to be inspired by a rich retailing experience: through product descriptions, rich content, and customer targeting, NDC-enabled retailing can help inspire passengers by making them aware of relevant airline products and offers. NDC-enabled retailing reso- nates with passengers.To support the technical implementation of NDC, IATA produced an NDC Implementation guide. See reference in Appendix.They want speed and accuracy: travel web- sites have to answer within seconds, and when shown, an offer has to be available. They want transparency: they want to know the all inclusive price - no last minute hidden fees (booking fees, card fees etc.) that appear at the end of the process.They want personalized offers or the ability for themselves to construct a personalized offer by being able to select from a range of product attributes: business and leisure passengers alike feel comfortable sharing their personal information with sellers and aggregators, provided the data is kept safe, in strict compliance with the appropriate data privacy laws that may apply, and they receive relevant (or enhanced) offers in return.They want choice when it comes to forms of payment, i.e. be able to use their preferred method in any channel and/or any country.1.2.2. Airline distrib