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TPM00198 - EFFECT OF COMPUTERIZED AIRLINE RESERVATION SYSTEM ON AIRLINE MANAGEMENT IN NIGERIA


CHAPTER ONE

INTRODUCTION

1.1 Background of The Study

Airlines Reservations System (ARS) is the improved computerized feature of airline reservations. ARS helps in systematic and effective organization of bookings, prices, schedules and customer data. Airlines reservations system has today evolved into Computer Reservations System (CRS). ARS, when integrated with Global Distribution System (GDS) can be used by multiple distribution channels such as travel agencies, which can then use it for hotel rentals, flight booking, car hires as well as activities and tours via single system. ARS consists of several areas such as the inventory management, availability display and reservation and fare quotes and tickets. (Winston and Morrisson, 1995.)

American Airlines introduced the first automated ARS called the Electromechanical Reservisor in 1946. It was followed by a new machine called Magnetronic Reservisor. In 1959, to improve the existing Reservisor, an improved automated booking system called SABRE was introduced. Similarly, other airlines created their own systems for ticket booking and management. Today, many brands co-operate with the world airlines companies for user-friendly direct systems, increased productivity and efficiency. Some of the major ARS brands today are Abacus, Amadeus, Navitaire, Sabre and TravelSky. (Ross, 2013)

The users can easily purchase an e-ticket using computerized airline reservation system by going to the ticket sale website, searching and selecting the destination, entering the details such as name, way of travel, luggage information and dates and finally making the payment via bank cards, bank transfer or through online payment companies. The e-ticket is then emailed or texted on the telephone of the customer. While previously travel agents and airlines assisted customers in making ticket purchases, today with the improved internet system, it is getting easier and easier to book the flights on your own. After the customer makes the purchase, the electronic record and the details of the ticket are saved into airline’s database. The database is integrated with the passenger service system, which is then connected to the airports, airlines, travel agencies for sharing real time information. (Crosby 2007.)

In the recent years, the travel and tourism industry in Nigeria has received increasing responses with the growth and availability of internet. People uses the internet nowadays to plan their journeys and vacations and thus, has led to the evolution of online reservation to the airline industry through the introduction of electronic ticket for reservation systems (Turban, King, Lee, & Warkentin, 2002). Computerized airline reservation as defined by (Hoffman & Novak, 1996) stated that online flight reservation is an advanced form of home shopping or booking and require changes in behavioral attitudes through using information technology. The main focus of airline companies today has been in the satisfaction of customers. The companies are doing this by making journeys possible in a fully mobile and social environment with the intelligent use of vast quantities of data to deliver real service and operational improvements. The personalized use of mobile phones and web by customers is expected to increase drastically, with the estimation of 90% airline companies offering mobile check-in by 2015. (Travelmole 2013.)

The growth of computerized airline reservation system and popularity among consumers has driven the International Air Transport Association (IATA) to introduce computerized airline reservation system totally by the year 2007 in replacing the traditional manual air tickets (David, 2004). Introduction of Internet to the population has enabled people to communicate more efficiently, reduce business transaction costs and capturing the online market which could hardly be done based on brick and mortar methods. The estimated internet users worldwide have increased 480.4% from 360 million users to 6.9 billion Users from year 2000 to year 2011. The most significant increase in internet users was around 44% of the total world internet users from 114 million to 2.8 billion users (CIA, 2011).

Previous studies have compared the shopping characteristics between traditional and the online shopping and found that the online shopping has more advantages in terms of consumer and retailer aspect (Monsuwé, Dellaert, & Ruyter, 2004). This is in line with the current culture where online information is vastly available and comparisons can be made before people are able to decide on the products they wished to procure. However, the implementation and propagation of the computerized airline reservation system may not necessary provide full benefits to the customer but instead mostly beneficial to the airline companies in reducing costs and increased profit margin. The computerized airline reservation system security and the honesty of the airline company on the computerized airline reservation system policies are questionable and affect the level of trust and the acceptance of the system by the customers. The level of trust and the acceptance of the customers to the airline company and the computerized airline reservation system determine the level of usage of the system.

One of the reasons of the growth in online reservation were due to the wide access of internet availability, the development of commercial websites with many range of products and services offered, and the improvement of security and logistic in delivering their products to their customers ("Trends in Online Shopping a Global Nielson Consumer Report.," 2008). For instance Ilorin International Airport  introduced various conveniences to the customers by making them able to book seat reservations and reserve their preferred flights at their conveniences, issuing the tickets at home and make and self-check-in in the website by themselves or self-check- in at the airport. Through the e-reservation system, the system also helps to reduce the workload of their travel agents while allowing to buy and book their air tickets using the computerized reservation system (Komsub, 1999). Most of the airline company nowadays provides online payment facility such as credit cards, ATM cards and other online monetary form such as PayPal for their computerized airline reservation system to the customer. This shows that there are efforts introduced by the airline company to encourage customers to make online purchase of air tickets. There are previous researches which had studied on the user’s intention to purchase products and services online using the internet (Hueng, 2003; Suki, 2005; Jathuravith et al, 2007; Safavi, 2007) but most of them explained consumer behavior in general and limitation. Hence, there is a need to understand the demand and also the behavior of the consumer in Nigeria which would switch to online flight reservation to purchase their airline tickets to improve on their existing air ticket reservation system.

Ilorin International Airport started as a small airline to facilitate air travel within Nigeria. This airline was to facilitate transportation of passengers within the country. The airline was originally designed to handle small number of customers. It is an International Airline facilitating travel of much numbers of passengers on a daily basis. Today, Ilorin International Airport still use a computerized reservation system and manual booking system of flight booking, flight management and scheduling. Flight booking is done manually through travel agents across major towns, and also done online by internet users, flight data and customer details are kept online and also in manual files. The manual booking system is slow and results into booking conflicts, vacant seats in some planes and it is hard to quickly obtain customer information in case of emergency. It’s for this reason, the researcher set out to design an online airline reservation system to provides a modern, flexible reservation and inventory management solutions including call center, travel agency, internet engine, global distribution systems and interlines booking with in which Ilorin International Airport is also a beneficiary of the system.

Due to the fast paced nature of the world today, air travel is considered as one of the first choice among several modes of transportation to save time and one of the tools passengers use to speed up the process of travelling by air is the Airline Reservation System (ARS), especially passengers who don‘t have time to or don‘t want to visit a travel agent. Keeping in mind the fact that people might not have enough time out of their busy routine to go and visit a travel agent in order to make a reservation, most airlines have offered their services over the World Wide Web. Therefore internet has become the integral part of the flight reservation process not only for travel agents, who sits in the office and makes use of web servers of different airlines to find out the most suitable flight for a particular customer, but also for the customers who want to reserve flights online without necessarily having to contact air travel agents (Jones, 2004).

An airline computerized reservation system is very important because it has the strong ability to reduce errors that might have occurred when using a manual system of reservation. The computerized system makes it possible for customers to book the flights as when they require. The need of this system was realized since the beginning stages of the airline industry when information such as routes, aircrafts, schedules and fares about flights was published by airlines in large books. Travel agents had the difficult task of looking into separate books for reservations that involve multiple airlines. It was a dream to get a real time picture of available seats because airlines share information at day end only. Customers can therefore make use of computerized airline reservation system to make reservations, modify reservations in addition to cancel reservations. Computerized reservation system software should be specially developed so as to function as an independent application. It should be established as a self-contained product (Milde, 2008).

1.2. Statement of The Problem

In reference to previous statistics, the percentage of internet users globally in purchasing the airline computerized airline reservation ticket has increased by 8% to 32% from year 2008 to 2010 which indicate increasing amount of online bookings on airline tickets year to year. A computer reservations system (CRS) is a computerized system used to store and retrieve information and conduct transactions related to air travel. Originally designed and operated by airlines, CRSes were later extended for the use of travel agencies. Major CRS operations that book and sell tickets for multiple airlines are known as global distribution systems (GDS). Airlines have divested most of their direct holdings to dedicated GDS companies, who make their systems accessible to consumers through Internet gateways. Furthermore, there are previous surveys conducted in gathering consumer opinion regarding on the purchasing online products or services without consulting online reviews. One of them found that 18% of online users globally do not make computerized airline reservation on online tickets without any reviews on the products or services before ("Global Trends in Online Shopping," 2010). This system proved successful, and was soon being used by several airlines, as well as Sheraton Hotels and Goodyear for inventory control. It was seriously hampered by the need for local human operators to do the actual lookups; ticketing agents would have to call a booking office, whose operators would direct a small team operating the Reservisor and then read the results over the telephone. There was no way for agents to directly query for the system. Issues and questions were been raised on the factors and level of trust which influenced the customer’s intention in make e-reservation on airline ticket. Still yet, other airlines soon established their own systems. Delta Air Lines launched the Delta Automated Travel Account System (DATAS) in 1968. United Airlines and Trans World Airlines followed in 1971 with the Apollo Reservation System and Programmed Airline Reservation System (PARS), respectively (Agianaku, 2013). Soon, travel agents began pushing for a system that could automate their side of the process by accessing the various ARSes directly to make reservations. Fearful this would place too much power in the hands of agents, American Airlines executive Robert Crandall proposed creating an industry-wide Computer Reservation System to be a central clearinghouse for U.S. travel; other airlines demurred, citing fear of antitrust prosecution.

Thus, the problem statement which rose from the study during this paper work  was discovered that the Airline Reservation System used by the Airport industries  offer the basic features of a reservation system such as searching for flights, selecting available flights and paying for the reservation.  This discovery now brought about the idea of creating an improved computerized airline reservation system. Some of the problems being faced by the existing system are the Inability of passengers to select seat(s) for their chosen flight(s) from the existing reservation system. This has ultimately resulted in time being wasted at the check-in counter in assigning seats to passengers before they are allowed to board the airplane.  Non notification of passengers in the event of flight cancellation or delays with no access to aircraft maintenance reports to ease passenger fears as regards to air travel and its disasters. The manual booking system is slow, time consuming and it is very difficult for each person to book through office agents. Users inquire about the tickets through phones and it is very difficult for the user to remember all the details that they received through phones. It is very difficult to calculate how many peoples registered and how many seats on a particular plane are vacant .This requires quite a lot of time and wastage of money as it requires quite lot of manpower to do. Therefore, the computerized airline reservation system quality of the company and the level of trust between the user and Airline Company will influence the users of computerized airline reservation system to declare it as the most efficient in the air flight reservation system.

1.3. Research Questions

As regards to this study, many questions require answers. Hence, the research will provide answers to the following questions:

  1. What are the benefits of computerized airline reservation system to staffs and passengers in terms of their service class?
  2. Where are the areas in which computerized system have been applied in the aviation industry?
  • What are theweaknesses in using computerized airline reservation system in the management of airline industry in Nigeria?
  1. What are the possible solutions to the identified problems of computerized airline reservation system in Nigeria airline industry?

1.4. Aim and Objectives

The aim of the study is to examine the roles of computerized airline reservation system. The specific objectives are:         

  1. To explore the benefits of computerized airline reservation system to staffs and passengers in terms of their service class.
  2. To identify the areas in which computerized system have been applied in the aviation industry.

 

  • To examine the weaknesses in using computerized airline reservation system in the management of airline industry in Nigeria.
  1. To proffer possible solutions to the identified problems of computerized airline reservation system in Nigeria airline industry.

1.5. Hypothesis of The Study

The hypothesis of the study was formulated in the null form, thus:

H0: Thecomputerized airline reservation system does not offer any significant benefits to staffs and passengers in terms of their service class.

1.6. Significance of The Study

This study seeks to understand the management information system with the extension of the variable of trust in the context of computerized airline reservation system. Thus, there is a need to understand how trust in the context of computerized airline reservation system in Ilorin International Airport, Nigeria context in predicting the purchasing decisions among Nigerians. Therefore, this study will help to explain the trust’s role, benefits and the shortcomings in the use of computerized airline reservation system among Nigerians. By understanding the antecedents behind the intention behavior, the study will help Airline Company to enable them to be able to re-design their computerized airline reservation system and provide better services to the their consumers. Another significance of this research is also to help airline industries to test out the Acceptance and trust into Nigerian consumer context in using computerized airline reservation system and will further help to further understand the relationship of the perceptions of the Nigerians’ consumer behavior in adopting the computerized airline reservation system such as provided by Ilorin International airline, Arik airline, Dana Airline. Other component of perceptions such as air flight company’s reputation, willingness to customize of the airline company investigated are to extend the research further in understanding the Nigerians passengers trust on using the computerized airline reservation system. Furthermore, the full implementation of this project will further improve the booking system of Nigerian transportation industries, even in other areas of life where reservations or bookings are done, and could also revive the dying entertainment part in travelling, while also helping to cut down cost of servicing extra manpower needed to run report sorting.

1.7. Scope of The Study

The scope of this study will be within the jurisdiction of Ilorin International Airport, Kwara State. The focus of this study is to assess the benefits of computerized airline reservation system in the reservation system of the airport industry. This research work seeks to improve the benefits of the computerized airline reservation system within the study area and thereby eradicating problem encountered by the passengers and staffs of the airline industry.

1.8.      Limitation of The Study

            This study limitation would be postponed till the end of the research to enable us computes the overall study limitation.

1.9.      Definition of Terms

Airline Industry (Air Transport Industry): This is an area of commerce that uses aircraft to transport people, cargo, and mail. The air transport industry encompasses flights of common carriers (government-certified companies that offer cargo and passenger services to the public) and general aviation (private aircraft used for recreation or business.

Reservation: The written record or promise of an arrangement by which accommodations are secured in advance.

System: This is any collection of component elements that work together to perform a task. In computer science, System is used in a variety of contexts. A computer System is a hardware system consisting of a microprocessor and allied chips and circuitry, plus an input device (keyboard, mouse, disk drive), an output device (monitor, disk drive), and any peripheral devices (printer, modem).

Computerize System: To control a function, process, or creation by a computer.

Computer Reservations System (CRS): is a computerized system used to store and retrieve information and conduct transactions related to air travel.

Flight: This is a journey made by air especially in an air craft or plane.

Planning: This is a make detailed arrangements for something you want do e.g. travelling in the future.

Air craft: This can be referring to as any machine that can drive support in the atmosphere from the reactions of the air against the earth’s surface.

Routes: It is way for travelling from one place to another.

Transport: This is the movement of passengers and goods from one location to another.

Boarding: The act of passenger and crew entering in air craft.

Air space: It is the area located above ground level, which in air craft traveled through.

Airport: An airfield with control tower and hanger as well as accommodation for passenger and cargo.