Cases

December 15, 2014

Digital Transformation of the Credit Control in S7 Airlines

S7 Airlines sells the tickets through it own and independent agents and partners and cooperates with all market players: travel web portals, tour operators.

The end-to-end cycle of mutual payment took 70 days, in average. EastBanc Technologies created a concept and implemented the Automated System of Financial Reporting (ASFR), which allowed reducing this period to 9 days.

The cycle of mutual payment between the airline and its agents was reduced from 70 to 9 days after the system implementation.

ASFR solves the following tasks:

  • Regarding the conditions of financial security;
  • Minimization of account receivable;
  • Automated reporting of sales.

First, the EastBanc Technologies and S7 professionals defined and implemented (on the client side) the administering measures for unifying the commercial conditions of the collaboration with the agents and specified the rules to use them. In particular, we standardized the contract templates, requirements for the financial security, mutual payment rules, procedure of reacting on the credit limit breaks, and conditions for business incentive. As a result, the airline company got the forma constructor of the agent and bonus rewards.

First, the EastBanc Technologies and S7 professionals defined and implemented the administering measures for unifying the commercial conditions of the collaboration with the agents and specified the rules to use them.

Second, we implemented the program solution automating the whole cycle of credit control. The new CRM was created with the profiles and dossiers of contract agents. The Dossier includes the full information on working commercial conditions, charges, bonuses, financial security, signed agreements, and also the contact list, sales points and so on. It is used in all business processes of the collaboration with the partner.

The contract agent dossier is integrated with the accounting system of the airline company (payments, sales documents), booking system (holding the deals between the passenger and agent), portal for the cooperation with contract agents.

Second, the whole cycle of credit control was automated. The agent dossier was created and integrated with the accounting system of the airline, with the booking system, and the portal for cooperation with contract agents.

Now the service sales data is uploaded to the system automatically, where the working technologies and commercial conditions are checked and the mutual payments are done, resulting in set invoices and payment messages with the detailed info on all operations.

But the credit control is not over with the invoice. It is necessary to get the payment info in time. This task is solved by the automated payment loading and distribution, and also by the mechanism of cutting the sales in case of failure to pay.

As a result, the full cycle of payment reduced to 7-9 days.

Finally, the system was transferred to the legally relevant electronic document flow. All the participants got the digital signature. This is how the last block of the mutual payments chain was automated — preparation of the closing documents. So S7 Airlines and its partners got rid of the paper document flow.

Finally, the system was transferred to the legally relevant electronic document flow.

S7 Airlines passed to the new technology level of working with agent network. The universal and fully automated system of mutual payments and electronic document flow enhanced monitoring for the agent work, minimized human factor in the process of payments, and simplified the process of dispute settlement.

The cycle of credit control is closed during one week, which helps to avoid accumulating accounts receivable, calculate the taxes correctly, and, finally, improve remarkably the operational efficiency of the company.

 

December 15, 2014

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