This study, which is part of a larger programme of doctoral research on B2B e-Marketplaces in the airline industry, focuses on the level of efficiency improvements gained by using B2B e-Marketplaces in the procurement process. Many e-Commerce principles were pioneered in the airline industry. The computer reservation systems were among the earliest examples of e-Commerce. At a later stage, these reservation systems have evolved into global distribution systems. While the airline's focus was on Business to Consumer strategies in the early 1990s, in the late 1990s, B2B e-Business became more and more the centre of attention. A B2B e-Marketplace exchange is a central e-Marketplace, facilitated by ICT, in which multiple buyers and suppliers come together to gather information and buy and sell goods and services. The potential of B2B e-Marketplaces to enhance efficiency levels and competitiveness are tested through a survey questionnaire addressing a sample of 300 major international airlines, e.g. full service airlines, charter and low cost airlines of different types and sizes. The results are based on a response rate of 28.7 %. The use of B2B e-Marketplaces does play a vital role across the various airline groupings. Airlines that are involved in strategic alliances show higher joint-procurement activities than airlines that are not involved in alliances. However, alliances are probably viewed as loose arrangements and thus airlines may be reluctant to share information on procurement prices and processes to another airline that could act as a competitor next day. The financial involvement in or initiation of such e-Marketplaces by airlines is very low. Low-cost airlines show high use of e- Marketplaces, but demonstrate no financial involvement in contrast. Low cost airlines have taken the lead in using e- Marketplaces in non-maintenance related areas, while full service airlines tend to use them as fairly constant but lower levels across all spending categories. Overall, the categories of spares and repairs, office supplies and tools/GSE show the greatest potential for reducing costs and increasing procurement process efficiencies. The intense competitive pressures facing carriers will make their search for tools to realise even incremental savings and efficiency gains ever more urgent. For the covering abstract please see ITRD E135207.
Abstract