Imagine a future where business travelers can easily book flights with personalized services like upgrades and priority security screening through corporate booking systems, with all spending data seamlessly integrated into travel reports while company policies are automatically enforced. The International Air Transport Association's (IATA) New Distribution Capability (NDC) is turning this vision into reality. The question is: how can travel management companies (TMCs) seize this opportunity?
NDC: Reshaping Airline Distribution
NDC represents more than a technical upgrade—it's a fundamental transformation of airline distribution models. Designed to overcome limitations of traditional Global Distribution Systems (GDS), NDC enables airlines to offer richer, more personalized products directly to customers. This means ancillary services previously available only through airline websites—such as extra baggage allowances, lounge access, and preferred seating—will gradually become accessible through TMCs and integrated into corporate travel programs.
Becoming "NDC-Ready": Essential Preparation for TMCs
Preparing for NDC requires more than technical adjustments; it demands a comprehensive reevaluation of service models, technical infrastructure, and business strategies to align with airlines' retail transformation. Specifically, TMCs need to develop:
- Content aggregation capabilities: The ability to source and consolidate rich airline content from multiple NDC channels into unified booking platforms.
- Policy enforcement: Seamless application of corporate travel policies to NDC content, ensuring compliance with budgets and regulations.
- Data analytics: Capabilities to collect and analyze NDC transaction data for deeper travel insights and cost optimization.
- Business model innovation: Development of new commercial approaches like personalized travel packages and dynamic pricing services.
The "3C+1C" Framework for Success
TMCs should focus on four critical elements—"3C+1C"—to achieve NDC readiness:
- Content: Comprehensive NDC offerings meeting diverse client needs
- Customer: Deep understanding of client preferences for personalized service
- Control: Effective enforcement of corporate travel policies
- Commercials: Sustainable business models ensuring profitable growth
These interconnected elements form the core competitiveness for TMCs in the NDC era, where deficiency in any area could create competitive disadvantages.
Transforming the Indirect Value Chain
Airlines are increasingly adopting NDC as the standard for distributing rich content and personalized services through indirect channels (aggregators, TMCs, and corporate booking tools). While initial implementations may focus on simplified enhancements like ancillary services, the transition toward dynamic airline retailing will accelerate rapidly. This evolution requires TMCs to evaluate potential impacts and opportunities to better serve all stakeholders—travel managers, travelers, and airlines alike.
TMCs must examine their systems, processes, and business models to effectively deliver NDC-enabled content that benefits clients while maintaining commercial viability through proper controls and comparable presentation formats.
15-Step NDC Readiness Checklist
IATA provides a comprehensive checklist to help TMCs prepare for NDC implementation across five phases:
Phase 1: Understanding Impact and Opportunity
- Develop thorough NDC understanding
- Assess client impact across business types and regions
- Evaluate business implications for workflows and models
Phase 2: Assessing Supply Chain Partners
- Understand airline retail strategies
- Evaluate technology aggregators' NDC capabilities
- Consider new IT partnerships
- Align corporate booking tools with NDC strategy
Phase 3: Defining Project Components
- Assess necessary system adaptations for policy application, data systems, CRM, payments, and user interfaces
- Develop business cases with clear ROI projections
Phase 4: Stakeholder Communication and Planning
- Form dedicated implementation teams
- Collaborate with suppliers and clients on pilot programs
- Communicate plans to all stakeholders
Phase 5: Execution and Review
- Implement pilot projects
- Review progress with partners
- Maintain industry engagement through working groups
The Time to Act Is Now
Industry collaboration reveals that TMCs face challenges with airline distribution complexity while seeking opportunities to enhance client offerings. NDC adoption can help TMCs improve service propositions, upsell valuable ancillaries, and streamline operational processes.
While full NDC implementation requirements continue to evolve as airlines and aggregators develop their strategies, early-adopter TMCs are already shaping the future of travel management. The opportunity exists to create significantly enhanced client experiences where consistent, comparable content flows through policy-controlled booking channels.