SIS LH - Project Setup

1. SIS @ LH - Project Setup ICH UG KUL, 22.10.2010

2. 2 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 SIS @ LH � focus of this presentation How did we set up our project to cover all involved business areas? What were the essential questions that needed an answer? How many process design needs to be done before we can start developing? What is still unclear from our perspective?

3. 3 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 SIS project is part of several e-Invoicing initiatives

4. 4 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach, 1st step - how do the processes work today?

5. 5 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach, 1st step - how do the processes work today?

6. 6 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach, 2nd step � what do we need to change for SIS?

7. 7 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach � Questions Accounts Receivable I Who will be authorized to send data to SIS and who enters the postings on the accounts? Different solutions for different billing categories possible? All decentralized processes seemed to be a problem (access rights, posting on accounts, archiving of legal documents) When do we enter the postings on our accounts? Before or after the invoice was generated within SIS? How do we cope with dual processes during migration phase? 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world

8. 8 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach � Questions Accounts Receivable II How can we produce the xml-files? Is the system capable and can the system manage supporting documents? What needs to be changed within data flow (e.g. no F12 anymore)? How can we guarantee for unique invoice numbers considering all involved LH group companies? How can we organize the obligation to send paper copies for 3 months after implementation (need to print all invoices that are produced by SIS)? 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world

9. 9 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach � Questions Accounts Payable How do we distribute incoming invoices to the respective departments / group companies? � there is no reliable criterion for us How can we transfer maximum information from the IS-xml automatically into our internal approval and posting system? How do we cope with dual processes during migration phase? How can we archive all documents (legally compliant)? Are all invoices compliant with German legislation, especially German Tax Law? 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world

10. 10 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach � General Questions How can group companies participate? Who needs which instruments (Dashboard, User Administration, Member Profile) along the process, who owns the �master rights�? Error handling during the whole process What internal controls do we need on the SIS system (e.g. do we receive all outgoing invoices or do we miss some?) How can we manage to use the �IATA IS XML Invoice Standard� for all eInvoices from/to LH? 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world

11. 11 SIS @ LH - Project Setup ICH UG KUL, 22.10.2010 LH�s approach � Conclusion 1st step: analyze the WHOLE process as it is today 2nd step: develop a new SIS process 3rd step: determine the necessary process changes 4th step: develop, change or purchase system Throughout the whole process: get familiar with the eInvoicing regulations in your country Most important: Design the internal process before start thinking about IT-system design! 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world 2 History of interline billing Based on issuing and receiving paper long before computers existed Large numbers of people in factory-type operations Batch-oriented Boxes of paper moved around the department in sequence as each sub-process completed Invoicing was done manually, and supported by boxes of tickets and supporting calculations All this had to be shipped to airlines, frequently getting delayed or even lost Systems were usually built as replications of manual processes We now have 3 different data streams (Invoices, IDEC and Claims), often with different data Going forward from May 2008 ET is mandatory in the settlement systems, and will become universal as paper fades away IDEC is already mandatory for interline ET ICH is now paperless, and running on weekly cycles, with flexible input requirements, Encourages faster billing Reduces batch sizes and risk However� Weekly batching and billing means more work, and Weekly IDEC requires substantial development work, and Reconciliation problems between invoices, IDEC and claims have got worse, and The ACH has already voted to abolish paper billing support, so We have an opportunity to rethink the interline process to take advantage of an all-data world