KLM streamlines contracts with digital signing

Profile picture for user pwainewright By Phil Wainewright December 22, 2014
Taking its first steps into cloud computing, Dutch airline KLM has switched to digital signing of contracts to speed processes and improve sustainability

KLM image
Netherlands flag carrier KLM estimates it has saved printing out a million sheets of paper every year after bringing in an electronic signature process for contracts using Adobe EchoSign. Even more valuable has been the boost to timeliness and productivity, says Joost Van De Bunt, responsible for business development at the airline.

It's almost impossible to imagine how we were working before that time. You wonder how you ever did without it.

[When] we had a paper signing process, every contract was printed out twice, with a courier sent back and forth with the client and an internal signing process. It was very cumbersome and very difficult at any given moment to tell where contracts were. So we were longing for a digital solution.

While around a third of contracts are with local partners in the Dutch market, such as travel agencies, the majority are made in other countries. Digital signing has been especially successful in the global sales office, said Van De Bunt, which deals with global corporations that operate internationally. These contracts must be sent to a number of countries for signature, while on KLM's side, there are often several other airlines involved. That means the contract must be signed, for example, by Delta in Atlanta, Alitalia in Rome and Air France in Paris, as well as KLM itself in Amsterdam.

Before EchoSign was rolled out, the contract would fly over in a KLM aircraft using an old-fashioned internal mail system with specially coded envelopes. Tracking its progress would be "quite a battle," said Van De Bunt. "If the contract didn't arrive in Rome, you got on to Atlanta to ask, 'Where is it?"

A simpler, more visible process

The new system at last puts account managers into a position where they can manage the process, he said.

If you sign quicker, you can spend your time on other things than chasing contracts. You can spend more time on actually making these contracts work.

It really saves our account managers a lot of visibility and a lot of grip on the process.

For example, account managers have more time to follow up opportunities or problems, for example when a costumer is not booking the same volumes or patterns of flights they signed up for. It also became possible to simplify the signing process, said Van De Bunt.

We redesigned the whole flow. We used to have many people responsible for small parts in the paper contract signing process. So we asked ourselves, how few people need be employed in the process. We cut out a number of middlemen.

Now there are typically just two to three people involved — one to create the contract, and someone with power of attorney who checks and signs it and that is more or less it. A large bank of filing cabinets where the controller's office used to store all the paper contracts was also eliminated.

Integrating to Salesforce

The initial implementation is a standalone system on the internal website, with some simple workflow to upload the contracts and direct them to the right signatories. The next step will be to integrate EchoSign into the Salesforce CRM system that KLM is in the process of rolling out. An integration tool is currently being tested, said Van De Bunt.

What better place to have your contracts than right in the middle of your account view in your CRM tool? Then to create the contract in your CRM tool according to certain parameters.

In an ideal world, you would start a contract from the CRM system. From when the contract is signed, the system starts checking if the performance of the contract is being honored.

EchoSign has been the first cloud computing application to go into production at the airline, followed closely by Salesforce.

This was our first baby steps out of the server room. Airlines usually have their own proprietary systems that are on-premise. These systems are our first steps into the cloud world.

Overcoming resistance

There was less resistance than expected to introducing digital signing, said Van De Bunt, and some organizations became interested in adopting the same process for themselves. Only a few partners resisted the move — although KLM withdrew paper alternatives just to make sure the changeover would be swift.

We did some workshops internally, typically an hour long. I made a three or four page manual and off we went.

Then came the task of selling it externally. We did away with the paper system so there was no other way to get your contract signed except with EchoSign. I convinced my hierarcy [to do] that so there [would be] no opportunities to sign paper contracts.

Some of our customers had to develop a policy for it themselves. We had lengthy discussions with our legal to build up the ammunition to answer many legal questions. In the end, not a lot of legal questions came.

Maybe five or six in the total market didn't want to sign electronically. We opened the backup option that they print out and fax back their contract. We use a cover page that sends it into EchoSign.

Meanwhile KLM is glad of the sustainability impact from eliminating those million sheets of paper — based on an annual contract count of around 20,000, each comprising 25 pages and printed in two copies. According to KLM, which has ranked top of the transport sector in the Dow Jones Sustainability Index for the past decade, that equates to 120 trees and almost 10 million litres of water. Van De Bunt commented:

This ties right into our sustainable image, to do away with a process that uses papers like that.

Disclosure: Salesforce is a diginomica premier partner. Adobe introduced KLM for this interview.

Image credit: KLM.