Invitation for the Implementation of Enterprise Resource Planning (ERP) Solution

Invitation for the Implementation of Enterprise Resource Planning (ERP) Solution Pakistan International Airlines (PIA), Pakistan s national flag carrier, plans to implement a proven, timetested, internationally acclaimed and airline specific Enterprise Resource Planning (ERP) solution catering to its requirements in the following areas: 1 Enterprise Resource Planning (ERP) Existing scope of work includes the following ERP Modules. Finance & Controlling Human Resources Procurement and Logistics Any other sub module as to meet the PIA s RFP requirement e.g.: Revenue Accounting Work Flow Employee Self Service Document Management System Vendor providing Revenue Accounting will be preferred. Tender will be called on Single Stage Two Envelopes basis from ERP related companies or their authorized / certified representative or partners or consortium of such companies for the provision and implementation of ERP solution. Bidders are required to submit a Pay Order of Rs. 3,000, (or its USD equivalent) drawn on Pakistan International Airline alongwith Technical Proposal as Tender fee. Bidders are required to submit 2% of Total Bid value as Earnest Money in shape of Pay Order alongwith Financial Proposal. Proposals must reach at address given below on / before 26-01-2015 till 1030 Hours (PST). Technical Proposals will be opened on the same date at 11:00 Hours (PST). Bidders are required to submit two copies of Technical Bid marked as Original and Copy. PIA reserves the right to reject any or all bids, or decide not to implement the ERP solution without assigning any reason thereof. Bids received after date and time stipulated shall not be considered. For any query, please feel free to contact: General Manager (Contracts & Agreements) Pakistan International Airlines Procurement and Logistics Building Near PIA Head Office Karachi Airport Karachi Ph: +92-21-99043181, 9904 3081 Email: gmcontracts@piac.aero, contract.administration@piac.aero

PAKISTAN INTERNATIONAL AIRLINES INVITATION TO BID FOR ERP IMPLEMENTATION (TERMS OF REFERENCE) 1. Introduction Pakistan International Airlines Corporation (PIA) has initiated a project to implement Enterprise Resource Planning (ERP) in order to achieve greater operational efficiencies and facilitate the realization of growth targets. As a first phase, the areas of Finance; Human Resources and Administration; and Procurement and Inventory Control are being targeted. PIA now invites firms with experience of implementing ERP solutions in large public sector organizations and/or in the Airlines industry to bid for the following: 1. Provision of licenses for an ERP Package and Add-ons 2. Supply and Installation of Appropriate Hardware and Review of Infrastructure Environment 3. ERP Implementation, Training and Rollout 4. Post Implementation Warranty and Support 2. Request for Proposal A detailed Request for Proposal document is attached setting out the following: Section A - Project Detail Section B - Instructions To Contractors Section C - PIA s IT Environment Section D - Product Requirements (ERP Package & Add-ons) Section E - Product Requirements (Others) Section F - Services Requirements Section G - Hardware Requirements Section H - Requirements Compliance Matrix Section I - Completion and Compliance Checklist Section J - Criteria for Technical and Commercial Evaluation 3. Bidding Process Being a public sector corporation PIA complies with the Public Procurement Rules 2004 and the guidelines of the Public Procurement Regulatory Authority. The process being followed for selecting a vendor is Single-stage Two-envelope bidding, which requires technical and commercial proposals to be submitted in two separate sealed envelopes. Bidders are advised to carefully review, in particular, Instructions (Subsection B1) of Instructions to Contractors (Section B) and ensure that their bids comply with all stated conditions.

4. Significant Dates From RFP Issuance to Contract Signing Pre-bid Meeting 16-01-2015 Submission of Proposals 26-01-2015 Opening of Technical Bids 26-01-2015 Submission of Technical Evaluation Report Opening of Commercial Bids Announcement of Technical and Commercial Evaluation Results To be decided Submission of Draft Contract Finalization of Contract Contract Signing with Successful Bidder Contract Timelines and Payment Terms This is a high priority project for PIA which is being monitored directly by the Board of Directors. While recognizing that each ERP vendor will have their own methodology PIA has developed the following schedule as a baseline against which the schedules proposed by each bidder will be measured, significant Weightage being given to adhering as closely to the baseline dates as possible (albeit following the vendor s own methodology). The schedule also indicates the payment terms which PIA intends to follow, this being linked to achievements of specific project milestones:

Major Project Milestones Signing of Contract (against bank guarantee) Associated ERP Implementation ERP Licenses Hardware Project Services Deliverables 1 Target Payment Target Payment Target Payment Date % 2 Date % 2 Date % 2 1, 2, 3 10 5 Installation of Interim Servers 6 - Delivery and Installation of SW (ERP Package and Add-ons Hardware Delivery (Production and DR Sites) Issuance of Certificate Upon Successful HW Installation Business Requirements Gathering and Analysis 7 40 8 20 9 30 10, 11, 12 To be decided To be decided To be decided 5 Build and Conduct UAT 13, 16, 17, 18, 19 10 End-User Training and Readiness 14, 15, 20, 21, 26 20 Project Go-Live 22, 23, 24 40 30 Completion of Post Go-live Support 25 10 45 35 Recurrent Costs Bidder to Specify Bidder to Specify Bidder to Specify Notes: 1. Successful completion of the project deliverables listed in Section 6 would mark the achievement of the project milestones 2. Although the payment schedule for each of the project components, that is, ERP Licenses, Hardware and ERP Implementation Services is separately mentioned, there is a high degree of interdependencies among them. If the Contractor is unable to achieve the target ERP Implementation deadlines this would not only impact the payment schedule for that particular component of the Contract but for others (ERP Licenses, Hardware) as well. To elaborate the point, timely delivery and installation of the required hardware, but without the ERP Implementation deadlines being achieved would require PIA to withhold scheduled payments against hardware as well.

5. Suggested Project Deliverables The successful bidder will be required to provide deliverables during the course of this project, some of which are as follows: 1. Draft Contract 2. Signing of Contract 3. Project Charter Document including Detailed Project Plan 4. Fortnightly Progress Report 5. Status of Project Issues List. This should be updated weekly during the project duration. 6. Interim Servers, Operating Servers and Related Tools 7. ERP Software (Media) Installation 8. Installation of Hardware at Production and Disaster Recovery Sites 9. Certificate upon Successful Installation of Hardware 10. Requirements Specifications Document 11. Gap Analysis Document 12. Templates for Data Collection 13. Solutions Design Document 14. End-User Training Manuals and Exercise Guides based on the Configured Solution 15. Training Plan for ERP Overview, Configured ERP Application and for End-Users. The end-users training plan should be role-based 16. UAT Plan 17. Scenarios-based Test Scripts for User Acceptance Testing 18. Development/Provision of Standard and Customized Reports 19. Roles and Responsibility Matrix 20. Master Implementation / Rollout Plan 21. IT Infrastructure Readiness Report and Certification 22. Fully Configured ERP solution 23. Go-Live Certificate 24. Detailed Plan for Post-implementation Support 25. Project Completion Report and Certificate 26. Application Users or Operations Manuals This list may not necessarily be comprehensive or exhaustive. Hence, bidders are free to suggest additional deliverables, if necessary. 6. Pre-bid Meeting A pre-bid meeting will be scheduled at 1500 on 16-01-2015 at Conference Room, P&L Department, PIA to respond to queries of interested bidders. General Manager (Contracts & Agreements) Pakistan International Airlines Procurement and Logistics Building Near PIA Head Office Karachi Airport Karachi Ph: +92-21-99043181, 9904 3081 Email: gmcontracts@piac.aero, contract.administration@piac.aero

7. Other Instructions 1. Bids must be delivered to the aforementioned address. All bids must be accompanied by a bid bond (included in the Commercial Proposal envelope) for 5 percent of the total bid price (in shape of Pay Order / Bank Draft / Bank Guarantee). Bank Guarantee must be valid for 90 days from the date of submission of bid. Bid Bonds will be returned within 30 days of the award of the contract under this RFP to the successful bidder 2. Successful bidder shall be required to furnish a Performance Guarantee which shall be 10% of the contract amount 3. Successful bidder shall be required to sign the Integrity Pact (format attached in RFP document) 4. Late bids will be rejected. Bids will be opened in the presence of the representatives of bidders who choose to attend. 5. Bid must be valid for at least 90 days (extendable) from the date of submission.

Pakistan International Airlines INVITATION FOR THE IMPLEMENTATION OF ENTERPRISE RESOURCE PLANNING (ERP) SOLUTION

TABLE OF CONTENTS SECTION A PROJECT DETAILS... 10 A1 PIA BACKGROUND... 11 A2 PROJECT BACKGROUND... 13 A3 PROJECT ORGANIZATION... 18 A4 PROJECT PHASES... 18 SECTION B INSTRUCTIONS TO CONTRACTORS (ITC)... 21 B1 INSTRUCTIONS... 22 B2 SUMMARY OF REQUIREMENTS... 35 B3 TEMPLATE FORMS... 36 B4 FORMAT AND CONTENTS OF PROPOSAL... 57 SECTION C PIA IT ENVIRONMENT... 58 C1 IT DEPARTMENT... 64 C2 EXISTING SYSTEMS... 65 C3 EXISTING IT INFRASTRUCTURE...139 SECTION D PRODUCT REQUIREMENTS (ERP PACKAGE & ADD-ONS)... 14439 D1 ERP PACKAGE AND ADD-ON REQUIREMENTS...145 D2 INFORMATION NEEDS AND APPLICATION REQUIREMENTS...156 SECTION E PRODUCT REQUIREMENTS (OTHERS)... 19186 E1 RDBMS AND DATABASE ADMINISTRATION TOOLS...192 E2 APPLICATION DEVELOPMENT TOOLS...194 E3 QUERY AND REPORT GENERATOR TOOLS...195 E4 INTERIM SERVERS...196 E5 3 RD PARTY SOFTWARE...197 SECTION F SERVICES REQUIREMENTS... 193 F1 IMPLEMENTATION...199 F2 TRAINING...203 F3 DATA MIGRATION...206 F4 DOCUMENTATION...207 F5 WARRANTY AND MAINTENANCE SUPPORT...209 F6 VERSION AND UPGRADES...211 SECTION G HARDWARE REQUIREMENTS... 21207 G1 HARDWARE...213 SECTION H REQUIREMENTS COMPLIANCE MATRIX... 21510 H1 GLOBAL REQUIREMENTS GENERAL...216 H2 GLOBAL REQUIREMENTS TECHNICAL...225 H3 GLOBAL REQUIREMENTS OTHERS...231 H4 FUNCTIONAL REQUIREMENTS FINANCE...235 H5 FUNCTIONAL REQUIREMENTS HUMAN RESOURCES AND ADMINISTRATION...249 H6 FUNCTIONAL REQUIREMENTS PROCUREMENT AND INVENTORY CONTROL...260 H7 SERVICES REQUIREMENTS...269 H8 HARDWARE REQUIREMENTS...276 SECTION I COMPLETION AND COMPLIANCE CHECKLIST... 27974 I1 PROPOSAL COMPLETION CHECKLIST...280 I2 PRODUCTS AND SERVICES...281 I3 BUSINESS INFORMATION AND APPLICATION NEEDS...287 I4 ERP PACKAGE REQUIREMENTS...288 SECTION J CRITERIA FOR TECHNICAL AND COMMERCIAL EVALUATION... 283

Request for Proposal For Enterprise Resource Planning Solution January 2015

SECTION A PROJECT DETAILS

A1 PIA BACKGROUND Pakistan International Airlines (PIA) came into existence in March 1955, when a privately owned company, Orient Airways, merged with the Government of Pakistan to form the state-owned airline. PIA has been an air travel pioneer since its inception. In 1962, PIA set out to break the record for the fastest flight between London and Karachi. With representatives of FAI (Federation Aeronautics International) on board to monitor the official timings, PIA completed the flight in 6 hours, 43 minutes, 51 seconds, a record which remains unbroken to this day. Section B Instructions to Contractors (ITC) Page 11

PIA Vision PIA's vision is to be a world class airline exceeding customer expectations through dedicated employees, committed to excellence. PIA Mission Employee teams will contribute towards making PIA a global airline of choice: Offering quality customer services and innovative products Participating in global alliances Using state-of-the-art technologies Ensuring cost-effective measures in procurement and operations Customer Expectations Service Innovation Cohesiveness Integrity Reliability Safety PIA Values Convenience, Caring, and Competitive Tariff Personalized and Courteous Cherishing New Ideas, Translated Into Action Respect for Individuals, Teamwork, and Effective Communication Business Ethics, Accountability, and Transparency Loyalty and Consistency Passengers, Employees, Environment, and Health Information Technology (IT) Objectives Keeping in line with the organization s vision and mission, the Information Technology department at PIA has formulated the following objectives: To implement industry standard systems / solutions which are integrated, adaptive and flexible to both internal and external challenges and evolve as technology progresses and must be capable to meet airline industry challenges. To carefully plan and deploy resources to ensure continuity of Information Technology services and its availability on 24x7 hours basis. To ensure that Information Technology is effectively applied to business needs. To provide technology tools to PIA staff for capturing and harnessing the knowledge base with the latest in IT, for timely management decision support. A high-level functional organization chart of PIA IT Department is provided in Section C. Section B Instructions to Contractors (ITC) Page 12

A2 PROJECT BACKGROUND PIA s management is of the view that new scenarios and changing business requirements necessitate a reassessment of business operations and a major upgrade of the information technology environment. In order to achieve greater operational efficiencies and facilitate the realization of growth targets, PIA has decided to implement a comprehensive Enterprise Resource Planning (ERP) solution. PIA intends to procure the best combination of technology products and services at the most reasonable cost. PIA desires to adopt a phased implementation approach. The areas of Finance; Human Resources and Administration; and Procurement and Inventory Control have been assigned initial priority. With rapid implementation methodologies and accelerated deployment options available in all good ERPs, it is PIA s intention to complete the implementation, training and rollout in minimum time period. The Contractor must recommend a suitable rapid implementation approach to help ensure project success within the proposed timeline. Since time is of essence, the proposed timeline will be fixed and strictly adhered to. The locations intended to be covered under the scope of the ERP Solution implementation are as follows: - PIA Head Office at Karachi PIA Computer Center at Karachi PIA Offices (International and Domestic all locations) PIA Stores, Hangars and Workshops (all locations) Section B Instructions to Contractors (ITC) Page 13

Locations: The table below lists domestic airports where PIA flies to: SR. NO. LOCATION 1. BAHAWALPUR 2. CHITRAL 3. DADU 4. DALBANDIN 5. DERA GHAZI KHAN 6. FAISALABAD 7. GILGIT 8. GWADAR 9. ISLAMABAD 10. JACOBABAD 11. KANDAWARI 12. KARACHI 13. LAHORE 14. MOENJODARO 15. MULTAN 16. PANJGUR 17. PASNI 18. PESHAWAR 19. QUETTA 20. RAHIM YAR KHAN 21. SAIDU SHARIF 22. SIALKOT 23. SKARDU 24. SEHMAN 25. SUKKUR 26. TURBAT Please note that this is an indicative list that may change with time. Section B Instructions to Contractors (ITC) Page 14

The table below lists international airports where PIA flies to: SR. NO. COUNTRY NUMBER OF AIRPORTS 1. AFGHANISTAN 1 2. BAHRAIN 1 3. BANGLADESH 1 4. CANADA 1 5. CHINA 1 6. DENMARK 1 7. FRANCE 1 8. GERMANY 1 9. GREECE 1 10. HONG KONG 1 11. INDIA 2 12. ITALY 2 13. JAPAN 1 14. JORDAN 1 15. KUWAIT 1 16. MALAYSIA 1 17. NEPAL 1 18. NETHERLANDS 1 19. NORWAY 1 20. OMAN 1 21. PHILIPPINES 1 22. QATAR 1 23. RUSSIAN FEDERATION 1 24. SAUDI ARABIA 4 25. SINGAPORE 1 26. SPAIN 1 27. SRI LANKA 1 28. THAILAND 1 29. TURKEY 1 30. UNITED ARAB EMIRATES 4 31. UNITED KINGDOM 5 32. UNITED STATES OF AMERICA 2 33. UZBEKISTAN 3 Please note that this is an indicative list that may change with time. Section B Instructions to Contractors (ITC) Page 15

The table below lists stores maintained by PIA: SR. NO. STOCK ROOM STOCK TYPE TECHNICAL / COMMERCIAL STATION ONLINE / OFFLINE 1. SR-A1 Component Technical Karachi Online 2. SR-B2 Consumable Technical Karachi Online 3. SR-09 Tires Technical Karachi Offline 4. SR-45 Engine Parts Technical Karachi Online 5. SR-14 Avionics Parts Technical Karachi Online 6. SR-26 Rubberized Technical Karachi Online 7. SR-81 Consumable Technical Karachi Online 8. SR-18 F-27 Parts Technical Karachi Online 9. SR-89 Pneumatic Technical Karachi Online 10. SR-20 Surplus Technical Karachi Online 11. SR-B3 A/C Furnishing Commercial Karachi Online 12. SR-80 Raw Material Commercial Karachi Online 13. SR-04 Chemical Commercial Karachi Online 14. SR-58 TGS Commercial Karachi Online 15. SR-82 Chemical Commercial Karachi Online 16. SR-41 Forms Commercial Karachi Online 17. SR-64 Printing Mat Commercial Karachi Online 18. SR-59 Advertising Commercial Karachi Offline 19. SR-16 Common Commercial Karachi Online 20. SR-39 Uniform Commercial Karachi Online 21. SR-17 FSD Commercial Karachi Online 22. SR-22 Consumable Technical Islamabad Online 23. SR-42 Component Technical Islamabad Online 24. SR-55 P.O.L Commercial Islamabad Offline 25. SR-51 Commercial Commercial Islamabad Offline 26. SR-49 Printing Stationery Commercial Islamabad Offline 27. SR-56 FSD Commercial Islamabad Offline 28. SR-43 Uniform Commercial Islamabad Offline 29. SR-50 TGS & MT Commercial Islamabad Offline 30. SR-48 Computer Paper Commercial Islamabad Offline 31. SR-33 Consumable Technical Lahore Online 32. SR-34 Component Technical Lahore Online 33. SR-36 Commercial Commercial Lahore Offline 34. SR-54 Common Commercial Lahore Offline 35. SR-46 Printing Stationery Commercial Lahore Offline 36. SR-60 FSD Commercial Lahore Online 37. SR-66 Consumable Technical Peshawar Offline 38. SR-83 Printing Stationery Commercial Peshawar Offline 39. SR-94 Uniform Commercial Peshawar Offline 40. SR-93 Commercial Commercial Peshawar Offline 41. SR-63 Component Technical Faisalabad Offline 42. SR-62 Consumable Commercial Faisalabad Offline 43. SR-70 Uniform Commercial Faisalabad Offline Section B Instructions to Contractors (ITC) Page 16

SR. NO. STOCK ROOM STOCK TYPE TECHNICAL / COMMERCIAL STATION ONLINE / OFFLINE 44. SR-76 Commercial Commercial Faisalabad Offline 45. SR-77 Consumable Technical Multan Offline 46. SR-79 Uniform Commercial Multan Offline 47. SR-57 Consumable Technical Quetta Offline 48. SR-61 Component Technical Quetta Offline 49. SR-96 Commercial Commercial Quetta Offline 50. SR-68 Printing Stationery Commercial Quetta Offline 51. SR-C8 FSD Commercial Quetta Offline Please note that this is an indicative list that may change with time. Section B Instructions to Contractors (ITC) Page 17

A3 PROJECT ORGANIZATION For realizing the overall business and technological objectives, a fully resourced IT team is collaborating with PIA s management, through various stages of this project. Together the team reports to Project Steering Committee and ERP Implementation Committee that has been set-up to oversee the progress and make decisions on key issues. The successful ERP Contractor would become a part of this team and will work under the guidance and control of Project Steering Committee and ERP Implementation Committee. A4 PROJECT PHASES The various components covered under this RFP are: Supply of ERP System, Appropriate Hardware and Review of Infrastructure Environment ERP Implementation, Training and Rollout Post Implementation Warranty and Support The following component-wise activities have been identified: Supply of ERP System, Appropriate Hardware and Review of Infrastructure Environment Supply of an appropriate ERP solution that caters to the requirements mentioned in this RFP document and has been successfully implemented in the Airline and Aviation Industry. ERP solution and systems shall comprehensively fulfill PIA s business process requirements and objectives. ERP Solution should be capable to meet present requirements and future needs as described in Section D. The solution being provided must be relevant and complete with a suitable disaster recovery plan. Proposed ERP should have verifiable Airline / Aviation references. Supply of appropriate hardware to run the ERP solution in a high availability environment Study and provide detailed infrastructure requirements for optimum performance. It must focus on the required network (number of nodes, bandwidth, network availability requirements, VPN, intranet and internet, Network Management System (NMS), remote log on, security requirements, etc.); power (availability, stability, backup support, etc.); housing; air-conditioning and other facilities required. It is the responsibility of the Contractor to provide a complete solution to PIA, clearly mentioning the various items, components, tools, risks involved, etc. Any shortfall or critical components not specified in this RFP which the Contractor Section B Instructions to Contractors (ITC) Page 18

considers necessary for the solution to work smoothly and efficiently should be separately and clearly mentioned. Any Contractor who fails to do so, if awarded the contract, would without prejudice to PIA s legal rights, be responsible to procure and provide to PIA such tools, items, and components at its own cost. ERP Implementation, Training and Rollout Devise an implementation approach / strategy that should be adopted after due consideration to project scope, applicable constraints and magnitude of business improvement goals. Contractor must provide detailed implementation methodology. Identify and formulate implementation procedures and controls for systems security, auditability, confidentiality, reliability, integrity, and business continuity. Prepare conceptual design and highlight parameters that will be configured in the ERP system in accordance with PIA business requirements. Provide integration solutions where ERP will be integrated with other applications as identified in the RFP. Configure the ERP based on approved conceptual design, parameters and integration areas. It should also include complete workflow for transaction approvals and escalation. Prepare reports that fulfill management and statutory reporting requirements. Convert and migrate historical and live data, efficiently and accurately. Prepare the user community for change through appropriate knowledge transfer and end-user training. Prepare and execute a comprehensive training plan to train the trainers / power users and end users. Gain acceptance for new systems by actively involving key users in driving the acceptance testing process and achieving cut-over to the new environment. Ensure smooth and seamless transition to new systems without any disturbance to the ongoing operational activities of PIA. Provide a sufficient number of properly qualified ERP experts for each specific area mentioned in the RFP. These should cover as a minimum experts having implementation experience in airline of size comparable to PIA in the areas of Human Resources, Finance and Procurement and Logistics. To address ERP implementation at all PIA locations in the following areas: Finance General Ledger Financial Analyzer Fixed Assets Management Cash Management Petty Cash Management Accounts Payable Revenue Accounting Accounts Receivable Insurance Management Leasing Management Budget and Cost Management Profitability Management Foreign Currency Management Section B Instructions to Contractors (ITC) Page 19

Taxation Management Treasury and Risk Management Human Resources and Administration HR Planning and Operations Recruitment Management Qualifications Management HR Development Performance Management Compensation and Benefits Management Training and Development Time Management Healthcare Management Travel Management Payroll Processing Final Settlement Processing Personnel Insurance Management Security Management Staff Funds Management Self Service HR Procurement and Inventory Control Contracts and Procurement Management Vendor Management Items Management Stores Management Inbound / Outbound Logistics Management The implementation areas are indicative only; details are provided in Section D. Post Implementation Warranty and Support Provide a team of certified experts to be stationed at PIA locations for post implementation support for a minimum period of two months to ensure optimum and seamless operations of systems and processes. Specify a detailed support program and mechanism. Contractor must provide at least Three years post implementation warranty for software and hardware. The Contractor has to ensure that all software and hardware supplied are free from defects / bugs / flaws / security holes, etc. Warranty periods for hardware / software should be clearly mentioned. Any discrepancies, mismatches and resource constraints experienced during the support period which were not specified in the Proposal will be responsibility of the Contractor. Section B Instructions to Contractors (ITC) Page 20

SECTION B INSTRUCTIONS TO CONTRACTORS (ITC) Section B Instructions to Contractors (ITC) Page 21

B1 INSTRUCTIONS 1. Eligible Contractors 1.2 For the purpose of this RFP all parties receiving or responding to this RFP are considered bidders or potential contractors and have been identified throughout the RFP accordingly. This will be a Single Stage Two Envelope Bidding Process. 1.3 The Contractors are invited to submit a detailed Technical Proposal and an item wise Commercial Proposal for Products and Services required for the assignment as named in the ERP. The proposal will be the basis for the ultimate execution of a contract with the selected successful Contractor(s). 1.4 Information relating to evaluation of proposals and recommendations concerning awards will not be disclosed to the Contractor or to other persons not officially concerned with the process. The Contractor shall maintain complete confidentiality of its proposal and shall not disclose the proposal or any terms thereof to any unrelated person or any third party. The Contractor shall also keep confidential all its discussions with PIA. 1.5 By submitting a Proposal, the Contractor agrees to be legally bound by the terms and conditions set out in this RFP. The Proposal will be considered as a binding offer from the Contractor subject to acceptance by PIA. 1.6 PIA will not be bound to accept the lowest or indeed any Proposal and will not be committed to any Proposal until a contract has been executed. PIA, in its absolute discretion and without liability to any party, may decide at any time to amend the RFP, extend the deadline for submission of Proposals or amendments to the Proposals or terminate the RFP process in whole or in part. PIA. 1.7 Both hardcopies and softcopies (on CDs) of technical and commercial proposals should be submitted. Separate CDs for Technical and Commercial proposals should be made. Utmost care should be exercised in enclosing each CD in a separate relevant envelope. Failure to do would disqualify the bidder. 2. Products and Services 2.1 For the purposes of this RFP, the Enterprise Resource Planning Package Solution, also called simply the ERP Package or ERP Solution, means all of the products and related services on turnkey basis to be provided by the selected Contractor under the contract. 2.2 Contractors are bound to submit solutions based on their proposals submitted. Section B Instructions to Contractors (ITC) Page 22

3. Cost of Bidding 3.1 The Contractors shall bear all costs associated with the preparation, submission and clarification of its proposal, presentations and meetings. PIA will, in no case, be responsible or liable for those costs, regardless of the conduct or outcome of the bidding process. 4. Content of RFP Documents 4.1 The contents of the RFP Documents are listed below and should be read in conjunction with any addenda issued in accordance with ITC Sub-section 6: Section A - Project Detail Section B - Instructions To Contractors Section C - PIA IT Environment Section D - Product Requirements (ERP Package & Add-ons) Section E - Product Requirements (Others) Section F - Services Requirements Section G - Hardware Requirements Section H - Requirements Compliance Matrix Section I - Completion and Compliance Checklist Section J - Criteria for Technical and Commercial Evaluation 4.2 Contractors must examine all instructions, forms, terms, specifications and other information in the RFP Documents. Each Contractor by submitting its proposal shall be deemed to have satisfied itself as to all the conditions and circumstances affecting the scope of work and bid amount / contract price. 4.3 Failure to furnish all information required by the RFP Documents or to submit a Proposal not substantially responsive to the RFP Documents in every respect will be at the Contractor s risk and may result in the rejection of their Proposal and the Contractor shall not hold PIA liable for such rejection in anyway whatsoever. PIA reserves the right to verify at its sole discretion any or all information submitted in response to the RFP Document. Any false information or misrepresentation or non-disclosure may result in rejection of the entire Proposal. 5. Clarification of RFP Documents 5.1 Contractors may seek clarification pertaining to the RFP Documents by submitting specific questions, in writing, to PIA. This could be done within ten (10) working days from the date of issuance of RFP. PIA will respond in writing within five working days. The questions and PIA s responses will be sent to all bidders. All queries have to be submitted to: General Manager Procurement Pakistan International Airlines Procurement and Logistics Building Near PIA Head Office Karachi Airport Section B Instructions to Contractors (ITC) Page 23

Karachi Ph: +92-21-99045135 Fax: +92-21-34570120/+92-21-34575200 Email: gmptnl@piac.aero, contract.administration@piac.aero 6. Amendment to RFP Documents 6.1 PIA may modify the RFP Documents by issuing addenda, for any reason, and at any time prior to the deadline for submission of Proposals. Any addenda to the RFP Documents shall be considered part of the RFP Document. 6.2 All Contractors will be notified of the addenda in writing by email, letter or facsimile, all such Contractors shall confirm the receipt of such addenda to PIA and it shall be binding on them. 6.3 To allow Contractors reasonable time to take any addenda into account in preparing their Proposals, PIA may, at its own discretion, extend, as necessary, the deadline for the submission of proposals. 7. Language of Proposals 7.1 Proposals and all correspondence and documents relating to the proposals exchanged between the Contractor and PIA, shall be written in English. 8. Documents Comprising the Proposal 8.1 The proposal submitted by the Contractor shall comprise the following: (a) The relevant completed Proposal Form and all Price Schedules as included in Section B, Subsection B3 Template Forms, completed and duly signed by the Contractor in accordance with ITC Sub-sections 9,10 and 14; (b) Bid security furnished in accordance with ITC Sub-section 13; (c) (d) A full description of the technical solution to the business requirements described in Sections D Product Requirements (ERP & Add-ons), Section E Product Requirements (Others), Section F Services Requirements and Section G Hardware Requirements. The completed Requirements Compliance Matrix (Section H), Proposal Completion Checklist (Section I, Subsection I1) and Compliance Checklists (Section I, Subsections I2 to I4). 9. Proposed Prices 9.1 The Contractor must provide the prices of the proposed Solution using the Price Schedule Templates provided in Subsection B3. Section B Instructions to Contractors (ITC) Page 24

9.2 Prices provided on the Price and Recurrent Costs Schedules (as per Templates) shall be listed individually in the following manner: (a) (b) (c) Unit and total prices of products offered, inclusive of all taxes and duties. Prices for implementation services on the Services Price Schedule. Recurrent costs on the Recurrent Costs Form, as follows: (i) (ii) the cost of all software updates, recurrent licensing fees, and any other items needed to operate the ERP Solution, plus any other recurrent supply of products specified in the RFP Documents, the cost of all maintenance and technical support services, and any other recurrent services specified in the RFP Documents, including all taxes payable by the Contractor thereon. PIA shall not be liable to pay any of the aforesaid charges, taxes, expenses, etc. at any point during or after the period of this contract. (d) (e) Totals of Products, Services and Recurrent Costs, on the Proposal Price Summary Form. The Contractors should highlight separately the prices for Passenger Revenue Accounting and Cargo Revenue Accounting systems. These should include separate software / licensing costs as well as implementation / services / maintenance costs. 9.3 The Contractor s separation of price components in accordance with ITC Subsection 9, item 9.2 will be solely for the purpose of facilitating the comparison of proposals and will not in any way limit PIA s right to contract on any of the terms offered. 9.4 Prices quoted by the Contractor shall be fixed maximum prices during the Contractor s performance of the contract. Proposals submitted with adjustable price quotations will be rejected and the Contractor shall not hold PIA liable in anyway whatsoever for such rejection. 9.5 This is a high priority project for PIAC which is being monitored directly by the high management. While recognizing that each ERP vendor will have their own methodology PIAC has developed the following schedule as a baseline against which the schedules proposed by each bidder will be measured, significant weightage being given to adhering as closely to the baseline dates as possible (albeit following the vendor s own methodology). In proposal Bidder shall specify a milestone based payment procedure however payments will be released as per milestones achieved at sole discretion of PIA. Section B Instructions to Contractors (ITC) Page 25

10. Suggested Project Deliverables The successful bidder will be required to provide deliverables during the course of this project, some of which are as follows: 27. Draft Contract 28. Final Contract 29. Project Charter Document including Detailed Project Plan 30. Fortnightly Progress Report 31. Status of Project Issues List. This should be updated weekly during the project duration. 32. Interim Servers, Operating Servers and Related Tools 33. ERP Software (Media) Installation 34. Installation of Hardware at Production and Disaster Recovery Sites 35. Certificate upon Successful Installation of Hardware 36. Requirements Specifications Document 37. Gap Analysis Document 38. Templates for Data Collection 39. Solutions Design Document 40. End-User Training Manuals and Exercise Guides based on the Configured Solution 41. Training Plan for ERP Overview, Configured ERP Application and for End- Users. The end-users training plan should be role-based 42. UAT Plan 43. Scenarios-based Test Scripts for User Acceptance Testing 44. Development/Provision of Standard and Customized Reports 45. Roles and Responsibility Matrix 46. Master Implementation / Rollout Plan 47. IT Infrastructure Readiness Report and Certification 48. Fully Configured ERP solution 49. Go-Live Certificate 50. Detailed Plan for Post-implementation Support 51. Project Completion Report and Certificate 52. Application Users or Operations Manuals This list may not necessarily be comprehensive or exhaustive. Hence, bidders are required to suggest additional deliverables, if necessary.

11. Bid Currencies 11.1 All Prices are to be quoted in Pakistan Rupees. 12. Documents Establishing Contractor s Eligibility and Qualifications 12.1 The documentary evidence of the Contractor s qualifications and ability to perform the contract if its proposal is accepted shall establish to PIA s satisfaction: (a) (b) (c) (d) (e) that, in the case of a Contractor not doing business in Pakistan, the Contractor is represented in Pakistan and will be able (if awarded the Contract), to carry out the installation, implementation, support, maintenance, and other service obligations prescribed in the RFP Documents. Documentary evidence supporting the aforementioned must be provided; that the Contractor and any Sub-contractors have the financial, technical, and staff capabilities to support the ERP Solution, and have a successful performance history, appropriate for their role in fulfilling the contract. Only the pre-qualified Contractors can be designated as the Lead Contractor. In the event a proposal is jointly submitted by more than one Contractor, all other participants should be designated as Sub-contractors. Any planned or proposed use of Sub-contractors must be clearly documented in the proposal with their names and relationship defined. In addition the Lead Contractor should complete the Consortium Responsibilities Form in Section B, Subsection B3. The Contractor shall not be permitted to introduce any other sub-contractor, other than the ones already mentioned in the documents as mentioned aforesaid. Each Sub-contractor must sign a Letter of Authorization / Joint Venture Agreement authorizing the Lead Contractor to act on its behalf. A copy of this Letter of Authorization / Joint Venture agreement must be submitted along with the Proposal. The Lead Contractor shall be completely responsible for all contract services to be performed. The Lead Contractor must demonstrate that all aspects of this RFP Document have been carefully and completely considered. No substitution of a Sub-contractor shall be allowed during the term of this contract. Failure of a Sub-contractor to perform as expected shall not relieve the Lead Contractor of its duties to perform on the whole requirement and the Lead Contractor shall be liable for any / Section B Instructions to Contractors (ITC) Page 27

all loss(es / damage(s) that PIA may suffer as a result of failure of a Sub-contractor to perform any / all of its obligations under this contract. 13. Documents Establishing Products and Services Eligibility and Conformity to RFP Documents 13.1 Pursuant to ITC Sub-section 8, the Contractor shall furnish, as part of its Proposal, documents establishing the eligibility and conformity to the RFP Documents of all products and services that the Contractor proposes to supply under the contract. 13.2 The documentary evidence of conformity of the products and services to the RFP Documents may be in the form of written descriptions, literature, diagrams, certifications and client references, including: (a) (b) (c) a detailed description of the essential technical and performance characteristics of the products; an item-by-item commentary on PIA s Product and Services Requirements, as detailed in Sections D, E, F and G, demonstrating the substantial responsiveness of the proposed solution to the specifications provided; and a confirmation that the Contractor shall accept responsibility for the successful integration and interoperability of all proposed products and other PIA systems as required by the RFP Documents. 14. Bid Bond 14.1 Pursuant to ITC Sub-section 8, the Contractor shall furnish, along with its Commercial Proposal, an unconditional and irrevocable bid bond for 5% (five percent) of the total amount of the Products, Services and Support Prices. 14.2 The bid bond is required to protect PIA against the risk of the Contractor s conduct that would warrant the security s forfeiture, as per ITC Subsection 13, item 13.7. 14.3 The bid bond shall be denominated in Pakistan Rupees, shall be valid for ninety (90) days beyond the validity of the Proposal, and shall be in one of the following forms: (a) (b) a bank guarantee by a Pakistani Scheduled bank, in the form provided in the RFP Documents; A Pay Order / Demand Draft drawn on a Pakistani Scheduled bank. Section B Instructions to Contractors (ITC) Page 28

14.4 Any Proposal not secured in accordance with ITC Sub-section 13, items 13.1 and 13.3 will be rejected by PIA and the Contractor shall not hold PIA liable in anyway whatsoever for any such rejection. 14.5 Unsuccessful Contractors bid bond will be discharged or returned as promptly as possible after the expiration of the period of Proposal validity prescribed by PIA pursuant to ITC Sub-section 14. 14.6 The successful Contractor s bid bond will be discharged upon the Contractor signing the contract, pursuant to ITC Sub-section 24, and furnishing the performance security, pursuant to ITC Sub-section 23. 14.7 The bid bond may be forfeited: (a) (b) (c) If a Contractor attempts to withdraw its Bid before the date stipulated in the RFP for the validity of the Bid or any extension in this date agreed between the Company and the Contractor, if a Contractor attempts to modify or amend its Bid without the approval / consent of the Company before the date stipulated in the RFP for the validity of the Bid or any extension to this date agreed between the Company and the Contractor, In the case of a successful Contractor, if the Contractor fails to: (i) Furnish Performance Guarantee in accordance with ITC Sub-section 23; and / or (ii) Sign the contract in accordance with ITC Sub-section 24. The Contractor shall not hold the Company liable in anyway whatsoever for the amount so forfeited by the Company. 15. Period of Validity of Proposals 15.1 Proposals shall remain valid for 180 days from the date of Proposal submission prescribed by PIA, pursuant to ITC Sub-section 16. A Proposal valid for a shorter period shall be rejected by PIA and PIA shall not be liable for such rejection in anyway whatsoever. 15.2 In exceptional circumstances, PIA purely on its discretion may solicit the Contractor s consent to an extension of the period of validity. The request and the responses thereto shall be made in writing by letter or facsimile. The bid security provided under ITC Sub-section 13 shall also be suitably Section B Instructions to Contractors (ITC) Page 29

extended. A Contractor may refuse the request without forfeiting its bid security. 16. Format, Signing and Packaging of Proposals 16.1 The Contractor is required to submit the original and one copy each of its Technical and Commercial Proposals, clearly marking each ORIGINAL BID or COPY OF BID, as appropriate. In the event of any discrepancy between them, the original shall govern. One softcopy of the Technical Proposal on a CD should also be submitted. 16.2 The Technical and Commercial Proposals shall be typed or written in indelible ink and shall be signed by a person or persons duly authorized to bind the Contractor to the contract, which authorization shall be corroborated by a written power of attorney accompanying the Proposal. 16.3 The Technical and Commercial Proposals shall be submitted in separately sealed envelopes, each marked Technical Proposal and Commercial Proposal accordingly, and bearing the name and return address of the Contractor and the project name Licensing and Implementation of Enterprise Resource Planning (ERP) Solution. Proposals offered through telex / fax / cable / email will not be accepted. Proposals should be addressed to: General Manager (Procurement & Logistics) Pakistan International Airlines Procurement and Logistics Building Near PIA Head Office Karachi Airport, Karachi Ph: +92-21-99045135 Fax: +92-21-99040120 Email: gmptnl@piac.com.pk 16.4 If the envelopes are not sealed and marked as required by ITC Subsection 15, item 15.3, PIA will assume no responsibility for the Proposal s misplacement or premature opening. 16.5 Contractors shall organize their Proposals in accordance with the format specified in Section B4 Contents and Format of Proposal. Section B Instructions to Contractors (ITC) Page 30

17. Deadline for Submission of Proposals 17.1 Proposals must be received by PIA at the address and by the time specified in the RFP Covering Letter. Proposals received after this deadline will be rejected and returned to the Contractor unopened. 17.2 PIA may, at its discretion, extend this deadline for the submission of Proposals, in which case all rights and obligations of PIA and Contractors previously subject to the deadline will thereafter be subject to the deadline as extended. 18. Modification and Withdrawal of Proposals 18.1 The Contractor may modify or withdraw its Proposal after submission, provided that the modification, substitution or written notice of withdrawal of the Proposal is received by PIA prior to the deadline prescribed for submission of Proposals. No Proposal may be modified after the deadline for submission of Proposals. 18.2 No Proposal may be withdrawn in the interval between the deadline for submission of Proposals and the expiration of period of Proposal validity specified by the Contractor on the Proposal Form. Withdrawal of a Proposal during this interval may result in the Contractor s forfeiture of its bid security pursuant to ITC Sub-section 13, item 13.7 and PIA shall not be liable in anyway whatsoever to return / make good the loss of the bid security. 19 Opening of Proposals by PIA 19.1 PIA will open all Technical Proposals at a place and time to be advised in the covering letter by PIA. Contractors or their representatives may attend the opening, and those who are present shall sign a register evidencing their attendance. 19.2 No Proposal shall be rejected at Proposal opening, except for late Proposals, which shall be returned unopened to the Contractor pursuant to ITC Sub-section 16, item 16.1. 19.3 The Commercial Proposals of Contractors will be opened subsequently and evaluated. Contractors will be informed of the place and time by PIA. 20. Clarification of Proposals 20.1 During evaluation of Proposals, PIA may, at its discretion, ask the Contractor for a clarification of its Proposal. The request for clarification Section B Instructions to Contractors (ITC) Page 31

and the response shall be in writing, and no change in the prices or substance of the Proposal shall be sought, offered, or permitted during or after evaluation of the Proposal. 20.2 PIA may request the Contractor to arrange site visits for its reference sites. 20.3 PIA may also request the Contractor to give proof of concept by developing prototypes of specific scenarios identified by PIA. 21. Contacting PIA 21.1 Any effort by the Contractor to unethically influence PIA in the process of evaluating Proposals and in decisions concerning award of the contract will result in the rejection of the Contractor s Proposal. 21.2 The Contractors submitting proposals should attach a declaration that: (a) (b) (c) (d) They will not obtain or induce the procurement of the contract or any right, interest, privilege, or other obligation or benefit related to the contract from PIA or the Government of Pakistan, or any subdivision or agency thereof, through any corrupt business practice. They will not give or agree to give and shall not give or agree to give to anyone within or outside Pakistan either directly or indirectly through any person or organization, including affiliates, agents, associates, brokers, consultants, directors, promoters, shareholders, sponsors or subsidiaries, any commission, gratification, bribe, finder s fee or kickback, whether described as consultation fee or otherwise, with the object of obtaining or inducing pursuant to the contract or any right, interest, privilege or other obligation or benefit related to the contract in whatsoever form. They have made and will make full disclosure of all contracts and arrangements with all persons / organizations in respect of or related to the proposed contract with PIA and have not taken any action or will not take any action to circumvent the above declaration, representation or warranty. They agree to pay compensation to PIA in an amount equivalent to the direct losses to PIA, which would include the sum of any commission, gratification, bribe, finder s fee or kickback that would otherwise have been given to PIA in the form of a concession, given by the parties submitting proposals for the purpose of corruptly obtaining or including the procurement of the contract or any right, interest or other obligation or benefit related to this Section B Instructions to Contractors (ITC) Page 32

contract in whatsoever form from the parties submitting proposals, if it shall ultimately be determined by a final judicial decision that the party submitting proposals has so obtained or induced the procurement of the contract, or any right, interest, privilege or other obligation or benefit related to such contract. 22. PIA s Right to accept any Proposal and to reject any or All Proposals 22.1 PIA reserves the right (without limitation to any other right whatsoever) to accept or reject any Proposal, or to annul the bidding process and reject all Proposals at any time prior to contract award without incurring any liability to the affected Contractor or Contractors. 22.2 PIA also reserves the right (without limitation to any other right whatsoever) to award the consolidated contract in its entirety to a single Contractor or to award it in parts to more than one Contractor without incurring any liability to the affected Contractor or Contractors. 22.3 After receipt of proposals from the Contractors, PIA will evaluate and study the submitted proposals. PIA does not bind itself to award the contract to the lowest or to any Contractor but will take into consideration all relevant facts and aspects. Finalization of the Contract between the successful Contractor and PIA will be held in the presence of representatives of PIA s Procurement and Logistics department, at PIA Head Office, Procurement and Logistics Building or PIA Computer Center. The aim is to reach agreement on all points and sign a contract. 22.4 Having selected the successful Contractor on the basis of, among other things, an evaluation of the total solution offered, proposed methodology (work plan), verifiable successful implementations, and proposed key professional staff, PIA expects to finalize a contract on the basis of the products and available expertise named in the proposal. Before contract finalization, PIA will require assurances that products and experts will be actually available. PIA will not consider substitutions during contract finalization unless both parties agree that undue delay in the selection process makes such substitution unavoidable or that such changes are critical to meet the objectives of the assignment. 22.5 The finalization of the contract with the successful Contractor will conclude with a review of the agreed draft, to be signed by PIA and the Contractor, ensuring successful delivery and completion of the project. PIA and the successful Contractor will initial the agreed draft of the contract. If this process fails, PIA may invite the next Contractor for the award of the assignment. In this regard, Contractors should submit draft copies of their proposed contracts and Service Level Agreements along with their Technical Proposals. Section B Instructions to Contractors (ITC) Page 33

23. Performance Guarantee 23.1 Within five (5) working days of the receipt of notification of award of the Contract from PIA, the successful Contractor shall furnish a Performance Guarantee for 10% (ten percent) of Contract value in accordance with the conditions of Contract, using the Performance Security Form provided in the RFP document. 24 Signing of Contract 24.1 Within four (04) working days of receipt of the Performance Guarantee in accordance with ITC Sub-section 23, PIA will send the successful Contractor the Contract Form provided in the RFP documents, incorporating all agreements between the parties. 24.2 Within four (04) working days of receipt of the Contract Form, the successful Contractor shall sign and date the contract and return it to PIA. Section B Instructions to Contractors (ITC) Page 34

B2 SUMMARY OF REQUIREMENTS This schedule lists all major components of the ERP Solution to be procured through this Request for Proposal. Further details and exact specifications for each item are included in the Sections D, E and F. Item Type Description Project Site(s) ERP Package Application software modules to meet the Applications Head Office requirements as per details in Section D Other Locations 1 ERP Package Any Add-on required for ERP solution, if any Head Office Other Locations 3 rd Party Software As required by the proposed ERP Package and Add-on Applications Head Office Other Locations RDBMS As required by the proposed ERP Package and Add-on Head Office Applications Other Locations Recommended configuration of hardware and operating system software for the Production Environment will be provided by the Contractor and it shall not be binding on PIA to procure this from the Contractor. Hardware Others Installation / Implementation Services Training Data Migration Recurrent Services Interim Application / Data Server(s) including Operating Systems as required by the proposed ERP for Training, Development, Testing and Quality Assurance Environments will be provided by the Contractor at its own cost Application Development Tools, Query and Report Generating Tools, Business Intelligence Tools, Systems Administration Tools, Operating Systems, Systems Management Tools, etc. Installation, configuration and implementation of Hardware and Operating System, ERP Standard Software, Add-on Applications, 3 rd Party Applications. End User, Power User and Management training for ERP, Add-on and 3 rd Party Applications, Technical training for Developers and Administrators on Application Development Tools, Reporting Tools, RDBMS, DBA tools, OS, System Management Tools, etc. Development of applications and migration of data from legacy systems and manual records Post-Implementation support for three years (after Warranty Period) for ERP Package, Add-on applications, Hardware and 3 rd Party Software Maintenance and Support Head Office Other Locations Head Office Head Office Other Locations Head Office Other Locations Head Office All Locations 1 List of locations where PIA operates is available in Section A, Subsection A2. Section B Instructions to Contractors (ITC) Page 35

B3 TEMPLATE FORMS Notes for Contractors on the Template Forms 1. The Contractor shall complete and submit with its Proposal the Proposal Form and the required Price Schedules and in accordance with the requirements included in Section B, Subsection B1. 2. The Contractor should provide the Bid Bond as per the form included in this Subsection. 3. The Performance Guarantee form is not required at the time of Proposal submission by bidders. Only the successful Contractor will be required to provide Performance Guarantee as per the form included in Section B, Subsection B3. PIA, however reserves the right, in case of failure on part of selected the Contractor to provide the aforesaid Performance Guarantee in accordance to the instructions as laid down in Instruction to Contractors (ITC) Section B within the specified time, to forfeit the bid security furnished by the Contractor. Section B Instructions to Contractors (ITC) Page 36 Confidential

Proposal Form To: Dear Sir: General Manager (Procurement & Logistics) Pakistan International Airlines Procurement and Logistics Building Near PIA Head Office Karachi Airport Karachi Ph: +92-21-99045135 Fax: +92-21-99040120 Email: gmptnl@piac.com.pk Having examined the Request for Proposal Documents including Addenda Nos. [insert numbers, if issued and applicable], the receipt of which is hereby duly acknowledged, we, the undersigned, offer to produce, deliver, install, implement, support and maintain the ERP Solution in full conformity with the said RFP Documents. We undertake, if our Proposal is accepted, to implement the ERP Solution in accordance with the Project milestones agreed with PIA. We certify that a bid bond for 5% (five percent) of the total amount of the proposal is submitted as part of our Commercial Proposal. If our Proposal is accepted, we will provide a Performance Guarantee in the form and in the amounts, and within the times stipulated in the Request for Proposal Documents. We agree to abide by this Proposal for a period of 180 days from the date fixed for Proposal submission, and it shall remain binding upon us and may be accepted at any time before the expiration of that period. Until a formal Contract is prepared and executed, this Proposal, together with your written acceptance thereof and your notification of award, shall constitute a binding Contract between us. We understand that you are not bound to accept the lowest or any Proposal you may receive. Dated this day of 20. [signature] [in the capacity of] Section B Instructions to Contractors (ITC) Page 37 Confidential

Duly authorized to sign Proposal for and on behalf of Section B Instructions to Contractors (ITC) Page 38 Confidential

Bidding Organization and Experience [Provide a brief (not more than five pages) description of the background and organization of your firm/entity and each sub contractor for this assignment.] Section B Instructions to Contractors (ITC) Page 39 Confidential

Bidder s Experience [Using the format below, provide information on each assignment for which your firm, and each associate for this assignment, was legally contracted either individually as a corporate entity or as one of the major companies within an association, for carrying out services similar to the ones requested under this assignment. Attach details on separate sheet if necessary.] Assignment name: Approx. value of the contract (in current PKR): Country/Province : Location within country: Name of Client: Address: Start date (month/year): Completion date (month/year): Name of Sub-Contractor, if any: Duration of assignment (months): Total No of staff-months of the assignment: (If applicable) Approx. value of the services provided by your firm under the contract (in current PKR): No of professional staff-months provided by Sub- Contractor: Name of senior professional staff of your firm involved and functions performed (indicate most significant profiles such as Project Director/Coordinator, Team Leader): Narrative description of Project: Description of actual services provided by your staff within the assignment: Section B Instructions to Contractors (ITC) Page 40 Confidential

Description of Approach, Methodology & Project Plan for the Project [In order to ensure timely completion of this project, the consultant/service provider should submit a methodology and detailed Project Plan including the estimated completion timeline of each area/sub area of the scope] Section B Instructions to Contractors (ITC) Page 41 Confidential

Team Composition and Task Assignments [Using the format below, provide information regarding the nominated project team for this assignment baed on proposed methodology and work plan. Depending upon skill sets, experience and technology certifications as mentioned in TECH FORM-7 and subject to the submission of documentary evidences] Professional Staff/Nominated Project Team Name of Staff Position Assigned Area/Task Assigned in this Project Skill Sets and Technology Certification Name(s) Section B Instructions to Contractors (ITC) Page 42 Confidential

Curriculum Vitae (CV) for Professional Staff [CVs should be submitted for Nominated Project Team/Professional Staff only] 1. Proposed Position: 2. Name of Firm [Insert name of firm proposing the staff]: 3. Name of Staff [Insert full name]: 4. Date of Birth: Nationality: 5. Education [Indicate college/university and other specialized education of staff member, giving names of institutions, degrees obtained, and dates when obtained]: 6. Technology Certification(s) Achieved [Provide name of all the technology certification achieved by the staff] 7. Other Trainings [Indicate significant training since, education under 5, were obtained]: 8. Countries of Work Experience: [List countries where staff has worked in the last ten years]: 9. Languages [For each language indicate proficiency: good, fair, or poor in speaking, reading, and writing]: 10. Employment Record [Starting with present position, list in reverse order every employment held by staff member since graduation, giving for each employment (see format here below): dates of employment, name of employing organization, positions held.]: From [Year]: To [Year]: Employer: Positions held: 11. Detailed Tasks Assigned [List all tasks to be performed under this assignment] Section B Instructions to Contractors (ITC) Page 43 Confidential

12. Work Undertaken that Best Illustrates Capability to Handle the Tasks Assigned [Among the assignments in which the staff has been involved, indicate the following information for those assignments that best illustrate staff capability to handle the tasks listed under point 11.] Name of assignment or project: Year: Location: Client: Main project features: Positions held: Activities performed: 13. Certification: I, the undersigned, certify that to the best of my knowledge and belief, this CV correctly describes myself, my qualifications, and my experience. I understand that any wilful misstatement described herein may lead to my disqualification or dismissal, if engaged. [Signature of staff member or authorized representative of the staff] Date: Day/Month/Year Full name of authorized representative: Section B Instructions to Contractors (ITC) Page 44 Confidential

Item No. Name of Contractor Page of Product Description Contractor Proposal Reference Products Price Schedule Product Producer Partner or Subcontractor Responsible for Supply and Installation Quantity Unit Price 1 (Rs.) Total Price 2 (Rs.) (1) (2) (3) (4) (5) (6) (7) = (5) x (6) ERP Package Module A 3 Module B Subtotal Add-on Applications Add-on A 4 Add-on B Subtotal RDBMS Subtotal 3 rd Party Software Subtotal Hardware: Subtotal Other Products: Subtotal TOTALS Additional ERP Licensing Cost Per User 5 Signature of Contractor 1 Prices include all taxes payable by the Contractor thereon. 2 In case of discrepancy between unit price and total, the unit price shall prevail. Similarly, subtotals shall prevail over totals. 3 Price for each Application/Module/Tool should be provided separately 4 Price for each Add-On should be provided separately 5 Price for Each Additional ERP User should be provided separately Section B Instructions to Contractors (ITC) Page 45

Services Price Schedule Item No. Name of Contractor Page of Service Description Contractor Proposal Reference Partner or Subcontractor Responsible for Service Delivery Quantity Unit Price 6 (Rs.) Total Price 7 (Rs.) (1) (2) (3) (4) (5) (6) = (4) x (5) Implementation ERP Package Add-on Applications 3 rd Party Software Subtotal Training Master Trainers End-users Technical Apps Dev Tool Reporting Tool DBA Tool RDBMS Operating System Sys Admin / Mgmt Others Data Migration Documentation Other TOTALS Subtotal Signature of Contractor 6 Service prices include all taxes payable by the Contractor thereon. 7 In case of discrepancy between unit price and total, the unit price shall prevail. Similarly, subtotals shall prevail over totals. Section B Instructions to Contractors (ITC) Page 46

Recurrent Costs Schedule (Prices during the maintenance period for first five years) Name of Contractor Page of Maintenance Fee: ERP Package Add-on Application 3 rd Party Software RDBMS Sub-total Maximum compounded costs per annum after expiration of the warranty period (in Pak Rupees) 8 Year 1 Year 2 Year 3 Year 4 Year 5 Total Recurrent Costs Recurrent Software Licensing Fees: ERP Package Add-on Application 3 rd Party Software RDBMS Sub-total Hardware maintenance costs Other recurrent costs TOTALS Signature of Contractor 8 The annual costs should indicate the total costs for the year inclusive of all taxes. Section B Instructions to Contractors (ITC) Page 47

Name of Contractor Page of Proposal Price Summary Form Products Price Total Services Price Total Recurrent Costs Total Amount in Pak Rupees Total Proposal Price: Signature of Contractor Section B Instructions to Contractors (ITC) Page 48

Bid Bond Form BANK GUARANTEE NO. DATED: AMOUNT: EXPIRY: Pakistan International Airlines Karachi Airport Karachi BID BOND AS PER TENDER FOR LICENSING AND IMPLEMENTATION OF ERP SOLUTION WHEREAS (hereinafter called the Contractor ) has submitted to PAKISTAN INTERNATIONAL AIRLINES (hereinafter called the Company ) a bid dated day of year, for the execution of the above work. AND WHEREAS it is provided by this bid that the Contractor shall furnish the Company with security by way of an unqualified, unconditional and irrevocable bond or guarantee for the due fulfillment of certain matters relating to this Bid. AND WHEREAS have at the request of the Contractor agreed to give such security. NOW THEREFORE WE of undertake, subject to the following terms, to pay to the Company on its first written demand such sums as may be claimed by it in writing up to a maximum of Rs. as recorded on the Request For Proposal. 1. The PIAC may claim payment hereunder if either: 1.1 Before the date stipulated in the Request For Proposal for the validity of the Bid or any extension to this date agreed between the Company and the Contractor, the Contractor attempts to withdraw, modify, or amend his bid without the approval of the Company or 1.2 The Company has agreed with the Contractor that a Contract will be executed, but the Contractor fails to execute the formal Contract Document when requested to do so by the Company or Section B Instructions to Contractors (ITC) Page 49 Confidential

1.3 At the time of entering into a Contract with the Company to undertake and complete the work, the Contractor fails to provide the Bonds and Guarantees required by such Contract. 2. Payment shall be made hereunder on the Company s first demand in writing to us stating that one or more of the above events has occurred without any further condition or substantiation and without the necessity of any proceedings whatever, whether judicial or otherwise being instituted by the Company. 3. The Bond shall remain in full force and effect until the date when the Contractor shall have executed the formal Contract Document and provided the necessary Bonds and Guarantees there under or upon the written rejection by the Company of the Contractor s Bid, whichever is earlier, at which time the Bond shall automatically expire and be of no further effect. IN WITNESS WHEREOF this Bond has been duly signed and sealed on the day of year. For and on behalf of Officer Manager Witnesses: 1. 2. Section B Instructions to Contractors (ITC) Page 50 Confidential

Form of Contract Agreement THIS AGREEMENT made the day of year between Pakistan International Airlines (hereinafter called PIA ) of the one part and [name of Contractor] of [city and country of Contractor] (hereinafter called the Contractor ) of the other part: WHEREAS PIA invited Proposals for certain products and ancillary services, viz., ERP Solution and has accepted a Proposal by the Contractor for the supply of those products and services in the sum of [contract price in words and figures] (hereinafter called the Contract Price ). NOW THIS AGREEMENT WITNESSETH as follows: 1. In this Agreement words and expressions shall have the same meanings as are respectively assigned to them in the Conditions of Contract referred to. 2. The following documents shall be deemed to form and be read and construed as part of this Agreement, viz.: (a) Request for Proposal; (b) Summary of Requirements; (c) Product and Services Requirements; (d) General Instructions and Conditions of Contract (if any); (e) Special Terms and Conditions of Contract (if any); (f) Contractor s Proposal. 3. In consideration of the payments to be made by PIA to the Contractor as hereinafter mentioned, the Contractor hereby covenants with PIA to provide the products and services and to remedy defects therein in conformity in all respects with the provisions of the Contract. 4. PIA hereby covenants to pay the Contractor in consideration of the provision of the products and services and the remedying of defects therein, the Contract Price or such other sum as may become payable under the provisions of the Contract at the times and in the manner prescribed by the Contract. 5. Unless expressly stated herein, wherever any period or periods of time are specified, the parties hereto agree that time shall be the essence of the Contract. 6. Unless expressly stated herein, the failure of one party to exercise any option, right or remedy under the Contract or to demand compliance of any obligation of the other party, shall not constitute a waiver of any such option, right or remedy or the performance thereof. 7. Each of the rights and obligations contained in this Contract shall be deemed to be distinct and severable so that if one such right and obligation shall be declared or become illegal, void or unenforceable, then the remaining rights and obligations Section B Instructions to Contractors (ITC) Page 51 Confidential

shall (unless the effect is to frustrate the fundamental basis of this Contract) continue in full force and effect. 8. The Contractor shall not assign any of its duties / obligations under this contract to any third party. 9. The parties to the Contract shall not be liable for any loss, claims or demands of any nature whatsoever and shall not be deemed in breach of this Contract because of any delay or failure in observing or performing any of the conditions or provisions hereof if such delay or failure is caused by or arises out of any circumstances whatsoever, beyond the affected party s control, including (but without limiting the generality of the foregoing), war, sabotage, blockade, revolution, police action, riots or disorder, embargoes or trade restrictions of any sort, government or quasigovernment action, acts of God, fire, flood, earthquakes, explosion, accident, radiation, strike, lockouts or other Labor disputes or disasters. 10. PIA shall have the right to terminate the Contract: If the Contractor, in the judgment of PIA, is or has been engaged in corrupt or fraudulent practices in competing for or executing the Contract If the Contractor commits a breach of any of the terms and conditions of this Contract At its absolute discretion, at any time, by giving thirty days notice to the Contractor, whether or not in default, whereupon PIA s liability shall be to pay the Contractor remuneration of services performed up to the date of termination In any case, PIA terminates the contract on any of the aforesaid reasons; the Contractor shall be liable for all direct losses, damages and charges incurred by PIA, in relation to the termination of this contract. 11. All disputes or any difference or question which may arise between the parties hereto or any person claiming thereof, touching or arising out or in respect of this Contract or the subject matter thereof shall be referred to the arbitration in accordance with the Arbitration Act 1940, each party shall appoint its own Arbitrator and the decisions in such arbitration proceedings shall be final and binding on both the parties. The place for arbitration will be Karachi while the laws of the Islamic Republic of Pakistan will be the Governing Law. IN WITNESS whereof the parties hereto have caused this Agreement to be executed the day and year first above written. Signed, sealed, and delivered by the Section B Instructions to Contractors (ITC) Page 52 Confidential

said [name of representative] (for PIA) in the presence of [name of witness] Signed, sealed, and delivered by the said [name of representative] (for the Contractor) in the presence of [name of witness] Section B Instructions to Contractors (ITC) Page 53 Confidential

Pakistan International Airlines Karachi Airport Karachi Dear Sir, PERFORMANCE GUARANTEE Performance Guarantee Form BANK GUARANTEE NO. DATED: AMOUNT: EXPIRY: DESCRIPTION OF WORK Whereas, we understand that you have placed a Work Contract No. dated with (The Contractor) for the above mentioned work and that in accordance with the terms of the contract, the Contractor is required to furnish a Bank Guarantee in respect of it s obligations under the said contract for an amount equal to 10% of the contract value vise (amount of contract in words and figures). Now, therefore, in consideration of the above, we, (Name and address of Bank) hereby GUARANTEE irrevocably and unconditionally the due payment to you upon demand of first written such sum or sums not exceeding (amount of guarantee in words and figures) without whatsoever right of objection in the event that the contractor fails to perform or fulfill any of the terms and conditions of the contract at the time or during the period specified therefore in the contract, provided that any demand hereunder is received in writing at this office within the validity of this guarantee accompanied by your written declaration to us that the Contractor has failed to comply with the terms of the contract, and such declaration shall be accepted by us as conclusive proof that the amount claimed is due to you, and we shall forthwith pay you the entire amount claimed. Our liability under this guarantee shall not be affected by any dispute or difference between you and the Contractor or by any forbearance or indulgence granted by you to the Contractor or by any other security held by you from the Contractor relating to the above mentioned contract or any variation in the contract or any other matter or thing which might otherwise affect our liability hereunder. We further Guarantee that no change or addition to or other modification of the terms of the Contract shall in anyway release us from any liability under this Guarantee and we hereby waive notice of any such change, addition or modification. Section B Instructions to Contractors (ITC) Page 54 Confidential

This Guarantee will remain valid until... and any claims hereunder must be received by that date, after which this guarantee will become null and void, and must be returned to us for cancellation. This guarantee shall be construed in accordance with the laws of Pakistan. For and on behalf of Officer Manager Witnesses: 1. 2. Section B Instructions to Contractors (ITC) Page 55 Confidential

` Name of Firm 9 Consortium Responsibility Form Product or Form of Business 10 Role in Project 11 Responsibilities 12 Service 13 to be Provided Lead Contractor Joint Venture Agreement 14 Reference and Date For each partner list the staff members who will be a part of the project, their proposed roles and the minimum committed man days for each person. Signature and Stamp of Authorized Lead Contractor 9 Enter the name of each of the Consortium / Joint Venture / Sub-Contracted firms, starting with the Lead Contractor 10 State whether Individual, Sole Proprietor, Limited Liability Company, Partnership, Corporation, etc. 11 State the role of the Firm on the Project i.e. whether Lead Contractor, Project Manager, Software Supplier, Software Developer, Trainer, etc. 12 Clearly list all the key responsibilities the Firm would be undertaking on the Project 13 Include a time schedule for provision of products and services of each partner 14 Copy(s) of Agreement(s) to be attached Section B Instructions to Contractors (ITC) Page 56

B4 FORMAT AND CONTENTS OF PROPOSAL 1. GENERAL PROPOSAL REQUIREMENTS 1.1 PIA discourages lengthy and costly proposals. Proposals should be prepared simply and economically and provide a straightforward, concise description of the Contractors capabilities to satisfy the requirements of this RFP. Emphasis should be on completeness and clarity of content. 1.2 Contractors must follow all formats and address all portions of the RFP set forth herein providing all information requested. Contractors may retype or duplicate any portion of this RFP for use in responding to the RFP, provided that the proposal clearly addresses all of PIA's information requirements. 1.3 Contractors must respond to every subsection under the Technical Proposal and Commercial Proposal sections. Contractors must label each response to RFP requirements with the section and subsection numbers or Proposal Reference IDs associated with the subject requirement in this RFP Document. 1.4 Proposals must not contain extraneous information. All information presented in a Proposal must be relevant in response to a requirement of this RFP, must be clearly labeled, and, if not incorporated into the body of the Proposal itself, must be referenced to and from the appropriate place within the body of the Proposal. 1.5 Proposals shall be prepared on standard A4 size paper. Foldouts containing charts, spreadsheets, and oversize exhibits are permissible. All responses, as well as any reference material presented, must be written in English. Proposal pages must be numbered and responses must be identified by the related RFP section number. 1.6 Contractors shall divide their responses to this RFP into a Technical Proposal and a Commercial Proposal. Commercial Proposal and pricing information should not be included in the Technical Proposal. Inclusion of Commercial Proposal or pricing in the Technical Proposal shall make the proposal ineligible for further evaluation and participation in the process. Section B Instructions to Contractors (ITC) Page 57 Confidential

2. REQUIRED FORMAT OF THE PROPOSAL Each Contractor can submit only one Proposal. Contractor shall prepare their Proposal using the following structure and form. 2.1 Management Overview: The Contractor s response concerning its ability to satisfy the qualification, eligibility, business and technical requirements as stated in the RFP documents. The Contractor should summarize the proposed technical and service solution and qualitatively describe its advantages. 2.2 ERP Package: Complete details should be provided of the ERP Package that is being proposed as part of the solution. The ERP Packages general functional description and capabilities, with particular reference to Section D, Subsection D1, must be addressed. In addition specific details addressing how each of the Business Functional Needs and Application requirements, as detailed in Section D, Subsection D2, will be met by which module of the ERP Package, must be provided. The proposed ERP package should have tightly integrated modules and should seamlessly interface with PIA s existing software. The Contractor should elaborate on the extent and efforts for customization required to satisfy the functional requirements. The Contractor should also provide contingency and backup plans / procedures with guaranteed Service Level Agreements. Licensing cost for ERP users should be provided as follows: 50 ERP users 100 ERP users 500 ERP users 1,000 ERP users 1,500 ERP users 2,000 ERP users Unit cost for each ERP user If enterprise licensing option is available, please specify Licensing cost for self-service HR users should be provided as follows: 500 employee self-service users 1,000 employee self-service users 5,000 employee self-service users 10,000 employee self-service users 15,000 employee self-service users Unit cost for each employee self-service user If enterprise licensing option is available, please specify Contractor must also specify an Escrow arrangement for the availability of source code necessary to support the proposed solution in case the Section B Instructions to Contractors (ITC) Page 58 Confidential

Contractor or the principal vendors cease to exist, discontinue this line of business or are incapacitated in any way to support the proposed solution. 2.3 Add-on Applications: Where the suite of ERP modules does not meet all the functional requirements of PIA, and the Contractor proposes to custombuild application(s) as Add-ons to the ERP to fulfill the requirements, details of the application development methodology, development platform and tools, and extent of development complexity are to be provided. Their capability to integrate seamlessly with the ERP and other proposed external software utilities and modules should be described, with an overview of integration and data transfer mechanisms. The ownership rights of the Add-on applications will rest with PIA, including all Intellectual Property Rights. The Contractor s (or Consortium Partner s) experience of developing and implementing such Custom-Built applications must be highlighted. 2.4 Relational Database Management System: Complete details of the proposed RDBMS as well as Database Administration Tools are to be provided. These should include, as a minimum, the version, features, capabilities, adherence to industry standards, portability and openness. 2.5 Query and Report Generator Tools: Complete description of the tools that are being provided with the ERP standard functionality for end-user adhoc query and report generation, including capabilities for ease-of-use and learning. 2.6 Interim Server(s): A complete description of the hardware configuration and performance expectations of the proposed Interim Server should be provided as detailed in Section E, Subsection E4. The Contractor should also describe the contingency arrangements that will be in effect for the period that the Interim Server(s) is required, as well as maintenance responsibilities. The Site Specifications for installation of the Server(s) must be provided to enable PIA to cater for the requirements. 2.7 Implementation: The Contractor should provide details of the implementation methodology to be adopted, and include a componentwise detail-level plan. Details should be provided of the project organization that will be maintained, including, in the case of consortiums, relationships between the various parties and the communication process and plan. The project progress reporting and issue escalation mechanisms are to be highlighted. Details of how the identified resources will be utilized during the various phases of the Project should be described. These should include estimates of the total staff input (professional and support staff; staff time and location) needed to carry out the project, supported by bar chart diagrams showing the time proposed for each professional staff team member. The quality assurance process Section B Instructions to Contractors (ITC) Page 59 Confidential

to be followed for products and services, as well as responsibilities, should be described. Detailed time schedule should be provided highlighting main milestones and activities in detail with overall time span and the deliverables associated with each milestone. Contractors must clearly specify the facilities required by their staff during implementation. Implementation tasks requirements are detailed in Section F, Subsection F1. PIA at its discretion may interview the nominated ERP experts to assess their technical expertise and reserves the right to accept an ERP expert or ask for replacement of any or all such experts. PIA at its discretion may also ask for replacement of any expert at any stage of the project if PIA considers that the said expert is engaged in questionable activities or the performance of the expert is not at par with required standard. 2.8 Training: Details of Courses to be conducted by the Contractor should be provided, with description of type, content, duration and location of courses for each of the identified personnel levels, with reference to Section F, Subsection F2. The number of participants per course should be prescribed. Also describe the training material to be provided on completion of the course as well as certification / examination method to be followed. Following table indicates the approximate number of users that would require training: USER GROUPS EXPECTED ROLES NUMBER Senior Management (up to GM Level) Power / Key Users Report / MIS review Transaction review and approval Limited transaction entry / edit Finance 40 Human Resources and Admin System parameterization 25 and configuration Procurement and Logistics Master trainers 15 IT 20 Others 15 End Users Finance 300 Transaction entry / edit Human Resources and Admin 250 Transaction approvals Procurement and Logistics 150 Report / MIS review Station Users 300 Others 50 70 Section B Instructions to Contractors (ITC) Page 60 Confidential

USER GROUPS EXPECTED ROLES NUMBER Technical Users (IT Department) Technical Support 30 This is an indicative list that would be finalized by PIA at an appropriate time during the project. 2.9 Data Migration: Details of data migration strategy and process to be followed, including verification, should be provided with reference to Section F, Subsection F3. Details of forms, screens, or interim file arrangements should be described. The resources that will be required as well as any training requirements must be highlighted along with the programming effort that will be required. 2.10 3 rd Party Software and Interfaces: Contractor will be responsible to ensure that required 3 rd party software, operating systems, system management and monitoring tools, backup and recovery software, database administration tools, disaster recovery and business continuity tools, APIs / interfaces, etc. are all made available, documented, designed, implemented and operational to meet PIA s requirements in the proposed ERP solution. These should be clearly spelt out in the Technical Proposal and corresponding pricing shown in the Commercial Proposal. 2.11 Documentation: Details of documentation to be provided for ERP and other Applications, describing a summary of contents, media on which provided, and the number of hard and soft copies. The Contractor should address the needs of End user as well as technical (operations, support, and development) staff with reference to Section F, Subsection F4. 2.12 Post-Implementation Warranty and Support: Details of postimplementation support that will be provided after the expiry of the warranty should be provided for each required component (As indicated in Section B, Subsection B2 - Summary of Requirements) and reference to Section F, Subsection F5. The type of support, coverage, location from which support will be provided should be described, as well as the level of expertise that will be employed for support. Also describe the escalation process that is to be followed, and the Service levels. A description of the handling of various categories of problems and response times should be provided. Contractor should also specify the versions of all software / documents being provided to PIA and ensure that these will be upgraded to the latest available certified version during the warranty period (reference to Section F, Subsection F6). 2.13 Technology Architecture: Details of the proposed technology architecture under which the ERP solution will be implemented should be provided, consistent with modern architectural design. It should also contain the details of technology standards supported and at what levels. Minimum Section B Instructions to Contractors (ITC) Page 61 Confidential

requirements for Local Area Network and Wide Area Network bandwidth should be specified, including a commentary on PIA s existing network set-up and its capability or otherwise in meeting the minimum requirements. 2.14 Hardware: The Contractor should provide the optimum platform configuration for Server hardware to run the ERP Package and other Applications, consistent with the ERP features and Technology architecture, as proposed in Subsection B4, item 2.13 above, and details provided in Section D, Subsection D1, items 2.8 and 2.9. The proposed ERP and RDBMS should be platform independent to give PIA the liberty to choose any appropriate platform in the future. Contractor has to propose complete hardware solution and minimum network infrastructure for smooth functioning. PIA reserves the right to purchase hardware / operating software from the successful Contractor or any other vendor of its choice 2.15 Deliverables: The Contractor must provide a complete list of all deliverables that it proposes to produce / make available to PIA during the course of this project. 2.16 Requirements from PIA: The Contractor must specify in detail the facilities to be provided by PIA for effective implementation. The Technical Proposal must clearly mention the responsibilities of PIA and the Contractor during different phases of the project. 2.17 Comments / Suggestions (Optional): The Contractor should provide any comments or suggestions on the Terms of Reference. 2.18 In case the Contractor fails to provide any / all of the abovementioned information or fails to abide by any of the terms and conditions of this Contract, PIA reserves a right to immediately terminate the Contract at any time before and / or during the Contract period without assigning any reason whatsoever and PIA shall not be liable to make good any loss / damage to the Contractor which may result on account of such termination. Section B Instructions to Contractors (ITC) Page 62 Confidential

SECTION C PIA IT ENVIRONMENT Section C PIA IT Environment Page 63 Confidential

C1 IT DEPARTMENT The Information Technology (IT) Department at PIA supports data gathering, processing, and reporting functions to the core business units and other support departments. Director (IT) heads the department. He functionally and administratively reports to Deputy Managing Director (DMD). The IT Department is divided into the following three sections: The approved staff strength of PIA s IT Department is around 335. The current structure and manpower resources of the IT Department may be fulfilling PIA s contemporary needs, however, they will have to transform and adjust in order to effectively respond to new challenges in the wake of ERP implementation and other business and technology initiatives. Section C PIA IT Environment Page 64 Confidential

C2 EXISTING SYSTEMS The data processing environment at PIA is a blend of legacy systems - some of which were developed more than twenty years ago - and modern state-of-the-art systems that have been acquired from different vendors. In order to keep abreast of the competition, PIA has been striving to obtain new systems, particularly those specific to the airline industry. At the same time in-house resources are also being utilized to develop and maintain various applications. Overall three categories of applications can be identified at PIA: Hosted Systems Acquired Systems In-house Developed Systems Following tables present a list of major applications being used by PIA: HOSTED SYSTEMS Reservation System (Sabre Multi Host) Passenger Check In System (ACSI) Revenue Management System (AirMax) Schedule Planning System (AirFlite) Flight Operations System (AirOps) Cargo Revenue Management (CargoMax) Revenue Integrity Management Systems (RIM) Frequent Flyer System (TLS) E-ticketing WEB Ticketing (Sabre Sonic WEB) SITA Shared Cargo ULD Management System Travel Information System (Timatic) Baggage Tracing System (World Tracer) ACQUIRED SYSTEMS Passenger Revenue Accounting System (QUASAR) Air-Pricing System Crew Scheduling System (AIMS) APIS System Queue Management System Section C PIA IT Environment Page 65 Confidential

IN-HOUSE DEVELOPED SYSTEMS Payroll Income Tax / Provident Fund Systems Human Resource System Leave and Passage System General Ledger System Budget / Agent Ledger Systems Flight Log System Uniform System PAMMIS (Aircraft Maintenance) POSS (Online Orders) Cargo Revenue Traffic Load Summary Mail Revenue Interline Billing Attendance Monitoring System Standby and Waitlist Passenger List Flight Status Board Web-based Passenger Information System Cargo Management System Customer Complaint Management System File Management System Flight Firming System New SpeedEX System Recipe Management System Medical Units Automation System Baggage Reconciliation System Human Resources Record System FREPAK System Fuel Management and Analysis System Route Performance and Profitability System Traffic Performance System Traffic Trend Bulletin System International Market Share Analysis System Domestic Market Competition Analysis System Section C PIA IT Environment Page 66 Confidential

International Market Affairs System It is anticipated that the proposed ERP will require interfaces with the Hosted and Acquired Systems. However, a number of in-house developed systems might get replaced by the selected ERP. Further details of some of these systems are presented below: Section C PIA IT Environment Page 67 Confidential

Purpose / Details Hardware Platform Programming Language Operating System Database / File Structure Deals with planning of commercial and other inventory items IBM MP2003 COBOL/VSE VM/ESA VSE/ESA DLI/VSE VSAM Tracks the movement of aircraft parts that come to Engineering Department for maintenance IBM MP2003 VisualGen VM/ESA VSE/ESA DB2/VSE Deals with disbursements made under different account heads Preparation of General Ledger Preparation of annual budget Preparation of subsidiary ledger IBM MP2003 COBOL/VSE VM/ESA VSE/ESA DB2/VSE VSAM Provides flight regulatory information of PIA flights for the day Show flight delays and reasons of delay Provides flight load summary for the day and year-to-date IBM MP2003 COBOL/VSE VM/ESA VSE/ESA DLI/VSE VSAM Deals with the payment made to employees in different cadres and keeps history thereof IBM MP2003 COBOL/VSE VM/ESA VSE/ESA VSAM Keep HR details of all employees like bio-data, family information, addresses, ACR, etc. Captures passage issuance details of employees Records attendance and leaves IBM MP2003 COBOL/VSE VM/ESA VSE/ESA DB2/VSE VSAM Deals with Passenger, Cargo, Mail and Interline revenues Traffic Load Summary provides management reports for route performance, class wise seat availability and costing analysis IBM MP2003 COBOL/VSE VM/ESA VSE/ESA VSAM Pints monthly, quarterly and annual income tax statements Prepares salary certificates Printing of CBR annual register IBM MP2003 COBOL/VSE VM/ESA VSE/ESA VSAM Keeps track of employee s provident fund and profit paid thereon. Also generates reports Staff ledger deals with staff related loans / advances / accounts to be incorporated in G/L IBM MP2003 COBOL/VSE VM/ESA VSE/ESA VSAM Module / Application Name POSS (PIA Online Store System) PAMMIS (PIA Aircraft Maintenance Management Information System) GENACCT (General Accounting System) FREPAK/OSPAK (Flight Regulatory/ Crew Scheduling System of PIA) PAYROLL POPIS (PIA Online Personnel Information System) Revenue Accounting System TLS (Traffic Load Summary) Income Tax Provident Fund Staff Ledger Section C PIA IT Environment Page 68 Volume

Module / Application Name Purpose / Details Hardware Platform Programming Language Operating System Database / File Structure Volume QUASAR Passenger Revenue Accounting SUN Fire V1280 Unknown Sun Solaris Version 8 Oracle 350GB Oracle DB Size AIRPRICE Marketing Software SUN Fire V1280 Unknown Sun Solaris Version 8 Oracle 65GB Oracle DB Size Traffic Performance System Marketing Intelligence CICS / COBOL VSAM Traffic Trend Bulletin System Marketing Intelligence PC VB6 / Crystal Reports 9 Windows 2000 Server SQL Server 2000 International Market Share Analysis System Marketing Intelligence PC VB.NET / Crystal Reports 10 Windows 2000 Server SQL Server 2000 Domestic Market Competition Analysis System Marketing Intelligence PC VB.NET / Crystal Reports 10 Windows 2000 Server SQL Server 2000 International Market Affairs System Marketing Intelligence PC VB.NET / Crystal Reports 10 Windows 2000 Server SQL Server 2000 Section C PIA IT Environment Page 69

AIRLINE INFORMATION MANAGEMENT SYSTEM (AIMS) AIMS are Windows 2000/2003 client-server based software for airline crew, aircraft, and flight management and operations control. It is designed to assist airline management to more efficiently control and minimize costs related to crew, aircraft, flight support staff, administration, hotel, transport and communications. The proposed ERP solution has to be integrated with AIMS to cater to crew scheduling. Core Modules Core modules that make up the AIMS system are as follows: Crew Management o Planning o Pairing / patterns / crew routes construction o Assignment o Tracking o Check-in o Records (administrative, medical, training, etc) o Reports and Statistics Operational Control o Aircraft scheduling and assignment o Movement and control o Reports Commercial Planning o Flight schedule preparation o Upload / download SSIM files o Reports Section C PIA IT Environment Page 70

AIMS Application Interface with Other PIA Applications The following applications running at PIA are interfaced with AIMS. extracted from AIMS which is then used in these applications. DHD System Arrival / Departure System AIMS versus Sabre System Flight Safety SMS System Free Pak System Auto Pairing Auto Rostering MIS Report Data is AIMS at PIA Following is an overview of how AIMS is being used at PIA: Commercial Planning Section (CPS) of Marketing Division prepares flight schedule for next one month in Sabre Airflite Application. Copy of flight schedule is sent to the following departments to ensure resource availability: Flight Operations Flight Services Engineering Signed copies are sent back to CPS regarding confirmation of resource availability by: Flight Operations for cockpit crew Flight Services for cabin crew Engineering for aircraft CPS reviews flight schedule. Upon satisfaction, CPS uploads SSIM File (flight schedule) in AIMS Application and intimates Flight Operations / Services Sections. Flight Operations prepares pairings / patterns for cockpit crew and Flight Services prepares pairings / patterns for cabin crew in AIMS. CPS makes cost / benefits analysis and reviews / amends flight schedule accordingly. Thereafter, Flight Operations and Flight Services make changes in crew patterns and generate roster plan for cockpit crew and cabin crew respectively in AIMS. Roster plan is published and a copy of the plan is sent to the crew s residence. Roster plan can also be accessed by crew through web or Interactive Voice Response (IVR). Both Flight Operations and Flight Services sections track roster plan for any change. Crew record is updated accordingly in the system. Reports are generated by respective sections as and when required. Section C PIA IT Environment Page 71

System Related Information Application Category Acquired System Operating System Windows 2000 or 2003 Database Front End Application Source Code APIs Oracle 9i Delphi, C-Sharp Not available. Any changes to standard application are made by vendor upon request. Not available. The only interface available is known as AIMS Report Generator. All customized reports developed by PIA IT department are published through this interface, which can be accessed by AIMS users through AIMS Menu. Section C PIA IT Environment Page 72

Vacation Management* AIMSApplication Overview&Interface With ERPSystem Automatic CrewPairing Generator* Crew Database Maintenance Preparation of Flight Schedule (Commercial Planning) Crew Pairings/ Schedule Costing* Marketing Department HOTAC& Travel Management* CrewManagement Flight Schedule Uploads into AIMS Application Operational Control Crew Training Planning & Tracking* -Planning -Scheduling -Tracking -Reports PIA In-House Applications / Programs Aircraft Scheduling APIS Reporting System Interactive Voice Response Crew Access Flight Operations / Services Departments -DHD System -Arrival/Departure System -AIMSversus Sabre System -Flight Safety System -Free Pak System -Auto Pairing -Auto Rostering -MISReports Flight Operations / Services Departments Crew Access to AIMSvia internet -Crew Personal Data -Leave Management System* -Crew Training* -HOTAC/ Travel Management System* -Crew Allowances* ERPSystem * Currently not in use Section C PIA IT Environment Page 73

QUASAR QUASAR, a product of Sabre Airline Solutions, is a passenger revenue accounting system which enables PIA to account for unearned revenue associated with ticket sales and earned revenue associated with ticket use. In addition, it provides information on earned revenue and passenger statistics to the upper management, marketing, sales and accounting areas. Timelines of revenue information are delivered through the system s sales-based accounting method. It stores reference tables that can be maintained online or loaded from an industry data supplier. The proposed ERP solution has to be integrated with QUASAR to help PIA in managing and accounting for its revenues. QUASAR Modules QUASAR provides revenue and marketing information through following major modules: Computer Reservation System (CRS) Data Capture and Ticket Database The system captures audits and records ticket data received electronically from all issuing CRSs. It uses these records to prorate and audit. Interline Accounting The system processes, prices and audits the interline payables and receivables for other carriers, plus it produces all the standard IATA / ACH forms and generates and accepts IDEC tapes. Sales and Lifts Accounting Sales processing accepts all forms of passenger traffic documents from all sources. The system generates account-coded and balanced entries to post completed sales transactions and creates online queues to correct errors. Lifts processing determines earned revenue by attaching a prorated fare to each lift. Proration and Audits The system prorates the fare paid to the coupon level based on either ATA or IATA interlines settlement rules. This includes the application of special prorate agreements and industry provisos. Commissions, including incentives, are audited and prorated to the coupon level and expensed when the coupon is flown. The system also checks sales for the correct fare and ensures that it complies with conditions of that fare. Data Sources Data regarding ticket sales and its utilization comes from the following sources: PIA sales offices (using Sabre application for recording of ticket sales data) Section C PIA IT Environment Page 74

PIA appointed agents within Pakistan (using ABACUS system for recording of ticket sales data) Billing and Settlement Plan (BSP) Airline Reporting Corporation (ARC) Extended Ticket Capture (ETC) Sales data for each ticket is electronically recorded in Sabre and then transferred through Transaction Control Number (TCN) file and ETC file to TCN Edit Process, where it is corrected in workflow queue and the tickets are prorated and saved in ticket database for further usage. TCN contains information on passenger taxes, fare, mode of payment, etc. Tax and fare audit is performed in the work flow area of QUASAR. QUASAR Product Integration with Sabre Applications QUASAR is integrated with the following Sabre Applications: SabreSonic: Passenger solutions for capture of ticket data (TCN), airlines sales, electronic ticket usage, operated flights and flight schedules. Sabre AirMax: Revenue Manager, enabling sharing of historical flight coupon values. Sabre AirPrice: Contract composer for obtaining market (net) fares and their conditions of use. System Requirements Delivered over the internet, QUASAR is remotely accessed through the Sabre emergo Web access environment. This delivery method requires an ISP or direct network connection and a web browser. The Sabre Airline Solutions business manages all necessary hardware, upgrades and applicable third-party software. Section C PIA IT Environment Page 75

Other System Related Information In-house / 3 rd Party 3 rd Party Hardware Platform SUN Fire V1280 Operating System Sun Solaris Version 8 Programming Language Unknown DB / File Structure Oracle Source Code Not Available Section C PIA IT Environment Page 76

QUASAR SYSTEM An Overview Interconnected Modules & Interface with ERP Sales Processing Sales Data Capture Lift/Sales Accounting Match Lift Processing Sales Posting & Unearned Revenue Lift CRS Match Pricing CRS Processing Proration Create Debit and Credit Memos Earned Revenue Recognition Marketing Information CRS Data Collection Fare, Tax & Commission Audits Quasar Database Interline Receivables/ Payables Reports & Invoices ERP Financial Accounting System Section C PIA IT Environment Page 77

SABRE AIROPS SUITE Introduction AirOps provides centralized, real time access to critical data such as flight, passenger, crew, maintenance, aircraft, airport, weather, payload and navigational, as well as fuel data. Currently PIA is in the process of implementing this application suite. The proposed ERP solution has to be integrated with this solution. The AirOps suite includes the following modules: Sabre Decision Manager Sabre Dispatch Manager Sabre Ground Manager Sabre Load Manager Sabre Movement Manager Sabre Re-accommodation Manager Currently PIA is using the following modules: Sabre Dispatch Manager (used by Flight Dispatch Section) Sabre Movement Manager (used by Flight Control Section) Sabre Dispatch Manager (Flight Planning) It enables Flight Operations department to operate its own dispatching and flight planning system. It interfaces with virtually all passenger reservations and message switching systems and provides centralized functionality of mainframe dispatch systems in a flexible client / server setting. Sabre Movement Manager It enables PIA to monitor and schedule daily maintenance and flight operations. It uses a Gantt chart to graphically show flight leg information from a central database. This module presents information about current operations and maintenance events, which assist in evaluating problems and determining costeffective solutions. Section C PIA IT Environment Page 78

It also includes the following additional modules: The Maintenance Routine module The Sabre EC slots real time slot request and management module The browser-based Flight Information Display System provides real-time updates of the latest flight departure and arrival information in a continuous test display. Information Flow Schedule Planning Section of Commercial Division sends flight schedule which is updated manually in Flight Online Schedule System (FOSS). From FOSS the schedule is mapped to Sabre AirOps Application. Thereafter, following information is updated / tracked through this application: Flight departure and arrival time reporting Flight plan document is prepared by Flight Dispatch Section in FOSS System and handed over to Pilot which consists of aircraft assignment, crew assignment, departure time, cargo load, passenger load, altitude, baggage load, fuel weights, etc. Any changes in the flight schedule (delays, cancellations, diversions, etc.) are updated in the system by Flight Control Section and reported to Central Reservation Control (CRC). Reasons for delays / cancellations / diversions are also mentioned and reported to CRC. CRC intimates to different stations for any changes in flight schedule and if required, passengers are re-accommodated for a particular flight. Aircraft maintenance information is also updated in the system. This assists the Flight Dispatch Section to prepare flight schedule in accordance with fleet availability. Note Both FOSS and AirOPS are applications of Sabre which are used to assist in flight operations. At PIA, FOSS will be replaced by AirOPS (browser-based application); however the functionality will remain the same. System Requirements The AirOps Suite is available in a variety of platforms, including Windows and UNIX, offering flexibility in deployment. Section C PIA IT Environment Page 79

Sabre AirOps Suite An-Overview It provides real-time access to critical data such as flight departure / arrival time, passenger, crew, aircraft maintenance, airport, weather, payload, navigational and fuel data. Flight Schedule from FOSS is uploaded in AirOps. Thereafter, all flight operations are tracked and updated in the AirOps System. Commercial Planning Flight Schedule Details Sabre FOSS System Uploads Flight Schedule Details Sabre AirOps Maintains; - Flight Departure/Arrival Time - Passenger - Crew - Aircraft Maintenance - Weather - Payload - Navigational & Fuel Data Communicates; Flight Delays, Cancellations, Diversions, etc. to Major Document Flight Dispatch Section prepares Flight Plan Document, which consists of: - Aircraft & Crew Assignment - Departure Time - Passenger & Cargo Load - Altitude - Baggage Load - Fuel Weights Central Reservation Control (CRC) - Communicates changes in flight schedule to all stations Section C PIA IT Environment Page 80

SABRE AIRFLITE SUITE The Sabre Airflite Planning and Scheduling suite combines core flight scheduling functions such as scheduling, profitability forecasting and analysis, fleet assignment and slot management through a seamless integration with shared interfaces and database information. This integration improves system performance and accuracy and reduces development efforts, resulting in a flexible, stable and efficient tool that runs on multiple platforms. Currently PIA is in the process of implementing this application suite. The proposed ERP solution has to be integrated with this solution. The Sabre Airflite Suite has the following components: Airflite Schedule Manager It enables an airline to develop flight schedules that meet customer needs. Using this system, an airline can increase its profitability by enhancing the flight schedule development process. Schedule Manager simplifies scheduling tasks previously performed manually, thus making time available for schedulers to continuously explore better solutions. It provides schedulers with options so they remain in control of the decision making process. It helps create a corporate wide flight scheduling database and provides easy connectivity to legacy systems while offering powerful tools and utilities that enable schedulers to view, edit and report flight schedule information. In PIA, changes in schedule are communicated through telex and updated in AIMS Application by the Flight Operations department. Airflite Profit Manager It evaluates the profitability of a given schedule to assist in strategic, long range planning. It can identify strengths or weaknesses within a carrier s schedule as well as quantify the impact a particular schedule may have. Profit Manager forecasts the typical week profitability for a complete O&D network. As part of this evaluation, the tool produces forecasts of passenger demand, passenger traffic and passenger revenue on all services (host and competitor) in the network. Profit Manager delivers a greater understanding of customer and market behavior, an increased focus on network management, quicker evaluation of multiple scenarios, effective management of schedule changes and centralized data sources for corporate use. Airflite Fleet Manager It enables an airline to optimally allocate fleet capacity to improve the profitability of a schedule. Fleet Manager employs a sophisticated global optimization technique to provide an airline with strategic and tactical analysis support when developing profitable and operationally feasible schedules. It enables schedulers Section C PIA IT Environment Page 81

to swap aircraft assignments, re-time and cancel flights, improve utilization and minimize aircraft towing. Schedulers can also use Fleet Manager as a schedule feasibility solver when creating a feasible schedule. The application incorporates a patented O&D passenger flow model in its global optimization. Airflite Slot Manager Enables an airline to manage and track its slot rights at FAA and IATA slotcoordinated airports. It streamlines the slot request process, reduces the number of errors associated with generating and sending SSIM slot request messages, and monitors slot status The system reduces the possibility of costly errors and provides support to maximize the usage of valuable slot assets. System Requirements Products in the Airflite suite operate in either Windows or UNIX environment. Oracle 9i ILOG CPLEX (can be bundled with an Airflite system install package) ILOG Jviews (can be bundled with an Airflite system install package) SAS (for profit manager calibration) JRE 1.5 or higher Weblogic Application Server JDBC drivers Netscape 4.75+ or IE 5.5+ One Pentium III 750 CPU for every six users 1 GB of RAM per user Section C PIA IT Environment Page 82

Section C PIA IT Environment Page 83

Section C PIA IT Environment Page 84

SABRE AIRMAX SUITE Introduction Today s airlines require systems that enable them to selectively accept or reject passenger bookings based on their overall revenue contributions and adjust inventories and prices up to and including the day of operation in response to demand. Revenue management often means the difference between profit and loss. The proposed ERP solution has to be integrated with this solution. The Sabre AirMax Revenue Management Suite offers sophisticated tools to manage an airline s revenue. Sabre AirMax Revenue Manager It is a robust and flexible tool, a best-of-breed solution supporting the entire range of revenue management applications including reservations data collection, offline data collection, forecasting, overbooking, optimization, performance measurement and reporting. The system can be run in different processing modes based on the desired level of sophistication in inventory control. It offers three levels of inventory controls: leg and segment, virtual nesting and O&D. System Requirements The AirMax Suite is platform independent and uses a browser interface. Open system architecture enables interactive processing with external systems; whereas data is warehoused in an Oracle database. Section C PIA IT Environment Page 85

Sabre AirMax Suite An-Overview Sabre Reservation System Operational Data Inventory Details/Seats Allocations Based on Demand, Class Wise Seats Allocations to Maximize Profits & Reduce Cost AirMax Revenue Management System Revenue Accounting Financial Accounting Seats Capacities, Allocations Fares Overbooking Values Alerts, Flight Management Management Reports QUASAR System Database ERP Financial Accounting System Database Section C PIA IT Environment Page 86

SABRE CARGOMAX SUITE Sabre CargoMax is an airline automated decision-support tool which helps to manage cargo operations at an optimal level, thereby increasing revenue while maximizing profit and improving customer relationships. The proposed ERP solution has to be integrated with this solution. The Sabre CargoMax Revenue and Pricing Suite offers the following products to help improve air processing. Sabre CargoMax Revenue Manager It helps an air cargo operation increase profits through effective cargo space management. Extensive computer models estimate the capacity of each departing flight and determine the most profitable space allocation of various cargo products. With Revenue Manager, much of the guesswork is taken out of managing a complex cargo operation so an air cargo company can: Determine cargo capacities for future flight departures based on passenger load, mail and bags. Accurately plan cargo loads for maximum revenue by forecasting available cargo capacity by market, segment, equipment type, day of the week and time of day. Capture additional revenue and reduce offloads through an optimized overbooking function that considers booking behavior. Improve earnings and service quality as the result of proactive identification of revenue streams and potential service failures. Depends on no-shows, cancellations, and over / under-tendering. Allocating cargo capacity to station / customers; considering past usage, density, revenue and routes. Allocating cargo capacities to various products or alternatively determine the minimum acceptable Bid Price; considering network effect of demand, density, revenue and routes. Proactively monitor flights to identify critical flights; premium flights / promotional flights. Revenue Management Features Revenue Manager uses several comprehensive, state-of-the-art optimization and forecasting models to support air cargo operations: Allotment Management and Utilization Tracking Section C PIA IT Environment Page 87

The allotment decision-support model assigns cargo capacity to attain the highest net revenue. It evaluates bids based on relative revenues and costs, historical utilization and global network effects of the resulting allotments. The usage tracking model provides station and shipper summary statistics, comparing average space utilization to allotments by flight and day of the week. Overbooking Optimum overbooking levels are calculated so you can intentionally sell more cargo space than available to offset the effect of cancellations and no-shows. Forecasting Three types of forecasting are provided: Capacity Available: Cargo capacity is computed for each departing flight in terms of weight, volume and containers. This forecast is based on current and historical operational conditions. For passenger aircraft, the number of scheduled passengers and bags is also considered. Show-up Rate: The ratio of the actual amount tendered to the weight or volume of cargo booked is expressed as the shipment show-up rate. Based on the historical average of similar shipments, the rate can be computed by market, product, shipper or a combination of these factors. This data is then used by the overbooking model. Demand: Sophisticated models are used to forecast demand at flight level and at the O&D level. What-if Analysis Revenue Manager provides an efficient method for evaluating the impact various circumstances such as extreme peaks and unusual market demand may have on capacity allotment. Route Generation Alternative routes that carry a shipment from its origin to its destination are created by considering shipment characteristics and aircraft limitations Booking Engine Available cargo capacity is distributed to shipment requests for optimal revenue gain. Shipment feasibility checks cover the areas of available capacity, service time window, equipment type, connect points and minimum / maximum connect times. Booking shipments, modifying existing shipments and checking the status of confirmed and unconfirmed bookings can be quickly accomplished. Recommended Market Allocations and bid Prices Revenue Manager recommends bid prices and gradients for various flight legs that assist with market allocations. This is accomplished by employing origin-, destination- and rate class-based revenue mix methodologies. Using unit profit Section C PIA IT Environment Page 88

contribution to evaluate revenue mix provides the flexibility to treat shipments differently based on certain business relationships. However, the system can also evaluate revenue mix based on revenue, revenue adjusted by value and profit adjusted by value. Performance Monitoring The system monitors the performance of the user set overrides and the forecasting modules against the actuals. It also monitors capacity forecasts, demand forecasts and show-up rate forecasts. Revenue-Opportunity Evaluation The system provides tools to measure the revenue enhancement due to overbooking and network management, including demand forecasting, route generation and bid pricing functions. The following areas of CargoMax have not yet been implemented. PIA is planning to buy these: CargoMax Accounting Manager CargoMax Reservation System (presently PIA is using SITA-based application, which is going to be discontinued in the near future). Section C PIA IT Environment Page 89

Flow of Information Flight schedule is entered in Sabre Airflite Suite from where it is uploaded in Sabre CargoMax Suite through SSIM file. Cargo Sita Reservation System provides an air cargo operation with reliable booking, inventory control and shipment tracking capabilities details to Sabre CargoMax. Sabre steady state load management provides post departure data to Sabre CargoMax. On the basis of above information, CargoMax forecasts cargo capacity and also interfaces with Sabre AirMax Suite to calculate passenger history, EBT, PLA (Pay Load Available) etc. System Requirements CargoMax Revenue Manager is a web-based application that can be linked with other complex systems, enabling individual workstations to be distributed across a network. Written in Java and using Oracle database, it runs on a Unix-based platform and supplies users with interactive communication to external legacy systems or other client-server applications. The system delivers a friendly graphical interface that provides full capabilities of Windows, graphics, control buttons and pull-down menus. Section C PIA IT Environment Page 90

Sabre CargoMax Integrated Solution An-Overview User Inputs Overrides Cargo Capacities, Allocations Bid Prices Overbooking Values Alerts, Flight Management Management Reports Capacity Updates Sabre AirMax Pax Forecasts CargoMax Revenue Manager Schedule, AWB Data, Allotments Cargo Reservation System AWB History, Revenue, Cost & Other Data Post Departure Data Operational Data (AWB, etc.) for Sales & Revenue Accounting Data Warehouse / Cargospot Sabre Steady State Cargo Accounting System ERP Financial Accounting System Section C PIA IT Environment Page 91

FREPAK (FLIGHT REGULATORY SYSTEM OF PIA) It is expected that the proposed ERP solution would replace FREPAK that runs at PIA Head Office as well as Lahore and Islamabad offices. The Contractor must familiarize itself with the complete functionality of FREPAK as it would be responsible to provide similar or better functionality in the proposed solution. Introduction FREPAK is an on-line real-time system for monitoring and controlling of aircraft movements and delays to enable such control to be exercised. Flight schedule from AIMS application is uploaded through SSIM file format in FREPAK system on a monthly basis. Thereafter, this schedule is tracked throughout the month for any changes (cancellations, delays etc) in the flight. Arrival / Departure times and delays are logged by the concerned user immediately on receipt of aircraft movement (MVT) messages. System displays alert messages of missing times when no information is logged within 45 minutes of scheduled departures. Flight control operators are advised to ensure that either actual time of departure (ATD) is logged within 45 minutes or expected time of departure (ETD) is sent along with the delay codes / comments. Delay codes have been established to communicate information concisely and to record it in the system for display and analysis. This ensures that all concerned agencies over the PIA network are aware of current flight status and can take necessary actions downstream. On-line reports (daily and quarterly) are available which can be used to display all incidents contributing to delays which are categorized by departments responsible. Such categorization and access to information on flights immediately contributes significantly to improve passenger services. After month-end closing, data is also downloaded on PC for preparation of graphical reports and sent to GM Central Control. Flight information from FREPAK system is extracted and transferred through FTP to the following recipients: Flight Kitchen System GM Revenue for coupon follow up of ship papers Technical Group Support for shift maintenance Section C PIA IT Environment Page 92

Loads Aircraft passenger and cargo load signal information is also received after the flight has taken off. Movement message is received when the plane takes off and lands. System also provides flight load summary for the day and year-to-date. Load data is also transferred to Marketing Intelligence System. FREPAK Functions Menu Following are the main menu functions of FREPAK system. Flight Display (Departures) Flight Display (Arrivals) Department Delay Actual Times/Delay Code update Delay Comments Exceptions (missing/delayed flights) Flight SKD update Delay Code Table Punctuality / summary of delayed incidents Weather update Flight Inquiry Menu Traffic Performance Menu Miscellaneous Transactions Major Reports Flight departure/arrival report Flight update report Traffic Performance Report Baggage discrepancy Statement Weather history data Summary of delay incidents Aircraft Movement Report PIA Locations Using FREPAK System Karachi (all departments) Islamabad (all departments) Lahore (all departments) Section C PIA IT Environment Page 93

Technical Information In-house / 3 rd Party Hardware Platform Program Language Operating System DB / File Structure In-house MP2003 (IBM mainframe) COBOL/VSE, CICS/VS VM/ESA VSE/ESA DLI/VSE VSAM Section C PIA IT Environment Page 94

FREPAK System An-Overview FREPAK is an on-line real-time system for monitoring and controlling of Aircraft Movements and Delays to enable such control to be exercised. Flight schedule from AIMS Application is uploaded through SSIM file format in FREPAK system on monthly basis. Thereafter, schedule is tracked throughout the month for any changes (flight cancellations, delays etc) in the flight. AIMS Application Flight Schedule Details - Flight Kitchen System - GM Revenue for Coupon Follow Up of Ship Papers - Technical Group Support for Shift Maintenance Flight Information FREPAK System -Flight Schedule Tracking/Changes -Monitoring Aircraft Movement -Actual Arrival/Departure Times -Delays/Cancellations Recording -Passenger/Cargo Loads Information Reports Major Reports - Flight departure/arrival report - Flight update report - Traffic Performance Report - Baggage discrepancy Statement - Weather history data - Summary of delay incidents - Aircraft Movement Report Loads Information Marketing Intelligence System Section C PIA IT Environment Page 95

ROUTE PERFORMANCE AND PROFITABILITY SYSTEM It is expected that the proposed ERP solution would replace this system that runs at PIA Head Office. The Contractor must familiarize itself with its complete functionality as it would be responsible to provide similar or better functionality in the proposed solution. Introduction This system includes the route economics reporting operational statistics, revenue, variable operating cost, direct fixed cost and indirect fixed cost. System is capable to compute Profit/Loss based on actual revenue and cost. However, if the cost or revenue is not available for any flight, it is capable to estimate these based on available data using averages. The system is used as: Planning Tool: enabling the planner to model the revenue, cost and profit/loss in order to decide about the viability of route/flight. Financial Tool: enabling to monitor and achieve the intended results through proper costing and analysis. Accounting Tool: through maintenance of central up to date cost, operation statistics and revenue. The major benefit of the system is that, it can be used for better and timely decision making because of the analytical capabilities that work on its rich database. It provides flight performance along with operational statistics and various cost heads at the desktop. The system has interfaces with the following systems that were required to import / export or to exchange data in order to eliminate duplication / manual entry of data: Fuel Management and Analysis System Traffic Performance System Passenger and Freight System Passenger Revenue Various templates have been developed so that different sections could fill them in with the relevant cost data including: Contractual agreed rates Overlying rates Aircraft types and related data Traffic handling Section C PIA IT Environment Page 96

Engineering cost Cockpit/Cabin crew slip, ground transportation and hotels Depreciation, rental and other direct fixed costs / rates Indirect fixed cost The system can be accessed across the network through Citrix Meta frame software and is operational at the following departments: Finance Financial Monitoring Fuel Management Marketing Intelligence Chief Financial Officer Flight Operations System computes the following useful information: Break Even yield Break Even seat factor Passenger load factor Cost/ASK Yield/RPK Cost/Atk Cost/Block hours Revenue / Block hours Fuel burn off / Block hours Aircraft utilization/day Sector wise/flight wise/tail wise analysis System generates various types of MIS reports. It includes profit/loss summaries: Sector wise Flight wise Route wise Region wise Aircraft type Tail wise Application Technical Information Microsoft Visual Basic.net Microsoft SQL Server 2000 Crystal Report 10 Section C PIA IT Environment Page 97

Infragistics Control version 6.1 Meta frame Citrix Server (Presentation Layer) Section C PIA IT Environment Page 98

PIA Route Profitability & Performance System An-Overview The system is used to compute flight route profit / loss based on actual revenue and cost data received from relevant sources. Sources of Cost Data from relevant sections -Contractual agreed rates -Overlying rates -Aircraft types and related data -Traffic handling -Engineering Cost -Direct Fixed Cost -Indirect Fixed Cost System Computes - Fuel Management System - Traffic Performance System - Passenger & Freight System - Passenger Revenue Interfaces ROUTE PROFITABILITY System - Break Even yield - Break Even seat factor - Passenger load factor - Cost/ASK - Yield/RPK - Cost/Atk - Cost/Block hours - Revenue / Block hours - Fuel burn off / Block hours - Aircraft utilization/day - Sector wise/flight wise/tail wise analysis Departments Using The System Major Reports Departments Reports -Finance -Financial Monitoring -Fuel Management -Marketing Intelligence -Chief Financial Officer -Flight Operation Route Profitability; -Sector Wise -Flight Wise -Route Wise -Region Wise -Aircraft Type -Tail # Wise Section C PIA IT Environment Page 99

CORPORATE STANDARD STATION ACCOUNTING PACKAGE (COSSAP) COSSAP is an in-house developed software used to enforce financial discipline and accuracy of reporting / accounting at PIA stations. It was designed, developed, implemented and is currently being maintained by the Finance Department of PIA. COSSAP is an effective tool to assist the Finance Managers in performance of their duties and responsibilities. The basic idea of developing COSSAP was to achieve standardization all over the PIA network and to enable stations personnel to benefit from the computer technology so that station functions are performed effectively and efficiently. It is expected that the proposed ERP solution would replace COSSAP at all stations and Head Office. The Contractor must familiarize itself with the complete functionality of COSSAP as it would be responsible to provide similar or better functionality in the proposed solution. COSSAP Environment COSSAP is a multi-user and multi-tasking system having the facility to communicate with a remote computer. This implies that more than one user can operate one program simultaneously and more than one program can also operate concurrently. Computer 486/586 Operating System Application and Database UNIX Multi User - networked through modems ORACLE (Forms, Reports and RDBMS) List of Modules in COSSAP The following is a list of modules included in COSSAP: 1. Station Master Data 2. Direct Passenger Sales 3. Direct Cargo Sales 4. Direct Refunds 5. Passenger Agent Sales / Refunds 6. Cargo Agent Sales / Refunds 7. Credit Control 8. Banking Control 9. Miscellaneous Transactions 10. Disbursement 11. Revenue Accounting Documents Control 12. DADS (Pricing) 13. Market / MIS 14. Station General Ledger 15. System Administration 16. State Bank Section C PIA IT Environment Page 100

Module Details 1 Station Master Data Module This module is station specific and is controlled by station and contains station s information like: 1.1 Fixed Parameters; Station Code Currency Finance Manager Name Station Head Name Pay Voucher Serial No. Invoice Number Serial Cheque Number Serial Bank Name Address, etc. 1.2 Details relating to Passenger / Cargo Agents and Customers 1.3 Bank Guarantee of Agent, its effective and expiry date, etc. 1.4 On-line calculator 2 Direct Passenger Sales Module This module takes care of direct passenger sales data entry and printing of invoices. Sales Accounting Report (SAR) data can be entered through this module, as well, to account for credit / cash transactions. Major Documents: Passenger and Baggage Sales Report (R-1) & R-1 JV Passenger and Baggage Sales Report (SAR Summary) and SAR JV SAR Invoice R-1 Invoice 3 Direct Cargo Sales Module This module provides options to enter data, print invoices / reports relating to station cargo sales and Charges Collect Shipment Application. Major Documents: Cargo Sales Report (R-2) and R-2 JV Cargo (Incoming) Collection Report (R-3) and R-3 JV Section C PIA IT Environment Page 101

4 Direct Refund Module This module covers all functions relating to refunds at stations including printing of pay vouchers, cheques and credit notes. Major Documents: Refund Report (R-6) and R-6 JV R-6 Cheque Payment Voucher R-6 Cash Voucher R-6 Credit Note / Adjustment Voucher 5 Passenger / Agent Sales / Refunds Module This module pertains to the preparation of: R-10 Agent Sales Application, Domestic and International Agent Refund Application Reports Printing Agent Ledger Application Major Documents: Agent Sales and Remittance Report (R-10) and R-10 JV Agent Outstanding Reported in (R-10) Passenger Agent Aging Statement 6 Cargo Agent Sales / Refunds Module This module caters for data entry of R-11 and Cargo Agent Sales which thereby helps to produce R-11 and Cargo Agent Sales Reports. Major Documents: Cargo Agent Sales and Remittance Report (R-11) and R-11 JV Cargo Agent Aging Statement Section C PIA IT Environment Page 102

7 Credit Control Module This module covers R-5 and R-8 Applications. R-5 Application includes; Cash Receipt Printing Stock Control Facility Credit Adjustments Debit Adjustments R-7 R-8 data is compiled automatically and there is no need of transferring data to R- 8 from various disks. Computerized follow-up letter along with details of overdue invoices can be generated to exercise regular monitoring of recoveries as well as better co-ordination among parties, Finance Unit and Marketing Section. Major Documents: Invoice Collection/Adjustment Report (R-5) and R-5 JV Invoice Collection Cash Receipt / Adjustment Advice Invoice Collection Advice (R-7) 8 Banking Control Module Printing of R-9 and bank deposit details is controlled through this module. No data entry is required for R-9 rather it is compiled automatically from all relevant reports. Major Documents: Monthly Summary of Collection (R-9) and R-9 JV Reconciliation of Collection Account Outstanding Deposits Slips 9 Miscellaneous Transactions Module This module provides functions relating to R-4 including printing of invoices / Cash Receipt (CR) and maintaining stock of R-4 Cash Receipt. Major Documents: Miscellaneous Cash / Credit Transactions Report (R-4) and R-4 JV 10 Disbursement Module This module controls the following: 10.1 Accounts Coding Manual Application Section C PIA IT Environment Page 103

This application is used by all users but controlled at Head Office level and has following tables: Aircraft Table Department Table Location Table Accounts Table Staff Accounts Table Pay Code Table Pay Group Table Accounts / Department Table Location / Department Table Section C PIA IT Environment Page 104

10.2 Budget Control Application This application is used by all users with reference to their station and at Head Office level as well. This module has the facility to enter data manually and through downloading, if prepared separately on some other system. It also facilitates preparation of budget based on previous data contained in history. Disbursement Application Employee Record Application Payee Record Application Imprest Bank Reconciliation Application Payroll Journal Voucher Application Cash Flow Statement VAT Application On-line Query (disbursement history) Payroll Application Closing of Month Major Documents: Budget Control Register (Location-Wise) Budget versus Actual Statement (DEP/LOC/ACT. Wise) Monthly Payment Book Disbursement Accounts Summary Station Payment Summary 11 Revenue Accounting Documents Control Module This module controls application relating to issue / receipt / withdrawal of documents, printing of stock issuance advice, inventory report of Main and Sub Stocks, document serial break. Letters and Average Monthly Consumption reported by Agent / Counters, for both Passenger and Cargo. Section C PIA IT Environment Page 105

11.1 Inventory Control Module This module is operated by Head Office and stations as well. Starting point is the placement of printing orders by Head Office. This is followed by recording of receipts by Head Office; issuance of stock to stations; subsequent issuance by stations to its counter and agents; and reporting back by counters and agents recorded by station. This module also gives a picture of inventory in hand by Head Office, Station, Counter, Agents on real time basis for passenger and cargo stocks. 11.2 Material Management This is a complete module for material management with reference to Procurement and Logistic Support. 12 DADS (Pricing) Module This module controls DADS related information. It updates DADS floated rates (both passenger and cargo), prepares monthly party-wise memo ledger, D-20 report, D-21 report and Memo Ledger Adjustments. 13 Marketing / MIS Module This module caters for yield reports and MIS Application like Sales vs. Refund Statement, Sales vs. Total Statement, Ticket Sold vs. Ticket Voided, Route Wise Agency Sales, Agents Productivity Report, Cost / Sales Ratio, etc. 14 Station General Ledger This module complies with accounting data from respective reports and prints Station General Ledger Report (Report / Account Wise). Section C PIA IT Environment Page 106

15 System Administration Module It includes the following areas: Transfer of data to floppy disk Import General Sales Agent (GSA) data from floppy disk Deletion / Copying of Sales Data (R-10) Delete / Copy of Data except R-10 Format High Density Diskette (3.5 ) Database Back-up Check Agency Sales / Refund Data Disk NIL Report Application Check Contents of Disk / Tape Closing of Month 16 State Bank Module This module compiles and print reports required to be submitted to local State Bank authorities of different international stations. It requires customization as per local rules and regulations. Major Documents: Passages Sold / Ticket Issued Report Cancellation / Refund of Passage Report Baggage Carried Report Section C PIA IT Environment Page 107

Additional Requirements of COSSAP Web-based Centralized database Zero, two and three decimal set of programs Based on two bank accounts - disbursement and collection Keep records of document stock (passenger / cargo) Recording of all station s financial activities Based on current / post data concept Facilitate subsidiary ledgers Facilitate various MIS reports Facilitate to keep all historical data Facilitate generation of financial report for submission to Head Office Facilitate to generate General Ledger Facilitate customized printing of cheques / vouchers at various stations Facilitate multi-currency operation Facilitate downloading / validation of foreign data Facilitate migration of data for / from other user (Sabre) Records to be identified with user s code Previous records to be copied to avoid lengthy data entry General Requirements All modules / applications should have entry forms with Edit, Delete, Find, Display and Batch Proof options. All monthly data must be transferred periodically into post table and access to that data should be restricted to display and print. All reports should be closed before taking their data for General Ledger and final print. No data entry should be allowed for any closed report. No data entry for any report should be allowed beyond two months of closing No access on another location / station data Should provide display forms for historical data Display / printing options for history / current data may be provided based on specific criteria Should have privilege to display data and printing option to Head Office Users should be allowed to display / print their own data as well as others of the same location Duplicate printing of Pay Vouchers (PV), Cash Receipts (CR) and Invoices must be labeled as duplicate No editing, updation and deletion is allowed on printed PVs, CRs and Invoices Station-wise central control of PVs, CRs, and Invoices should be available Section C PIA IT Environment Page 108

Provision to print reconciliation for any previous periods Periodical updation of R-8, Passenger Agent Ledger, Cargo Agent Ledger, Passenger Inventory and Cargo Inventory should be provided on user option. At least 30 users should be able to logon at any given point in time from same station / location Section C PIA IT Environment Page 109

Major Function / Report Details 1. Ticket Wise Sales At PIA Counter (R-1) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Ticket wise data entry Ticket wise balancing of Debit and Credit Ticket validation with Document Control Module Ticket wise identification of Agent / Counter Ticket wise identification of APW / DG50 Ticket wise identification of form of payment Ticket wise identification of cash payment e.g. mna, jd, cc etc. Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to check rates with DADS Module Facilitate to calculate commission on prescribed rates Ensure generation of invoices Ensure balancing of cash with R-9 Facilitate date range display/batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update stock inventory Update Budget Control Register if expense account is operated Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Facilitate to migrate periodical data for SABRE SYSTEM in given format 2. Sales Summary of PIA Counter (SAR) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Date wise entry of sales summary Date wise balancing of Debit and Credit Ticket validation with Document Control Module for credit transactions Ticket wise identification of Agent / Counter for credit transaction Ticket wise identification of APW / DG50 for credit transaction Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Section C PIA IT Environment Page 110

Facilitate to calculate commission on prescribed rates Ensure generation of invoices for credit transactions Ensure balancing of cash with R-9 Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update stock inventory Update Budget Control Register if expense account is operated Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 111

3. Air Waybill Wise Sales At PIA Counter (R-2) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current Air Waybill only. Air Waybill wise data entry Air Waybill validation with Document Control Module Air Waybill wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to calculate Excise duty automatically Facilitate to check rates with DADS Module Facilitate to calculate commission on prescribed rates Ensure generation of invoices Ensure balancing of cash with R-9 Air Waybill wise balancing of Debit and Credit Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update stock inventory Update Budget Control Register if expense account is operated Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Facilitate to migrate periodical data for REVENUE SYSTEM in given format (AWB matching program) Section C PIA IT Environment Page 112

4. SPEEDEX Sales At PIA Counter (SPEEDEX) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current Airway Bill only. Date wise data entry Date wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to calculate Excise duty automatically Facilitate to calculate commission on prescribed rates Ensure generation of invoices Ensure balancing of cash with R-9 Date wise balancing of Debit and Credit Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update Budget Control Register if expense account is operated Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 113

5. Air Waybill Wise Delivery of Charges Collect Shipment By PIA Counter (R-3) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current Air Waybill only. Air Waybill wise data entry Air Waybill wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Ensure generation of invoices Ensure printing of cash receipts Ensure balancing of cash with R-9 Air Waybill wise balancing of Debit and Credit Facilitate date range display / batch proofing Facilitate to display original value, weight and currency at origin station (sales point) Facilitate finalization of entered data on user s option Generate debtor s ledger Facilitate printing of final user s defined reports Update cash receipt stock Update Budget Control Register if expense account is operated Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Facilitate to migrate periodical data for REVENUE SYSTEM in given format (charges collect matching program) Section C PIA IT Environment Page 114

6. Miscellaneous Transaction Not Covered Under R-1, SAR, R-2, R-3, R-5, R-10, R-11 At PIA Counter (R-4) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Cash receipt / invoice number wise data entry Cash receipt / invoice number wise balancing of Debit and Credit Cash receipt / invoice number wise identification of form of payment Facilitate to check employee s identification from Database Facilitate to check customer s identification from Database Ensure validation of Account, Location, Department, Aircraft Code etc. from Account Coding Manual Ensure generation of invoices Ensure printing of cash receipts Ensure balancing of cash with R-9 Air Waybill wise balancing of Debit and Credit Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Facilitate printing of final user s defined reports Update cash receipt stock Update Budget Control Register if expense account is operated Update of staff ledger Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 115

7. Invoice Collection At PIA Counter (R-5) Types of Transactions 1. Regular Invoice collection (same station) 2. Outgoing R-7 (Collection of other station) 3. Incoming R-7 (Invoice collected by other station) 4. Debit / Credit adjustment Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Invoice wise data entry Invoice wise balancing of Debit and Credit Invoice validation with Debtors Ledger Invoice wise identification of customer Ensure printing of cash receipts Ensure balancing of cash with R-9 Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Facilitate printing of final user s defined reports Update cash receipt stock Update Budget Control Register if expense account is operated Facilitate printing of final user s defined reports at Head Office level Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 116

8. Ticket Wise Refund At PIA Counter (R-6) Types of Transactions 1. Cash Refund 2. Cheque Refund 3. Credit Refund Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Both Pay Voucher and Credit Note once printed cannot be deleted No duplicate entry is allowed Refunded data should be saved in history file so that the same document cannot be refunded twice. Facilitate cheque printing Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to enter unlimited number of Taxes Facilitate to check lost tickets from database Ticket wise data entry Ticket wise display off debit and credit Ticket wise identification of Agent / Counter Ticket wise identification of APW / DG50 / TAC Ensure generation of Credit Notes Facilitate date range display/batch proofing Facilitate finalization of entered data on user s option Facilitate printing of final user s defined reports Update Budget Control Register if expense account is operated Update debtor s ledger Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Facilitate to migrate periodical data for SABRE SYSTEM in given format Section C PIA IT Environment Page 117

9. Debtor s Ledger (R-8) This is a by-product of R-1, R-2, R-3, R-4, R-5, R-6, R-10 and R-11 10. Report Wise Cash Collection and Bank Deposits (R-9) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. To enter cash collections and deposit details Each transaction identified with report source i.e. R-1, R-2, R-3, R-4, R-5, R-10, R-11, etc. Each transaction identified with report date and deposit date Display report wise figure Display report amount and deposit amount on the basis of given date identified with report source Display collection date wise figure Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 118

11. Collection Reconciliation Facilitate to enter date of credit by bank Facilitate entry of transfer from collection account to disbursement account Facilitate entry of transfer from collection account to Head Office Facilitate entry of transfer from collection account to New York composite account Facilitate entry of transfer from collection account to territories Facilitate entry of transfer from collection account to investment account Facilitate entry of dishonored cheque Facilitate entry of bank charges Facilitate entry of interest received Facilitate entry of exchange gain / loss Facilitate entry of unlink Debit / Credit Facilitate printing of bank reconciliation statement Facilitate printing of bank reconciliation journal voucher Facilitate date range display / batch proof Facilitate finalization of entered date on user s option Updation of closing book / bank balance Facilitate printing of final user s defined reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Facilitate to migrate periodical date for funds management Section C PIA IT Environment Page 119

12. Passenger Agent Sales / Collection Summary (R-10) Display closed date and user Display receivable for current transaction Display progressive receivable of entered LOC / AGT Display progressive total of Debit / Credit amount pertaining to the current transaction Sales date wise data entry LOC / AGT validation with Agent profile Sales date wise identification of location / Agent Transaction wise identification of form of payment Transaction identification, e.g. A, B, C, D Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Ensure balancing of cash with R-9 Ensure balancing of sales, commission, taxes etc with ASR10 Ensure balancing of refund, commission, taxes etc with REF10 Facilitate to display status of R-10. ASR10, REF10 with reference to sales date and location agents Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate passenger agents ledger Update cash receipt stock Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 120

13. Ticket Wise Sales By PIA Agents (ASR10) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Ticket wise data entry Ticket validation with Document Control Module Ticket wise identification of Agent Ticket wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to check rates with DADS Module Facilitate to calculate commission on prescribed rates Ensure generation of invoices Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update stock inventory Facilitate printing of final user s defined reports Facilitate to migrate periodical data for SABRE SYSTEM in given format Section C PIA IT Environment Page 121

14. Ticket Wise Refund By PIA Agents (REF10) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current ticket only. Ticket wise data entry Ticket validation with Document Control Module Ticket wise identification of Agent Ticket wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to calculate commission on prescribed rates Ensure generation of Credit Notes Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Facilitate printing of final user s defined reports Facilitate to migrate periodical data for SABRE SYSTEM in given format Section C PIA IT Environment Page 122

15. Cargo Agent Sales / Collection Summary (R-11) Display closed date and user Display receivable for current transaction Display progressive receivable of entered LOC / AGT Display progressive total of Debit / Credit amount pertaining to the current transaction Sales date wise data entry LOC / AGT validation with Agent profile Sales date wise identification of location / Agent Transaction wise identification of form of payment Transaction identification e.g. A, B, C, D Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Ensure balancing of cash with R-9 Ensure balancing of sales, commission, taxes etc with ASR10 Ensure balancing of refund, commission, taxes etc with REF10 Facilitate to display status of R-10. ASR10, REF10 with reference to sales date and location agents Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate Cargo Agents ledger Update cash receipt stock Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 123

16. Air Waybill Wise Sales By PIA Agents (ASR11) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current Air Waybill only. Air Waybill wise data entry Air Waybill validation with Document Control Module Air Waybill wise identification of Agent Air Waybill wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to check rates with DADS Module Facilitate to calculate commission on prescribed rates Ensure generation of invoices Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Update stock inventory Facilitate printing of final user s defined reports Facilitate to migrate periodical data for SABRE SYSTEM in given format Section C PIA IT Environment Page 124

17. Air Waybill Wise Refund By PIA Agents (REF11) Display closed date and user Display progressive total of Debit / Credit amount pertaining to the current Air Waybill only. Air Waybill wise data entry Air Waybill validation with Document Control Module Ensure no duplicate refund is allowed Air Waybill wise identification of Agent Air Waybill wise identification of form of payment Facilitate to enter unlimited number of Taxes Facilitate to enter unlimited other accounts on both side i.e. Debit and Credit with department code Facilitate to calculate commission on prescribed rates Ensure generation of Credit Notes Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Generate debtor s ledger Facilitate printing of final user s defined reports Facilitate to migrate periodical data for SABRE SYSTEM in given format Section C PIA IT Environment Page 125

18. Disbursement (D-15) Types of Transactions o Cash o Cheque o Direct bank transfer o Adjustment o Reversal o Perquisites o Lease o DADS o Regular payments like rent etc Display closed date and user Display progressive total of amount pertaining to the current pay voucher Pay voucher wise data entry Facilitate validation of employee record where applicable Facilitate validation of payee record Facilitate validation of chart of account Facilitate acceptance of flight number, flight date, sector and aircraft tail number for specified accounts Ensure expenses are within budgetary allocations Update budget control Update staff ledger Ensure no duplicate payment is made / released Facilitate printing of normal pay vouchers Facilitate printing of normal cheques Facilitate printing of customized pay vouchers / cheque Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate payment of bill / invoice is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 126

19. Payroll At International Facilitate to enter all basic component of salary Facilitate to enter user defined formulas for allowances Facilitate to enter user defined formulas for deductions Facilitate to enter advances and its deductions Facilitate to generate staff ledger Ensure printing of pay slips Ensure printing of payroll Ensure printing of bank advices Ensure printing of pay voucher / cheque Ensure integration with Disbursement (D-15) Ensure generation of payroll journal voucher Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Facilitate printing of final user s defined reports Updation of budget control Updation of staff ledger Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 127

20. Imprest Reconciliation Facilitate to enter date of cheque presentation Facilitate entry of transfer from collection account Facilitate entry of bank charges Facilitate entry of unlink Debit / Credit Facilitate printing of Bank Reconciliation Statement Facilitate printing of Bank Reconciliation Journal Voucher Facilitate date range display / batch proofing Facilitate finalization of entered data on user s option Facilitate to report and adjust stale cheque Finalization of entered data on user s option Updation of closing book/bank balance Facilitate printing of final user s defined reports Ensure integration with General Ledger of closed reports Duplicate generalization is not allowed Generalization of foreign currency is done in PKR at given rates Section C PIA IT Environment Page 128

Requirements for Passenger Revenue Accounting (Mandatory) GENERAL a) Sales based system with prime coupon concept for production of timely and accurate Revenue earned & Un-earned transportation liability information. b) Capability to accommodate data from the following sources through interfacing: i. Auto Tickets/Reservation System. ii. Facility for feeding details of manually issued documents and refunded documents iii. iv. Insertion of off-line files generated by Station Accounting Package. Revenue documents stock control system for recording distribution, its consumptions and stock inventory details on the basis of pre-printed stock control numbers. v. ARC/BSP sales data. vi. Data capture/scanning facility for recording coupons usage. vii. Proration Package. viii. Interface with Fare Quote System. ix. IDEC payable input. x. Lost documents database and subsequent control on utilization on the basis of stock control numbers as well as system-generated numbers xi. Utility for correct capture of web-based/ e-tickets sales/ utilization data c) The quantification and substantiation of four major balances related to transportation revenue for corporate financial statements. i. Earned Revenue. ii. Unearned Revenue. iii. Interline Accounts Receivable. iv. OAL inward billing i.e. Accounts Payable. d) Separation of Domestic and international Accounting & Controls. e) Correct capturing and accounting of all the taxes collected on the tickets under relevant heads of accounts f) Complete system integrity through defined security levels for different categories of users. g) Provision of detailed/ user friendly utility-wise procedural manuals for all categories of users h) Complete transaction-wise audit trail for all the activities carried out by the users of the system. Section C PIA IT Environment Page 129

i) Automated availability of historical data for at least 5 years with easy/online access. j) Use of most modern/sophisticated EDP tools with a variety of equipment types for real time processing at point-of-sale level for editing/ generation of MIS Reports PROCESSING OF SALES DATA Facility To: 1. Interface or capture Sales data from sources such as: a) Auto Ticketing. b) Station Accounting Package. c) Station/Agency sales data capture in real time. d) ARC/BSP sales. 2. Segregate all Domestic and international tickets sales transactions with separates accounting entries. 3. Capture sales data in multiple currencies at various locations and within the same location (for automated as well as non-automated/ manual sales) 4. Update facility or data capture of pre-printed Stock Control Number and Computer Generated Ticket Numbers. 5. Record all types of issued in exchange transactions with complete trail which include: a) Reissues/Even Exchange. b) Reissues/Refunds. c) Reissues/Additional Collection. d) Reissues/Combined with PK and OAL coupons. 6. Data validation features like Check Digit Calculation, Sales proceeds against banking etc. 7. Revenue Documents Inventory/Stock Control by Station/Agent. 8. Auto proration of international ticket sales for: i. Assigning prorated actual vales on each flight coupon (As per IATA standards). ii. Updating flight coupon-wise value in ticket database. 9. Auto proration of pure domestic tickets on the basis of point-to-point fares Section C PIA IT Environment Page 130

10. Correct proration of fully/ partially exchanged documents involving additional collections in the same currencies or the currencies other than the currency of original issue. 11. Auto Preparation of Sales Reports Status. i. Received and Not Received. ii. Processed and Un-processed. 12. Auto Generation of station-wise Revenue Documents /Inventory / Stock position reports with serial break identification. 13. Generate ticket/ ticketing agent/counter/ Sales agent/ station-wise reports / sales summaries reflecting all debit and credit sides of the transaction. 14. Automated audit system with respect to the following: i. Gross fares ii. Net fares iii. All taxes 15. Facility to generate computer based ADM / ACM and creation of database for updating stations / agent s ledger and monitoring settled / unsettled ADMs. 16. Auto generation of various MIS / productivity reports in local as well as accounting currency including but not limited to the following. i. Station / Agency- wise sale. ii. Region-wise sales. iii. 5th & 6th Freedom Traffic iv. Station / Agency- wise sales v. Route / Sector wise sales/ Yields Analysis. vi. Station Yield. vii. Normal / Incentive / Overriding Commissions Analysis. viii. Guarantees vs. Agency Sales comparison. PROCESSING OF UTILIZED / UPLIFTED COUPONS Facility To: 1. Interface with flight operations systems for either downloading or updating flight schedule/operated schedule and non-scheduled operations. 2. Records Receipt and Control of Lifted flight coupons. 3. Auto generation of a Report pertaining to non-receipt of lifted flight coupons on any given date. Section C PIA IT Environment Page 131

4. Capture system generated numbers and pre-printed stock control of all the lifted flight coupons. 5. Data capture on the basis of Prime coupon concept. 6. Create/ update lost ticket database for all missing/stolen and lost documents/ coupons (Passenger/ Blank Lost). 7. Interface lost ticket database to detect fraudulent utilization of missing/stolen tickets/coupons with the utilization source i.e. a) Uplifted Flight Coupons. b) Re-issued Flight Coupons. c) Refund Flight Coupons. d) OAL inward Billing Coupons. 8. Generate flown/earned revenue Journal Voucher with accuracy and direct input to corporate financial ledger. 9. Facility to generate productivity statement / MIS report with PKRs and yields including but not limited to the following: i. Flight wise flown revenue/yield. ii. Aircraft/ tail-wise flown revenue. iii. Sector performance by station/yield iv. Sector performance by fare basis/yield. v. Station/Agent wise flown revenue/yield. vi. Region wise revenue/yield. vii. Freedom wise revenue/yield viii. Analysis/Reports based on gross & net fares ix. Travel class-wise Revenue/ Yield REPORTING / PROCESSING OF REFUNDS 1. Ability to capture counter/ non-bsp PK document holding agents refunds and generate required reports. 2. Segregate all domestic and international refunded ticket transactions and carry out accounting functions under applicable heads of accounts. 3. Facility to capture refunded coupons data in multi-currency environments. 4. Facilitate capture of pre-printed stock control numbers and system generated ticket numbers of all the refunded documents. 5. Creation of Rejection Queues for editing/correction. Section C PIA IT Environment Page 132

6. Proration facility for refunded coupons on the basis of reported refund value. 7. Auto generation of status of Field Offices / Agents Refund Reports: a) Received or Not- Received. b) Processed or Un- processed. 8. Facility to generate Adjustment Debit Memos/ Adjustment Credit Memos and creation of database of updating station /agent ledger and monitoring settled /unsettled Adjustment Memos. MATCHING OF SALES AND UTILIZATION 1. Complete Matching of audit coupons with the corresponding utilized coupons on daily basis. 2. Un-utilized coupons must be listed separately for substantiating the Un-Earned Revenue appearing in the Corporate Ledger. 3. Provide details of UN-REPORTED ARC/BSP/Other PK documents. 4. Provide statements of gain / loss on refund inward billing transaction. 5. Duplicate utilization coupon report. 6. Provide reports though inward billing transaction where online sector business transferred to other carriers. 7. Provide Exceptional report for: a. Out of sequence coupons usage b. Usage coupon date is less than date of sale c. Variances in Pax status, sector, class of travel and fare base. d. Utilization of any black listed document. INTERLINE BILLING It must provide direct connectivity with IATA clearing house (ICH-Web) & be SIS compliant. Issue invoices for prime & first rejection billing Issue invoices for inclusion in billing Issue invoices for 6% currency rate variation Generation of rejection memo & invoices through IATA clearing house (ICH)/Airline clearing house (ACH) in line with SIS instructions. Production of standard IATA forms (Form 01,02,03) through ICH/ACH Section C PIA IT Environment Page 133

For all OAL uplifted coupons, invoices be raised to other airlines & receivable be generated thereby. Automatic re-proration Provision v/s billing matching Automatic rejection or acceptance of billing Addition of first rejection memos Processing of charge memos & 2 nd & 3 rd rejection memos Management of correspondence & final settlements Maintenance of rejection history Automatic addition of accounting entries Identification of under and over billing and generation of required documents in standard IATA format. Editing of various accounting documents and forms. Availability of online information of other airline documents for a period of 21 months. To generate ADM for recall of overriding commission on IDEC payable data, if any Auto check IDEC payable data & generate variance report The table for exchange rates must contain following rate issued by IATA i. Mean Rate for the last 5 banking days. ii. Mean Rate of Exchange based on entire current month. It must be able to capture data from IDEC files and should generate IDEC files for outward billing. Production of: o Form 1 o Form 2 o Summary of Form 2 o Detailed Invoice o Automatic Rejection Memos o Accounting Summary. The table for exchange rates must contain following rate issued by IATA. i. Mean Rate for the last 5 banking days. ii. Mean Rate of Exchange based on entire current month. The above table should generate automatic supplementary billing when exchange rate is negative. PRORATION An integrated auto proration package. It should allow the airline to detect the applicability of appropriate rule, proviso requirement, and bilateral/multilateral agreement based on various factors such as sales /uplift periods, seasonality, place of issue, class and fare basis, sector and regions, discounts, type of Section C PIA IT Environment Page 134

journey, routing etc. and applying the same after resolving any conflict. It should adhere to IATA standards. TRAINING Vendor would be required to impart in depth training to a Core team of End users and ISD personnel who will then act as the Master Trainers for training rest of the personnel in PIA. The training should cover the following areas. i. Operation of the system. Vendor would be required to provide a user manual. ii. System architecture iii. Operating Environment iv. Disaster Recovery full back procedures. Section C PIA IT Environment Page 135

Requirements for Cargo Revenue Accounting 1. Stock Management It is vital that Cargo Revenue accounting documents are closely monitored. Stock processing from the printer through to the agent. Allocation of air waybill numbers for Cargo Accounts Settlement System (CASS) locations. Agents blacklisted because of default, etc. Blacklisted documents utilization report. 2. Sales (Unearned Revenue and Billing) Incidental charges are being punched directly from the air waybills other charges column while these should be calculated from the applicable rate that should be present in the system e.g. fuel surcharge, security charges, dangerous goods fees etc. in both own sales and agency sales. Sales/Lift matching which is non-existent presently should be conducted to avoid possible malpractices in own sales. Airline office and CASS as well as non CASS areas Sales Accounting. Invoicing of GSAs, agent and airline offices. Processing and accounting of Debit/Credit memos. Processing and accounting of Charges Correction Advices. Matching of sales vs. flown air waybills in agency sales. Direct billing of agents based on uplift. Automatic proration. Capture and accounting of sales returns. Automated generation of CCAs and DCMS. 3. Charges Collect Sales and Billing Invoicing of ground handling agents, GSAs airlines and stations for CC airway bills. Computation and accounting of CC fees. Accounting of interline provision for CC Collection on behalf of other carriers. Reconciliation of collection vs. billing for CC air waybills and accounting adjustment. Direct billing of customers for air bills and ground handling charges through automated invoices. Management of ground handling documents other than airway bills. 4. Pricing The system should enable the filing of spot rates and special or market rates with a mechanism for approval. The system should automatically compute the applicable rates, spot rates, special or contract rates and tact rates, while simultaneously determining the agency commission. Section C PIA IT Environment Page 136

5. Provision for Trucking Agreements with trucking can be filed in the system and its accounting also. 6. Interline Proration Proration process should be automatic to increase productivity and efficiency. Multiple Prorate Agreements Special Prorate Agreements Proration filing area for testing bilateral agreements, provisions and requirements. 7. Uplift and Flown Processing (Earned Revenue) Required for quick evaluation and determination of earned revenue for every shipment uplifted. Flights manifest monitoring. Net revenue determination. Automatic proration. Provision for interline and trucking sectors. Management of part shipment. Accounting for CC airway bills transferred to other airlines. 8. Interline Billing Evaluation of air waybills issued by other airlines and efficient generation of interline billing to quickly recoup money owned. Billing for another carriers prepaid air waybills uplifted. Billing for transfer of charges collect air waybills. Charge memos to other airlines can be captured and included in billing invoices. Billing for another carriers prepaid air waybill uplift. Rejection billing. Generation of airline invoices. Generation of standard IATA forms. 9. Interline Billing received from other Airlines Evaluation of interline bills received from other airlines and checking for validity and accuracy. Management of part shipment. Automatic proration. Matching of provision vs. billing Automatic rejection or acceptance of billing Generation of rejection memos Automatic accounting entries 10. Mail Processing Section C PIA IT Environment Page 137

Billing and revenue accounting of the documents issued by Postal Authorities. All of P.O. Mail is handled including letter and cards closed parcels and empty mail bags Special rate agreements with General Postal Authorities Standard Universal Postal Union (UPU) rates. Uplift revenue accounting Interline provision Billing to Postal Authorities and accounting Obtaining of supporting documents for invoices. Preparation of invoices AV3/AV5 (Admin Wise) Automated follow-up of invoices Re-billing of rejected invoices Accounting of revenue and receivables. Standard Industry Reports for control/ MIS purposes Section C PIA IT Environment Page 138

C3 EXISTING IT INFRASTRUCTURE 3.1 Servers The IT Department at PIA maintains a number of servers and storage arrays to support various applications. Some of these applications have been developed in-house while some have been acquired from third-party vendors. A certain number of applications are also hosted externally. The block diagram shown below represents how different applications and modules are connected to the 10 GBPS backbone: Section C PIA IT Environment Page 139 Confidential

3.2 Connectivity The fundamental purpose of a communications system is the exchange of data between two parties. Communications networks are designed by interconnecting a variety of devices. This is done to help share the information and make efficient use of common resources available within an organization. A high-level block diagram representing the PIA network is given below: Section C PIA IT Environment Page 140 Confidential

3.2.1 Local Area Network (LAN) The PIA LAN is centered at the Computer Centre building situated next to PIA Head Office, in the vicinity of Jinnah International Airport. It is based on a fiberoptic backbone and serves different locations as follows: Section C PIA IT Environment Page 141 Confidential

3.2.2 Wide Area Network (WAN) PIA also supports major WAN connectivity linking all its regional and local offices to PIA Computer Centre. The WAN setup is being done in two phases as follows: Section C PIA IT Environment Page 142 Confidential

Section C PIA IT Environment Page 143 Confidential

SECTION D PRODUCT REQUIREMENTS (ERP PACKAGE & ADD-ONS) Section D Product Requirements (ERP and Add-Ons) Page 144 Confidential

D1 ERP PACKAGE AND ADD-ON REQUIREMENTS 1. Overview of Solution Requirements PIA desires to procure and implement an ERP Solution for its business needs which would comprise the following:- A comprehensive suite of integrated applications specific to Airline industry in: Finance Human Resources and Administration Procurement and Inventory Control Add-on applications, to be kept at a minimum Future value added-modules The solution to PIA s information needs and application requirements, described in Section D, Subsection D2, should conform to the features the marketplace is offering in Airline industry solutions. The Contractor must provide an effective solution in a cost beneficial way, keeping in view the specific information and application needs of PIA. The Technical Proposal submitted in response to this RFP should clearly describe how the Contractor will meet the needs of PIA, either directly, in whole or in part, or through alternatives. Further, the Contractor must suggest solutions that will require minimum customization or add-ons, maximum or completely seamless integration between applications, lower systems implementation risks, while at the same time providing the best possible performance at an economical price. The Contractor shall present a fully responsive written Technical Proposal to address the requirements defined in the following sections and explain approach to each requirement. The proposal must also identify any requirement the Contractor cannot satisfy. Sufficient details should be included to demonstrate the Contractor s knowledge of the project and the ability to satisfy each requirement. Each Contractor can submit only one solution. Section D Product Requirements (ERP and Add-Ons) Page 145 Confidential

2. Technology Requirements 2.1 New Technology The system should be designed in such a way as to easily allow the incorporation of new technologies, as they become available. 2.2 Multiple Environments In addition to the production environment, the system must support independent copies for training, development, and test environments. These environments must be sufficiently isolated from production and from each other so that operations in one environment do not affect those of another. The environments will be employed as follows: Production all production processing will be performed in this environment. Development all development activities including unit and system testing will be conducted in this environment. Test after all development, unit and system testing has been completed, this environment will be used for User Acceptance Testing before the system is accepted into production. Training for all in-house implementation and post implementation training activities 2.3 System Performance The system must be responsive with high availability feature. The system should support rapid fail-over or redeployment in the event of problems or planned maintenance. Ninety-nine percent of all fail-over events must take place in less than five minutes. Any volume (batch) processing must not interfere with online responsiveness or availability. Contractor must provide system availability figures of its proposed solution. In case various components have different values, these must be specifically mentioned. 2.4 Archive and Purge The system must support the periodic archival and purging of unused or obsolete information. Archived information should be available for historical reporting in such a manner that queries could be performed on archived data using automated data retrieval functions. Contractor must provide a complete data archival plan. Section D Product Requirements (ERP and Add-Ons) Page 146 Confidential

2.5 Recovery The system must automatically recover to the last complete prior transaction in the event of a failure. The system must clearly indicate to the user that a transaction failed and that it must be re-entered. Recovery must occur without operator intervention. Contractor must provide contingency and backup recovery procedures with guaranteed Service Level Agreements (SLAs). 2.6 Backup and Reorganization The system must provide for the unattended daily backup of all information and data to a media that can be stored offsite for disaster recovery purposes. Backups must not prevent the system from being available at all times and must not disrupt system operations. There should be no performance degradation during data backup. Database reorganizations should not significantly impair system availability. Contractor must provide the calculation of time taken to backup data with respect to data size increase. 2.7 Print Management The system should provide a method for managing the print environment for report distribution so that reports are directed to the appropriate print facility. Both high speeds centralized printing facilities as well as local LAN-based printing facilities will be employed in addition to printing over internet / intranet. 2.8 Technology Architecture The Contractor should provide recommendations of the technology architecture under which the proposed ERP Package will operate, with the following features preference: N-tiered Client/Server architecture incorporating thin presentation-logic-client communicating with client-neutral, server-based applications, communicating with the database Thin client, for remote users Applications distributed at servers located at Head Office Centralized database, located at Head Office While designing the technology architecture, the Contractor should ensure that the following are kept under consideration: Solution should be scalable with complete platform independence PIA does not intend to be tied down to a single platform Solution should be effortlessly portable from one system to another Should provide support for different flavors of UNIX; however it should be a totally interoperable solution Section D Product Requirements (ERP and Add-Ons) Page 147 Confidential

There must be open source support. In this context, the Contractor must specify the current scenario vis-à-vis the solution offered and the future roadmap Optimization of licensing costs for the platform software PIA s existing Local and Wide Area Network, and minimization of Wide Area Network bandwidth requirements, Simplicity of System Administration and Operations, Ease of business continuity planning and execution. Contractors should present a number of architecture options, providing pros and cons of each option, as well as the Contractors recommended option. 2.9 Server The Contractor should provide both its minimum and optimum configuration requirements for Application and Database Servers to run the ERP Package and other applications, consistent with the ERP features and proposed technology architecture (2.8 above), and multiple environment requirements (2.2 above). The recommended configuration should cater for the existing load as well as annual volume growth of 10-15% for the next five years. The configuration should be capable of retaining data for at least eleven years (that is, current year plus ten years historical record). The solution must be redundant, reliable and consistently available to allow uninterruptible 24x7 operations. The main servers will be housed in PIA s Information Technology Department. The production server configuration should include redundant (RAID5) data storage (including SAN) and multiple processors and cater for compatibility with PIA s existing LAN / WAN environment as described in Section C, Subsection C3. The Contractor should take into consideration the areas of performance and scalability, reliability and fault tolerance while recommending Server configurations. Contractor must provide performance guarantees of the solution under different scenarios such as concurrent users during normal working, during data backup, during overload, during partial system failure, etc. 2.10 Systems and Network Management Tools Contractors are required to recommend suitable Systems and Network Management Tools. These tools should ensure proper planning, configuration, and problem handling of IT resources and support such tasks as defining, resolving, and managing problems; operating networks and multi-vendor systems; distributing and managing software and data; controlling operations; Section D Product Requirements (ERP and Add-Ons) Page 148 Confidential

planning and managing performance; administering security; maintaining asset information; and planning for the future capacity of systems. 2.11 Authentication The system must support authentication methods that will assure that only authorized users are able to access protected data and transactions. These could include support for digital signatures and PKI infrastructure also. Section D Product Requirements (ERP and Add-Ons) Page 149 Confidential

3. General Requirements 3.1 Common Characteristics Common characteristics represent capabilities that should be shared by all functional areas of the ERP Solution. They are to be considered along with the more specific functional requirements that follow in the design of a system. 3.2 Integration The software should support modern best business practices, with data located in one integrated system shared across all organizational units. The software should support enterprise-wide business processes with a goal of eliminating multiple handling of data and increasing accuracy. It should also be integrated with future modules using the same development language / platform. 3.3 Configuration PIA desires to procure a system that will require minimum software modification to meet its business requirements. The software should allow for easy configuration to meet those requirements without changing software code or requiring Add-ons. Changes to parameters, software switches, processing rules, and other tailoring approaches may be acceptable. The configuration should be accomplished in a way that does not adversely impact future installation of system upgrades. The software must be flexible enough to allow easy reconfiguration as requirements change. 3.4 Technology Interfaces The Contractor should provide standard application programming interfaces, tools and methodologies that allow current and future releases to accommodate interfaces without re-programming. A standard approach to interfaces should be employed to avoid multiple, unique approaches for different systems. The Contractor will have to ensure, at its cost, availability of not only its own APIs but also from other parties to enable integration with other applications that it has proposed along with the ERP as well as existing applications that will continue to run at PIA and will require integration with the proposed ERP. Contractor must ensure to provide XML-based APIs wherever these are available. All these APIs will be made available to PIA and PIA will have the right to use these for application integration and report generation. Section D Product Requirements (ERP and Add-Ons) Page 150 Confidential

3.5 Access Control The system must support multiple levels of security while providing single sign-on facility to the users. This includes protecting certain fields from unauthorized access. In addition, access to certain functions and data must be protected until they are approved by PIA s concerned policy makers. Application security should be integrated with database security. Data files / tables should only be accessed through the ERP; direct access through different query languages should not be possible. Templates or group functions should be provided to facilitate maintenance. Changes in assignment (employee transfers) or termination / retirement should automatically trigger a review of the employee s security privileges. Comprehensive logs of transactions and security incidents must be maintained for auditing purposes. System should provide authorization, authentication, integrity and non-repudiation facilities for critical transactions. Password length as per industry standards should be supported. System should be capable to maintain audit trails and logs, allow secure remote login and support digital signature and time stamp, etc. 3.6 User Interface The system should provide an intuitive, user-friendly, and easy-to-use interface that minimizes the need for training. The system should have a common look and feel across all applications with screen labeling in English and Urdu. Online help should be available for all applications and should allow for customization. The system must address the needs of infrequent or low volume users as well as those who use the system several hours each day. It should have fast data entry screens for bulk data entry. The system may be accessible using standard personal computer through browser. It should also allow opening multiple sessions and defining navigational menus that can be created by end-users according to their job requirements. It should also allow for switching between different programs without first having to exit from the system. Business rules should be incorporated into the system such that the rules are applied at the time information is entered into the system. The system should identify errors, inconsistencies or additional requirements at the time data is entered. Processing of the transaction should be suspended and / or re-routed to resolve the problem in real time. 3.7 Reporting / Inquiry The system must include comprehensive inquiry / reporting tools that allow for easy access to authorized data. Executive interfaces to the data with drill down capability to examine details should be included in these tools. It should also be possible to create reports that reflect status as of a specified point in time. Standard reports should be included to serve as models for customized reporting and to provide for basic functional reports. Report wizards or similar techniques Section D Product Requirements (ERP and Add-Ons) Page 151 Confidential

should be available to guide users through report creation. The system must be designed such that reporting activities do not compromise responsiveness of the interactive system. Reports should be formatted to print on local PC and LAN attached printers, centralized high-speed printers, as well as over internet and intranet. It should be possible to deliver fixed reports to users on a pre-determined schedule to be reviewed online, to be retained online or to be printed at the user s discretion. System should be able to deliver the reports using its own messaging / workflow engine as well as PIA s email system, Lotus Notes. The system should be able to demonstrate useful demographic and forecasting capabilities; support text-based, parameterized and wild-card searches; and provide users the ability to develop ad hoc reports at their discretion. The system must include a data dictionary or similar provision to allow non-technical users to identify the appropriate data elements for inclusion in their reports. 3.8 Analytic Tools PIA desires decision support tools and information bases that are fully integrated with the system to facilitate strategic planning, tactical operations and organization-wide analysis. The system should support the easy movement of data to common packaged PC-based applications such as Microsoft Office. The system should include the ability to locate information or text through a search capability. The system should be capable of producing what if scenarios to support decision-making. 3.9 Communication The system should foster information sharing at all levels of the organization. For example, policy directives and goals should be incorporated into the budget planning process; departments should be able to share purchasing intentions and specifications and best business practices should be readily available for consultation. In addition, the system should provide a single place for users to quickly access information and updates on organizational news and policies. 3.10 Flexibility The system must be easily reconfigured to respond to changes in business practices, policy directives, organization structure, statutes and regulations. As business requirements change, the system must also change to support the new Section D Product Requirements (ERP and Add-Ons) Page 152 Confidential

requirements. Flexibility should extend both to enterprise-wide as well as industry specific practices. 3.11 System Availability Overall it should be a highly available solution. It must be available for access by authorized personnel from anywhere at any time of the day or night (24 x 7 availability). The system must be equally usable from remote locations as from the Head Office. Web-based access should be supported. 3.12 Transaction Timing The system must support real time operations. Changes to data or the status of processes should be immediately available in the system. System operations should not artificially constrain the business processes supported by the system. The system must support effective dating for transactions, including both future and retroactive changes. The authority for such transactions must be included in the security capabilities of the system. The assignment of a retroactive date must generate the changes required to bring the system up to the current date. 3.13 Online Documentation and Training The system must include customizable online documentation and training materials such as context-specific help, search capability, business process documentation and process maps. 3.14 Storage / Record Retrieval Record collection and retention is an important organizational requirement. The ability to easily archive, retain and access records is required. Records retention procedures must allow information to be stored in a way that can be accessible indefinitely. Section D Product Requirements (ERP and Add-Ons) Page 153 Confidential

3.15 Data Support The solution should be able to support multiple data types text, image, voice, etc. It should be able to support data upload to and download from different systems in multiple formats. Besides simple upload / download facility it should also be able to communicate and support data interchange with mobile devices such as cellular phones, handheld terminals, PDAs, etc. It should also be able to support other devices such as scanners, barcode readers, biometric devices, card readers, RFID devices, etc. Support for important messaging / data formats / standards must include, as a minimum, Aircraft Communication Addressing and Reporting System (ACARS), SITATEX, ASCII, EDI, SMS, XML, Spec 2000, UNeDocs, MS-Office, Lotus Notes, etc. 3.16 System Security System provided must be secure and meet all standard security requirements i.e. Identification, Authentication, Authorization and Integrity. System should allow implementation of industry standard security policies and capability to evolve to meet security challenges. Details of the proposed security tools must be provided. 3.17 Web-enablement The proposed System should be Internet ready and allow web-enabled access to users from anywhere across the world through a web portal. It should also be compliant with the Service Oriented Architecture (SOA). 3.18 Self-Service Portal The proposed System should be capable of providing the users access to selfservice portals where they can log in and obtain different levels of information such as directory lists, airline schedules, seat availability on flights, etc. It should also allow users to update personal information and enter requests such as leave and passage approval, purchase of tickets, etc. 3.19 Workflow The proposed System should be capable of providing Workflow functionality to users by which information and requests could be automatically routed to the concerned levels for approval. Section D Product Requirements (ERP and Add-Ons) Page 154 Confidential

3.20 Others Besides above mentioned characteristics the proposed ERP should also be capable of: Supporting multi currency Supporting multi languages Supporting multiple legal companies Supporting multiple tax structures (that is, supporting individual country tax structure and reporting) Interfacing with legacy systems Storing transactions and balances of legacy systems Supporting user defaults Supporting user defined screens Supporting multiple date formats Supporting multiple decimal formats in amounts Providing easy development of user defined reports Supporting user defined fields Scheduling of jobs for unattended operations Maintaining effective dates of master file data Section D Product Requirements (ERP and Add-Ons) Page 155 Confidential

D2 INFORMATION NEEDS AND APPLICATION REQUIREMENTS PIA requires management information systems that support its decision makers by fulfilling their daily information needs and also assisting them in creating different scenarios and providing what-if analysis. Some of PIA s operations are centralized at the Head Office while many are distributed at its various stations both online and offline domestic and international. Contractor must analyze these functions and provide a solution that will best fit this model. The business information needs of PIA have been defined / identified at various levels of governance and management starting with those of its Board of Directors and then of its individual functional areas. 1 Information Requirements of Board of Directors An analysis of the past and present can help set growth targets and make informed decisions with regards to the future direction of PIA. Based on this notion the Board of Directors may want an analysis of operational and financial performance that should also help derive a future prognosis of PIA. The information and analytical demands at this level call for speed and accuracy though less of this information fits a predefined format or structured model. The broad-based information needs of PIA s Board of Directors may be classified as follows: Familiarity with the mission, vision, goals and objectives of PIA to be able to deliberate and decide on its business plans and strategies short-, mediumand long-term Awareness of the trends in the international airline industry to be able to assess its impact on the business of PIA Knowledge of government policies with regards to the airline industry and its impact on PIA s business strategy Understanding of the competitive (and investments) scenario in the local, regional and international airline industry to be able to reposition PIA, if necessary Analysis of flight safety, security and performance standards for formulating future strategies Awareness of PIA s current market position vis-à-vis competition Status of ongoing and planned investment projects as well as of other projects that are significant and important to PIA Analysis of the operational and financial well-being and strengths and weaknesses of PIA Section D Product Requirements (ERP and Add-Ons) Page 156 Confidential

Understanding of the manpower needs of PIA to consider sanctioning of new hires, promotions, etc., and to suggest any other organization changes Attentiveness to the corporate image of PIA in both the local and international markets 2 Information Requirements of Senior Management The Chairman and CEO and other key senior management personnel are responsible for managing the day-to-day operations of PIA. Their information needs pertain to monitoring, controlling and directing the operational and financial management activities of PIA. In disseminating information to management, one needs to avoid information overload. The need is for the right amount of information and at the right time. These should be fulfilled with features such as Key Performance Indicators (KPIs), Balance Scorecards, Dashboards, etc. The information requirements of PIA s management pertain to: Close and thorough monitoring of progress on ongoing and planned projects Monitoring the status of aircraft availability, passenger and cargo revenues, route and aircraft profitability Tracking fixed assets and materials inventory Historical, current and projected financial status of PIA Monitoring of actual expenditures against budgets Assessment of current and future manpower requirements derived from PIA s operating plans and business strategies Evaluation of the strengths and weaknesses of existing manpower resources which among other things assist in determining the training and development needs, management succession planning, etc. Awareness of inventions, innovations, new markets, new customers and geographical changes It is important to reemphasize that the information requirements of PIA s Board of Directors and senior management do not necessarily lend themselves to a predefined structure and do not fit a particular descriptive model or arrangement. Their information requirements will have to be fulfilled by collecting, processing, analyzing and disseminating data gathered from a variety of internal and external sources. For this purpose, there is a need to implement Strategic Enterprise Management, Business Intelligence, and Data Warehousing application systems with the following characteristics: Section D Product Requirements (ERP and Add-Ons) Page 157 Confidential

Business planning and simulation Business information sourcing (internal and external) Business performance monitoring and analysis Company benchmarking Data Mining Open reporting architecture 3 Functional Information Requirements The identification of functional information needs and related application systems have been approached by determining the essential business processes PIA has to perform in actualizing its mission and vision and fulfilling its business objectives. These pertain to the following functional areas: Finance Human Resources and Administration Procurement and Inventory Control Each functional area has been discussed by identifying the functionality required within each area. Besides these functional areas much of PIA s operations are handled at its various stations. Contractor will have to take into account the operations at these locations both domestic and international. Contractor should note that the following sub-sections contain minimum functionalities required by PIA that have been provided for indicative purposes. These will be finalized by Contractor in consultation with PIA during the preparation of conceptual design of ERP. The Contractor will then configure the ERP based on the conceptual design. Section D Product Requirements (ERP and Add-Ons) Page 158 Confidential

3.1 Finance As PIA increases investments in its new fleet the role of the financial management function will assume a much bigger dimension. In addition, there will be a need for instituting more effective financial discipline and controls throughout PIA. The successful realization of PIA s enhanced investment strategy also enjoins on the financial management function to ensure efficiencies, cost effectiveness, and responsiveness in line with the requirements of management and Board of Directors. The financial management function in PIA is organized around: Costing and Budgeting Revenue Accounting Funds Management General Accounting High Level Specification of Finance Applications 3.1.1 General Ledger The General Ledger is the key component of any financial management system. It gathers transactions/data from various sources for maintaining the books of accounts and for reporting to management, the Board of Directors, and other stakeholders of the company. The essential functionality of the General Ledger should be: Maintaining charts of accounts for multi-company processing Supporting multiple chart of accounts for one company Maintaining ledger accounts with complete hierarchical structure Maintaining hierarchies of cost centers and profit centers Providing graphical representation of hierarchies with easy navigation and drill-down features Maintaining statistical ledgers for quantities, volumes, number of flights, etc. Allowing at least 30 digits for the qualified chart of accounts in order to incorporate notional account, group companies, business units, locations, aircrafts, flight numbers, departments / cost centers based on the financial statement segments Allowing at-least 14 posting periods in a financial year Allowing multiple financial years for multiple companies Classifying multiple levels of chart of accounts Section D Product Requirements (ERP and Add-Ons) Page 159 Confidential

Providing and supporting a dynamic business unit structure in the chart of accounts Allowing mass maintenance of accounts by copying one chart into another as reference or deleting / blocking multiple accounts Allowing access to certain types of accounts to authorized users / usergroups Uploading budget from the Budgets and Cost Management System Posting of journal entries from subsidiary ledgers Processing entries directly entered in the General Ledger Accounting for special projects / subsidiaries; such as SpeedEX, etc. Processing entries from other systems Auto-generating entries of recurring items Maintaining and analyzing budgeted and actual amounts by account head Allocating expenses on the basis of defined parameters Maintaining multi-currency accounts Catering for inter-company settlements Maintaining ledgers for management and statutory reporting Generating consolidated financial statements (Balance Sheet, Profit and Loss Account, Cash flow, Statement of Changes in Equity, etc.) along with consolidated supporting schedules setting off inter-company balances Allowing separate closing of individual areas for example Fixed Asset, Accounts Receivable, Accounts Payable, General Ledger, etc. Allowing real-time online updates of General Ledger along with provision of temporary and permanent stoppages for account closing purposes these stoppages should be controlled by authority levels based on different types of vouchers / sub-ledger entries Allowing posting of transactions after temporary closing Allowing multiple year-end processing Processing month-end and year-end accounts Automatically calculating retained earnings Generating financial statements 3.1.2 Financial Analyzer The financial analyzer is a tool for detailed analysis of financial data and ratios and it fulfils varied management information requirements. It helps management view the financial performance of the company from various perspectives, which may not be possible through standard General Ledger reports. It should be able to produce complete books of accounts with accompanying notes to accounts in line with International Accounting Standards and the Companies Ordinance. It should also be able to provide comparisons of actual / Section D Product Requirements (ERP and Add-Ons) Page 160 Confidential

current period data with budgeted data as well as with data of previous period and same period of previous year. 3.1.3 Fixed Assets Management The Fixed Assets system should support tracking of fixed assets including, additions, transfers, disposals, original cost, net book value and depreciation, etc. It should assist PIA in managing the complete asset management life cycle that is, acquiring, tracking, managing and disposing and should include every aspect including labor, administration / maintenance, equipment, inventory and warranties. It should be capable of: Maintaining ownership data for assets Recording asset supplier information Maintaining number of flying hours in case of aircrafts Maintaining original and net book value, Calculating asset depreciation based on multiple depreciation methods, Allowing changes in book value and changes in depreciation rate Tracking physical location of assets at any given time Maintaining asset and depreciation records for management and statutory reporting Recording asset replacement value Allowing zero value assets Allowing inter-company assets transfer, for example from one subsidiary to another Showing assets in-transit during transfers till acknowledged by receiving location Handling mass transfer of assets Splitting of assets Recording asset assemblies and sub-assemblies (parent-child relationship) Processing disposal of assets Capitalizing projects and transferring costs Revaluing assets Section D Product Requirements (ERP and Add-Ons) Page 161 Confidential

3.1.4 Cash Management The Cash Management system should maintain up-to-date balances of PIA s bank accounts and of cash in-hand and provide cash flow forecasts. It should be capable of: Maintaining records of daily cash balances including details of daily receipts and disbursement of cash Monitoring bank balances Identifying withdrawal limits before a transaction for each bank account maintained in the system Transferring funds from one bank account into another Uploading and recording account statements received from banks Automatically processing bank reconciliation statements based on payments and deposits Forecasting cash requirements based on accruals, cash in hand, bank balances, outstanding and anticipated invoices from suppliers and agents / other customers, etc. Monitoring of markup rates and appropriate placement of funds Calculating markup in running finance and deposit / savings accounts Maintaining detailed records of investments of liquid funds including maturity profiles of funds invested Supporting user-defined cash flow statements 3.1.5 Petty Cash Management The purpose of Petty Cash Management system is to maintain and process cash disbursements at various locations including Head Office. It should be capable of: Recording cash receipts Recording cash disbursements Maintaining and verifying cash balances Determining withholding tax and sales tax on cash disbursements Submitting claims to Head Office for replenishment of petty cash 3.1.6 Accounts Payable The Accounts Payable system that supports maintenance of financial liabilities should be capable of: Creating and managing vendor master records Section D Product Requirements (ERP and Add-Ons) Page 162 Confidential

Adopting to PIA s payment policies including the limits of approval authorities Recording supplier s invoices and updating liabilities Checking for duplicate invoices Performing the two-way and three-way match between purchase order, receiving statement and supplier s invoice Processing payments to suppliers, employees and other parties through different methods such as cash, authority letter for payment through Petty Cash, cheque both manual and pre-printed system generated, bank transfer letter both hardcopy and data file for upload, letter of credit, credit card, internet, etc. Allowing partial payments against invoices Splitting one payment between different entities Linking with payment systems of various banks offering e-payment services Recording withholding tax liability Processing payment of government dues deducted at source and generating tax challans / returns Maintaining records of General Sales Tax paid on purchase of materials and hiring of services for subsequent credit at the output stage Allowing payments to be made both from Head Office and remote locations Providing online payment support for PIA s upcountry and international stations Provisioning for making payments in foreign currencies Booking exchange rate gains and losses for foreign currency payments Allowing generation of recurring payment vouchers for recurring payments Aging of accounts payables 3.1.7 Revenue Accounting This is the key functionality required by PIA to capture and manage the revenues generated by its operations at various locations. This includes revenue streams generated from passenger, cargo and interline segments as well as other services provided by PIA. Revenue Accounting System should supports IATA norms & connect to IATA web application plus upgrade to future IATA norms implemented without delay. Revenue Accounting should be SIS (Simplified interline settlement) compliant. It should be capable of: Provision for import of other Manual data like exchange rates etc. Capturing details of tickets / air waybills issued to agents (stock control). Capturing ticket / air waybill number and other details for sales of tickets / booking of cargo. Handling sales proceeds and matching of passenger revenues. Handling bookings and matching of cargo revenues. Section D Product Requirements (ERP and Add-Ons) Page 163 Confidential

Handling revenues generated through inter-line operations. Handling sales of services to other airlines / agencies. Handling sales returns / refunds to customers as well as agents Segregating all domestic and international refunded tickets. Handling sales returns / refunds in multi currency environment. Calculating agents commissions. Integrating with Sabre Applications, PIA s QUASAR system (for passenger revenues), SITA hosted applications (for cargo revenue) and PIA s Awards Plus program (for passenger ticket redemption). Contractors should carefully read details of PIA applications, particularly about COSSAP, presented in Section C2 Existing Systems. The proposed solution should be able to fulfill all the requirements stated therein. Contractors should carefully read Requirements for Passenger Revenue Accounting presented in Section C2 Existing Systems. The proposed solution should be able to fulfill all the requirements stated therein. Contractors should carefully read Requirements for Cargo Revenue Accounting presented in Section C2 Existing Systems. The proposed solution should be able to fulfill all the requirements stated therein. Ticket wise identification of APW and automated invoice generation along with accounting treatment thereon. MCOs accounting and report generation of tickets issued against MCO along with accounting treatment thereon..issuance of automated short collection investigation reports and ADMS for any variation in MCO amounts and tickets issued thereon along with proration. Capable of creating sales contract, agreements, orders with other airlines and third parties based on different criteria such as flat rate, fixed price, time & material. Section D Product Requirements (ERP and Add-Ons) Page 164 Confidential

3.1.8 Accounts Receivable The Accounts Receivables system is required to support tracking of receivables. It should be capable of: Creating and maintaining customer / agent master records Creating customer groups and clubbing related customers together Managing credit ratings for customers / agents Creating sales contracts / agreements / orders with other airlines and third parties based on different criteria such as flat rate, fixed price, time and material, etc. Creating sales orders by direct manual entry in the system as well as by automatically converting data imported from other applications such as QUASAR, Sabre, etc. Generating invoices and maintaining receivables Sending payment reminders through email and fax Providing multi-currency support for sales of tickets and other goods and services Generating debit / credit notes for adjustments to accounts receivables Enabling electronic submission of invoices and debit / credit notes Recording payments received Offsetting payments against outstanding credit by manually selecting open items or running automatic settlements based on pre-defined rules Recording and managing receipt of security deposits / bank guarantees from agents and customers Calculating and managing incentives and commissions to agents Managing credit sales Maintaining and processing aging statements Maintaining credit, payment and bad-debt history of customers 3.1.9 Insurance Management Insurance Management should be capable of maintaining and processing insurance policies taken out by PIA. Besides other things, it should be capable of: Maintaining market valuation of assets and linking them with the asset master of Fixed Assets Management Providing true / logical valuation for insurance purpose of all assets including aircraft fleet and properties. Professional risk management techniques Section D Product Requirements (ERP and Add-Ons) Page 165 Confidential

should be applied with an aim to minimize risk and optimize savings in premium costs Calculating insurance premiums based on approved quotes and triggering requests for payment of premium Calculating monthly allocation of insurance cost Generating required renewal / underwriting information for renewal of aviation / aircraft fleet and general insurance policies Generating correctly the required information for settlement of insurance claims by insurance companies. For example, in case of aviation insurance claims the standard information which is required for claim processing like certificate of registration, certificate of airworthiness, investigation report, etc. should be available in the system. Same should apply to claims handling for all general / aviation insurance policies Tracking outstanding insurance claims raised Handling and processing customer insurance claims against PIA Section D Product Requirements (ERP and Add-Ons) Page 166 Confidential

3.1.10 Leasing Management This system should be capable of maintaining and processing records related to leased assets and should include the following functionality: Terms and conditions and other relevant details of leasing arrangements leasing company, type of lease (operating or financial lease), lease rentals, down payment, residual value, lease period, etc. Auto-generating recurring payment vouchers in Accounts Payable Identifying physical location of leased assets Identifying users of leased assets Processing disposal of leased assets Handling and managing aircraft leasing, for example wet lease, etc. 3.1.11 Budget and Cost Management Budget and Cost Management system should support preparation of detailed budgets by cost center and by expense head and their monitoring against actual expenditures. It should also allow for revision to original budgets and consolidation of budgets. In addition, it should be capable of: Creating and maintaining hierarchical structures for cost centers Creating and maintaining different cost / expenditure types (direct, indirect, fixed, variable, semi-variable, etc.) and collecting data relating to those types Defining a complete budget hierarchy and classifying revenue and expenditure items. The budget model should be flexible and capable to update itself with the changes in operations / flight schedules Providing graphical representation of budget hierarchy with easy navigation and drill-down features Creating and maintaining cost collectors such as maintenance orders Supporting hierarchical structure of managing the maintenance orders Collecting shop floor data against maintenance orders Recording man-hours against maintenance orders Issuing external repair orders against maintenance orders Defining control limits for over-expenditure against specified budget heads Performing budget availability checks while posting transactions restricting spending beyond budget limits Managing over-expenditure through special approvals based on authority levels and generating reports to monitor use of special approvals Maintaining baseline and revised budgets Section D Product Requirements (ERP and Add-Ons) Page 167 Confidential

Allowing import of budgets created in external systems such as MS-Excel and others Allowing manual input of budget data at lowest level of detail and rolling-up to provide summarized data Allowing manual input of budget data at summarized level and allocating it either manually or automatically through pre-defined formulae Maintaining sales targets for passenger and cargo revenue generation Distribution of annual budget over specified periods; monthly distribution or on a seasonal pattern Comparing budgeted and actual expenditures Supporting standard costing model based on actual operations, comparable with the actual results along with the variance analysis. It should automatically prepare standard reports from fixed and flexible budgetary inputs. Supporting and providing Activity Based Costing Managing overhead costing Integrating with PIA s MRO solution for job order costing Allowing allocation of expenditures from one cost centre to another based on PIA defined rules Determining dependence on fuel pricing and providing different what-if analysis and recommendations for hedging Supporting different budgeting techniques including zero based budgeting 3.1.12 Profitability Management As part of PIA s strategic information needs, profitability status by different criteria is of prime importance. It should be able to identify and highlight profitable stations, routes and also provide the profitability status of various flights. It should be able to collect actual financial data from Revenue Accounting and match it against the planning data from Budget and Cost Management. It should also be capable of: Creating and maintaining hierarchical structures for profit centers Planning and setting up sales / performance targets Handling special agreements with IATA, different airlines and agents Collecting operational and financial data, such as: Flight schedules Fare paying passengers Flight logs Freight tonnage Maintenance and repair charges Section D Product Requirements (ERP and Add-Ons) Page 168 Confidential

Engines / components / spares reservation / leasing charges Aircraft rental charges Block hours Fuel uplift charges Landing / navigational charges En-route charges Handling charges aircraft, passenger, cargo / baggage, etc. Passenger related expenses taxes, handling, meals, give-aways, etc. Flight disruption charges - hotel accommodation, meals, transportation, parking, security, technical handling, crew allowances, etc. Crew related expenses allowances, transportation, layover, flying, etc. Commissions to agents for ticket sales Fixed costs Preparing traffic load summaries Generating aircraft- and route-wise fuel uplift report Providing costing reports including but not limited to direct overhead costing, variable overhead costing, indirect fixed costing, etc. Calculating route and aircraft profitability and development of route economics Providing profitability analysis for other activities such as maintenance services, training, catering, etc. provided to third parties Preparing financial statements (balance sheet, income statement, cash flow statement and profitability statement) for stations based on their local base currencies along with conversion to PKR Statistical and operational performance reporting based on airline specific Key Performance Indicators (KPIs) such as: Market share Available seat per kilometer (ASK) Passenger yield (Revenue per passenger kilometer RPK) Revenue seat factor Available freight tonnes per kilometer (AFTK) Cargo yield (Revenue freight tonnes per kilometer RFTK) Load factor Best / worst performing flight segments / routes Best / worst performing stations Earnings by hubs and international entity including code-sharing Largest revenue earning routes Ranking of cities against revenue generated Others Reporting by: Section D Product Requirements (ERP and Add-Ons) Page 169 Confidential

Region Network Route City Pair Station Aircraft What-if analysis 3.1.13 Foreign Currency Management As part of its operations, PIA regularly deals in foreign currencies. To handle these currencies it requires functionality that can support these operations. It should be capable of: Supporting daily maintenance of foreign currency rates Allowing currency rate conversion calculations Supporting multiple currency rates for different purposes Supporting different decimal places for different currencies; for example 0 for Japanese Yen, 2 for Pak Rupees, 3 for Omani Riyal, etc. Supporting currency conversion, translation and revaluation Maintaining both foreign and local currency amounts for individual transactions Calculating and posting exchange rate gains and losses 3.1.14 Taxation Management PIA operates its offices in many countries of the world; as a result it has to cater to the taxation requirements of these countries. These requirements arise as PIA is involved in making payments for different services received. It should be capable of: Allowing different tax regimes Supporting tax systems in vogue in countries where PIA offices are located Supporting calculations of VAT Supporting sales tax Supporting Civil Aviation tax Supporting withholding tax Supporting income tax Supporting zero tax Supporting tax reporting Maintaining effective dates for tax exemption certificates Section D Product Requirements (ERP and Add-Ons) Page 170 Confidential

3.1.15 Treasury and Risk Management PIA s Treasury department needs to make sound investments, manage its investment portfolio, mitigate financial risks, hedge against increasing fuel prices and monitor and adjust currency and interest rate positions. Treasury and Risk Management should be capable of: Minimizing idle cash Managing portfolios Positioning in multiple currencies Supporting various financial instruments such as debts, investments, foreign exchange, derivatives, etc. Tracking exposures and hedges Analyzing and mitigating risks Managing liquidity Carrying out sensitivity analysis Simulating different scenarios Section D Product Requirements (ERP and Add-Ons) Page 171 Confidential

3.2 Human Resources and Administration PIA is pursuing a strategy of recruiting and retaining talented resources and training them to achieve operational excellence. It is essential to strengthen the manpower resources as operational staff has the responsibility to minimize risks related to engineering and operations. At the same time, business support staff has the responsibility to support cost effective and efficient operations as a whole. This brings the important role of the Human Resources (HR) function into view. Enlightened human resource practices will allow PIA to attract, retain, and develop critical manpower resources and to optimally utilize their expertise and knowledge. The most important information requirement of the HR function is to maintain records of the skills available with and required by various operational and business support functions in PIA. This information helps them match the required skills with those that are already available. The resulting gap analysis helps plan recruitment, staff training and development activities. The Human Resources and Administration function at PIA is organized into the following departments: Human Resources Management Recruitment, Placement and Records Organization Development Welfare Security High Level Specification of Human Resources and Administration Applications 3.2.1 HR Planning and Operations HR Planning and Operations should support maintenance of the organization structure, available jobs and their descriptions / specifications, job standards, employee database, etc. In addition, it should be capable of: Setting up and managing HR budgets Updating organizational charts Creating and maintaining job specifications and job descriptions Simulating, analyzing, forecasting and experimenting with proposed organizational changes Providing analytical reporting such as headcount planning cost simulation, etc. Managing and optimizing the workforce within PIA Section D Product Requirements (ERP and Add-Ons) Page 172 Confidential

Managing capacity planning and load planning Maintaining employee personnel details including staff number, name, address, family details, etc. Maintaining employment history including personal data, joining date, confirmation date, group/grade level, promotions with dates, placements, transfers, temporary transfers, foreign postings, separation date, training history, etc. Maintaining performance appraisals that should include the overall rating, last year s objectives versus actual achievements, objectives for next year, training and development needs, performance improvement plans appraiser s comments, etc. Allowing employee photographs and other documents to be added as part of employee records Automatically monitoring dates for various HR processes; that is specifying date-driven reminders to initiate follow up activities (for example, annual increment, periodic performance review, expiry of employment contract, retirement date, etc.) Integrating with PIA s document management system where physical records are currently being archived Recording employee grievances and decisions made thereon Maintaining records of employees on deputations and secondments Managing disciplinary cases against employees Maintaining contract details of contractual employees Managing award schemes 3.2.2 Recruitment Management The purpose of Recruitment Management is to facilitate the process of selecting the most suitable candidate for employment. This system should be capable of: Maintaining a database of applicants with details of their personal data including education, qualification and work experience related information Managing selection testing Scheduling and arranging interview sessions Organizing and tracking candidates throughout the entire recruiting process Maintaining a list of available job positions Processing recruitment requisitions against sanctioned positions Allowing web-based job application and resume submission as well as online submission of application fee Identifying candidates based on the matching of job requirements with the skills and qualifications of each individual Short-listing candidates based on job specifications Section D Product Requirements (ERP and Add-Ons) Page 173 Confidential

Identifying specific essential requirements for a job and allowing comparison of candidates based on these requirements Recording the ratings and comments of the interviewers Issuing acceptance / rejection letters depending on recruitment decisions Updating employee records from the selected candidate s files Allotting Personnel Number and Under Training Number to selected candidates 3.2.3 Qualifications Management Qualifications management is a very important functionality required by PIA. Recording and monitoring of the knowledge, skills, qualifications, licenses, certifications and competencies of its operational staff pilots, engineers, flight crew, ground staff, etc. is vital for safe and efficient management of its operations. It should be capable of: Defining profiles for candidates and employees along with specifying the type of information that should be stored with each profile Recording the qualifications required to perform specific jobs or tasks, including work-related skills and specific certifications or licenses in the qualifications catalog integrating with PIA s MRO application for linking job (maintenance) requirements with available qualifications Identifying qualifications such as licenses that require monitoring of expiration and renewal dates Linking similar qualifications as an alternative to one another, 3.2.4 HR Development HR development is an important activity carried out by the Human Resources function at PIA. It helps in people development that ultimately benefits the organization in the long run. It should be capable of: Creating and managing career paths within the company Basing career and succession planning on career paths or on an individual s skills and potential Defining and maintaining both company and individual goals Designating individuals for positions or marking them as having the potential to succeed in a particular area or position Mapping a career path for employees outside of their current disciplines Allowing employees to match their qualifications with requirements of a position and determining what (training, proficiency) is needed to meet their goal Managing job rotations and postings Section D Product Requirements (ERP and Add-Ons) Page 174 Confidential

Matching an individual s skills or qualifications to those required for a position, identifying gaps and proposing training and development plans to acquire the necessary skills Keeping track of on-the-job training and training activities such as classes, seminars and workshops Managing internship programs 3.2.5 Performance Management The Human Resources function at PIA supports the core business and other support functions in evaluation of their staff to determine the effectiveness of the staff development processes in place. It should be capable of: Providing a flexible framework to create and administer the process of performance reviews and appraisals. Setting up performance targets and their measurement criteria Having the capability of recording individual employee s Smart Goals Integrating performance reviews into PIA s total rewards strategy. Planning, designing, performing and analyzing multiple appraisal models for multiple purposes. Using a variety of appraisal models as templates to support the staff appraisal process, including: Bell curves Personnel, employee and manager appraisals 360-degree feedback Evaluation of work or projects Event, instructor and participant appraisals Multiple number of appraisers Section D Product Requirements (ERP and Add-Ons) Page 175 Confidential

3.2.6 Compensation and Benefits Management Compensation and Benefits Management should support, maintain and process company guidelines with regards to salaries and wages, perquisites / benefits, facilities, allowances and other staff costs as well as staff increments. It should be capable of: Maintaining ranges of compensation and benefits offered to staff in each group / grade and those on foreign postings Maintaining a record of actual compensation and benefits of all employees Maintaining a database of compensation and benefits of employees of benchmarked companies Maintaining Consumer Price Index (CPI) survey and details of the State Bank of Pakistan s (SBP) report with regards to inflation Making a comparative assessment of compensation and benefits of PIA and other benchmarked companies Evaluating the impact of inflation on purchasing power of PIA's employees using the CPI survey and SBP report details Maintaining surveys and Central Bank reports for countries where PIA employees are posted Evaluating the impact of inflation on salaries and allowances for employees posted abroad 3.2.7 Training and Development Training and Development should identify and target training and professional development needs of staff based on current and projected business requirements of PIA. It should maintain profiles of employee s skills and intellectual assets manage training requirements and activities, identify career and succession planning objectives and track progress. It should be capable of: Maintaining list of resources (rooms, audio-visual aids, trainers, etc.) and allocating them to different courses Maintaining training and development plans of employees Maintaining records of available training programs / catalogues in-house and external (local and oversees) sources Scheduling in-house training programs along with resources required Maintaining calendars of external training programs Determining course demand based on pre-bookings and / or actual attendance of prior periods Registering attendees directly as well as through web access. Also allowing online submission of training fee Section D Product Requirements (ERP and Add-Ons) Page 176 Confidential

Recording feedback provided by trainees and trainers Integrating with Performance Management System to allow appraisals for instructors, attendees and courses. Also matching trainings required to fulfill promotion criteria Conducting and grading different tests / exams Maintaining records of training programs attended by individuals / corporate Maintaining attendance records of external training participants Issuing training certificates Recording trainings attended by employees and the grades obtained by them. For regulated trainings (such as CAA) recording of certificates, issuance dates, expiry dates, dates for refresher courses, etc. Performing a gap analysis between job specifications and employee skills to plan and fulfill training and professional development requirements of each individual 3.2.8 Time Management Time management is required to optimize the process of planning, managing and evaluating the working times and performance of internal and external employees. The system should be able to handle the working time provisions of PIA in lines with those that are required by law. It should be capable of: Maintaining the PIA calendar with holidays Maintaining multiple calendars simultaneously, for instance Gregorian for Pakistan, Hijri for Saudi Arabia, etc. Recording employee attendance Interfacing with different time-recording machines (with bio-metrics capability) to capture real-time attendance data Maintaining leaves, absences, days-off, on-corporation services (OCS) duration etc., of each individual Assisting in shift / roster planning for various departments and crews based on actual / forecasted workload. Integrating with Sabre s Flight Scheduler to capture flight schedules, AIMS software for crew scheduling and MRO solution with engineering shift scheduling Administering shift / roster plans considering defined requirements along with employee skills, qualifications, and availability merging load planning with capacity planning Providing information to crew and other staff of their rosters through SMS or making the information available to them when they dial in to PIA s Call Centre Processing day-to-day changes in the shift schedule based on transactions that affect requirements or availability of staff Identifying and managing rotating assignments Section D Product Requirements (ERP and Add-Ons) Page 177 Confidential

Establishing automatic substitution and on-call procedures Checking employee time assignments against PIA s policies and legal requirements Evaluating time data used for calculation of overtime, shift allowance, night allowance, and other allowances specific to cockpit and cabin crews, engineering staff, etc. Providing attendance and overtime data for payroll processing Processing leave applications 3.2.9 Healthcare Management Healthcare Management should be capable of managing the healthcare requirements of nearly 18,000 employees, plus eligible dependants and retirees. Its main features would include the following: Processing candidate, employee, retiree and dependant registration Initiating medical test procedure for recruitment and recording medical fitness of flight staff Maintaining medical history of PIA staff, retirees and their dependants Processing patient referrals Recording diagnosis and treatment details provided by consultants or hospitals Maintaining list of hospitals, consultants and medical stores on PIA s panel Maintaining the Pharmacopoeia document (PIA s list of authorized medicines) Maintaining treatment costs for management reporting Issuing medicines to PIA staff and their dependants 3.2.10 Travel Management PIA provides travel passage to employees, retirees and their dependants depending on their entitlements. This creates a need for a Travel Management system to support flight reservations, maintain traveling records, etc. It should be capable of: Managing requests for travel passage including approvals from appropriate authorities Maintaining record of employees traveling on corporation service Calculating allowances for employees traveling on corporation service Maintaining records of and providing assistance in obtaining visas Issuing tickets / passages based on entitlements Maintaining traveling schedules of employees, retirees and dependants Keeping track of traveling history of employees, retirees and dependants Section D Product Requirements (ERP and Add-Ons) Page 178 Confidential

3.2.11 Payroll Processing The Payroll should process payment of salaries, wages, benefits, and allowances of employees based on the compensation and benefits data available in Compensation and Benefits Administration and the attendance record maintained in Time Management. It should be an airline industry specific payroll catering to various types of airline specific allowances. Payroll should be capable of: Processing compensation and benefits of each individual based on pay package and attendance record Calculating payroll based on multiple shifts with time data collected from various time collection devices Calculating various allowances for flying staff based on specific flight timings different for cockpit and cabin crew Managing salaries of employees posted at various foreign locations based on the calendars applicable in those countries Managing salaries and running payroll of local employees posted at various foreign locations based on their local statutory, taxation and labor law requirements Catering to the laws of Pakistan as well as the countries where payroll will be run (a list of foreign stations is available in Section A, Sub-section A2) Handling across the board, one-time payments like bonuses, etc. Allowing retro-processing and arrears processing Auto generation of salary increments Adhoc salary increments for individual / groups Processing of loans and advances to employees Generating bank advice for salary transfer to relevant bank accounts Printing salary cheques for employees without bank accounts Generating pay slips of employees Deducting income tax at source Generating location-wise periodic tax returns for statutory reporting / filing with different tax authorities Generating tax deduction certificates of individual employees Providing complete integration between HR and financials systems Simulating payroll runs before actual payroll is run Generating pension run for pensioners 3.2.12 Final Settlement Processing Section D Product Requirements (ERP and Add-Ons) Page 179 Confidential

This system should facilitate calculations and processing of final settlements for all employees; whether regular and contractual. Components of final settlement include all allowances, deductions, leaves, passages, provident fund, leave encashment, loans; preparation of audit sheet and pension sheet; calculation of income tax payable by employee. It should have the following functionalities: Capturing reasons for separation; such as retirement, resignation, termination, etc. Identifying in advance about the retiring employees and generating necessary letters / memos Capturing details of exit interview Withholding salary and other benefits till all clearances are obtained Preparing Audit Sheet with all final settlement calculations Preparing Pension Sheet calculating pension amounts Preparing gratuity information for each employee Maintaining income tax brackets and calculating final settlement amounts after catering for tax deduction Maintaining detailed history for possible re-hiring cases 3.2.13 Personnel Insurance Management PIA offers various group insurance policies to its employees voluntary, term, and provident fund. Besides it also offers accidental death / injury policies for cabin crew and cockpit crew; and personal accident travel (PAT) policy for nonflying employees traveling on PIA business. The Personnel Insurance Management System should provide a database for maintaining insurance claims and what has been disbursed to them. It should include the following features: Maintaining a list of various insurance policies that PIA offers to its employees Maintaining a database of different insurance policies that each employee has subscribed to Calculating insurance premiums based on approved quotes and triggering requests for payment of premium Generating required renewal / underwriting information for renewal of insurance policies Calculating monthly allocation of insurance cost Maintaining insurance claims made by employees Maintaining insurance claims made on behalf of employees Maintaining correspondence with Insurance Companies Integrating with Payroll Processing Section D Product Requirements (ERP and Add-Ons) Page 180 Confidential

Providing standard / basic information like death certificate, etc. for settlement of group insurance claims Maintaining records of claims actually paid to the employees or their nominees 3.2.14 Security Management The Security Division of PIA issues different security cards and passes to its employees, their family members, retirees, and contractors. These include the PIA ID Card, Family Card, Retired Employee Card, and Airport Pass (permanent and temporary passes). Security clearance for foreign postings and interaction with VVIPs are also processed by the Security Division. Functionalities should include: Maintaining data of employees, family members and retired employees required for issuance of respective security cards Issuing ID cards and different types of passes Maintaining photographs of employees, family members, and retired employees Integrating with Time Management so that security cards issued to employees can also be swiped on the time-recording machines 3.2.15 Staff Funds Management Staff Funds Management should maintain and process records related to administration of provident fund, pension, gratuity, and worker s profit participation fund and maintain related books of accounts. All regular employees at PIA are entitled to Provident Fund. 8.33% of an employee s basic salary is deducted from their payroll, and is matched by PIA. Regular employees can also benefit from Additional Provident Fund, amounting to a contribution of 10% of employee s basic salary; PIA, however does not contribute to this fund. Besides other things, it should be capable of the following functions: Managing Provident Fund and Additional Provident Fund contributions by the employee and PIA Posting and bookkeeping of all employees funds Processing Provident Fund loan applications Recording and managing loans and advances disbursed to employees against funds Integrating with Payroll Management for employee contributions, loan disbursements, and loan repayments Processing pension appraisal of employees at the time of retirement Calculating refund of Additional Provident Fund amount Section D Product Requirements (ERP and Add-Ons) Page 181 Confidential

Recording monthly payments to retirees and their dependents Calculating profits earned on portfolio investments of funds 3.2.16 Self Service HR Employee Self Service allows to monitor and update employee own record. it should be capable of the following functions: Maintain personal information, such as home address and emergency contacts View payslips and pay rate change history Update bank accounts and pay distribution information Submit leave applications (absence requests) View leave history Enter qualifications, licenses, certificates, professional training and language skills. Section D Product Requirements (ERP and Add-Ons) Page 182 Confidential

3.3 Procurement and Inventory Control PIA s objective of achieving greater efficiency and economy in technical, operational and business support functions requires harmonized materials planning, accurate consumption monitoring, shorter purchasing cycles, effective stores management, well coordinated logistics, etc. The need for effective procurement and stores management becomes more significant as PIA pursues increased investment in new aircraft and improved engineering facilities. The Procurement and Logistics (P&L) Department of PIA is responsible for the procurement activity of the corporation for all the goods and services at economic prices following procurement rules and procedures, custodian of its inventory and its provision to the authorized users in an efficient manner. Total 51 stores are being managed by PIA at various locations. A detailed list is available in Section A, Subsection A2. There is partial automation at the stores. PIA s in-house developed application, PIA Online Store System (POSS), deals with planning and transaction capturing of commercial and other inventory items. The structure of P&L Department at PIA is organized around the following divisions: 1. Procurement Purchase Technical Purchase Commercial Purchase Technical (Commercial) Purchase New York 2. Logistics Logistics Stores Inventory Control Shipping and Disposal QC & Inspection COMAT Section D Product Requirements (ERP and Add-Ons) Page 183 Confidential

High Level Specification of Procurement and Inventory Control Applications 3.3.1 Contracting and Procurement Management The purpose of Contracting and Procurement Management is to manage purchase of materials and services against indents / requisitions / capital expenditure sanctions raised by different departments and purchase / work orders issued to suppliers. It should also maintain a database of registered / prequalified vendors and facilitate hiring of vendors, suppliers, contractors and other service providers. The main features and functionality will include: Recording and processing profiles and other relevant details of suppliers and service providers potential and pre-qualified. Supplier database should be at least per JAA / FAA / CAA compliance Supporting interaction with the supplier as per Spec 2000; for example, Purchase Order transmission and acknowledgement, etc. Maintaining indents / requisitions / capital expenditure sanctions raised by various departments Supporting online approvals for requisitioning, ordering and invoicing Generating requisitions from other areas / systems such as Engineering (MRO), Flight Kitchen (MRP Recipe Management), etc. Handling requisitions for different types of procurement such as: Stock items Non-stock items Assets Services Other agreements Routing and authorizing procurement documents based on pre-defined criteria Comparing actual cost of purchases against available budgets, budget monitoring. Validating available budget at the time of Requisition and Ordering Generating requests for quotation for pre-qualified supplier / Approved Vendor List or service providers Maintaining price quotations received from suppliers or service providers Supporting on-line bidding by suppliers Supporting the tendering process based on PPRA rules Evaluating proposals online based on cost, delivery time, supplier's record, proposed warranty, technical support, etc. Section D Product Requirements (ERP and Add-Ons) Page 184 Confidential

Generating price comparison statements for items to be purchased or services to be availed Creating purchase / work orders / contracts and tracking procurement status Handling multiple currencies on the same purchase / work order / contract Capturing details of Repair Service Agreements with fixed price / PBH for services, man-hour rates, repair lead-time, warranty conditions, part exchange program, reliability guarantee in compliance with product support documents, for example GCP 2000, PSAA, etc. Tracking receipt of materials / services against purchase / work orders / contracts Tracking materials under inspection and the quantities accepted and / or rejected against purchase orders Logging and approving invoices from suppliers and contractors after threeway matching with Purchase / Work Order and receipt of goods / services 3.3.2 Vendor Management The purpose of Vendor Management is to help PIA in strategic sourcing. It will support creation of vendor master records and maintaining information regarding them, specifically their performance history. This system should be capable of: Vendor performance management in accordance with GCP 2000 and PSAA Evaluating supplier's performance based on lead time, enquiry response time, quantity discrepancies, quality discrepancies, price variance, rejection rate, changes to delivery date, quality of exchanges, etc. Maintaining performance history of suppliers Creating and managing vendor master records Categorizing vendors in categories like aircraft parts vendors, other international vendors, local vendors, employees, etc. Blocking vendors for various reasons such as bankruptcy, blacklisting, poor performance, etc. Pre-qualifying vendors / Approved Vendor List (AVL) Linking vendors to proprietary/ related items Linking AVL with Quality Systems (QS) approval process 3.3.3 Items Management The purpose of Items Management is to identify and maintain information related to store items, particularly aircraft parts, as well as tools and equipments. This system should be capable of: Section D Product Requirements (ERP and Add-Ons) Page 185 Confidential

Maintaining a list of items, tools and equipments with unique identification numbers, detailed specifications, inventory value, previous purchase price, purchase history, min, max and reorder levels, etc. Providing quick referencing / accessing functionality with barcodes and RFID tagging Supporting capturing of the following minimum data related to aircraft parts: Vendor part number OEM part number Part description Relationship tables (WBS) Price Vendor Reliability factor (MTBUR meantime between unscheduled removal / MTBF meantime between failure) Service Level (as per PIA Policy) Alternate parts Limitations of alternate usage Authority for declaring alternate (for e.g. IPL reference, QA letter, etc.) IPC references with usage code Normal stock rooms and shops authorized to withdraw the items Material groups responsible for the item Quantity per aircraft Recommended quantity as per RSPL Essentiality code Class (Rotable, Repairable, Consumable) Buy direct from vendor / OEM, etc. Handling aircraft parts according to a minimum of ten different classes such as rotables, repairables, consumables, etc. Loading initial provision of aircraft parts in the system for aircraft maintenance plan based on manufacturer recommendations Allowing revisions (new, change, remove) to the initial provisioning list Establishing safety stock base keeping in mind the service levels provided by the various vendors / as per PIA Policy Establishing project requirements based on forecast, extrapolation, trend and smoothing factors Monitoring forecast accuracy and identifying deviation Identifying material by OEM part number Grouping all materials of the same form, fit and function under a material number (interchangeability of parts one-way, two-way) Section D Product Requirements (ERP and Add-Ons) Page 186 Confidential

Identifying material to the aircraft types, ATA chapter, classification characteristics of the material, etc. Providing price information about the material including valuation price (at moving average), batch price (Purchase Order based), catalogue price (from various vendors), etc. Provide linkage with various vendors / OEMs current catalogue list price Changing material classification with adequate control (for example, rotable to repairable) Supporting different treatment for each material classification in terms of provisioning formula, movement types, issue control, serialized numbering, etc. Providing parts interchangeability management capability and displaying all interchangeable item at the time of requisition (when requisitioned item is not available) Tracking the shelf life of items, monitoring them and flagging out expired items. Supporting salvaging and re-certification of components from scrap items (Bring On Charge the salvaged components) Keeping track of warranty of items supplied warranties could be of different nature such as repair, purchase, service, etc. 3.3.4 Stores Management The purpose of Stores Management is to support receipts, issues, and transfers of materials and to maintain records of on-hand balances. In addition, it should be capable of: Supporting the requirements of ATA Spec 2000 Providing warehouse management functionality including space management and binning. Warehouses (physical and logical) shall include: Central Stations (local / overseas) In-house maintenance facilities Aircraft Flight spare containers Bench stock (at workshops) Workshops (internal and external) - for both items under repair and spares holding Loan (from and to) Document stock (tickets, air waybills, etc.) Quarantine stock Consignment stock, etc. Section D Product Requirements (ERP and Add-Ons) Page 187 Confidential

Optimizing space allocation for all items by volume and weight, environmental conditions, movement (that is, fast / slow moving items), etc. Identifying materials available at various locations Identifying the aircraft on which a flight container is placed as well as the spares in that flight container Notifying material controller if certain materials reach the threshold level Supporting multiple warehousing for materials. Auto-replenishing (either transfer or reorder) stock in predefined warehouses when it reaches the replenishment level Receiving material in store and holding in quarantine till quality checks are made. It should also support acceptance of services Storing quality assurance certificates (scanned images) and delivery documents in image format and linking them to the Purchase Order Valuing material in each store by moving average price with reference information of purchase price for each batch Tracking on-hand balances and quantities reserved by aircraft Tagging materials reserved against provisional requests. Supporting hard allocation of reserved materials. The release of hard reserved materials for other use should be approved by an authorized party Dispatching materials outside the warehouse based on the following: Sales Sending to line stations Sending items out for repair Returning third party items Returning leased items Returning other operator items Transferring between warehouses Lending to another airline / organization Exchanging with another airline / organization Issuing for consumption (for example, against a Job Order) Disposing off as scrap, etc. Monitoring the whereabouts of dispatched item (based on their batch / serial number) until acknowledgement of receipt Reserving materials manually as well as automatically through other systems such as MRO or through internal requisitions. Issuing materials against requests received. While issuing, recommending the issue of materials down to the batch number. The batch number should be determined either by a first in first out basis or shelf life Producing pick lists for items to be issued Supporting sales of items to other airlines / parties Section D Product Requirements (ERP and Add-Ons) Page 188 Confidential

Supporting stock exchange between aircrafts and between PIA and other airlines Generating inter-store stock transfer notes Supporting and tracking outstanding loans (both from and to PIA) and providing regular reports / alerts for stock items, spares, tools, etc. Determining min, max and reorder levels based on historical and planned consumption patterns Identifying and regularly reporting on non-moving / slow-moving materials Supporting a permanent on-going stock-taking process Scheduling and recording physical count of high value and frequently used items Determining variances between book records and physical count of materials Managing items declared surplus or redundant and managing their sale with a view to optimizing the revenues 3.3.5 Inbound / Outbound Logistics Management The purpose of the Inbound / Outbound Logistics Management is to track shipments of imported / exported materials, status of letters of credit, and compile and compute the total landed cost of each shipment. It should be capable of: Recording authorizations received from government agencies for foreign exchange spending Maintaining records of letter of credits, including the date of establishing the L/C, bank s name, bank charges, insurance cost, supplier of materials, exchange rates, purchase order number, retirement date, etc. Tracking shipments based on intimation received from suppliers or freight forwarders Highlighting delayed items or those missing in-transit and supporting insurance claims Calculating landed cost based on total charges Providing interface with Customs systems and assisting in obtaining clearance from Customs authorities Processing retirement of documents and maintaining relevant records Processing and maintaining details of goods cleared from Customs Supporting statutory / regulatory reporting and documentation requirements when components are moved to external contractors. This will include at least the following: Preparation of air waybill Preparation of freight forwarder instructions Preparation of other accompanying documents Section D Product Requirements (ERP and Add-Ons) Page 189 Confidential

Preparation of Indemnity Bond Integration with freight forwarders for on-line status information Section D Product Requirements (ERP and Add-Ons) Page 190 Confidential

SECTION E PRODUCT REQUIREMENTS (OTHERS) Section E Product Requirements (Others) Page 191 Confidential

E1 RDBMS AND DATABASE ADMINISTRATION TOOLS The Contractor is required to supply the latest version of RDBMS that effectively supports the proposed ERP Package. To this extent certification of ERP manufacturer that the particular version of RDBMS is fully supported by the ERP should be provided. Besides, the Contractor must also provide an install base of the RDBMS with the proposed ERP in projects of comparable size. Database schema definition, management, query and reporting facilities must be provided. Historical transactions must be maintained by the RDBMS. Facilities for reviewing transactions, multiple transaction roll back and transaction log reporting are required. Database update facilities must include features such as the use of working copies and status reporting on query and update operations. The system must provide locking mechanisms for update and delete operations. The system must maintain concurrent control mechanisms to ensure the correctness of transactions and to detect and resolve deadlocks on the network. The system must support authorization lists and groups for create, read, update and delete. The provision of on-line facilities to manage transactions and overall on-line system performance is desirable. The system must provide users and applications with distribution independence. Users do not need to know where database objects are located. The system must operate in a distributed environment where different nodes of the network run at different functional levels. The system must have the ability to automatically recover and restore the database fully to the last consistent state after a media or system or database failure. The ability to notify users as to what transactions were being processed but not written to the database during a crash is highly desirable. The system should have archive logs and checkpoint facilities and the capability to roll back / undo to any one checkpoint. The system must continue to be available to users during any backup process or alteration of the database schema s and definitions. The system must support one-to-one, one-to-many and many-to-one relationships. The system must be capable of working in a multi-tier environment, and provide the appropriate tools for partitioning the location of the processing. All tuning must be independent to the user. All information in the database must be represented as values in the table. Section E Product Requirements (Others) Page 192 Confidential

Null value support (as opposed to empty character strings, blank characters or zero) must be available for all data types. Database recovery must be made in minimum acceptable downtime. Acceptable downtime is to be negotiated and agreed upon RDBMS should have a support for ETL RDBMS should have support for SAN storage and cluster environment Load balancing and failover must be supported to minimize down time RDBMS should support DR sites and automatic standby configurations. It must be capable of operating in the DR environment and support synchronous as well as asynchronous data replication at remote DR site RDBMS should be capable of supporting large amounts of data in terra bytes RDBMS should have support for transmission of data from other new systems as well as exiting legacy systems It should support libraries to enable backup on tape and disk drives It should have support for new firewalls and n-tier network architecture It should have support for OLAP, OLTP and DSS systems For effective monitoring and management of the database, the Contractor is required to provide, as part of its solution, Database Administration Tools that will help database administrators in database monitoring, storage analysis, capacity planning and performance monitoring and including trend analysis, size estimation and table creation. Section E Product Requirements (Others) Page 193 Confidential

E2 APPLICATION DEVELOPMENT TOOLS All application development and maintenance will be carried out on the centrally located development server. The Contractor will be required to propose and supply application development tools, consistent with the proposed ERP package. It is expected that the proposed solution comes with a built-in 4GL development environment tool set. Section E Product Requirements (Others) Page 194 Confidential

E3 QUERY AND REPORT GENERATOR TOOLS The Contractor must provide complete query and report generator functionality, preferably within the provided system. The report generator functionality must include a scheduling or production process for routine reporting. The report generator functionality must be robust and oriented to the skills of "average" desktop systems users and should support SQL. It is expected that the solution would support industry standard report generators such as Crystal Reports, Business Objects, etc. Formatting and statistical capabilities such as averaging, multi-level sub-totaling, percent change comparisons, standard mathematical operations and financial calculations is required. Generated reports must be able to be saved in several output formats, at a minimum: MS Word, MS Excel, Text, PDF, HTML and XML. The Contractor must describe its query and report generator systems in detail in the Technical Proposal. Section E Product Requirements (Others) Page 195 Confidential

E4 INTERIM SERVERS 1. In order to avoid any delay in meeting the Project completion milestone, and to cater for the lead time required by PIA in the procurement process, the Contractor is required, as part of its proposal to provide, without any cost to PIA, Interim Servers and Operating System Software, as follows: a) the Server, (or Servers) will be installed by the Contractor at PIA s Computer Centre. b) the Server(s) will be used for the purpose of configuration of the ERP Package, development of Add-on applications. Besides, interim servers will be needed for training of staff, and testing the system. c) all necessary hardware components such as CD-ROM drives, tape drives (for back up purposes), etc. are considered part of of interim servers d) software components, such as RDBMS, development tools, 3 rd party software, etc. provided by the selected Contractor will be used on the Interim Servers. 2. It is anticipated that the Server(s) will be required for a period of approximately nine (9) to ten (10) months from the date of supply of Server Hardware, Operating System Software and ERP Package Software. 3. The details of the proposed Interim Server(s) hardware Configuration and Operating System software are to be provided by the Contractor in its proposal. 4. The configuration of these machines should be capable to support the number of users as specified by the Contractor in its plan. 5. In its proposal, the Contractor will provide site specification requirements for the installation and operation of Interim Server(s). 6. PIA - at the end of implementation and rollout - may at its discretion, decide to purchase the interim servers provided by the Contractor. In this regard, the Contractor should, as part of its Commercial Proposal, separately mention the cost at which it would offer these machines for sale to PIA. However, this cost component should not be added to the total bid price, nor should it be used to calculate the bid bond amount. Section E Product Requirements (Others) Page 196 Confidential

E5 3 RD PARTY SOFTWARE 1. In order to effectively manage and run the complete solution some other 3 rd party software and application programming interfaces (APIs) may also be required to integrate various applications and execute and monitor the complete solution. 2. The Contractor will be responsible to ensure that all required 3 rd party software, operating systems, system management and monitoring tools, backup and recovery software, database administration tools, disaster recovery and business continuity tools, APIs / interfaces, etc. are made available, documented, designed, implemented and operational to meet PIA s requirements in the proposed ERP solution. 3. It is the responsibility of the Contractor to offer PIA a complete solution in all respects delays or costs arising out of any shortcoming will have to be borne by the Contractor. Section E Product Requirements (Others) Page 197 Confidential

SECTION F SERVICES REQUIREMENTS Section F Services Requirements Page 198 Confidential

F1 IMPLEMENTATION 1. As part of its proposal, the Contractor must submit an Implementation Strategy and Plan which caters for the following, to be performed by the Contractor: a) Installation of the Interim Server(s) including the Operating System. b) Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Interim Server(s). c) Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Permanent Servers. d) Implementation of Database security features e) Development of a Business Requirement Document (conceptual system design) for each functional area by mapping the business processes for the parameterization / configuration of ERP Package. This document should be based on PIA s reengineered business processes that would be made available to the Contractor. PIA will review and approve this document before Contractor can start work on parameterization / configuration of the ERP f) Development of business case scenarios g) Parameterization of supplied Software i.e. the configuration of application software via selection of in-built values, setting up of tables, etc. to meet the business requirements. h) Software modifications, where required, to supplied Application software and development of extensions and / or modules to meet the business requirements. i) Integration with PIA s other applications such as Sabre, AIMS, SITA Cargo,, MRO solution, QUASAR, Recipe Management, Corporate e-mail, PIA website, etc. j) Design and development of customized reports, screens, workflows, etc. PIA will try to maximize the use of standard reports, screens and workflows available in the proposed solution; however the Contractor cannot set an upper limit to the number of customization that it will undertake. k) Design, development and initial set up of databases. l) Unit, Integration and System testing prior to User Acceptance testing. m) Preparation of data migration strategy and plan and undertaking data migration activities based on the plan. n) Design and implementation of Online and Batch job operational procedures until implementation is successfully completed at all locations. o) Progress reporting (on a weekly basis) on the Contractor s activities. p) Quality Assurance for Contractor related activities. q) Any other tasks required in successful delivery of the supplied products and services. Section F Services Requirements Page 199 Confidential

2. The Contractor must utilize airline industry specific rapid implementation templates to ensure implementation within the specified timelines. Details of such templates should be submitted with the Technical Proposal. 3. A detailed comprehensive project plan is to be prepared by Contractor and submitted as a part of the proposal. The plan shall be mutually approved and incorporated as part of contract and reviewed at regular intervals. 4. The Contractor must submit a detailed project organization structure identifying, by name, the specific individuals who would be assigned different tasks of this project. The Contractor must assign full-time Project Manager and ERP module track leaders on this Project. The Project Manager as well as each ERP track leader must have the experience of implementing the proposed ERP in at least two airlines. A personnel roster containing detailed responsibilities of the Contractor s staff who shall be assigned to perform duties or services under the contract should be provided. It should include estimated number of days to be worked on the project for each person broken down in different phases of the project; with clear identification of the start and end dates for each phase. These staff members must have the experience of at least two complete implementations. If additional members are assigned their detailed CVs should be submitted as part of the proposal. The Contractor will not be allowed to assign staff members who do not have the experience of at least two complete life-cycle implementations of the proposed ERP. Daily charge-out rates for each Contractor staff must be provided in the Commercial Proposal. If deployment of the Contractor s proposed staff is less than the estimate provided in the personnel roster, PIA would make proportionate deductions from Contractor s payments. However, in order to ensure timely completion, the Contractor may have to deploy additional resources, if required, without extra cost to PIA. The Contractor shall be contractually bound to maintain the proposed team dedicated to the PIA project with the exception of a staff member leaving the Contractor organization. In such cases staff proposed as substitutes must have qualifications equivalent to or better than those being replaced and must be approved by PIA. 5. The Contractor must submit a detailed Testing Methodology. The Contractor may perform Unit, Integration, and Systems Tests off-site; however, the official Systems Test and all User Acceptance Tests (UAT) and Performance Accepatnce Tests (PAT) must be performed on-site using PIA s testing environment. Section F Services Requirements Page 200 Confidential

6. The Contractor must provide, by phase, the proposed number of personnel to be based on-site at PIA s premises, and space and other requirements to be provided by PIA during Implementation. 7. The Contractor will develop a system handover plan which indicates the conditional criteria required to fully handover the daily operation of the system to PIA s technical staff. At a minimum, the handover plan must include the state of readiness required for system handover and all required documentation. 8. The Contractor s implementation plan must take into consideration the business priority areas and applications. 9. System Performance: During system installation the Contractor will evaluate performance factors including, but not limited to, transaction volumes, response times, CPU utilization, and input / output activity. The Contractor will be responsible for tuning the application to meet acceptable response times. 10. Capacity Evaluation: The Contractor will conduct a Capacity Test that will include stress and volume testing. Capacity testing shall include a stress test that includes simulation of at least 30% of the system workload and volume tests that test the database activity against at least 30% of the data volume. The Contractor will document, the conclusions resulting from the test. 11. Project Management and Reporting: The Contractor is required to maintain a project plan covering its components of the project and each individual phase. The plan shall include project organization, work break down structures, schedules, critical path determination, and other features required to track and manage this project. The Contractor will be required to prepare and submit weekly progress reports to PIA on each component of the Project under which it is responsible. 12. Project Quality Management: In its proposal, the Contractor must describe its approach for assuring the quality of its components on this project. The proposal must demonstrate an understanding of the Contractor s ultimate responsibility for quality and define a comprehensive set of reasonable and effective practices for fulfilling that responsibility. The Contractor must also specify whether third party audit / quality assurance visits will be undertaken and who will bear the cost of these visits. 13. Acceptance Testing: PIA will conduct a rigorous acceptance test of the system. PIA user staff and information system specialists will exercise all system functional aspects using PIA-developed test data to assure that the system meets defined business and technical performance requirements. During this test, PIA will identify required modifications and document them through the problem resolution or change management processes (described below) as Section F Services Requirements Page 201 Confidential

appropriate. The Contractor shall modify the system as required and provide new versions of modified components to PIA for testing. PIA will notify the Contractor in writing when it determines that the system is acceptable. 14. Problem Resolution: The Contractor and PIA will cooperate to resolve system problems found during acceptance testing and production use, including the warranty period. PIA will prioritize and report problems in a written format. The Contractor shall track these problems to closure and report their status. The Contractor shall evaluate each reported problem, estimate the time needed to resolve the problem, identify potential impacts on the system and the project, and report to PIA. If PIA decides to proceed, the Contractor shall resolve the problem according to its assigned priority. 15. Change Management: PIA and Contractor will cooperate in managing changes to previously agreed upon system functional capabilities. PIA will identify potential functional changes and propose these to the Contractor in writing. The Contractor shall evaluate each proposal, identify potential impacts on the system and the project timeline, and report to PIA. If PIA decides to proceed, it will prioritize the change and authorize the Contractor in writing to perform the work. The Contractor shall track the status of in-progress change orders and report to PIA upon request. However, cost escalation will not be allowed under any circumstances. 16. Configuration Management: The Contractor shall manage version releases of all contract deliverables and certain other critical documents as determined by PIA. This process shall assure that the status of all deliverables is known, that only approved versions are released for production use, that prior released versions can be recreated, and that changes are made to released deliverables only when authorized by PIA. The final release of each controlled deliverable must reside in a library (preferably computer based) under PIA control. Section F Services Requirements Page 202 Confidential

F2 TRAINING 1. Training is required in two main areas: (a) Technical Support Staff, and (b) Systems Users. Technical Support Staff will comprise of System Operators, System Administrators, Database Administrators and Developers. Systems Users will comprise the staff from different functions of the company, including, but not limited to, Finance, Human Resources and Administration, Procurement and Logistics, Information Technology and those belonging to the stations. Three levels of Systems Users are currently identified as: Key Users (responsible for system parameterization in the future), End Users and Senior Management (who are expected to be provided System Overview). 2. As part of the proposal, the Contractor must describe in detail its approach to meeting the training requirements for each audience. The description must include methods proposed to deliver both training and documentation. The Contractor should describe the general content of all training materials, training courses, and documentation proposed. 3. The Contractor will be required to develop a Training Strategy to ensure that all identified Systems Users and Technical Support Staff is thoroughly trained in the use and support of the system. Training for Key Users must be imparted early in the implementation stage, preferably in the first month, to enable them to actively participate in the parameterization process 4. The Training Strategy should include a training solution to support the training of users throughout PIA in the functionality of the various ERP components and Add-on applications. The Contractor will be required to develop formalized classroom training sessions, to be delivered by their staff, for each of the user groups identified to ensure that the trainees become familiar with all the system features of the implemented applications. In addition, where required, for technical staff, informal training should also be included. 5. For PIA technical staff, the Training Strategy should include a plan to train the required staff in the Development and Administration tools supplied, and provide them the knowledge to efficiently operate, use and maintain the system independent of Contractor assistance. Technical training materials must be comprehensive and detailed. 6. The Training Strategy will address, at a minimum, the following: a) Description of the Course, the Course outline, specifications of the number and appropriateness of staff who will attend, probable dates for classes, etc. b) Proposed content of all training materials. c) Description of proposed software / tools (these may include training aids, manuals, on-line references, quick reference guides or templates, or computer based training), and their use during the training. Section F Services Requirements Page 203 Confidential

d) Details of the physical locations to be used for training. e) Training evaluation methodology f) The names, qualification and Formal Training experience in man-months, of the instructors for each training course. 7. The Contractor is required to provide materials for training users in central and remote locations. The User Staff training materials must cover, at a minimum, the following topics: a) Systems Overview systems benefits; data inputs, outputs, and reports produced; major systems business functions; Users Manual contents and usage; b) Systems Usage entering data and data validation; data correction and user help features; menu and system function traversal; problem recovery; report contents, report generation / suppression; search and inquiry features; record update procedures; c) Systems Operation job recovery; job scheduling; job cycles (daily, monthly, quarterly, annual, and special); special forms usage; 8. The Contractor must provide material for training Technical Staff such as database administrators, system administrators, operators, and developers. This material must cover all aspects of systems design, operation, and maintenance including, at a minimum, the following topics: application and database design and architecture; application structure and module / sub-module / program / subroutine relationships; application start-up / shut-down procedures; application back-up, recovery, and restart procedures; data dictionary structure and maintenance procedures; database logical and physical organization, and maintenance procedures; application security features; audit and testing procedures; Section F Services Requirements Page 204 Confidential

system data entry; checking, correction, and validation procedures; user help procedures and features; system troubleshooting and system tuning procedures and features; system administration functions management; setting and changing system password and user ID security features; system interface processing; on-line and batch processing procedures; unique processing procedures; report generation procedures; menu structures, chaining, and system command mode operations. 9. PIA requires the training material on CDs. All training material provided by the Contractor will be reproduced and used as needed by PIA. 10. Cost of Foreign Training, if proposed, should be included in the Contractor s Commercial Proposal and include all expenses related to travel, accommodation, tuition fees and other incidentals. Section F Services Requirements Page 205 Confidential

F3 DATA MIGRATION 1. The Contractor should include, as a part of its proposal, a description of its general approach to the data migration process (manual and automated) for historical and cutover data. 2. The Data Migration Strategy must address, at a minimum, the following: a) Migration overview with objectives, approach, impact, and resources b) Migration data (source and volume) c) Migration process (automated or manual, verification procedures) d) Migration support (systems, policy and hardware) e) Migration schedule f) Migration preparation task outline 3. The Detailed Migration Plan must address the following tasks: a) Identify data elements to be migrated. b) Identify necessary computer processing workloads. c) Identify any special forms and procedures. d) Identify any control procedures and evaluation criteria. e) Identify, with the assistance of PIA, the personnel needed to participate in the migration of the data. f) Plan any special training for migration activities. g) Plan any interim file maintenance requirements. h) Develop migration programs (this includes specifications, program coding, test plans, and complete testing). i) Present Migration Plan, Procedures, and Programs to PIA for approval. 4. The Contractor should perform the following tasks: a) Study the existing application, databases and manual data sources b) Design and develop a solution including intermediate utility (if any) to convert the data from existing databases to the new databases. c) Demonstrate and test this data migration on sample test data from existing live applications. d) Develop and document all operational and technical areas for above solution e) Migrate data from the legacy systems to ERP Section F Services Requirements Page 206 Confidential

F4 DOCUMENTATION 1. As part of its Technical Proposal, the Contractor must describe the level and types of documentation that will be delivered. This documentation must cover each level of operation, for example: user, security administrator, database administrator, operator, developer, etc. 2. Two complete hardcopy sets of documentation for all Contractor supplied components for this Project must be furnished, in addition to softcopies on CDs. 3. The manuals should feature clear organization of content, easy to understand language, useful graphic presentations, and a thorough index and glossary. These will be under the following categories: Detailed process manuals User manuals Operational manuals 4. These manuals must address the view of the system required by business unit staff (end users). It must contain sufficient information to enable the user to independently operate the system, troubleshoot simple problems, and correct problems. The User Manuals must be able to serve as a reference guide and a teaching aid. It must cover all facets of system functions and operations, including: Complete instructions for the users, completely explaining the use of each system function; System usage scenarios, based on real world examples drawn from the dayto-day workloads of typical users, that fully describe and explain the salient features and operation of the system; How input data are stored and related between system records; How to generate / suppress standard and ad hoc reports; Normal report distribution; Prioritization processing, system determined priorities, and user override procedures; System log-on, log-off, and security features; Error messages and error correction procedures; Help features and usage; System troubleshooting; Mandatory data fields and default data values; Traversing system menus; Screen layouts and contents; Inquiry functions Section F Services Requirements Page 207 Confidential

5. Besides, detailed User Manuals, Quick Reference cards will be produced by the Contractor, which will be an immediate aid to the user and quickly describe operations. 6. The Technical Manuals must address the view of the systems required by developers, administrators and other technical personnel. It should provide an understanding of the application; database design and file structures; relationships between programs, security; troubleshooting; special constraints; and other operational guidelines. 7. Copies of all licenses, warranties, maintenance agreements and similar materials for all Contractor delivered components of the project must be furnished separately. 8. Contractor must submit sample copies of all documents that it will prepare / deliver to PIA during the course of this project. Section F Services Requirements Page 208 Confidential

F5 WARRANTY AND MAINTENANCE SUPPORT 1. The Contractor will provide warranty services for a period of at least one year for software and a minimum of three years for hardware by ensuring that the system in every way meets the specifications stated in this RFP. The warranty will begin upon PIA s written final acceptance 15 of the system. All warranty support services, whether on- or off-site, are to be rendered free-of-charge to PIA. The Contractor shall be responsible for all costs (including but not limited to travel, accommodation, conveyance, other incidentals, etc.) associated with warranty support services. 2. Separate and apart from the warranty support services, the Contractor shall provide support ( Maintenance ) services for Applications, and RDBMS beginning upon the end of the warranty services and extended up to five (5) years thereafter. 3. The Contractor must describe in detail in the Technical Proposal its User and Technical Support Plan for the warranty and maintenance periods, covering the resources, timing and procedures that will be available to provide this support. The plan must include identifications of procedures for 24 x 7 support for on-site and off-site maintenance, for: on-site fault diagnostic techniques; remote or tele-diagnostic fault diagnosing techniques; average time to arrive on-site; mean time to fix major system components; fault escalation procedures; maintenance of error logs. 4. The Contractor must specify the various categories of problems it will support and describe the severity levels of problems. The escalation process must assure appropriate management contacts can be made in the event that the support response is not effective. PIA would like to sign a Service Level Agreement (SLA) (that would include penalties for non-performance or poor delivery) for maintenance support with the Contractor. 5. Details of the establishment of an effective Hot Line Telephone and Support Desk service should be provided. 15 Acceptance The ERP Solution shall be deemed accepted upon the successful completion of Acceptance Testing of all supplied applications and modules, conducted in accordance with PIA's Acceptance Criteria which will test the desired functionality and interoperability of Contractor supplied applications and modules. Section F Services Requirements Page 209 Confidential

6. PIA may require the Contractor to develop additional customized reports, screens, workflows, etc. during the maintenance and support period. Contractor must specify in its Technical Proposal a solution to accommodate PIA s requirement. The Commercial Proposal must contain the pricing mechanism for additional development / customization. 7. The Contractor must provide a list of clients in Pakistan for which ERP Maintenance Support is, or has been provided during the past three years. Details of modules supported should be included. Section F Services Requirements Page 210 Confidential

F6 VERSION AND UPGRADES 1. Contractor must ensure that training material / software / process documents are duly licensed for the purpose of implementation and use by PIA of the ERP. These are to be of latest version and Contractor must ensure up-gradation of all modules / material / process documents during the warranty period and as part of after-warranty maintenance support. 2. During the implementation and subsequent rollout, the Contractor would be responsible to arrange and provide free version upgrades of all components under its responsibility. Contractor must ensure that at the time of handing over the solution to PIA all components are of the latest release and that the total solution is certified by the Contractor for completeness. Section F Services Requirements Page 211 Confidential

SECTION G HARDWARE REQUIREMENTS Section G Hardware Requirements Page 212 Confidential

G1 HARDWARE 1. The Contractor must evaluate and prepare an appropriate configuration to run the proposed ERP solution. PIA is looking for a high-availability solution including servers, clustering design, and disaster recovery recommendations besides maintenance / repair options needed for the associated infrastructure. a) Contractor should submit details of the proposed configuration, including layout diagram detailing model designation(s), memory size, number of CPUs, type of drives with capacity and counts. b) The offered solution should comply with the Open Systems Architecture and latest technology trends. c) The solution should be scalable, both horizontally and vertically. d) The hardware should be sized keeping in view the operational requirements of the ERP and associated applications. e) The hardware should be fully capable of hosting the ERP certified database. f) The hardware must allow each partition of the ERP environment to be isolated in such a way that a software fault in one partition will not have an impact on another partition. g) All software required for clustering of servers and implementation of DRP should be included in the solution. h) The solution should be fully supported by the Contractor for not less than ten years from the date of supply. It should remain capable of being supported, upgraded and extended by the Contractor during this period. i) The solution provided should be accompanied with complete documentation, operating manuals, system diagrams, startup and recovery procedures and all other information required for proper and efficient operation. j) Contractor should provide all technical materials and verifiable benchmarks related to the proposed solution. The hardware should be certified by the ERP principal vendor for the operation of the ERP and be reasonably expected to be certified for future versions of the ERP during the expected life of the hardware. k) Contractor should provide information on warranties on the equipment and any options regarding warranty extension. Principal s assurance is required for parts availability after expiry of warranty period. l) The Contractor must provide thorough and contemporary 3 rd -party testing software for acceptance and load testing. The testing should be done according to systems equipment specifications as well as generally accepted practices. m) All test results should be completely documented by the Contractor. Complete test documentation including results of the 3rd party load / stress testing software should be provided to PIA. n) Based on PIA s high availability requirements, failover design should be based on protecting single point of failure. Section G Hardware Requirements Page 213 Confidential

o) For high availability on the application layer, the solution should implement log on load balancing between the application servers. It should not need any form of reallocation of resources between servers. The application environment should be sized and designed such that upon failure of an application server (based on single point of failure), minimum degradation of performance is experienced. p) A Disaster Recovery (DR) design should be provided which provides a seamless, pragmatic DR process. It should integrate within the overall design of the ERP landscape. q) The DR process should be simple to execute. A step-by-step process and procedure is required to minimize the potential for human error in a time of crisis and disaster. Additionally, the DR design must be easily tested with minimal impact on day-to-day operations. Section G Hardware Requirements Page 214 Confidential

SECTION H REQUIREMENTS COMPLIANCE MATRIX Section H Requirements Compliance Matrix Page 215 Confidential

H1 GLOBAL REQUIREMENTS GENERAL Detailed below are the global requirements applicable for the entire solution. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a thirdparty solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 216 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 Common Characteristics 1.1 Common characteristics are shared by all areas of the ERP Solution 2 Integration 2.1 2.2 Software supports modern best business practices, with data located in one integrated system shared across all organizational units It will also be integrated with future modules using the same development language / platform 3 Configuration 3.1 Software will require minimum software modification to meet its business requirements. It will allow for easy configuration to meet those requirements without changing software code or requiring Add-ons 4 Technology Interfaces 4.1 4.2 4.3 4.4 Software has standard application programming interfaces, tools and methodologies that allow future releases to accommodate interfaces without reprogramming A standard approach to interfaces is available to avoid multiple, unique approaches for different systems The Contractor has ensured, at its cost, availability of not only its own APIs but also from other parties to enable integration with other applications that it has proposed along with the ERP as well as existing applications that will continue to run at PIA and will require integration with the proposed ERP Contractor has ensured to provide XML-based APIs wherever these are available 5 Access Control 5.1 The system supports multiple levels of security while providing single sign-on facility to the users 5.2 Individual fields will be protected from unauthorized access 5.3 Access to certain functions and data will be protected until they are approved by PIA s concerned policy makers Section H Requirements Compliance Matrix Page 217 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 5.4 Application security will be integrated with database security. Data files / tables will only be accessed through the ERP; direct access through different query languages will not be possible 5.5 Templates or group functions will be provided to facilitate maintenance 5.6 5.7 5.8 5.9 5.10 Changes in assignment (employee transfers) or termination / retirement will automatically trigger a review of the employee s security privileges Comprehensive logs of transactions and security incidents will be maintained for auditing purposes. System will be capable to maintain audit trails and logs System will provide authorization, authentication, integrity and non-repudiation facilities for critical transactions Password length and acceptable character combination as per industry standards are supported System will allow setting up of password change frequency and the number of previous passwords that could not be repeated 5.11 System will force users to change their passwords after pre-defined intervals 5.12 System will allow secure remote login and will support digital signature and time stamp, etc. 6 User Interface 6.1 The system will have a common look and feel across all applications 6.2 Screen labeling will be available in English and Urdu 6.3 Online help will be available for all applications and will allow for customization 6.4 The system will have fast data entry screens for bulk data entry 6.5 The system will be accessible using standard personal computer through browser 6.6 System will allow opening multiple sessions 6.7 6.8 System will allow for switching between different programs without first having to exit from the system. System will allow defining navigational menus that can be created by end-users according to their job requirements Section H Requirements Compliance Matrix Page 218 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 6.9 6.10 Business rules will be incorporated into the system such that the rules are applied at the time information is entered into the system The system will have validation routines / parameters to identify errors, inconsistencies or additional requirements at the time data is entered 7 Reporting / Inquiry 7.1 The system will include comprehensive inquiry / reporting tools that allow for easy access to authorized data 7.2 Drill down capability to examine details will be available 7.3 7.4 7.5 7.6 7.7 7.8 7.9 7.10 It will also be possible to create reports that reflect status as of a specified point in time Standard reports will be included to serve as models for customized reporting and to provide for basic functional reports Report wizards or similar techniques will be available to guide users through report creation The system will be such that reporting activities do not compromise responsiveness of the interactive system Reports will be formatted to print on local PC and LAN attached printers, centralized high-speed printers as well as over internet and intranet It will be possible to deliver fixed reports to users on a pre-determined schedule to be reviewed online, to be retained online or to be printed at the user s discretion System will be able to deliver the reports using its own messaging / workflow engine as well as PIA s email system, Lotus Notes The system will be able to demonstrate useful demographic and forecasting capabilities 7.11 The system will support text-based, parameterized and wild-card searches 7.12 System will provide users the ability to develop ad hoc reports at their discretion 7.13 The system will include a data dictionary or similar provision to allow nontechnical users to identify the appropriate data elements for inclusion in their reports Section H Requirements Compliance Matrix Page 219 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 8 Analytic Tools 8.1 8.2 8.3 PIA desires decision support tools and information bases that are fully integrated with the system to facilitate strategic planning, tactical operations and organization-wide analysis these will be available The system will support the easy movement of data to common packaged PCbased applications such as Microsoft Office The system will be capable of producing what if scenarios to support decision-making 9 Communication 9.1 9.2 The system will foster information sharing at all levels of the organization. For example, policy directives and goals will be incorporated into the budget planning process; departments will be able to share purchasing intentions and specifications and best business practices will be readily available for consultation The system will provide a single place for users to quickly access information and updates on organizational news and policies 10 Flexibility 10.1 10.2 The system will be easily reconfigured to respond to changes in business practices, policy directives, organization structure, statutes and regulations Flexibility will extend both to enterprise-wide as well as industry specific practices 11 System Availability 11.1 Overall it will be a highly available solution 11.2 11.3 The system will be available for access by authorized personnel from anywhere at any time of the day or night (24 x 7 availability) The system will be equally usable from remote locations as from the Head Office 11.4 Web-based access will be supported 12 Transaction Timing Section H Requirements Compliance Matrix Page 220 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 12.1 12.2 12.3 12.4 The system will support real time operations. Changes to data or the status of processes will be immediately available in the system System operations will not constrain the business processes supported by the system The system will support effective dating for transactions, including both future and retroactive changes. The authority for such transactions will be included in the security capabilities of the system The assignment of a retroactive date will generate the changes required to bring the system up to the current date 13 Online Documentation and Training 13.1 The system will include customizable online documentation and training materials such as context-specific help, search capability, business process documentation and process maps 13.2 Context sensitive help will include: 13.2.1 Menu options 13.2.2 Tabs 13.2.3 Data entry fields 13.2.4 Buttons 13.2.5 Icons 14 Storage / Record Retrieval 14.1 14.2 Record collection and retention is an important organizational requirement. The ability to easily archive, retain and access records is required Records retention procedures will allow information to be stored in a way that can be accessible indefinitely 15 Data Support 15.1 The solution will support multiple data types text, image, voice, etc. 15.2 The system will support data upload to and download from different systems in multiple formats Section H Requirements Compliance Matrix Page 221 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 15.3 Besides simple upload / download facility it will also communicate and support data interchange with mobile devices such as: 15.3.1 cellular phones 15.3.2 handheld terminals 15.3.3 PDAs, etc. 15.4 System will support other devices such as: 15.4.1 Scanners 15.4.2 barcode readers 15.4.3 biometric devices 15.4.4 card readers 15.4.5 RFID devices, etc. 15.5 Support for important messaging / data formats / standards will include, as a minimum: 15.5.1 Aircraft Communication Addressing and Reporting System (ACARS) 15.5.2 SITATEX 15.5.3 ASCII 15.5.4 EDI 15.5.5 SMS 15.5.6 XML 15.5.7 Spec 2000 15.5.8 UNeDocs 15.5.9 MS-Office 15.5.10 Lotus Notes, etc. 16 System Security Section H Requirements Compliance Matrix Page 222 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 16.1 16.2 System provided is secure and meets all standard security requirements i.e. Identification, Authentication, Authorization and Integrity System allows implementation of industry standard security policies and is capable to evolve to meet security challenges 16.3 Details of the proposed security tools is provided 17 Web-enablement 17.1 The proposed system is Internet ready and allows web-enabled access to users from anywhere across the world through a web portal 17.2 The system is compliant with the Service Oriented Architecture (SOA) 18 Self-Service Portal 18.1 18.2 The proposed system will provide the users access to self-service portals where they can log in and obtain different levels of information such as directory lists, airline schedules, seat availability on flights, etc The proposed system will also allow users to update personal information and enter requests such as leave and passage approval, purchase of tickets, etc. 19 Workflow 19.1 The proposed system will provide Workflow functionality to users by which information and requests could be automatically routed to the concerned levels for approval 20 Others 20.1 Some other requirements include: 20.1.1 Supporting multi currency 20.1.2 Supporting multi languages 20.1.3 Supporting multiple legal companies 20.1.4 Supporting multiple tax structures (that is, supporting individual country tax structure and reporting) 20.1.5 Interfacing with legacy systems 20.1.6 Storing transactions and balances of legacy systems Section H Requirements Compliance Matrix Page 223 Confidential

GLOBAL REQUIREMENTS GENERAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 20.1.7 Supporting user defaults 20.1.8 Supporting user defined screens 20.1.9 Supporting multiple date formats 20.1.10 Supporting multiple decimal formats in amounts simultaneously 20.1.11 Supporting user defined fields 20.1.12 Scheduling of jobs for unattended operations 20.1.13 Maintaining effective dates of master file data Section H Requirements Compliance Matrix Page 224 Confidential

H2 GLOBAL REQUIREMENTS TECHNICAL Detailed below are the technical requirements applicable for the entire solution. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a third-party solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 225 Confidential

GLOBAL REQUIREMENTS - TECHNICAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 New Technology 1.1 The system is designed in such a way that it easily allows the incorporation of new technologies, as they become available 2 Multiple Environments 2.1 The system supports multiple environments. These environments are sufficiently isolated from each other so that operations in one environment do not affect those of another. The environments are as follows: 2.1.1 Production all production processing will be performed in this environment 2.1.2 2.1.3 Development all development activities including unit and system testing will be conducted in this environment Test after all development, unit and system testing has been completed, this environment will be used for User Acceptance Testing before the system is accepted into production 2.1.4 Training for all in-house implementation and post implementation training activities 3 System Performance 3.1 3.2 3.3 The system is responsive and available; it supports rapid fail-over or redeployment in the event of problems or planned maintenance. Ninety-nine percent of all fail-over events will take place in less than five minutes Any volume (batch) processing will not interfere with online responsiveness or availability System availability figures of the proposed solution are provided. In case various components have different values, these are specifically mentioned. 4 Archive and Purge 4.1 The system supports periodic archival and purging of unused or obsolete information 4.2 Archived information is available for historical reporting in such a manner that queries can be performed on archived data using automated data retrieval functions 4.3 A complete data archival plan is provided 5 Recovery Section H Requirements Compliance Matrix Page 226 Confidential

GLOBAL REQUIREMENTS - TECHNICAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 5.1 5.2 5.3 The system automatically recovers to the last complete prior transaction in the event of a failure The system clearly indicates to the user that a transaction failed and that it must be re-entered. Recovery occurs without operator intervention Contingency and backup recovery procedures with guaranteed Service Level Agreements (SLAs) have been provided 6 Backup and Reorganization 6.1 The system provides for the unattended daily backup of all information and data to a media that can be stored offsite for disaster recovery purposes 6.2 System supports different types of backups such as: 6.2.1 Full backup 6.2.2 Incremental backup 6.2.3 Online backup 6.2.4 Offline backup 6.3 Backups do not prevent the system from being available at all times and do not disrupt system operations 6.4 There is no performance degradation during data backup 6.5 Database reorganizations do not significantly impair system availability 6.6 The calculation of time taken to backup data with respect to data size increase has been provided. 7 Print Management 7.1 The system provides a method for managing the print environment for report distribution so that reports are directed to the appropriate print facility. It caters to both high speed centralized printing facilities as well as local LAN-based printing facilities that will be employed in addition to printing over internet / intranet 8 Technology Architecture 8.1 Recommendations of the technology architecture under which the proposed ERP Package will operate are provided, with the following features preference: Section H Requirements Compliance Matrix Page 227 Confidential

GLOBAL REQUIREMENTS - TECHNICAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 8.1.1 N-tiered Client/Server architecture incorporating thin presentation-logic-client communicating with client-neutral, server-based applications, communicating with the database 8.1.2 Thin client, for remote users 8.1.3 Applications distributed at servers located at Head Office 8.1.4 Centralized database, located at Head Office 8.2 Able to support different network based services / protocols such as: 8.2.1 TCP/IP 8.2.2 DHCP 8.2.3 WINS 8.2.4 DNS 8.2.5 NetBEUI 8.2.6 LDAP 8.2.7 FTP 8.2.8 DLC 8.3 System is able to support open specifications for APIs / middleware applications such as: 8.3.1 COM / DCOM 8.3.2 CORBA 8.3.3 RMI 8.3.4 ALE 8.3.5 MQ Series Link 8.3.6 OLE / COM2 8.3.7 ODBC 8.4 It is able to integrate with Internet technologies such as: Section H Requirements Compliance Matrix Page 228 Confidential

GLOBAL REQUIREMENTS - TECHNICAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 8.4.1 HTTP 8.4.2 XML 8.5 Scalable architecture is supported, such as: 8.5.1 SMP 8.5.2 MPP 8.5.3 Clustering 8.6 8.6.1 While designing the technology architecture, the following are kept under consideration: Solution is scalable with complete platform independence without tying down PIA to a single platform 8.6.2 Solution is effortlessly portable from one system to another 8.6.3 8.6.4 It provides support for different flavors of UNIX; however it is a totally interoperable solution There is open source support. In this context, the current scenario vis-à-vis the solution offered and the future roadmap are provided 8.6.5 Optimization of licensing costs for the platform software 8.6.6 PIA s existing Local and Wide Area Network, and minimization of Wide Area Network bandwidth requirements 8.6.7 Simplicity of System Administration and Operations 8.6.8 Ease of business continuity planning and execution 9 Server 9.1 9.2 9.3 The recommended configuration caters for the existing load as well as annual volume growth of 10-15% for the next five years The configuration is capable of retaining data for at least eleven years (that is, current year plus ten years historical record) The solution is redundant, reliable and consistently available to allow uninterruptible 24x7 operations Section H Requirements Compliance Matrix Page 229 Confidential

GLOBAL REQUIREMENTS - TECHNICAL Sr. No. Requirement Response (S, W, E, C, N) Remarks 9.4 9.5 9.6 The production server configuration includes redundant (RAID5) data storage and multiple processors and caters for compatibility with PIA s existing LAN / WAN environment The areas of performance and scalability, reliability and fault tolerance while recommending Server configurations have been taken into consideration Performance guarantees of the solution under different scenarios such as concurrent users during normal working, during data backup, during overload, during partial system failure, etc. have been provided 10 System and Network Management Tools 10.1 Suitable Systems and Network Management Tools have been recommended. These tools will ensure proper planning, configuration, and problem handling of IT resources and support such tasks as: 10.1.1 defining, resolving, and managing problems 10.1.2 operating networks and multi-vendor systems 10.1.3 distributing and managing software and data 10.1.4 controlling operations 10.1.5 planning and managing performance 10.1.6 administering security 10.1.7 maintaining asset information 10.1.8 planning for the future capacity of systems 11 Authentication 11.1 The system supports authentication methods that will assure that only authorized users are able to access protected data and transactions 11.2 These include support for: 11.2.1 digital signatures 11.2.2 PKI infrastructure Section H Requirements Compliance Matrix Page 230 Confidential

H3 GLOBAL REQUIREMENTS OTHERS Detailed below are other global requirements applicable for the entire solution. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a third-party solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 231 Confidential

GLOBAL REQUIREMENTS - OTHERS Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 RDBMS AND DATABASE ADMINISTATION TOOLS 1.1 Database schema definition, management, query and reporting facilities provided 1.2 1.3 Historical transactions will be maintained by the RDBMS. Facilities for reviewing transactions, multiple transaction roll back and transaction log reporting are available Database update facilities include features such as the use of working copies and status reporting on query and update operations. 1.4 The system provides locking mechanisms for update and delete operations. 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 The system maintains concurrent control mechanisms to ensure the correctness of transactions and to detect and resolve deadlocks on the network. The system supports authorization lists and groups for create, read, update and delete There is a provision of on-line facilities to manage transactions and overall on-line system performance. The system provides users and applications with distribution independence. Users do not need to know where database objects are located. The system operates in a distributed environment where different nodes of the network run at different functional levels. The system has the ability to automatically recover and restore the database fully to the last consistent state after a media failure. The ability to notify users as to what transactions were being processed but not written to the database during a crash is available. The system has checkpoint facilities and the capability to roll back / undo to any one checkpoint. The system will continue to be available to users during any backup process or alteration of the database schema s and definitions. 1.14 The system will support one-to-one, one-to-many and many-to-one relationships. 1.15 The system is capable of working in a multi-tier environment, and provides the appropriate tools for partitioning the location of the processing. All tuning will be independent to the user. Section H Requirements Compliance Matrix Page 232 Confidential

GLOBAL REQUIREMENTS - OTHERS Sr. No. Requirement Response (S, W, E, C, N) Remarks 1.16 All information in the database is represented as values in the table. 1.17 Null value support (as opposed to empty character strings, blank characters or zero) is available for all data types. 1.18 Database recovery will be made in minimum acceptable downtime. downtime will be negotiated and agreed upon Acceptable 1.19 RDBMS has a support for ETL 1.20 RDBMS has support for SAN storage and cluster environment 1.21 Load balancing and failover are supported to minimize down time 1.22 RDBMS will support DR sites and automatic standby configurations. It will be capable of operating in the DR environment and support synchronous as well as asynchronous data replication at remote DR site 1.23 RDBMS will support large amounts of data in terra bytes 1.24 RDBMS will have support for transmission of data from other new systems as well as exiting legacy systems 1.25 It will support libraries to enable backup on tape and disk drives 1.26 It have support new firewalls and n-tier network architecture 1.27 It will support OLAP, OLTP and DSS systems 2 APPLICATION DEVELOPMENT TOOLS 2.1 The proposed solution has a built-in 4GL development environment tool set 3 QUERY AND REPORT GENERATOR TOOLS 3.1 The report generator functionality includes a scheduling or production process for routine reporting 3.2 The report generator functionality supports Structured Query Language (SQL) 3.3 It also supports industry standard report generators such as Crystal Reports, Business Objects, etc. 3.4 Report generator has formatting and statistical capabilities such as: 3.4.1 Averaging Section H Requirements Compliance Matrix Page 233 Confidential

GLOBAL REQUIREMENTS - OTHERS Sr. No. Requirement Response (S, W, E, C, N) Remarks 3.4.2 Multi-level sub-totaling 3.4.3 Percent change comparisons 3.4.4 Standard mathematical operations 3.4.5 Financial calculations 3.5 Generated reports are able to be saved in several output formats, such as: 3.5.1 MS Word 3.5.2 MS Excel 3.5.3 Text 3.5.4 PDF 3.5.5 HTML 3.5.6 XML 4 INTERIM SERVERS 4.1 Specifications are provided for interim servers that will be used for ERP configuration, add-on software development, user training, etc. 4.2 All necessary hardware components are also provided 4.3 The configuration of these machines will support the number of users as specified in the plan. 5 3 RD PARTY SOFTWARE 5.1 All required 3rd party software, operating systems, system management and monitoring tools, backup and recovery software, database administration tools, disaster recovery and business continuity tools, APIs / interfaces, etc. will be made available, documented, designed, implemented and operational to meet PIA s requirements in the proposed ERP solution. 5.2 A complete solution in all respects has been offered to PIA delays or costs arising out of any shortcoming will be borne by the Contractor. Section H Requirements Compliance Matrix Page 234 Confidential

H4 FUNCTIONAL REQUIREMENTS FINANCE Detailed below are the functional requirements applicable for Finance. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a third-party solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 235 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 General Ledger 1.1 Maintaining charts of accounts for multi-company processing 1.2 Supporting multiple chart of accounts for one company 1.3 Maintaining ledger accounts and hierarchies of cost centers and profit centers 1.4 Providing graphical representation of account hierarchy with easy navigation and drill-down features 1.5 Maintaining statistical ledgers for quantities, volumes, number of flights, etc. 1.6 Allowing at least 30 digits for the qualified chart of accounts in order to incorporate notional account, group companies, business units, locations, aircrafts, flight numbers, departments / cost centers based on the financial statement segments 1.7 Allowing at-least 14 posting periods in a financial year 1.8 Allowing multiple financial years for multiple companies 1.9 Classifying multiple levels of chart of accounts 1.10 Providing and supporting a dynamic business unit structure in the chart of accounts 1.11 Allowing mass maintenance of accounts by copying one chart into another as reference or deleting / blocking multiple accounts 1.12 Allowing access to certain types of accounts to authorized users / user-groups 1.13 Uploading budget from the Budgets and Cost Management System 1.14 Posting of journal entries from subsidiary ledgers 1.15 Processing entries directly entered in the General Ledger 1.16 Accounting for special projects / subsidiaries; such as SpeedEX, etc. 1.17 Processing entries from other systems 1.18 Auto-generating entries of recurring items 1.19 Maintaining and analyzing budgeted and actual amounts by account head 1.20 Allocating expenses on the basis of defined parameters Section H Requirements Compliance Matrix Page 236 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 1.21 Maintaining multi-currency accounts 1.22 Catering for inter-company settlements 1.23 Maintaining ledgers for management and statutory reporting 1.24 Generating consolidated financial statements (Balance Sheet, Profit and Loss Account, Cash flow, Statement of Changes in Equity, etc.) along with consolidated supporting schedules setting off inter-company balances 1.25 Consolidating and summarizing accounts 1.26 Consolidating financial accounts across multiple companies 1.27 1.28 Allowing separate closing of individual areas for example Fixed Asset, Accounts Receivable, Accounts Payable, General Ledger, etc. Allowing real-time online updates of General Ledger along with provision of temporary and permanent stoppages for account closing purposes these stoppages should be controlled by authority levels based on different types of vouchers / sub-ledger entries 1.29 Allowing posting of transactions after temporary closing 1.30 Allowing multiple year-end processing 1.31 Processing month-end and year-end accounts 1.32 Automatically calculating retained earnings 1.33 Generating financial statements 2 Financial Analyzer 2.1 2.2 2.3 Providing detailed analysis of financial data and ratios to fulfill varied management information requirements Producing complete books of accounts with accompanying notes to accounts in line with International Accounting Standards and the Companies Ordinance Providing comparisons of actual / current period data with budgeted data as well as with data of previous period and same period of previous year 3 Fixed Assets Management 3.1 Maintaining ownership data for assets Section H Requirements Compliance Matrix Page 237 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 3.2 Recording asset supplier information 3.3 Maintaining number of flying hours in case of aircrafts 3.4 Maintaining original and net book value 3.5 Calculating asset depreciation based on multiple depreciation methods 3.6 Allowing changes in book value and changes in depreciation rate 3.7 Tracking physical location of assets at any given time 3.8 Maintaining asset and depreciation records for management and statutory reporting 3.9 Recording asset replacement value 3.10 Allowing zero value assets 3.11 Allowing inter-company assets transfer, for example from one subsidiary to another 3.12 Showing assets in-transit during transfers till acknowledged by receiving location 3.13 Handling mass transfer of assets 3.14 Splitting of assets 3.15 Recording asset assemblies and sub-assemblies (parent-child relationship) 3.16 Processing disposal of assets 3.17 Capitalizing projects and transferring costs 3.18 Revaluing assets 4 Cash Management 4.1 Maintaining records of daily cash balances including details of daily receipts and disbursement of cash 4.2 Monitoring bank balances 4.3 Identifying withdrawal limits before a transaction for each bank account maintained in the system 4.4 Transferring funds from one account into another 4.5 Uploading and recording account statements received from banks Section H Requirements Compliance Matrix Page 238 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 4.6 4.7 Automatically processing bank reconciliation statements based on payments and deposits Forecasting cash requirements based on accruals, cash in hand, bank balances, outstanding and anticipated invoices from suppliers and agents / other customers, etc. 4.8 Monitoring of markup rates and appropriate placement of funds 4.9 Calculating markup in running finance and deposit / savings accounts 4.10 Maintaining detailed records of investments of liquid funds including maturity profiles of funds invested 4.11 Supporting user-defined cash flow statements 5 Petty Cash Management 5.1 Recording cash receipts 5.2 Recording cash disbursements 5.3 Maintaining and verifying cash balances 5.4 Determining withholding tax and sales tax on cash disbursements 5.5 Submitting claims to Head Office for replenishment of petty cash 6 Accounts Payable 6.1 Creating and managing vendor master records 6.2 Adopting to PIA s payment policies including the limits of approval authorities 6.3 Recording supplier s invoices and updating liabilities 6.4 Checking for duplicate invoices 6.5 6.6 Performing the two-way and three-way match between purchase order, receiving statement and supplier s invoice Processing payments to suppliers, employees and other parties through different methods: 6.6.1 Cash 6.6.2 Authority Letter for payment through Petty Cash Section H Requirements Compliance Matrix Page 239 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 6.6.3 Cheque both manual and pre-printed system generated 6.6.4 Bank Transfer Letter both hardcopy and data file for upload 6.6.5 Letter of Credit 6.6.6 Credit Card 6.6.7 Internet 6.7 Allowing partial payments against invoices 6.8 Splitting one payment between different entities 6.9 Linking with payment systems of various banks offering e-payment services 6.10 Recording withholding tax liability 6.11 6.12 Processing payment of government dues deducted at source and generating tax challans / returns Maintaining records of General Sales Tax paid on purchase of materials and hiring of services for subsequent credit at the output stage 6.13 Allowing payments to be made both from Head Office and remote locations 6.14 Providing online payment support for PIA s upcountry and international stations 6.15 Provisioning for making payments in foreign currencies 6.16 Booking exchange rate gains and losses for foreign currency payments 6.17 Allowing generation of recurring payment vouchers for recurring payments 6.18 Aging of accounts payables 7 Revenue Accounting 7.1 Capturing details of tickets / air waybills issued to agents (stock control) 7.2 Capturing ticket / air waybill number and other details for sales of tickets / booking of cargo 7.3 Handling sales proceeds and matching of passenger revenues 7.4 Handling bookings and matching of cargo revenues Section H Requirements Compliance Matrix Page 240 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 7.5 Handling revenues generated through inter-line operations 7.6 Handling sales of services to other airlines / agencies 7.7 Handling sales returns / refunds to customers as well as agents 7.8 Calculating agents commissions 7.9 Integrating with: 7.9.1 Sabre Applications 7.9.2 QUASAR system (for passenger revenues) 7.9.3 SITA hosted applications (for cargo revenue) 7.9.4 PIA s Awards Plus program (for passenger ticket redemption) 7.10 7.11 7.12 7.13 7.14 7.15 7.16 Contractor has read the details of PIA applications, particularly about COSSAP, and the proposed solution fulfills all the requirements stated therein Contractor has read the Requirements for Passenger Revenue Accounting, and the proposed solution fulfills all the requirements stated therein Contractor has read the Requirements for Cargo Revenue Accounting, and the proposed solution fulfills all the requirements stated therein Ticket wise identification of APW and automated invoice generation along with accounting treatment thereon. MCOs accounting and report generation of tickets issued against MCO along with accounting treatment thereon. Issuance of automated short collection investigation reports and ADMS for any variation in MCO amounts and tickets issued thereon along with proration. Capable of creating sales contract, agreements, orders with other airlines and third parties based on different criteria such as flat rate, fixed price, time & material. 8 Accounts Receivable 8.1 Creating and maintaining customer / agent master records 8.2 Creating customer groups and clubbing related customers together 8.3 Managing credit ratings for customers / agents Section H Requirements Compliance Matrix Page 241 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 8.4 8.5 Creating sales contracts / agreements / orders with other airlines and third parties based on different criteria such as flat rate, fixed price, time and material, etc. Creating sales orders by direct manual entry in the system as well as by automatically converting data imported from other applications such as QUASAR, Sabre, etc. 8.6 Generating invoices and maintaining receivables 8.7 Sending payment reminders through email and fax 8.8 Providing multi-currency support for sales of tickets and other goods and services 8.9 Generating debit / credit notes for adjustments to accounts receivables 8.10 Enabling electronic submission of invoices and debit / credit notes 8.11 Recording payments received 8.12 Offsetting payments against outstanding credit: 8.12.1 By manually selecting open items 8.12.2 By running automatic settlements based on pre-defined rules 8.13 Recording and managing receipt of security deposits / bank guarantees from customers / agents 8.14 Calculating and managing incentives and commissions to agents 8.15 Managing credit sales 8.16 Maintaining and processing aging statements 8.17 Maintaining credit, payment and bad-debt history of customers 9 Insurance Management 9.1 9.2 9.3 Maintaining market valuation of assets and linking them with the Assets Master of the Fixed Assets Management Providing true / logical valuation for insurance purpose of all assets including aircraft fleet and properties. Professional risk management techniques should be applied with an aim to minimize risk and optimize savings in premium costs Calculating insurance premiums based on approved quotes and triggering requests for payment of premium Section H Requirements Compliance Matrix Page 242 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 9.4 Calculating monthly allocation of insurance cost 9.5 Tracking outstanding insurance claims raised 9.6 9.7 Generating required renewal / underwriting information for renewal of aviation / aircraft fleet and general insurance policies Generating correctly the required information for settlement of insurance claims by insurance companies. For example, in case of aviation insurance claims the standard information which is required for claim processing like certificate of registration, certificate of airworthiness, investigation report, etc. should be available in the system. Same should apply to claims handling for all general / aviation insurance policies 9.8 Handling and processing customer insurance claims against PIA 10 Leasing Management 10.1 Terms and conditions and other relevant details of leasing arrangements leasing company, type of lease (operating or financial lease), lease rentals, down payment, residual value, lease period, etc. 10.2 Auto-generating recurring payment vouchers in Accounts Payable 10.3 Identifying physical location of leased assets 10.4 Identifying users of leased assets 10.5 Processing disposal of leased assets 10.6 Handling and managing aircraft leasing, for example wet lease, etc. 11 Budget and Cost Management 11.1 Creating and maintaining hierarchical structures for cost centers 11.2 11.3 11.4 Creating and maintaining different cost / expenditure types (direct, indirect, fixed, variable, semi-variable, etc.) and collecting data relating to those types Defining a complete budget hierarchy and classifying revenue and expenditure items. The budget model should be flexible and capable to update itself with the changes in operations / flight schedules Providing graphical representation of budget hierarchy with easy navigation and drilldown features Section H Requirements Compliance Matrix Page 243 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 11.5 Creating and maintaining cost collectors such as maintenance orders 11.6 Supporting hierarchical structure of managing the maintenance orders 11.7 Collecting shop floor data against maintenance orders 11.8 Recording man-hours against maintenance orders 11.9 Issuing external repair orders against maintenance orders 11.10 Defining control limits for over-expenditure against specified budget heads 11.11 11.12 Performing budget availability checks while posting transactions restricting spending beyond budget limits Managing over-expenditure through special approvals based on authority levels and generating reports to monitor use of special approvals 11.13 Maintaining baseline and revised budgets 11.14 Allowing import of budgets created in external systems such as MS-Excel 11.15 Allowing manual input of budget data at lowest level of detail and rolling-up to provide summarized data 11.16 Allowing manual input of budget data at summarized level and allocating it: 11.16.1Manually 11.16.2Automatically through pre-defined formulae 11.17 Maintaining sales targets for passenger and cargo revenue generation 11.18 Distribution of annual budget over specified periods; monthly distribution or on a seasonal pattern 11.19 Maintaining cost centers for cost collection 11.20 Comparing budgeted and actual expenditures Supporting standard costing model based on actual operations, comparable with the 11.21 actual results along with the variance analysis. It should automatically prepare standard reports from fixed and flexible budgetary inputs 11.22 Supporting and providing Activity Based Costing 11.23 Managing overhead costing Section H Requirements Compliance Matrix Page 244 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 11.24 Integrating with PIA s MRO solution for job order costing 11.25 11.26 Allowing allocation of expenditures from one cost centre to another based on PIA defined rules Determining dependence on fuel pricing and providing different what-if analysis and recommendations for hedging 11.27 Preparing Traffic Load Summary reports 11.28 Supporting different budgeting techniques including zero-based budgeting 12 Profitability Management 12.1 Creating and maintaining hierarchical structures for profit centers 12.2 Planning and setting up sales / performance targets 12.3 Handling special agreements with IATA, different airlines and agents 12.4 Collecting operational and financial data, such as: 12.4.1 Flight schedules 12.4.2 Fare paying passengers 12.4.3 Flight logs 12.4.4 Freight tonnage 12.4.5 Maintenance and repair charges 12.4.6 Engines / components / spares reservation / leasing charges 12.4.7 Aircraft rental charges 12.4.8 Block hours 12.4.9 Fuel uplift charges 12.4.10Landing / navigational charges 12.4.11En-route charges 12.4.12Handling charges aircraft, passenger, cargo / baggage, etc. 12.4.13Passenger related expenses taxes, handling, meals, give-aways, etc. Section H Requirements Compliance Matrix Page 245 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks Flight disruption charges - hotel accommodation, meals, transportation, parking, 12.4.14 security, technical handling, crew allowances, etc. 12.4.15Crew related expenses allowances, transportation, layover, flying, etc. 12.4.16Commissions to agents for ticket sales 12.4.17Fixed costs 12.5 Preparing traffic load summaries 12.6 Generating aircraft- and route-wise fuel uplift report 12.7 Providing costing reports including but not limited to direct overhead costing, variable overhead costing, indirect fixed costing, etc. 12.8 Calculating route and aircraft profitability and development of route economics 12.9 Providing profitability analysis for other activities such as maintenance services, training, catering, etc. provided to third parties 12.10 12.11 Preparing financial statements (balance sheet, income statement, cash flow statement and profitability statement) for stations based on their local base currencies along with conversion to PKR Statistical and operational performance reporting based on airline specific Key Performance Indicators (KPIs) such as: 12.11.1Market share 12.11.2Load factor 12.11.3Passenger yield (Revenue per passenger kilometer) 12.11.4Revenue seat factor 12.11.5Best / worst performing flight segments / routes 12.11.6Best / worst performing stations 12.11.7Earnings by hubs and international entity including code-sharing 12.11.8Largest revenue earning routes 12.11.9Ranking of cities against revenue generated 12.11.10Others Section H Requirements Compliance Matrix Page 246 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 12.12 Reporting by: 12.12.1Region 12.12.2Network 12.12.3Route 12.12.4City Pair 12.12.5Station 12.12.6Aircraft 12.12.7 What-if analysis 13 Foreign Currency Management 13.1 Supporting daily maintenance of foreign currency rates 13.2 Allowing currency rate conversion calculations 13.3 Supporting multiple currency rates for different purposes 13.4 Supporting different decimal places for different currencies; for example 0 for Japanese Yen, 2 for Pak Rupees, 3 for Omani Riyal, etc. 13.5 Supporting currency conversion, translation and revaluation 13.6 Maintaining both foreign and local currency amounts for individual transactions 13.7 Calculating and posting exchange rate gains and losses 14 Taxation Management 14.1 Allowing different tax regimes 14.2 Supporting tax systems in vogue in countries where PIA offices are located 14.3 Supporting calculations of VAT 14.4 Supporting sales tax 14.5 Supporting Civil Aviation tax 14.6 Supporting withholding tax 14.7 Supporting income tax Section H Requirements Compliance Matrix Page 247 Confidential

FUNCTIONAL REQUIREMENTS FINANCE Sr. No. Requirement Response (S, W, E, C, N) Remarks 14.8 Supporting zero tax 14.9 Supporting tax reporting 14.10 Maintaining effective dates for tax exemption certificates 15 Treasury and Risk Management 15.1 Minimizing idle cash 15.2 Managing portfolios 15.3 Positioning in multiple currencies 15.4 Supporting various financial instruments such as debts, investments, foreign exchange, derivatives, etc. 15.5 Tracking exposures and hedges 15.6 Analyzing and mitigating risks 15.7 Managing liquidity 15.8 Carrying out sensitivity analysis 15.9 Simulating different scenarios Section H Requirements Compliance Matrix Page 248 Confidential

H5 FUNCTIONAL REQUIREMENTS HUMAN RESOURCES AND ADMINISTRATION Detailed below are the functional requirements applicable for Human Resources and Administration. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a third-party solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 249 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 HR Planning and Operations 1.1 Setting up and managing HR budgets 1.2 Updating organizational charts 1.3 Creating and maintaining job specifications and job descriptions 1.4 Simulating, analyzing, forecasting and experimenting with proposed organizational changes 1.5 Providing analytical reporting such as headcount planning, cost simulation, etc. 1.6 Managing and optimizing the workforce within PIA 1.7 Managing capacity planning and load planning 1.8 1.9 1.10 1.11 1.12 1.13 Maintaining employee personnel details including staff number, name, address, family details, etc. Maintaining employment history including personal data, joining date, confirmation date, group/grade level, promotions with dates, placements, transfers, temporary transfers, foreign postings, separation date, training history, etc. Maintaining performance appraisals that should include the overall rating, last year s objectives versus actual achievements, objectives for next year, training and development needs, performance improvement plans, appraiser s comments, etc. Allowing employee photographs and other documents to be added as part of employee records Automatically monitoring dates for various HR processes; that is specifying datedriven reminders to initiate follow up activities (for example, annual increment, periodic performance review, expiry of employment contract, retirement date, etc.) Integrating with PIA s document management system where physical records are currently being archived 1.14 Recording employee grievances and decisions made thereon 1.15 Maintaining records of employees on deputations and secondments 1.16 Managing disciplinary cases against employees Section H Requirements Compliance Matrix Page 250 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 1.17 Maintaining contract details of contractual employees 1.18 Managing award schemes 2 Recruitment Management 2.1 Maintaining a database of applicants with details of their personal data including education, qualification and work experience related information 2.2 Managing selection testing 2.3 Scheduling and arranging interview sessions 2.4 Organizing and tracking candidates throughout the entire recruiting process 2.5 Maintaining a list of available job positions 2.6 Processing recruitment requisitions against sanctioned positions 2.7 2.8 Allowing web-based job application and resume submission as well as online submission of application fee Identifying candidates based on the matching of job requirements with the skills and qualifications of each individual 2.9 Short-listing candidates based on job specifications 2.10 Identifying specific essential requirements for a job and allowing comparison of candidates based on these requirements 2.11 Recording the ratings and comments of the interviewers 2.12 Issuing acceptance / rejection letters depending on recruitment decisions 2.13 Updating employee records from the selected candidate s files 2.14 Allotting Personnel Number and Under Training Number to selected candidates 3 Qualifications Management 3.1 3.2 Defining profiles for candidates and employees along with specifying the type of information that should be stored with each profile Recording the qualifications required to perform specific jobs or tasks, including work-related skills and specific certifications or licenses in the qualifications catalog integrating with PIA s MRO application for linking job (maintenance) requirements with available qualifications Section H Requirements Compliance Matrix Page 251 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 3.3 Identifying qualifications such as licenses that require monitoring of expiration and renewal dates 3.4 Linking similar qualifications as an alternative to one another, 4 HR Development 4.1 Creating and managing career paths within the company 4.2 Basing career and succession planning on career paths or on an individual s skills and potential 4.3 Defining and maintaining both company and individual goals 4.4 Designating individuals for positions or marking them as having the potential to succeed in a particular area or position 4.5 Mapping a career path for employees outside of their current disciplines 4.6 Allowing employees to match their qualifications with requirements of a position and determining what (training, proficiency) is needed to meet their goal 4.7 Managing job rotations and postings 4.8 4.9 Matching an individual s skills or qualifications to those required for a position, identifying gaps and proposing training and development plans to acquire the necessary skills Keeping track of on-the-job training and training activities such as classes, seminars and workshops 4.10 Managing internship programs 5 Performance Management 5.1 Providing a flexible framework to create and administer the process of performance reviews and appraisals. 5.2 Setting up performance targets and their measurement criteria 5.3 Having the capability of recording individual employee s Smart Goals 5.4 Integrating performance reviews into PIA s total rewards strategy. 5.5 Planning, designing, performing and analyzing multiple appraisal models for multiple purposes. Section H Requirements Compliance Matrix Page 252 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 5.6 Using a variety of appraisal models as templates to support the staff appraisal process, including: 5.6.1 Bell curves 5.6.2 Personnel, employee and manager appraisals 5.6.3 360-degree feedback 5.6.4 Evaluation of work or projects 5.6.5 Event, instructor and participant appraisals 5.6.6 Multiple number of appraisers 6 Compensation and Benefits Management 6.1 Maintaining ranges of compensation and benefits offered to staff in each group / grade and those on foreign postings 6.2 Maintaining a record of actual compensation and benefits of all employees 6.3 6.4 6.5 6.6 6.7 6.8 Maintaining a database of compensation and benefits of employees of benchmarked companies Maintaining Consumer Price Index (CPI) survey and details of the State Bank of Pakistan s (SBP) report with regards to inflation Making a comparative assessment of compensation and benefits of PIA and other benchmarked companies Evaluating the impact of inflation on purchasing power of PIA's employees using the CPI survey and SBP report details Maintaining surveys and Central Bank reports for countries where PIA employees are posted Evaluating the impact of inflation on salaries and allowances for employees posted abroad 7 Training and Development 7.1 Maintaining list of resources (rooms, audio-visual aids, trainers, etc.) and allocating them to different courses 7.2 Maintaining training and development plans of employees Section H Requirements Compliance Matrix Page 253 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 7.3 Maintaining records of available training programs / catalogues in-house and external (local and oversees) sources 7.4 Scheduling in-house training programs along with resources required 7.5 Maintaining calendars of external training programs 7.6 7.7 Determining course demand based on pre-bookings and / or actual attendance of prior periods Registering attendees directly as well as through web access. Also allowing online submission of training fee 7.8 Recording feedback provided by trainees and trainers 7.9 Integrating with Performance Management System to allow appraisals for instructors, attendees and courses. Also matching trainings required to fulfill promotion criteria 7.10 Conducting and grading different tests / exams 7.11 Maintaining records of training programs attended by individuals / corporate 7.12 Maintaining attendance records of external training participants 7.13 Issuing training certificates 7.14 7.15 Recording trainings attended by employees and the grades obtained by them. For regulated trainings (such as CAA) recording of certificates, issuance dates, expiry dates, dates for refresher courses, etc. Performing a gap analysis between job specifications and employee skills to plan and fulfill training and professional development requirements of each individual 8 Time Management 8.1 Maintaining the PIA calendar with holidays 8.2 Maintaining multiple calendars simultaneously, for instance Gregorian for Pakistan, Hijri for Saudi Arabia, etc. 8.3 Recording employee attendance 8.4 Interfacing with different time-recording machines (with bio-metrics capability) to capture real-time attendance data Section H Requirements Compliance Matrix Page 254 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 8.5 8.6 8.7 8.8 8.9 Maintaining leaves, absences, days-off, on-corporation services (OCS) duration etc., of each individual Assisting in shift / roster planning for various departments and crews based on actual / forecasted workload. Integrating with Sabre s Flight Scheduler to capture flight schedules and also AIMS software for crew scheduling and MRO solution with engineering shift scheduling Administering shift / roster plans considering defined requirements along with employee skills, qualifications, and availability merging load planning with capacity planning Providing information to crew and other staff of their rosters through SMS or making the information available to them when they dial in to PIA s Call Centre Processing day-to-day changes in the shift schedule based on transactions that affect requirements or availability of staff 8.10 Identifying and managing rotating assignments 8.11 Establishing automatic substitution and on-call procedures 8.12 Checking employee time assignments against PIA s policies and legal requirements 8.13 Evaluating time data used for calculation of overtime, shift allowance, night allowance, and other allowances specific to cockpit and cabin crews, etc. 8.14 Providing attendance and overtime data for payroll processing 8.15 Processing leave applications 9 Healthcare Management 9.1 Processing candidate, employee, retiree and dependant registration 9.2 Initiating medical test procedure for recruitment and recording medical fitness of flight staff 9.3 Maintaining medical history of PIA staff, retirees and their dependants 9.4 Processing patient referrals 9.5 Recording diagnosis and treatment details provided by consultants or panel hospitals 9.6 Maintaining list of hospitals, consultants and medical stores on PIA s panel Section H Requirements Compliance Matrix Page 255 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 9.7 Maintaining the Pharmacopoeia document (PIA s list of authorized medicines) 9.8 Maintaining treatment costs for management reporting 9.9 Issuing medicines to PIA staff and their dependants 10 Travel Management 10.1 Managing requests for travel passage including approvals from appropriate authorities 10.2 Maintaining record of employees traveling on corporation service 10.3 Calculating allowances for employees traveling on corporation service 10.4 Maintaining records of and providing assistance in obtaining visas 10.5 Issuing tickets / passages based on entitlements 10.6 Maintaining traveling schedules of employees, retirees and dependants 10.7 Keeping track of traveling history of employees, retirees and dependants 11 Payroll Processing 11.1 11.2 11.3 11.4 11.5 11.6 Processing compensation and benefits of each individual based on pay package and attendance record Calculating payroll based on multiple shifts with time data collected from various time collection devices Calculating various allowances for flying staff based on specific flight timings different for cockpit and cabin crew Managing salaries of employees posted at various foreign locations based on the calendars applicable in those countries Managing salaries and running payroll of local employees posted at various foreign locations based on their local statutory, taxation and labor law requirements Catering to the laws of Pakistan as well as the countries where payroll will be run (a list of foreign stations is available in Section A, Sub-section A2) 11.7 Handling across the board, one-time payments like bonuses, etc. 11.8 Allowing retro-processing and arrears processing Section H Requirements Compliance Matrix Page 256 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 11.9 Auto generation of salary increments 11.10 Adhoc salary increments for individuals / groups 11.11 Processing of loans and advances to employees 11.12 Generating bank advice for salary transfer to relevant bank accounts 11.13 Printing salary cheques for employees without bank accounts 11.14 Generating pay slips of employees 11.15 Deducting income tax at source 11.16 Generating location-wise periodic tax returns for statutory reporting / filing with different tax authorities 11.17 Generating tax deduction certificates of individual employees 11.18 Providing complete integration between HR and financials systems 11.19 Simulating payroll runs before actual payroll is run 11.20 Generating pension run for pensioners 12 Final Settlement Processing 12.1 Capturing reasons for separation; such as retirement, resignation, termination, etc. 12.2 Identifying in advance about the retiring employees and generating necessary letters / memos 12.3 Capturing details of exit interview 12.4 Withholding salary and other benefits till all clearances are obtained 12.5 Preparing Audit Sheet with all final settlement calculations 12.6 Preparing Pension Sheet calculating pension amounts 12.7 Preparing gratuity information for each employee 12.8 Maintaining income tax brackets and calculating final settlement amounts after catering for tax deduction 12.9 Maintaining detailed history for possible re-hiring cases Section H Requirements Compliance Matrix Page 257 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 13 Personnel Insurance Management 13.1 Maintaining a list of various insurance policies that PIA offers to its employees 13.2 13.3 13.4 Maintaining a database of different insurance policies that each employee has subscribed to Calculating insurance premiums based on approved quotes and triggering requests for payment of premium Generating required renewal / underwriting information for renewal of insurance policies 13.5 Calculating monthly allocation of insurance cost 13.6 Maintaining insurance claims made by employees 13.7 Maintaining insurance claims made on behalf of employees 13.8 Maintaining correspondence with Insurance Companies 13.9 Integrating with Payroll Processing 13.10 Providing standard / basic information like death certificate, etc. for settlement of group insurance claims 13.11 Maintaining records of claims actually paid to the employees or their nominees 14 Security Management 14.1 Maintaining data of employees, family members and retired employees required for issuance of respective security cards 14.2 Issuing ID cards and passes 14.3 Maintaining photographs of employees, family members, and retired employees 14.4 Integrating with Time Management so that security cards issued to employees can also be swiped on the time-recording machines 15 Staff Funds Management 15.1 Managing Provident Fund and Additional Provident Fund contributions by the employee and PIA 15.2 Posting and bookkeeping of all employees funds Section H Requirements Compliance Matrix Page 258 Confidential

FUNCTIONAL REQUIREMENTS - HUMAN RESOURCES AND ADMINISTRATION Sr. No. Requirement Response (S, W, E, C, N) Remarks 15.3 Processing Provident Fund loan applications 15.4 Recording and managing loans and advances disbursed to employees against funds 15.5 Integrating with Payroll Management for employee contributions, loan disbursements, and loan repayments 15.6 Processing pension appraisal of employees at the time of retirement 15.7 Calculating refund of Additional Provident Fund amount 15.8 Recording monthly payments to retirees and their dependents 15.9 Calculating profits earned on portfolio investments of funds Section H Requirements Compliance Matrix Page 259 Confidential

H6 FUNCTIONAL REQUIREMENTS PROCUREMENT AND INVENTORY CONTROL Detailed below are the functional requirements applicable for Procurement and Inventory Control. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Description Remarks 4 Standard feature (S) Is available as a standard feature Module / standard feature of the proposed solution 3 Workaround (W) Is available as a work-around and without customization Is not a standard feqture of the proposed solution, but an acceptable workaround ix possible without any customization to the ERP and without incurring additional cost. Description of Add-on / Utility and the time required to configure / develop / implement it. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 2 Enhancement through add-on or third-party solution (E) The required functionality Is available through application add-on or third-party solution Is not a feature of the standard solution, but is possible through an application add-on or a third-party solution. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal 1 Customization (C) 0 Not available (N) The feature/functionality can be made available through customization Cannot be catered as standard feature, workaround, enhancement, customization The requirement cannot be fulfilled through a feature of the standard solution and any third-party application, but can be catered by developing a custom-built program for PIA. In such cases Contractor has to ensure that appropriate costs have been incorporated in the Commercial Proposal The requirement cannot be catered in any way. In case the Contractor does not provide any response, it will be assigned zero 0 The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 260 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 1 Contracting and Procurement Management 1.1 1.2 1.3 1.4 Recording and processing profiles and other relevant details of suppliers and service providers potential and pre-qualified. Supplier database should be at least per JAA / FAA / CAA compliance Supporting interaction with the supplier as per ATA Spec 2000; for example, Purchase Order transmission and acknowledgement, etc. Maintaining indents / requisitions / capital expenditure sanctions raised by various departments Supporting online approvals for requisitioning, ordering and invoicing based on financial approving authorities and transaction types 1.5 Generating requisitions from other areas / systems such as MRO, MRP, etc. 1.6 Handling requisitions for different types of procurement such as: 1.6.1 Stock items 1.6.2 Non-stock items 1.6.3 Assets 1.6.4 Services 1.6.5 Other agreements 1.7 Routing and authorizing Procurement documents based on pre-defined criteria 1.8 Comparing actual cost of purchases against available budgets, budget monitoring 1.9 Validating available budget at the time of Requisition and Ordering 1.10 Generating requests for quotation for pre-qualified suppliers / Approved Vendor List or service providers 1.11 Maintaining price quotations received from suppliers or service providers 1.12 Supporting on-line bidding by suppliers 1.13 Supporting the tendering process based on PPRA rules Section H Requirements Compliance Matrix Page 261 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 1.14 1.15 Evaluating proposals online based on cost, delivery time, supplier's record, proposed warranty, technical support, etc. Generating price comparison statements for items to be purchased or services to be availed 1.16 Online approval of comparative statement. 1.17 Creating purchase / work orders / contracts against approved comparative statement. 1.18 Online tracking of procurement cycle. 1.19 Handling multiple currencies on the same purchase / work order / contract 1.20 Capturing details of Repair Service Agreements with fixed price / PBH for services, man-hour rates, repair lead-time, warranty conditions, part exchange program, reliability guarantee in compliance with product support documents, for example GCP 2000, PSAA, etc. 1.21 Tracking receipt of materials / services against purchase / work orders / contracts 1.22 1.23 Tracking materials under inspection and the quantities accepted and / or rejected against purchase orders Logging and approving invoices from suppliers and contractors after three-way matching with Purchase / Work Order and receipt of goods / services 1.24 Managing material return against purchase 1.25 Generating automatic debit note against material return 2 Vendor Management 2.1 Vendor performance management in accordance with GCP 2000 and PSAA 2.2 Evaluating supplier's performance based on lead time, enquiry response time, quantity discrepancies, quality discrepancies, price variance, rejection rate, changes to delivery date, quality of exchanges, etc. 2.3 Maintaining performance history of suppliers 2.4 Creating and managing vendor master records 2.5 Categorizing vendors in categories like aircraft parts vendors, other international vendors, local vendors, employees, etc. Section H Requirements Compliance Matrix Page 262 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 2.6 Blocking vendors for various reasons such as bankruptcy, blacklisting, poor performance, etc. 2.7 Pre-qualifying vendors / Approved Vendor List (AVL) 2.8 Linking vendors to proprietary/ related items 2.9 Linking AVL with Quality Systems (QS) approval process 3 Items Management 3.1 Maintaining a list of items, tools and equipments with unique identification numbers, detailed specifications, inventory value, previous purchase price, purchase history, min, max and reorder levels, etc. 3.2 Providing quick referencing / accessing functionality with barcodes and RFID tagging 3.3 Supporting capturing of the following minimum data related to aircraft parts: 3.3.1 Vendor part number 3.3.2 OEM part number 3.3.3 Part description 3.3.4 Relationship tables (WBS) 3.3.5 Price 3.3.6 Vendor 3.3.7 Reliability factor (MTBUR - meantime between unscheduled removal / MTBF meantime between failure) 3.3.8 Service level (as per PIA policy) 3.3.9 Alternate parts 3.3.10 Limitations of alternate usage 3.3.11 Authority for declaring alternate (for e.g. IPL reference, QA letter, etc.) 3.3.12 IPC references with usage code 3.3.13 Pointer to purchase and airworthiness related documents locations 3.3.14 Normal stock rooms and shops authorized to withdraw the items Section H Requirements Compliance Matrix Page 263 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 3.3.15 Material groups responsible for the item 3.3.16 Quantity per aircraft 3.3.17 Recommended quantity as per RSPL 3.3.18 Essentiality code 3.3.19 Class (Rotable, Repairable, Consumable) 3.3.20 Buy direct from vendor / OEM, etc. 3.4 3.5 Handling aircraft parts according to a minimum of ten different classes such as rotables, repairables, consumables, etc. Loading initial provision of aircraft parts in the system for aircraft maintenance plan based on manufacturer recommendations 3.6 Allowing revisions (new, change, remove) to the initial provisioning list 3.7 3.8 Establishing safety stock base keeping in mind the service levels provided by the various vendors / as per PIA policy Establishing project requirements based on forecast, extrapolation, trend and smoothing factors 3.9 Monitoring forecast accuracy and identifying deviation 3.10 Identifying material by OEM part number 3.11 3.12 3.13 Grouping all materials of the same form, fit and function under a material number (interchangeability of parts one-way, two-way) Identifying material to the aircraft types, ATA chapter, classification characteristics of the material, etc. Providing price information about the material including valuation price (at moving average), batch price (Purchase Order based), catalogue price (from various vendors), etc. 3.14 Provide linkage with various vendors / OEMs current catalogue list price 3.15 Changing material classification with adequate control (for example, rotable to repairable) Section H Requirements Compliance Matrix Page 264 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 3.16 3.17 Supporting different treatment for each material classification in terms of provisioning formula, movement types, issue control, serialized numbering, etc. Providing parts interchangeability management capability and displaying all interchangeable item at the time of requisition (when requisitioned item is not available) 3.18 Tracking the shelf life of items, monitoring them and flagging out expired items 3.19 3.20 Supporting salvaging and re-certification of components from scrap items (Bring On Charge the salvaged components) Keeping track of warranty of items supplied warranties could be of different nature such as repair, purchase, service, etc. 4 Stores Management 4.1 Supporting the requirements of ATA Spec 2000 4.2 Providing warehouse management functionality including space management and binning. Warehouses (physical and logical) shall include: 4.2.1 Central 4.2.2 Stations (local / overseas) 4.2.3 In-house maintenance facilities 4.2.4 Aircraft 4.2.5 Flight spare containers 4.2.6 Bench stock (at workshops) 4.2.7 Workshops (internal and external) - for both items under repair and spares holding 4.2.8 Loan (from and to) 4.2.9 Document stock (tickets, air waybills, etc.) 4.2.10 Quarantine stock 4.2.11 Consignment stock, etc. 4.3 Optimizing space allocation for all items by volume and weight, environmental conditions, movement (that is, fast / slow moving items), etc. Section H Requirements Compliance Matrix Page 265 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 4.4 Identifying materials available at various locations 4.5 Identifying the aircraft on which a flight container is placed as well as the spares in that flight container 4.6 Notifying material controller if certain materials reach the threshold level 4.7 4.8 4.9 4.10 Supporting multiple warehousing for materials. Auto-replenishing (either transfer or reorder) stock in predefined warehouses when it reaches the replenishment level Receiving material in store and holding in quarantine till quality checks are made. It should also support acceptance of services Storing quality assurance certificates (scanned images) and delivery documents in image format and linking them to the Purchase Order Valuing material in each store by moving average price with reference information of purchase price for each batch 4.11 Tracking on-hand balances and quantities reserved by aircraft 4.12 Tagging materials reserved against provisional requests. Supporting hard allocation of reserved materials. The release of hard reserved materials for other use should be approved by an authorized party 4.13 Dispatching materials outside the warehouse based on the following: 4.13.1 Sales 4.13.2 Sending to line stations 4.13.3 Sending items out for repair 4.13.4 Returning third party items 4.13.5 Returning leased items 4.13.6 Returning other operator items 4.13.7 Transferring between warehouses 4.13.8 Lending to another airline / organization 4.13.9 Exchanging with another airline / organization 4.13.10Issuing for consumption (for example, against a Job Order) Section H Requirements Compliance Matrix Page 266 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 4.13.11Disposing off as scrap, etc. 4.14 4.15 4.16 Monitoring the whereabouts of dispatched item (based on their batch / serial number) until acknowledgement of receipt Reserving materials manually as well as automatically through other systems such as MRO Issuing materials against requests received. While issuing, recommending the issue of materials down to the batch number. The batch number should be determined either by a first in first out basis or shelf life 4.17 Producing pick lists for items to be issued 4.18 Supporting sales of items to other airlines / parties 4.19 Supporting stock exchange between aircrafts and between PIA and other airlines 4.20 Generating inter-store stock transfer notes 4.21 4.22 Supporting and tracking outstanding loans (both from and to PIA) and providing regular reports / alerts Determining min, max and reorder levels based on historical and planned consumption patterns 4.23 Identifying and regularly reporting on non-moving / slow-moving materials 4.24 Supporting a permanent on-going stock-taking process 4.25 Scheduling and recording physical count of high value and frequently used items 4.26 Determining variances between book records and physical count of materials 4.27 Managing items declared surplus or redundant and managing their sale with a view to optimizing the revenues 5 Inbound / Outbound Logistics Management 5.1 5.2 Recording authorizations received from government agencies for foreign exchange spending Maintaining records of letter of credits, including the date of establishing the L/C, bank s name, bank charges, insurance cost, supplier of materials, exchange rates, purchase order number, retirement date, etc. Section H Requirements Compliance Matrix Page 267 Confidential

FUNCTIONAL REQUIREMENTS - PROCUREMENT AND INVENTORY CONTROL Sr. No. Requirement Response (S, W, E, C, N) Remarks 5.3 Tracking shipments based on intimation received from suppliers or freight forwarders 5.4 Highlighting delayed items or those missing in-transit and supporting insurance claims 5.5 Calculating landed cost based on total charges 5.6 Providing interface with Customs systems and assisting in obtaining clearance from Customs authorities 5.7 Processing retirement of documents and maintaining relevant records 5.8 Processing and maintaining details of goods cleared from Customs 5.9 Supporting statutory / regulatory reporting and documentation requirements when components are moved to external contractors. This will include at least the following: 5.9.1 Preparation of air waybill 5.9.2 Preparation of freight forwarder instructions 5.9.3 Preparation of other accompanying documents 5.9.4 Preparation of Indemnity Bond 5.9.5 Integration with freight forwarders for on-line status information Section H Requirements Compliance Matrix Page 268 Confidential

H7 SERVICES REQUIREMENTS Detailed below are the services requirements. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Remarks 1 Y = Yes Details of how the services would be provided 0 N = No / Cannot be provided Nil In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 269 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 1 IMPLEMENTATION 1.1 An Implementation Strategy has been submitted that covers: 1.1.1 Installation of the Interim Server(s) including the Operating System. 1.1.2 1.1.3 Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Interim Server(s). Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Permanent Servers. 1.1.4 Implementation of Database security features 1.1.5 Development of Business Requirement Document for each functional area which maps the business process for the parameterization / configuration of ERP Package. This document will be based on PIA s reengineered business processes provided by PIA. 1.1.6 Development of business case scenarios 1.1.7 1.1.8 1.1.9 Parameterization of supplied Software i.e. the configuration of application software via selection of in-built values, setting up of tables, etc. to meet the business requirements. Software modifications, where required, to supplied Application software and development of extensions and / or modules to meet the business requirements. Integration with PIA s other applications such as Sabre, AIMS, SITA Cargo, MRO solution, QUASAR, Recipe Management, Corporate e-mail, PIA website, etc. Design and development of customized reports, screens, workflows, etc. There is 1.1.10 no upper limit to the customization that will be undertaken 1.1.11 Design, development and initial set up of databases. Testing Strategy. Unit, Integration and System testing prior to User Acceptance 1.1.12 testing. 1.1.13 Data migration activities. These include preparation of data migration strategy and plan and undertaking data migration activities based on the plan Section H Requirements Compliance Matrix Page 270 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks Design and implementation of Online and Batch job operational procedures until 1.1.14 implementation is successfully completed at all locations. 1.1.15 Progress reporting on Contractor related activities. 1.1.16 Quality Assurance for Contractor related activities. Any other tasks required in successful delivery of the supplied products and 1.1.17 services. 1.2 1.3 Airline industry specific rapid implementation templates will be utilized to ensure quick implementation. Details of such templates are submitted with the Technical Proposal A detailed comprehensive project plan is prepared and submitted as a part of the proposal. 1.4 A detailed project organization structure has been submitted: 1.4.1 1.4.2 1.4.3 1.4.4 1.5 1.6 Identifying the specific individuals who would be assigned different tasks of this project. Assigning a full time Project Manager to manage this Project. This person is from the list of Lead Consultants submitted by the Contractor in response to the EOI. He / she has the experience of implementing the proposed ERP in at least two airlines. Containing a personnel roster containing detailed responsibilities of Contractor staff assigned to perform duties or services. The roster includes estimated number of hours to be worked on the project for each person broken down in different phases of the project clearly identifying the start and end dates for each phase. These staff members are from the list of implementers provided in response to the EOI. Substitutes to the nominated staff will have qualifications equivalent to or better than those who will be replaced. A system turnover plan will be developed that will indicate the conditional criteria required to fully turn over the daily operation of the system to PIA technical staff. At a minimum, the turnover plan will include the state of readiness required for system turnover and all required documentation. During system installation the Contractor will evaluate performance factors including, but not limited to, transaction volumes, response times, CPU utilization, and input / output activity. The Contractor is responsible for tuning the application to meet acceptable response times. Section H Requirements Compliance Matrix Page 271 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 1.7 1.8 1.9 1.10 1.11 The Contractor will conduct a Capacity Test that will include stress and volume testing. Capacity testing shall include a stress test that includes simulation of at least 30% of the system workload and volume tests that test the database activity against at least 30% of the data volume. The Contractor will document, the conclusions resulting from the test. The Contractor will maintain a project plan covering its components of the project and each individual phase. The plan shall include project organization, work break down structures, schedules, critical path determination, and other features required to track and manage this project. The Contractor will prepare and submit weekly progress reports to PIA on each component of the Project for which it is responsible. The Contractor has described its approach for assuring the quality of its components on this project. Contractor has also specified whether third party audit / quality assurance visits will be undertaken and who will bear the cost of these visits. The Contractor will manage version releases of all contract deliverables and certain other critical documents as determined by PIA. 2 TRAINING 2.1 Training Strategy has been submitted as part of the Technical Proposal 2.2 2.3 It describes in detail the approach to meeting the training requirements for each type of audience The general content of all training materials, training courses, and documentation proposed has been described in the Technical Proposal 3 DATA MIGRATION 3.1 A description of the general approach to the data migration process (manual and automated) for historical and cutover data has been provided. 3.2 Migration approach / strategy addresses the following: 3.2.1 Migration overview with objectives, approach, impact, and resources 3.2.2 Migration data (source and volume) 3.2.3 Migration process (automated or manual, verification procedures) 3.2.4 Migration support (system, policy and hardware) Section H Requirements Compliance Matrix Page 272 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 3.2.5 Migration schedule 3.2.6 Migration preparation task outline 3.3 Migration Plan addresses the following tasks: 3.3.1 Identify data elements to be migrated. 3.3.2 Identify necessary computer processing workloads. 3.3.3 Identify any special forms and procedures. 3.3.4 Identify any control procedures and evaluation criteria. 3.3.5 Identify, with the assistance of the PIA, the personnel needed to participate in the migration of the data. 3.3.6 Plan any special training for migration activities. 3.3.7 Plan any interim file maintenance requirements. 3.3.8 Develop migration programs (this includes specifications, program coding, test plans, and complete testing). 3.3.9 Present Migration Plan, Procedures, and Programs to PIA for approval. 4 DOCUMENTATION 4.1 Contractor will provide user manuals that will cover as a minimum the following: 4.1.1 4.1.2 Complete instructions for the users, completely explaining the use of each system function; System usage scenarios, based on real world examples drawn from the day-to-day workloads of typical users, that fully describe and explain the salient features and operation of the system; 4.1.3 How input data are stored and related between system records; 4.1.4 How to generate / suppress standard and ad hoc reports; 4.1.5 Normal report distribution; 4.1.6 Prioritization processing, system determined priorities, and user override procedures; 4.1.7 System log-on, log-off, and security features; Section H Requirements Compliance Matrix Page 273 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 4.1.8 Error messages and error correction procedures; 4.1.9 Help features and usage; 4.1.10 System troubleshooting; 4.1.11 Mandatory data fields and default data values; 4.1.12 Traversing system menus; 4.1.13 Screen layouts and contents; 4.1.14 Inquiry functions 4.2 Contractor will provide technical manuals that will cover as a minimum the following: 4.2.1 4.2.2 4.3 Addresses the view of the system required by developers, administrators and other technical personnel. Provides an understanding of the application; database design and file structures; relationships between programs, security; troubleshooting; special constraints; and other operational guidelines Contractor has submitted sample copies of all proposed documents that it will prepare / deliver to PIA during the course of this project. 5 WARRANTY AND MAINTENANCE SUPPORT 5.1 5.2 Contractor will provide warranty services for a period of three years by ensuring that the system in every way meets the specifications stated in this RFP Separate and apart from the warranty support services, the Contractor shall provide support ( Maintenance ) services for Applications, and RDBMS beginning upon the end of the warranty services and extended up to three (3) year thereafter 5.3 Contractor has provided its User and Technical Support Plan detailing the following: 5.3.1 on-site fault diagnostic techniques; 5.3.2 remote or tele-diagnostic fault diagnosing techniques; 5.3.3 average time to arrive on-site; 5.3.4 mean time to fix major system components; 5.3.5 fault escalation procedures; Section H Requirements Compliance Matrix Page 274 Confidential

SERVICES REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 5.3.6 maintenance of error logs. 5.4 Contractor will establish Hotline and Helpdesk support 5.5 Contractor has specified a solution to accommodate PIA s requirement of additional customized reports during the maintenance and support period. 6 VERSIONS AND UPGRADES 6.1 6.2 Contractor has assured that training material / software / process documents will be duly licensed for the purpose of implementation and use by PIA of the ERP. These will be of latest version and Contractor will ensure up-gradation of all modules / material / process documents during the warranty period and as part of afterwarranty maintenance support. During the implementation and subsequent rollout Contractor will be responsible to arrange and provide free version upgrades of all components under its responsibility. Contractor will ensure that at the time of handing over the solution to PIA all components are of the latest release and that the total solution is certified by the Contractor for completeness. Section H Requirements Compliance Matrix Page 275 Confidential

H8 HARDWARE REQUIREMENTS Detailed below are the hardware requirements. Contractors must provide their responses in the Response column and provide additional information / clarification in the Remarks column. Vendor response must be restricted to: Vendor Score Response Remarks 1 Y = Yes Details of how the hardware requirements will be fulfilled 0 N = No / Cannot be provided Nil In case the Contractor does not provide a response, it will be considered as N. The Contractor should provide the response by filling up the columns "Response" and "Remarks" only. Any changes, such as addition, deletion, or modification of row contents in the RFP document, will be considered as an invalid response to the RFP. Section H Requirements Compliance Matrix Page 276 Confidential

HARDWARE REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 1 HARDWARE 1.1 1.2 Contractor has submitted details of the proposed configuration, including layout diagram detailing model designation(s), memory size, number of CPUs, type of drives with capacity and counts. The offered solution complies with the Open Systems Architecture and latest technology trends. 1.3 The solution is scalable, both horizontally and vertically. 1.4 The hardware is sized keeping in view the operational requirements of the ERP and associated applications. 1.5 The hardware is fully capable of hosting the ERP certified database. 1.6 1.7 1.8 1.9 1.10 1.11 1.12 The hardware allows each partition of the ERP environment to be isolated in such a way that a software fault in one partition will not have an impact on another partition. All software required for clustering of servers and implementation of DRP is included in the solution. The solution will be fully supported by the Contractor for not less than ten years from the date of supply. It will remain capable of being supported, upgraded and extended by the Contractor during this period. The solution provided will be accompanied with complete documentation, operating manuals, system diagrams, startup and recovery procedures and all other information required for proper and efficient operation. Contractor will provide all technical material and verifiable benchmarks related to the proposed solution. The hardware is by the ERP principal vendor for the operation of the ERP and is reasonably expected to be certified for future versions of the ERP during the expected life of the hardware. Contractor has provided information on warranties on the equipment and any options regarding warranty extension. Principal s assurance for parts availability after expiry of warranty period is also provided. The Contractor has provided a thorough and contemporary 3rd party testing software for acceptance and load testing. The testing will be done according to system equipment specifications as well as generally accepted practices. Section H Requirements Compliance Matrix Page 277 Confidential

HARDWARE REQUIREMENTS Sr. No. Requirement Response (Y / N) Remarks 1.13 1.14 1.15 1.16 1.17 All test results will be completely documented by the Contractor. Complete test documentation including results of the 3rd party load / stress testing software will be provided to PIA. Based on PIA s high availability requirements, failover design is based on protecting single point of failure. For high availability on the application layer, the solution will implement log on load balancing between the application servers. It does not need any form of reallocation of resources between servers. The application environment is sized and designed such that upon failure of an application server (based on single point of failure), minimum degradation of performance will be experienced. A Disaster Recovery (DR) design is provided which provides a seamless, pragmatic DR process. It integrates within the overall design of the ERP landscape. The DR process is simple to execute. A step-by-step process and procedure is provided to minimize the potential for human error in a time of crisis and disaster. Additionally, the DR design can be easily tested with minimal impact on day-to-day operations. Section H Requirements Compliance Matrix Page 278 Confidential

SECTION I COMPLETION AND COMPLIANCE CHECKLIST Section I Completion and Compliance Checklist Page 279 Confidential

I1 PROPOSAL COMPLETION CHECKLIST RFP Reference Sub Section Item section Requirement Description Yes / No B B1 8.1.a Completed Proposal Form 9.2.a 9.2.b 9.2.c 9.2.d 12.2.b 12.2.c Products Price Schedule Services Price Schedule Recurrent Costs Form Proposal Price Summary Form Item-by-item commentary on PIA s Products and Services requirements Declaration of accepting responsibility for the successful integration and interoperability of all proposed products and other PIA systems as required by the RFP documents 13.1 Bid Bond 15.1 Original plus One hardcopy of Technical and Commercial Proposals 15.1 Softcopy of Technical Proposal 15.3 15.5 Technical and Commercial Proposals provided separately, clearly marked and sealed, as required Proposal in Format, as specified in Section B4 Format and Contents of Proposal 20.2 Declaration of not inducing or influencing the bidding / evaluation process F F1 2 Comprehensive Project Plan 3 Project Organization Structure and Personnel Roster G H I Hardware specifications and design layout Requirements Compliance Matrix duly filled in Completion and Compliance Checklist Section I Completion and Compliance Checklist Page 280 Confidential

I2 PRODUCTS AND SERVICES E Section RFP Reference Sub section E1 E2 E3 E4 E5 3 4 5 6 7 8 9 2 3 Item Requirement Description RELATIONAL DATABASE MANAGEMENT SYSTEM AND DATABASE ADMINISTRATION TOOLS APPLICATION DEVELOPMENT TOOLS QUERY AND REPORT GENERATION TOOLS INTERIM SERVERS The Contractor is required, as part of its proposal to provide an Interim Server and Operating System Software. It is anticipated that the Server(s) will be required for a period of approximately six to nine months from the date of supply of Server Hardware, Operating System Software and ERP Package Software. The Contractor will be required to re-install all ERP, 3 rd Party, Custom-built software, RDBMS, Database, Development tools, etc. on the Permanent Server(s). The details of the proposed Interim Server(s) hardware Configuration and Operating System software are to be provided by the Contractor in its proposal. The configuration of machines should be capable to support the number of users as specified by the Contractor in its plan. In its proposal, the Contractor will provide site specification requirements for the installation and operation of the Interim Server(s). PIA - at the end of implementation and rollout - may at its discretion, decide to purchase the interim servers provided by the Contractor. In this regard, the Contractor should, as part of its Commercial Proposal, separately mention the cost at which it would offer these machines for sale to PIA. However, this cost component should not be added to the total bid price, nor should it be used to calculate the bid bond amount. 3 RD PARTY SOFTWARE F F1 IMPLEMENTATION Contractor will be responsible to ensure that all required 3rd party software, operating systems, system management and monitoring tools, backup and recovery software, database administration tools, disaster recovery and business continuity tools, APIs / interfaces, etc. are made available, documented, designed, implemented and operational to meet PIA s requirements in the proposed ERP solution. It is the responsibility of the Contractor to offer PIA a complete solution in all respects delays or costs arising out of any shortcoming will have to be borne by the Contractor. 1a) Installation of the Interim Server(s) including the Operating System. 1b) 1c) Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Interim Server(s). Installation of all supplied Application software, RDBMS software, Development / Query and Report Writer / Database Administration Tools and any other required Utilities, on the Permanent Server(s). 1d) Implementation of Database security features. 1e) Development of Business Requirement Document for each functional area which maps the business process for the parameterization / configuration of ERP Package. This should be based on PIA s reengineered business processes that would be made available to the Contractor. 1f) Development of business case scenarios Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 281 Confidential

Section RFP Reference Sub section 1g) 1h) Item Requirement Description Parameterization of supplied Software i.e. the configuration of application software via selection of in-built values, setting up of tables, etc. to meet the business requirements. Software modifications, where required, to supplied Application software and development of extensions and / or modules to meet the business requirements. 1i) Design, development and initial setup of databases. 1j) 1k) Integration with PIA s other applications such as Sabre, AIMS, SITA Cargo, MRO Solution, QUASAR, Recipe Management, Corporate e-mail, PIA website, etc. Design and development of customized reports, screens, workflows, etc. PIA will try to maximize the use of standard reports, screens and workflows available in the proposed solution; however the Contractor cannot set an upper limit to the number of customization that it will undertake. 1l) Unit, Integration and System testing prior to User Acceptance testing. 1m) Data conversion activities. 1n) Design and implementation of online and batch job operational activities until implementation is successfully completed at all locations. 1o) Progress reporting on Contractor related activities. 1p) Quality Assurance for Contractor related activities. 1q) 2 3 Any other tasks required in successful delivery of the supplied products and services. Contractor must utilize airline industry specific rapid implementation templates to ensure quick implementation. Details of such templates should be submitted with the Technical Proposal. A detailed comprehensive business plan is to be prepared by Contractor and submitted as a part of project. The business plan shall be mutually approved and incorporated as part of contract and reviewed at regular intervals. Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 282 Confidential

Section RFP Reference Sub section Item Requirement Description The Contractor must submit a detailed project organization structure identifying, by name, the specific individuals who would be assigned different tasks of this project. The Contractor must assign full-time Project Manager and ERP module track leaders on this Project. The Project Manager as well as each ERP track leader must have the experience of implementing the proposed ERP in at least two airlines. Contractor Proposal Ref. & Page 4 A personnel roster containing detailed responsibilities of Contractor staff who shall be assigned to perform duties or services under the contract should be provided. It should include estimated number of days to be worked on the project for each person broken down in different phases of the project; with clear identification of the start and end dates for each phase. These staff members should be from the list of implementers provided in response to the EOI and must have the experience of at least two complete implementations. If additional members are assigned their detailed CVs should be submitted as part of the proposal. Contractor will not be allowed to assign staff members who do not have the experience of at least two complete implementations of the proposed ERP. Daily charge-out rates for each Contractor staff must be provided in the Commercial Proposal. If deployment of Contractor s proposed staff is less than the estimate provided in the personnel roster, PIA will make proportionate deductions from Contractor s payments. However, in order to ensure timely completion, the Contractor will have to deploy additional resources, if required, without extra cost to PIA. 5 6 7 8 9 10 11 12 Contractor shall be contractually bound to maintain the proposed team dedicated to the PIA project with the exception of a staff member leaving the Contractor organization. In such cases staff proposed as substitutes must have qualifications equivalent to or better than those being replaced and must be approved by PIA. The Contractor may perform Unit, Integration, and Systems Tests off-site; however, the official Systems Test and all User Acceptance Tests must be performed on-site using PIA s testing environment. The Contractor must provide, by phase, the proposed number of personnel to be based on-site at PIA s premises, and space and other requirements to be provided by PIA during Implementation. The Contractor will develop a system turnover plan which indicates the conditional criteria required to fully turn over the daily operation of the system to PIA technical staff. At a minimum, the turnover plan must include the state of readiness required for system turnover and all required documentation. The Contractor s implementation plan must take into consideration the business priority areas and applications. System Performance: During system installation the Contractor will evaluate performance factors including, but not limited to, transaction volumes, response times, CPU utilization, and input / output activity. The Contractor will be responsible for tuning the application to meet acceptable response times. Capacity Evaluation: The Contractor will conduct a Capacity Test will include stress and volume testing. Project Management and Reporting: The Contractor is required to maintain a project plan covering its components of the project and each individual phase. The Contractor will be required to prepare and submit weekly progress reports to PIA on each component of the Project under which it is responsible. Project Quality Management: In its proposal, the Contractor must describe its approach for assuring the quality of its components on this project. Contractor must also specify whether third party audit / quality assurance visits will be undertaken and who will bear the cost of these visits. Section I Completion and Compliance Checklist Page 283 Confidential

Section RFP Reference Sub section F2 F3 F4 13 14 15 16 2 4 5 6 7 8 10 Item Requirement Description Acceptance Testing: PIA will conduct a rigorous acceptance test of the system. During this test, PIA will identify required modifications and document them through the problem resolution or change management processes (described below) as appropriate. The Contractor shall modify the system as required and provide new versions of modified components to PIA for testing. PIA will notify the Contractor in writing when it determines that the system is acceptable. Problem Resolution: The Contractor and PIA will cooperate to resolve system problems found during acceptance testing and production use, including the warranty period. PIA will prioritize and report problems in a written format. The Contractor shall track these problems to closure and report their status upon request. Change Management: PIA and Contractor will cooperate in managing changes to previously agreed upon system functional capabilities. PIA may identify potential functional changes; however cost escalation will not be allowed under any circumstances. Configuration Management: The Contractor shall manage version releases of all contract deliverables and certain other critical documents as determined by PIA. TRAINING As a part of the proposal, the Contractor must describe in detail its approach to meeting the training requirements for each audience. The description must include methods proposed to deliver both training and documentation. The Contractor should describe the general content of all training materials, training courses, and documentation proposed. The Training Strategy should include a training solution to support the training of end users throughout PIA in the functionality of the various ERP and Add-on applications components. For PIA technical staff, the Training Strategy should include a plan to train the required staff in the Development and Administration tools supplied. The Training Strategy will address, at a minimum, the following: a) Description of the Course, the Course outline, specifications of the number and appropriateness of staff who will attend, probable dates of classes, etc. b) Proposed content of all training materials. c) A description of the proposed software / tools (these may include training aids, manuals, on-line references, quick reference guides or templates, or computer based training), and their use during the training. d) Details of the physical locations to be used for training. e) Training evaluation methodology f) The names, qualification and Formal Training experience in man-months, of the instructors for each training course The Contractor is required to develop materials for training users in central and remote offices. The Contractor must provide material for training Technical Staff such as database administrators, system administrators, operators, and developers. Cost of Foreign Training, if proposed, should be included in the Contractor s Commercial Proposal and include all expenses related to travel, accommodation, tuition fees and other incidentals. DATA MIGRATION 2 The Conversion Strategy must address, at a minimum items a) to f) 3 The Conversion Plan must address tasks a) to i) 1 DOCUMENTATION As part of its Technical Proposal, the Contractor must describe the level and types of documentation that will be delivered. This documentation must cover each level of operation, for example: user, security administrator, database administrator, operator, developer, etc. Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 284 Confidential

Section RFP Reference Sub section F5 F6 2 3 4 5 6 7 8 1 2 3 4 5 6 7 1 Item Requirement Description Two complete hardcopy sets of documentation for all Contractor supplied components for this Project must be furnished, in addition to softcopies on CDs. The manuals should feature clear organization of content, easy to understand language, useful graphic presentations, and a thorough index and glossary. These manuals must address the view of the system required by business unit staff (end users). It must contain sufficient information to enable the user to independently operate the system, troubleshoot simple problems, and correct problems. In conjunction with the Users Manual, Quick Reference cards will be produced by the contractor, which will be an immediate aid to the user and quickly describe operations. The Technical Manuals must address the view of the system required by developers, administrators and other technical personnel. It should provide an understanding of the application; data base design and file structures; relationships between programs, security; troubleshooting; special constraints; and other operational guidelines. Copies of all licenses, warranties, maintenance agreements and similar materials for all Contractor delivered components of the project must be furnished separately. Contractor must submit sample copies of all documents that it will prepare / deliver to PIA during the course of this project. WARRANTY AND MAINTENANCE SUPPORT The Contractor will provide warranty services for a period of at least one year for software and a minimum of three years for hardware. The warranty will begin on PIA s written final acceptance of the system. All warranty support services are to be rendered free of charge to PIA. Contractor will be responsible for all related costs during this period. Separate and apart from the warranty support services, the Contractor shall provide Maintenance services for Applications, and RDBMS beginning upon the end of the warranty services and extended up to three (3) years thereafter. The Contractor must describe in detail in the Technical Proposal its User and Technical Support Plan for the warranty and maintenance periods, covering the resources, timing and procedures that will be available to provide this support. The Contractor must specify the various categories of problems it will support and describe the severity levels of problems. Details of the establishment of an effective Hot Line Telephone and Support Desk service should be provided. PIA may require the Contractor to develop additional customized reports, screens, workflows, etc. during the maintenance and support period. Contractor must specify in its Technical Proposal a solution to accommodate PIA s requirement. The Commercial Proposal must contain the pricing mechanism for additional report development / customization. The Contractor must provide a list of clients in Pakistan for which ERP Maintenance Support is, or has been provided during the past three years. Details of modules supported should be included. VERSION AND UPGRADES Contractor must ensure that training material / software / process documents are duly licensed for the purpose of implementation and use by PIA of the ERP. These are to be of latest version and Contractor must ensure upgradation of all modules / material / process documents during the warranty period and as part of after-warranty maintenance support. Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 285 Confidential

Section G RFP Reference Sub section 2 1 Item Requirement Description During the implementation and subsequent rollout Contractor would be responsible to arrange and provide free version upgrades of all components under its responsibility. Contractor must ensure that at the time of handing over the solution to PIA all components are of the latest release and that the total solution is certified by the Contractor for completeness. HARDWARE The Contractor must evaluate and prepare an appropriate configuration to run the proposed ERP solution. PIA is looking for a high-availability solution including servers, clustering design, and disaster recovery recommendations besides maintenance / repair options needed for the associated infrastructure. The response must address all items a) to q) Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 286 Confidential

I3 BUSINESS INFORMATION AND APPLICATION NEEDS Section RFP Reference Sub section Item Requirement Description D D2 1. Information Requirements of Board of Directors 2. Information Requirements of Senior Management 3. Functional Information Requirements 3.1 FINANCE 3.1.1 General Ledger 3.1.2 Financial Analyzer 3.1.3 Fixed Assets Management 3.1.4 Cash Management 3.1.5 Petty Cash Management 3.1.6 Accounts Payable 3.1.7 Revenue Accounting 3.1.8 Accounts Receivable 3.1.9 Insurance Management 3.1.10 Leasing Management 3.1.11 Budget and Cost Management 3.1.12 Profitability Management 3.1.13 Foreign Currency Management 3.1.14 Taxation Management 3.1.15 Treasury and Risk Management 3.2 HUMAN RESOURCES AND ADMINISTRATION 3.2.1 Organizational Management 3.2.2 Recruitment Management 3.2.3 Qualifications Management 3.2.4 Staff Development 3.2.5 Performance Management 3.2.6 Compensation and Benefits Administration 3.2.7 Training and Development Management 3.2.8 Time Management 3.2.9 Healthcare Management 3.2.10 Travel Management 3.2.11 Payroll Processing 3.2.12 Final Settlement Processing 3.2.13 Personnel Insurance Management 3.2.14 Security Management 3.2.15 Staff Funds Management 3.2.16 Self Service Management 3.3 PROCUREMENT AND INVENTORY CONTROL 3.3.1 Contracting and Procurement Management 3.3.2 Vendor Management 3.3.3 Items Management 3.3.4 Stores Management 3.3.5 Inbound / Outbound Logistics Management Contractor Proposal Ref. & Page Section I Completion and Compliance Checklist Page 287 Confidential

I4 ERP PACKAGE REQUIREMENTS Section RFP Reference Sub section Item Requirement Description D D1 1. OVERVIEW OF SOLUTION REQUIREMENTS Contractor Proposal Ref. & Page 2. TECHNOLOGY REQUIREMENTS 2.1 New Technology 2.2 Multiple Environments 2.3 System Performance 2.4 Archive and Purge 2.5 Recovery 2.6 Backup and Reorganization 2.7 Print Management 2.8 Technology Architecture 2.9 Server 2.10 System and Network Management Tools 2.11 Authentication 3. GENERAL REQUIREMENTS 3.1 Common Characteristics 3.2 Integration 3.3 Configuration 3.4 Technology Interfaces 3.5 Access Control 3.6 User Interface 3.7 Reporting / Enquiry 3.8 Analytic Tools 3.9 Communication 3.10 Flexibility 3.11 System Availability 3.12 Transaction Timing 3.13 Online Documentation and Training 3.14 Storage / Record Retrieval 3.15 Data Support 3.16 System Security 3.17 Web-enablement 3.18 Self-Service Portal 3.19 Workflow 3.20 Others Section I Completion and Compliance Checklist Page 288 Confidential

SECTION J CRITERIA FOR TECHNICAL AND COMMERCIAL EVALUATION Section I Completion and Compliance Checklist Page 289 Confidential

J1 Criteria for Technical and Commercial Evaluation for ERP Solution and Contractor Detailed below are the Criteria for Technical and Commercial Evaluation for ERP Solution provider. Mandatory Requirements Sr. No. 1 Attributes Off-the shelf solution of International Repute Requirements Literature/ brochure / catalogue of Product, user manual and technical documents 2 Details of litigation/sub-judice cases (if any) Certificate/ Letter 3 Income tax (NTN), Sales Tax Registration Certificate Provide certificates 4 Web enabled application Compulsory 5 Provision of on line bugs tracking / reporting system Compulsory 6 Search record Functionality Provide efficient Search functionality in all modules 7 Reports 8 Upgrades 9 10 Audited Financial Statements for preceding 3 years Undertaking of no outstanding claims against PIA Capability to generate multiple reports as per requirement of different modules Provide software enhancements, updates & patches in the package. (with no hidden charges) Audited financial statements Appropriate undertaking Technical Bid: 65% Commercial Bid: 35 % Sections Score Score Obtained A. Business Profile 15 B. Experience 15 C. Product details 30 D. Composition of team assigned 25 E. Training 05 F. Compliance 10 Total 100 Technical bids with scores of 70 points and above will be considered responsive and will be considered for further commercial evaluation. 1- Technical Bid Score: Marks obtained by Firm / 100 * 65 = 2- Commercial Bid Score: M/B * W = M Minimum Bid B The bid W Weight (35) Total Score = Technical Bid Score + Commercial Bid Score Note: PIA reserve the right to reject the proposal if any of the above mentioned requirements are not fulfilled. Section I Completion and Compliance Checklist Page 290 Confidential

Technical Evaluation Performa Sr. No. 1 Attributes Authorized Product dealer/ Partner A Business Profile Max Score 4 Score Distrib ution Requirements 4 Principal ERP vendor directly participating 3 OEM / Principal provide confirmation about the successful implementation of proposed solution in writing. 1 Authorized dealer/ partner participating 2 Financial Strength 4 4 3 2 More than or equal to PKR 1,000 million turnover with software services revenue being 50% PKR 750 to 999 million turnover with software services revenue being 60% or more PKR 500 to 749 million turnover with software services revenue being at least 70% or more 3 Company established (No. of years) 3 3 15 or more years 2 7 years or more 4 Location of Offices 4 4 2 Offices in more than 3 cities in Pakistan including Karachi, Lahore, Islamabad and at least one other (please specify) Offices in at least 3 cities in Pakistan including Karachi, Lahore and Islamabad 1 Office in Karachi Total 15 B Experience 5 Successful implementations in other organizations ( Local organizations - project of similar size and scope) 5 5 Airlines and/or Government organization 3 Airlines and/or Private organization 5 Implementation in the Airlines Industry in South Asia/Middle East (of at least PIA s size 40 aircrafts) 6 Successful implementations of Product (International organization) 5 3 Implementation in the Airlines Industry in Asia (of at least PIA s size 40 aircrafts) 1 Implementation in the Airlines Industry in North America / Europe (of at least PIA s size 40 aircrafts) 5 10 or more Implementations within Asia (at least 3 in the airlines industry) 7 Number of reference able Implementations 5 3 6-9 Implementations within Asia (at least 2 in the airlines industry) 2 3-5 Implementations within Asia (at least 1 in the airlines industry) Total 15 Section I Completion and Compliance Checklist Page 291 Confidential

C Product details 8 Compliance of Product with Functional Requirements of RFP 4 4 90%-100% compliance (all modules) 2 80%-90% compliance. 1 70%-80% compliance. 9 Integration & Inter-operatability with other products 4 2 Maximum flexibility to integrate with other modules and products (80 90 %). 2 70-79 % flexibility. 10 Presentation & user friendliness of product (provide screen shots of product) 4 2 Good (presentation and screen shots) 2 Average (presentation and screen shots) 5 No locally developed module 11 Configuration/customization level (for local partners) 5 4 Out of the box with some degree of customization 3 Integration with third party products and tools 2 One locally developed module added 1 More than one locally developed module added 12 Warranty period and conditions (if any for implemented solution) 5 5 Free for more 3 years or more 4 Free for up to 2 years 3 Free for up to 1 year 13 Free Maintenance & Operational Support 4 4 2 Maintenance and operational support for two years after complete implementation Maintenance and operational support for one year after complete implementation 14 Maximum time required for complete implementation from the date of award of contract Total 30 4 4 18 months 2 20 months Section I Completion and Compliance Checklist Page 292 Confidential

D Composition of Team Assigned to Implement ERP 15 16 Location of proposed ERP consultants and ERP trainers Project Manager (PM) experience of ERP implementation (ERP for international organization) (similar level product implementation in the airline industry ) 17 Project Management Team 4 4 4 4 Teams in Karachi, Lahore and Islamabad 2 Teams in Karachi and Lahore 1 Teams in Karachi. 4 3 or more ERP implementations (at least one in the Airlines Industry) as Project Manager 2 At least 2 ERP implementations as Project Manager 4 2 Dedicated Project Management Teams proposed (at least 80% of whom have worked together on two implementations on the scope relevant to PIA) Dedicated Project Management Team (at least 80% of whom have worked together on one implementation on the scope relevant to PIA) 4 10 or more years of Technical Solution Delivery Experience 18 Project Technical Lead (at least 2 resources) 4 2 Over 7 years of Technical Solution Delivery Experience 1 Over 5 years of Technical Solution Delivery Experience 19 Project Size Team 4 20 Experience Level and Relevance of Proposed Team Total 5 25 4 2 5 3 1 At least 40Resources of which 75% are functional and the rest technical (systems admin and reports/forms and add-on developers) At least 30Resources of which 75% are functional and the rest technical (systems admin and reports/forms and add-on developers) High (each resource has at least 5 years of experience) and combined team experience is more than 200 person-years) Moderate (each resource has at least 3 years of experience) and combined team experience is more than 150 personyears) Low (each resource has at least 2 years of experience) and combined team experience is more than 100 person-years) E Training 21 Location of training facilities and consultants for training available 5 5 Facilities and staff available in Karachi, Lahore, and Islamabad 3 Facilities and Staff available in Karachi and Lahore 2 Facilities and Staff available in Karachi Total 5 1 Facilities through other organizations / institutes F Compliance 22 Extent of Compliance with PIA s Suggested Timelines and Payment Terms 10 10 Fully Compliant (both timelines and payment terms) 5 Significantly Compliant (payment terms only) 3 Partially Compliant (timelines only) Total 10 Section I Completion and Compliance Checklist Page 293 Confidential