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Chapter 11 Case Study

Chapter 11 Case Study. By Max Grailer & Kyle Danovsky. Overview. Two airline companies, WestJet and JetBlue Each company was in need of sweeping IT upgrades to their reservation system In 2009, both companies upgraded their reservation systems (one with much more success than the other).

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Chapter 11 Case Study

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  1. Chapter 11 Case Study By Max Grailer& Kyle Danovsky

  2. Overview • Two airline companies, WestJet and JetBlue • Each company was in need of sweeping IT upgrades to their reservation system • In 2009, both companies upgraded their reservation systems (one with much more success than the other)

  3. JetBlue • Headquarters: Queens, New York • Incorporated in 1998 and founded by David Neeleman in 1999 • Flies to 63 destinations in 21 states and 11 in the Caribbean, South America and Latin America • Has 167 aircrafts in use • Goal: To provide low cost travel with unique amenities (ex. TV in every seat)

  4. WestJet • Headquarters: Calgary, Canada • Founded by a group of airline industry veterans (Neeleman being one of them) in 1996 • Flies to 71 destinations in North America • Has 88 aircrafts in use • Had 40% of the Canadian airline market by 2010

  5. Problem • The reservation system’s in place at the time were designed for smaller start-up airlines • The rapid growth of each airline made these current systems obsolete, which meant that the reservation systems needed to be upgraded.

  6. IT Needs • Both companies needed more processing power to deal with the increase in customers using their website. • Features like linking prices and seat inventory to other airlines they cooperate with.

  7. Solution • Both companies contracted the company Sabre Holdings, one of the most widely used IT providers for airlines, to upgrade their reservation system. • Wanted to implement the new SabreSonic CSS. SabreSonic CSS sells seats, collects payments, allows online shopping for flights, and provides an interface to connect the customer with reservation agents.

  8. WestJet Failure • WestJet was the first of two to implement the new system. • They went live with SabreSonic CSS on October 2009. • Results: - Website crashed repeatedly - Call centers were overwhelmed and understaffed • Caused slowdowns for customers at airports • Customer’s were unhappy

  9. WestJet's critical Issue • WestJet did not account for the time it would take to transfer the 840,000 files (containing data on transactions/purchases) from the old servers in Calgary to Sabre’s servers in Oklahoma.

  10. WestJet Results • Hundreds of thousands of bookings for flights in the future were not accessible during, and for a short time after, the file transfer. • This hiccup ruined WestJet’s reputation for a short period. • Delayed frequent flyer rollout and code sharing plans with other airlines.

  11. JetBlue: Learning from WestJet • JetBlue was more cautious about it’s launch. • Built a backup website in case the main site crashed • Hired 500 temporary call center workers • Switched files on Friday night, since Saturday flight traffic is usually low • Sold less seats on flights that took off on the day of the file transfer. • Still experienced a few problems (call wait times increased, not all printers were working correctly when system went live), but it was extremely minor compared to what WestJet went through.

  12. Why did WestJet’s implementation of a new Reservation System result in Issues? • A: There were no issues • B: WestJet did not account for the massive transfer of data files • C: 9/11 • D: WestJet chose the wrong reservation system for their needs

  13. Answer • B: WestJet did not account for the massive transfer of data files

  14. What helped JetBlue be more successful in their implementation? • A: Learned from WestJet’s mistakes • B: Built a backup website prior to launch • C: Sold less seats for launch date • D: All of the above

  15. Answer • D: All of the above • JetBlue was more successful because they learned from the mistakes of WestJet, set up a backup website in case of issues, and sold less seats for the day of the launch.

  16. Who played a role in founding both Jetblue and WestJet? • A: John Neeleman • B: Neal Davidson • C: David Neeleman • D: David Johnson

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