September 13, 1999

United: A Customer-Centric Approach

By Beth Bacheldor

f E-transformation translates into customer focus, the IT department at UAL Inc., parent company of United Airlines, is learning the language fast.

UAL's IT group has been involved in several cutting-edge projects for helping the airline's customers. United is deploying large-screen displays--nicknamed The Word--that will tell passengers when a flight has been canceled and what other flights are available to their destination. Also, United is deploying mobile workstations, known as Chariots, that can be connected to a LAN using radio-frequency technology and rolled out to gates when flights are canceled, so agents can re-ticket customers faster. The airline plans to use its Web site to capture data collected from visitor profiles, such as seat and meal preferences, so agents will know what customers prefer when they call to book flights.

But nowhere is E-transformation more evident than in the changes occurring to United's time-honored distribution model. With more people eschewing travel agents in favor of shopping for airline tickets on the Internet, United is riding the wave: The airline has an annual sales rate of some $500 million on its Web site.

Electronic ticketing is another digital success at United. In July, more than half (52%) of United's worldwide tickets were issued electronically for the first time. "We're very focused on things that traditionally you wouldn't see an IT department working on--creating new distribution models and executing on them," says Bruce Parker, senior VP and CIO at UAL. That means major changes at United, the world's largest passenger air carrier, which flew some 87 million customers last year and racked up $17.5 billion in revenue.

Eighteen months ago, Parker was among the top United executives who worked on a deal that involved late-night meetings and lightning-fast negotiations. After a week and a half, United ended up with 25% of Internet Travel Network, now called GetThere.com, an Internet company that develops procurement technologies for business travel. In July, United teamed with Internet retailer Buy.com to create an online travel store, BuyTravel.com, that will sell travel on all major airlines, as well as hotel rooms, car rentals, and cruises.

Those business initiatives call for more than the traditional IT credentials. "You need fundamentals in the technology, fundamentals in the industry, and you need a sense of impatience and a sense of entrepreneurial spirit," says Parker. But it adds up, he says: "You feel you're doing both innovative and creative things, because you're creating things that are new."

Return to main story, "E-Transformation."

Illustration by Matsu

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