WestJet Cuts Costs With Crowdsourcing
Flooded with money-saving ideas from employees, WestJet turned to Spigit to help it organize those ideas and identify the best ones.
Seeking to cut costs in a tough economy, the Canadian airline WestJet asked employees for suggestions and was overwhelmed by the response--literally, overwhelmed.
Within a year, WestJet realized that trying to manage the process with email, Excel, and SharePoint wasn't going to work, said Trent Tilbury, a senior business analyst with the airline. "We were inundated with ideas, to where we just couldn't handle them administratively," he said.
In addition to the staff tasked with managing submissions (2.5 full-time equivalents), managers were finding it difficult to sort through them all and respond to them appropriately, Tilbury said. That's when WestJet turned to Spigit, an enterprise social application created specifically for the purpose of crowdsourcing ideas for product development and improvement, cost savings, and other corporate goals.
[ Crowdsourcing can be a powerful tool. Read Crowdsourcing Cracks AIDS Mystery, What's Next? ]
In general, Spigit focuses on internal innovation communities, meaning soliciting and nurturing ideas from employees. Some applications also include members of the public. An example is Spigit's work with the City of New York to gather ideas about improving life there from both employees and citizens. There is also a Spigit for Facebook app, which is used more for market research with consumers.
WestJet has saved more than $10 million as a result of the suggestions submitted by employees during the past three years, including the period prior to the implementation of Spigit, Tilbury said. Spigit's contribution has been to make the process more manageable by encouraging employees to participate in the process of voting ideas up or down and determining which ones should move toward implementation. Managers then need only respond to the handful of ideas that have risen to the top of the list, he said.
Also, because Spigit makes participation fun and engaging, participation expanded from about 450 people who had registered for the SharePoint application to about 2,000 employees participating now, Tilbury said.
Spigit keeps employees interested by applying the principles of gamification, a social software technique that borrows from the mechanics of online games, said Lisa Purvis, senior vice president of product research and development at Spigit. The user interface takes advantage of "the rich and visual media that have existed for a while in the consumer space," as well as mobile applications. The ultimate goal is "to ensure engagement is more than a one-time thing, that it's not just submitting an app and never coming back," she said.
To keep people involved, Spigit lets them comment and vote on each other's ideas, while also keeping track of how their own are ranked by others. Through leaderboards and other mechanisms, employees get an opportunity to develop a reputation within the company as someone who is interested in innovation and has good ideas, she said.
Annie Lawrenson, vice president of innovation strategy at Spigit and a former customer, said the software's ability to keep employees engaged is what first got her interested. "It's not just why are they going to come back on day two, but why are they going to come back on day 200. For that to happen, you need habit inducing, habit forming behavioral guides," she said.
Spigit allows companies to define a process for how ideas graduate from one stage of review to the next and ultimately move toward implementation "to make sure ideas make their way through and don't just end there--that the required activities happen and make it to market," Purvis said. That idea graduation process "is fully configurable to make those stages specific to your environment," she said.
WestJet has taken advantage of that configurability to define its application as the "innovation hanger," where ideas proceed through a series of preflight checks before taking flight, Tilbury said.
Many of the cost-saving steps have proven to be very simple. For example, one employee questioned why the company was still printing old fashioned paper ticket jackets for customers in an age of e-tickets, and just eliminating that stationery expense saved $750,000 a year. Someone else questioned allowing pilots and flight attendants free access to the supply of bottled water brought onboard for customers.
Just by changing that policy, and telling the crew to bring their own water container and fill them from the plane's potable water tanks, WestJet saved another $500,000. The savings came not just from the price of bottled water but from weight savings as well--by carrying fewer water bottles on board, the airline saved the weight of that water by instead making use of water the plane was carrying anyway, Tilbury said.
The online brainstorming sessions have also generated new product ideas, although so far their value is "a little harder to gauge," he said.
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