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Aligned At Last

The new owner of National and Alamo is steering the car-rental companies out of a disastrous IT past
National now runs Odyssey on Hewlett-Packard N and V class PA-RISC-based servers, and Alamo runs its legacy system on IBM mainframes. Vanguard is installing two HP9000 PA-RISC Superdomes, which will run an updated version of Odyssey. National will go live on that version in July, with Alamo scheduled to move off its legacy platform and onto Odyssey in August, following the peak vacation season.

Consolidation on Odyssey and Superdome hardware is expected to help Vanguard reduce its IT budget by almost half, Best says. The company has a 2004 IT budget of $75 million, with the ongoing upgrade expected to total around $30 million. In fact, the system is expected to have a big impact on costs overall. "The whole goal for us is automating every step we can," Best says. "Every manual step that needs to be taken into account adds costs."

Odyssey's fleet-automation component is expected to help reduce the impact of another strategic misstep the company made while going through the bankruptcy process: consolidating National and Alamo counters and fleet lots at airports throughout the country.

"The turnaround guy at the time wanted to show how [he] could cut costs by a big chunk through site-operation consolidation, and it was adopted across the board," LeSage says. Customer complaints followed, especially from National's corporate clients who were used to the Emerald Club quick-service treatment. Those customers might show up at airports and find 25 people in line at the National-Alamo counters, with many waiting for cars to go on vacation, he says.

The facilities consolidation move is among several "made during the bankruptcy period we regret, and it's going to take some time to work through the decisions," Lobeck says. The company had negotiated multiyear contracts at airports for combined facilities. It has made some progress at many major airports in undoing contracts, but it could be years before many of them are renegotiated.

That's why it's critical to have Odyssey installed at both Alamo and National. While this move by itself won't eliminate longer lines, it will help ensure that all customers can get vehicles in a timely manner when they have reservations. The two fleets are maintained as separate entities in the Odyssey system, but the software can automatically draw from either fleet to supply a vehicle to a customer, without any manual interaction by counter personnel or customers. "It virtually doubles the available pool for customers," Best says.

Scalability and flexibility also played into the selection of the Odyssey and HP systems, he says. The Superdomes can be upgraded by increasing processing power or expanded by adding another box in a clustered environment. And Vanguard, which is completing code modifications on Odyssey, already is running the software in simulated environments that test the system at double the user rates expected when it actually goes live. The company has big growth plans: It expects its annual revenue of about $2.5 billion to blossom to $3.5 billion by 2005.

Vanguard expects to be profitable in 2004 as it gets its operations in order to make an expansion push in 2005, including a move into Europe. "What we need is to be adaptive and quick on our feet as we go through these adjustments," Best says. "A private company coming out of bankruptcy is basically a startup company, and we have to prove ourselves."

With solid business technology at last in place, Vanguard may be on the road to doing just that.

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