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Australian CIO Summit 2012: IS Transformation and Driving Technology Investment Value by Segar Reddy, Virgin Australia
1. Australian CIO Summit 2012
IS Transformation and Driving
Technology Investment Value
Segar Reddy
Virgin Australia
25 July 2012
2. Introduction
• The repositioning and transformation of our airline under the ‘Game
Change Program’ business strategy is progressing well
• Platform for growth now largely in place
• Early benefits from Game Change Program now flowing
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3. Virgin Australia & the Game Change Program
Virgin Australia is in a period of substantial growth and change driven by the
Game Change Program led by Virgin Australia’s CEO John Borghetti. The Game
Change Program aims to make Virgin Australia the airline of choice – for the
corporate market, as well as the leisure market, through the introduction of new
and improved services, products and a fresh new look, whilst maintaining the
Virgin service and flair.
Virgin Australia’s vision is to:
Be the airline of choice
Be Australia’s best customer led organisation
Do for corporate travellers what we did for
leisure travellers
“It never is business as usual. Business as usual is
actually changing things.”
John Borghetti
The Australian, 5 May 2012
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4. Game Change strategic goals
Key strategic pillars:
• Diversify revenue line
• Create global network
• Access growth markets
• Maintain cost advantage
• Upgrade product and services
• Invest in our people
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5. As the business transforms - IS must transform too…
Low Cost Premium airline -
Business
increased service levels
Strategy
Carrier
• More complexity - service
offerings, processes,
customer base etc
• Larger, more professional
organisation
Low Cost Scale up IS capability
Changes
Carrier
appropriate
IS
• IS has to enable and facilitate
fast-paced business change
• Develop solutions appropriate
to a large organisation
• Higher, industry practice
expectations 4
6. IS strategic framework
A trusted partner delivering technology
capability that meets business aspirations
Deliver solutions Focus Deliver real Provide
that transform on customer business value consistently
the business outcomes and efficiency stable systems
Engaged and motivated people
Within this framework, our FY 13 priorities:
• Deliver Unify Program
• Robust systems
• Game Change support
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7. IS team objectives
• Build an engaged and motivated IS team that is empowered to take action
• Deliver solutions that facilitate the transformation of the business
• Enable an improved guest experience through better management of
guest processes and information
• Optimise value from sourcing arrangements
• Deliver systems and services in a cost effective manner
• Provide robust and stable systems
• Deliver innovative solutions for competitive advantage
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8. Becoming ticketed airline…
• Transform business operations and processes to deliver guests a
seamless travel experience by adopting worldwide airline standards
• Transition to ticketed operations by introducing the SabreSonic® Customer
Sales and Service (CSS) system mid-January 2013
• This program of work will:
o Unify four airlines with two different reservation systems under
one strong brand, operating under a single airline designator code
on one reservations platform
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9. Becoming ticketed airline…
• Delivering significant benefits to guests:
o Providing enhanced, seamless, travel experience across the Virgin
Australia and partner airline networks
o Easier to book and travel across our global network, enabling:
seamless through-checking of baggage on partner airlines,
Easier and more consistent recognition of guest preferences, no
matter where you travel,
Ability to provide additional Velocity benefits.
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10. Becoming ticketed airline…
• Delivering significant benefits to our industry partners:
o Facilitate enhanced interactions with Travel Management Companies
and travel agencies worldwide
o Our domestic and international products will be available via all
distribution channels and through the GDS it will be faster and easier
for travel agents to book with Virgin Australia
o Corporate travel agents will be able to book with greater ease, using a
system that is a global standard
o Easier for Alliance Partners to work with us - a single airline designator,
adoption of IATA international airline standards, one set of processes for
international and domestic operations
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11. Becoming ticketed airline…
• Delivering significant increased business capability:
o Removal of ‘workarounds’ currently encountered by our team members
because we use two different reservations systems
o Integration of airline operations with one system and one designator
code
o Improved customer recognition and experience
o Integrated seamless travel with our alliance partners
o A more efficient industry standard Global Distribution System (GDS)
process
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12. Value-based sourcing – the past
• Large number of vendors bringing increased complexity, value dilution and
less consistency of practice as we have grown as an organisation
• Contracts lack optimisation
• Often short timeframes lead to indifferent results
• New Group Procurement Policy is bringing improved consistency and
compliance
13. Value-based sourcing – new approach
• Develop and Implement new Sourcing Strategy
• Communicate it internally
• Communicate it to Vendor Community
• Progressive roll out of tactical initiatives
14. Sourcing principles
In applying the sourcing decision framework the following dimensions were
considered:
• Strategic value - is a service considered core or non-core activity to Virgin?
• Capability - does Virgin have the capability and capacity to do this function in-
house?
• Risks – what are the risks associated with each sourcing option?
• Costs / Value – can Virgin obtain better value through an alternative sourcing
arrangement?
15. Service Towers
Tower Sub Services
Service Desk Service desk facilities; Level 0 – self help; Level 1 – end user support; Service
management (service integration); Service request management; End-to-end
incident management
Distributed Desktop/laptop support; Printer support; PDA support; Desktop build/release;
Computing Messaging & collaboration; Software distribution; Applications packaging & testing;
Enterprise collaboration; Server based computing/thin client management;
Physical install, move, add, changes (IMACs)
Applications Applications monitoring; Applications support & maintenance; Applications
enhancements; Training & knowledge management; Application documentation;
Middleware
Centralised Server operational management; Database management; Centralised log
Computing management
Storage and Backup Application backup; Network backup; Storage services
Comms (Network) Network monitoring; Network management; Network IMACs; Lan & Wan
Data Centre Facilities management