Continental and United are a warning to others

As a long-time frequent flyer on United, I had a front row seat for their merger with Continental. This was one adventure that for which I didn’t make a reservation and a trip I didn’t have the option to skip. With years of miles behind me, I wasn’t about to start over with another carrier and was actually at first excited to have so many more hubs and overseas destinations. At first…

It has been a rocky ride as even United admits. You probably don’t need to fly on United to know, as the news and social media have had an unending supply of travel horror stories. We had many of our own and one that was epic enough to write about this past Christmas.

A missed connection

The United and Continental merger could have been made better through the use of technology available when they made their plans to merge. Instead they’ve suffered a PR black eye and paid out enormous sums to their most loyal flyers as a way to apologize the problems that occurred.

It isn’t a cultural problem. United’s people are just as dedicated as the other major airlines. The biggest challenge was technology. If either airline had invested in infrastructure technologies prior to coming together under one roof, it could have been faster, easier and wouldn’t have alienated their most important customers. Let’s look a a few things they could have used that would have had an enormous impact.

Information backbone

If United or Continental had an infrastructure that allowed information to flow on a bus between discreet systems, they could have added or replaced parts of their infrastructure in pieces and over time. Instead, they went with a Big Bang approach and an enormous cutover this past March that brought them mostly to a standstill for an entire weekend and has been up and down ever since. Such a backbone makes replication of critical data much easier and the system much more resilient.

This backbone would have made the merger far easier, but would have also allowed the new United to have an excellent platform that would allow a modular approach to creating new capabilities around mobile, social and analytics. It would allow them to do better real-time work and to use a private or public cloud to make operations far more efficient. It would certainly make customer service, self-service and automation of manual work much, much easier.

Business events

The data spine described above would also speed United’s work to become an event-enabled enterprise in the same way leading airlines like Southwest have. Operations and customer service will be greatly served by systems that watch for key patterns to emerge real-time, where problems can be mitigated and potential problems avoided. Baggage services are already being managed this way elsewhere.

Making two into one

Likewise, if United and Continental took the time to map key processes within each of their airlines, they could have had a governed way to move to a single, unified process as the changeover occurred. Those maps would be the basis for finding ways to improve operations, improve compliance/security concerns and to automate work.

Electronic teachers

The same process maps that would have made the transition so much easier from a process management standpoint would have been an excellent way to train everyone gradually and electronically. The training would be easily updated every time business processes changed even after the merger and could have been sent to the employees as tracked notifications as change steadily occurred. Instead, they had visibly frustrated employees using paper instruction books for months after the new system came online. With the transaction volumes and number of employees that perform manual work, it is hard to understand why they didn’t do this.

I’m about to take a flight later today to the UK and France and I’m glad to see that most of the merger kinks have been worked out. Unfortunately, rather than this merger being an opportunity to create the best airline systems in the world, the new United is just now reaching the level of customer service and operations of three years ago. It was an enormous missed opportunity that in the end wasn’t about cost.

The good news? It isn’t too late. If United stated down a path to implement an information bus, business events, process and a few other systems, they could see enormous positive impact in months and be a new airline in one year. The software isn’t terribly expensive compared to the alternative and this consulting was free. Let’s see if they take my advice…

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Categories: BPM, Information Technology, Infrastructure, Process Management, Real-time, SOA / B2B, Transport and Logistics

Author:Chris Taylor

Reimagining the way work is done through big data, analytics, and event processing. There's no end to what we can change and improve. I wear myself out...

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4 Comments on “Continental and United are a warning to others”

  1. Howard Landa, MD, CMIO Alameda County Medical Center
    June 23, 2012 at 9:28 pm #

    As someone who travels ALMOST as much as you on United (1K x 11 years), I have exactly the same experience. Since they merged the computer systems; delays, confusion, and a dramatic decrease in the courtesy and customer service is the new norm.

    On a Hawaii flight the flight attendants forgot to do the declarations so everyone had to sit on the plane attached to the jet-bridge while the papers were filled out.

    Another flight has the equipment changed (and seating reassigned) 3 times in 2 hours.

    I was waiting for a delayed flight from SFO to DFW and I got a call from the car service that was picking me up to tell me my flight was cancelled! It took another few minutes before anyone at the gate was alerted!

    And finally, during a 7 hour delay between Miami and Honolulu, I asked if I could get a day pass to use the club, and I was told I could buy one for $50 but could have a $20 fast food voucher.

    This is not the united I flew for the last decade. Very sad…

  2. June 24, 2012 at 7:09 am #

    Chris, great post. Having processes clearly mapped before a merger seems like a requirement for success. Indeed, shareholders of acquiring firms should demand it.

    I remember thinking a few years ago, when BofA acquired countrywide, this will destroy a ton of shareholder value. Not only were the cultures massively different (and the little problem of junky loans) but banks have a history of problematic process and systems integrations.

  3. June 25, 2012 at 10:32 am #

    Brilliant analysis. IF ONLY United listened, but I fear your wonderful thoughts will hit those of us who have been burned during the merger rather than the administration who should have paid attention before it became the mess that currently exists. “Customer Service” is now an oxymoron: I had my baggage abused/stomped (the bootprint is absolutely clear on the top of the Briggs & Riley case!), items stolen and smashed…May 03. I’m still waiting to even talk to a live person. And the insult to all of this has been the hundreds of dollars of non-combinable “flight vouchers” they offer to calm the furious customer. That is, to me, the height of chutzpah. IF only they listened…

  4. Mark Eastwood
    July 1, 2012 at 2:49 pm #

    I arrived at the CO/UA merger from the other side as a loyal Continental flyer (1.5m+ miles). My experiences as a nobody on UA were generally poor so I wasn’t looking forward to the merger. Its obvious that they don’t yet have a single operating certificate form the FAA and they have challenges with the labor unions. I’m almost convinced that it took 4 hours to push a “broken” plane from the gate at ORD and replace it with another plane (also “broken”, possibly the same plane) because the ground crews are working without a contract. They need to get their labor problems under control. I sat with a UA flight attendant on a flight into IAH from EWR… not a happy camper with Mr. Smisek. On average the UA planes seem older and then CO planes newer…

    I agree with you Chris, that they could have done a better job with the systems integration and I’m a big fan of the enterprise service bus architecture.

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