Airlines such as WestJet and JetBlue promote low-cost and high-efficiency carriers by giving extremely competitive fares and outstanding customer service. Reservation system for these airlines are so important that when these companies need to make sweeping IT upgrades, their relationships with customers and their brands can be tarnished if things go awry. This can be seen when in 2009, both airlines upgraded their airline reservation systems, SabreSonic CSS was launch, customers struggled to place reservations, and the WestJet Web Site crashed repeatedly. WestJet’s call centers were also overwhelmed, and customers experienced slowdowns at airports. This delay provoked a deluge of customer dissatisfaction. In addition to the increase in customer complaint calls, customers also took to the Internet to express their displeasure. Angry flyers expressed outrage on Facebook and flooded WestJet’s site, causing the repeated crashes.
These problems impact both of the airlines operational activities and decision making to change their initial carrier which had started out as a system designed for smaller start-up airlines to a better carrier. Other than that, both airlines needed more processing power to deal with a far greater volume of customers. They also needed features like the ability to link prices and seat inventories to other airlines with whom they cooperated. Both JetBlue and WestJet contracted with Sabre Holdings to upgrade their airline reservation systems. The differences between WestJet and JetBlue’s implementation of Sabre’s SabreSonic CSS reservation system illustrate the dangers inherent in any large-scale IT overhaul. It also serves as yet another reminder of how successfully planning for and implementing new technology is just as valuable as the technology itself.

* Evaluate the risks of the projects to upgrade the reservation systems of WestJet and JetBlue and key risk factors.

Upgrading reservations systems carries special risks. From a customer perspective, only one of two things can happen: either the airline successfully completes its overhaul and the customer notices no difference in the ability to book flights, or the implementation is botched, angering customers and damaging the airline’s brand.
The key risk factors that should be considered are the project size, project structure, and experience with technology. The project size is indicated by cost, time, number of organizational units affected, and issue of organizational complexity.
For WestJet, the critical issue that they face was the transfer of its 840, 000 files containing data on transactions for past WestJet customers who had already purchased flight, from its old reservation system serves in Calgary to Sabre servers in Oklahoma. The migration required WestJet agents to go through complex steps to process the data. Since WestJet had not anticipated the transfer time required to move the files, they had failed to reduce its passenger loads on flights operating immediately after the charge over.
Next key risk factor is the project structure. It is structured, defined requirements run lower risk. Hundreds of thousands of bookings for future flights that were made before the charge over were inaccessible during the file transfer from Calgary to Oklahoma. The files still cannot be access for a period of time thereafter, because Sabre had to adjust the flights using the new system.
Last but not least, they need to have experience with technology to deal with the risk. JetBlue learned from WestJet’s mistakes, and built a backup web site to prepare for the worst case scenario. JetBlue made sure to switch its files over to Sabre’s serves on a Friday night, because Saturday flight traffic is typically very low. JetBlue also sold smaller numbers of seats on the flights that did take off that day. JetBlue experienced a few glitches- call wait times increased and not all airport kiosks and ticket printers came online right away. But compared to WestJet, the company was extremely well prepared to handle problems and risk such as these.

* Classify and describe the problems each airline faced in implementing its new reservation system. What people, organization, and technology factors caused those problems?

Both WestJet and JetBlue previously used a system designed for start-up airlines with simpler needs. As the carries grew, they needed more processing power to deal with increasing numbers of customers. They also wanted additional functions, such as the ability to link their prices and seat inventories to other airlines with whom they might wish to cooperate.
WestJet and JetBlue independently selected a system offered by Sabre holdings Corp. the system sells seats and collects passengers payment but it also controls much of the passengers experience: shopping on the airlines web site, interacting with reservation agents; using airport kiosks; selecting seats; checking bags; boarding at the gate; rebooking and getting refunds for cancellations.
The over might transitions of WestJet 840, 000 files didn’t go well. This is because the migration required WestJet agents to go through complex steps to process the data, making matters worse, WestJet didn’t reduce the number of passengers on the flights operating after the cutover, nor did it tell customers of its upgrade plans until the day of the switch. Westjet’s customer loyalty scores tumbled as a result of long waits and booking difficulties. The airline sent apology letters, offered flight credits to customers and bolstered call center with temporary staffers.
On the other hand, JetBlue make its switch on Friday night because Saturday traffic tends to be low. It also sold low numbers of seats on remaining flights with WesJet’s crashing web site issue, JetBlue develop a backup site to counter the crashing web site problem. However, there are still glitches call wait times increased and not all of the airport kiosks and ticket printers came online right away. But JetBlue had also experienced similar customer service debacles in the past. In February 2007, JetBlue tried to operate flights during a blizzard when all other major airlines had already canceled their flights. This turn out to be a poor decision, as the weather conditions prevented the flights from taking off and passengers were stranded for as long as 10 hours. JetBlue had to continue canceling flights for days afterwards, reaching a total of 1,100 flights canceled and loss of $30 million. JetBlue management realized in the wake of the crisis that the airline’s IT infrastructure, although sufficient to deal with normal day-to-day conditions, was not robust enough to handle a crisis of this magnitude. This experience, coupled with the observation of WestJet’s struggles when implementing its new system, motivated JetBlue’s cautious approach to its own IT implementation. * Describe the steps you would have taken to control the risk in these projects?

The steps to control the risk / managing project risk involves identifying nature and level of risk of project; each project can then be managed with tools and risk-management approaches geared to level of risk; managing technical complexity which involves internal integration tools.

Next, inventory can also help control risk. The step is to inventory the situation. That is, identify all of the risks possible in the project. The inventory should include all internal factors for the project such as resource changes, assumption failures, and sponsor availability. It should also include all external factors such as a change in company direction or a change of technology direction. Most of all, however, it should include the things that are new in the project. If the project is working with a new technology, is using a new development methodology, or even if there are new, relatively unknown team members, these need to be listed as potential risks to the project. The purpose of the inventory phase isn’t to classify the risk or identify its importance. That step happens later. The goal is to collect all the risks. Once a list of potential risks is completed, it’s time to evaluate them. Each risk should be evaluated based both on its probability and on the impact that it would cause if it happens. The loss of a key team member may have a low probability; however, the impact to the project can be great. Some people struggle with the evaluation step because both of the numbers, percentage and impact, are guesses. They recognize that even subtle changes in the values for these numbers can have a huge impact on the total risk of the project. However, in general, the objective here isn’t to come up with a single number that represents each risk. The objective is to develop a framework for evaluating the various risks against one another. Although precision in the estimating process is useful it's not essential. The other factor to evaluate when looking at a risk is its duration--how long that it can have a potential impact on the project. For instance, the loss of a subject matter expert early in the project is a risk because their input is still needed. However, later in the project they may not have much input and therefore aren't a risk if they leave. The risk of a functional analyst leaving is greatest in the initial phases of the project when they are intensively interacting with the customer. Later on in the project, the loss of the functional analyst has a smaller potential impact for the project. In order to get a consistent number for all of the risks, multiply the probability which should be per interval of duration by the impact and finally multiply that by the duration. The resulting number is a single number, a risk quotient, which can be used to prioritize risks within the project. For instance, if the probability of the risk happening in a given week is 10%, the number of weeks the risk may happen is 10 weeks, and the impact is $1000, the overall risk is $1000. (.10*10*1000 = 1000)

Prioritize
Now that risk quotient for the various risks is identified, it's possible to prioritize the risks for the project. It’ll give a clear vision of what the risks are and which ones that’ll ultimately need to be concerned about. This is also a part of the process that typically helps validate the estimates made above. For instance, if the greatest risk is personnel turnover (as it usually is) then, the probability may have to be evaluated more objectively. If the average person stays at the organization for three years it can be assume a probability of them leaving in a given week is 1/156 (3x52 weeks/year) which is a 0.00641 percent chance.

Control and mitigate
Once the risks are prioritized, go through the list and identify which risks are controllable, which risks are things that can be mitigated, and which risks must be accepted. For instance, the risk of losing key personnel can be mitigated by providing completion bonuses or even just monitoring their happiness more closely. Technical risks can be controlled by moving them forward in the project so that they are proven out nearly immediately. In general, the fastest way to reduce the overall risk quotient for a project is to tackle the controllable risks early in the project. The more quickly the risk associated with an item to be validated the more quickly the risk is no longer a risk (so its probability can be zeroed out.) Focusing on controllable risks won't completely eliminate risk but it will quickly cut it down. The next step is to develop mitigation strategies for those risks that can’t be controlled. Completion bonuses are a routine way that organizations which are closing down operations mitigate the risk that the people participating will leave before the project is ready to let them go. Not every mitigation strategy needs to involve money. Simply getting a verbal, personal commitment to finish the project is often enough to further reduce the probability that a person will leave during the project. Most people value their own sense of self-worth and they believe that their ability to meet their personal commitments is a part of the admirable part of their self.