–Bruce D Parker, Chief

Information Officer and



Senior VP, United Airlines.

Bruce D Parker wants to use technology to change the way

travelers fly with an airline. As Chief Information Officer and Senior VP, United

Airlines, Parker is taking the company toward a number of IT innovations. He launched

SkyNet, the company’s first intranet, electronically linking United’s 95,000

employees. Parker has also overseen the deployment of technology to better integrate the

carriers by setting up Star Alliance, a global team of airlines created to provide

customers with the ‘virtual airline’ experience. Recently, United Airlines has

announced a joint venture with The Chatterjee Group to set up SkyTech Solutions, a

software development center in Calcutta. The center, which is United’s first such

setup outside the US, will provide software development support and services to the travel

industry. In an interview with Dataquest, Parker spoke about the new venture and how it

would take United Airlines toward creating a whole new era in the airline industry.

Excerpts:

What was the objective behind setting up

this development center in India?



There is an increased need for services to be based on the internet technology as it
allows a whole new range of applications to emerge. In this joint venture, we are looking

for resources, mainly skilled people, who could allow us to tap new emerging technologies.

About a year ago, United Airlines embarked

on a strategy where it was decided to seriously consider India as a potential place to

build a development center. We wanted to put together long-term development skills and

were not interested in service contracts for short durations. So, we wanted people who

could understand technology as well as the airline industry.

Was there any specific reason you

entered into a joint venture instead of outsourcing?

We were not really looking for outsourcing because if we wanted only a service contract,
we would have never formed a joint venture. Our interest in India is not just to bid

projects and have people respond to them. We wanted to have a long-term consistent base

that is very good in technology and very much endowed with knowledge of all the business

processes in the airline industry. For instance, in E-ticketing you can’t have a

contract with anybody who might not even have sufficient knowledge about the ticketing

process in the industry. You must build that kind of knowledge among people and keep those

people with you for a long period. So, the reason for the joint venture was that we wanted

to build a close relationship with employees. We could have done it on our own, but we

felt it would be difficult for United Airlines to manage it on its own so we chose to do

it with a partner.

Why did you choose TCG as your partner?

Could you explain its role in this association?

Actually, we went through a series of companies, but we liked TCG for a couple of reasons.
One was their ability to build such a venture as they already have a tie-up with Computer

Associates. Both United Airlines and TCG found each other suitable and our relationship

began with a mutual desire for such a venture. They also wanted to do something besides

just contracts and services. And as we gained some experience of working with them, we

liked them a lot. They proved quite effective and we felt that they would be able to

manage such a setup successfully. Moreover, they are well respected in India in other

areas as well.

Initially, they will do the financial

management, training and project development for new techniques. We have already started

work at TCG’s facility in Calcutta and we have utilized 50 of their people in

development. Those people will now be transferred into the new joint venture company.

TCG’s facility in Calcutta will be the incubator for our joint venture and then it

will grow.

...And what attracted you toward India?

India has some very good technology schools and universities where people are trained on
technologies that are most commonly used. There are two main aspects: these people are

hardworking, focused and culturally work well in teams. And in situations where there are

large geographic distances among people, this is a fundamental requirement to be

successful. These were the main characteristics why we selected India.

You have emphasized on

‘technological innovations’ in your present strategy. Could you elaborate on

this?

Let me explain this with an example. E-ticketing, for instance, is one of the recent
innovative developments that we are talking about. It evolved when we started analyzing

how and why we need paper tickets and basically came to a conclusion that we don’t

need paper tickets. You can have electronic records to represent the value for payments.

We led the industry toward an e-ticketing solution. It was implemented in a series of

projects for United Airlines. Then we took the software and sold it to others including

our competitors like American Airlines. We anticipate that with SkyTech, we’ll be

able to create more such systems that will enable innovative change in the industry.

In what ways do you think this

development center will improve your services globally?

A large part of the technology that we use directly touches our customers. For instance,
we do a series of applications at the airport that are aimed at individuals as well as

businesses. We are looking at systems that will enable our customers to understand our

travel services and help them to deal with difficult situations. Many of the software

applications that we are developing aim to improve our customer services. Additionally,

they will also improve the profitability of the airline through revenue management.

Another important area is cost management through inventory reduction. The collaborative

type of software that comes with internet technology is being deployed. The knowledge

tools, collaborative tools and specialized applications built around these enable the

employees to utilize technology in a better way.

What are the main activities presently

being handled by the IT division of United Airlines?

At present, the IT division of United Airlines has about 2,000 people based in Chicago,
Denver, Los Angeles and San Francisco. We build systems that cover a whole range of

applications such as reservations and sales. We have a very large presence on the internet

under our website called ual.com. We are accelerating these efforts and hope to do a lot

more in that area. The maintenance and engineering department takes care of the aircraft

and systems. How we push technology here is by providing the technicians with an online

system that allows them to keep track of the aircraft. We operate two large data centers,

one of which is in Denver where reservations are processed. The other one is in Chicago

where we have a significant underground facility that does our flight planning. There is

an operations’ research group that does mathematical modeling of our various

problems.

Could you tell us what packages you use

for data processing?

Our LAN uses Novell servers and Bay Network routers. We have a very large TCP/IP network
deployed worldwide and the company is using Oracle as well as Informix data structures

heavily. Our web-based technology is run in a Unix environment. For reservations, we have

created an in-house product called Apollo.

...But why didn’t you go for any of

the popular CRS brands for reservations?

Actually, Apollo is one such solution for reservations. It is the underlying system for
Galileo, which is one of the largest global CRS. So, we created the original system that

is now providing reservation services to the travel world.

What are the other technology areas you

plan to invest in future?

We look at airlines as a series of applications portfolios. We’ll make investments in
our revenue portfolio, which covers internet sales. One of the other areas is asset

maintenance. We’ll be making considerable investment in that area because there is a

large amount of inventory, aircraft parts and so on that can be reduced by utilization of

new technology and by better services. Additionally, there is the area of flight training

where we can do a lot with technology and support the crews with the latest information.

We’ll improve our flight operations through better training and scheduling for our

pilots and crews. From a sum of $500 million, we spend about $200 million in applications

development. Internet-based applications are another important area where we plan to

expand in the future.

How crucial do you think IT has become

for the airline industry today?

IT is the nervous system of an airline. If it doesn’t work well, your limbs and arms
don’t work well either. That is the basic fact, but now I think IT has also become

the innovation point. It can help you to alter your products. With some of the internet

offerings, the kind of sales and service benefits that you can offer to your travelers

couldn’t have been done earlier. So, now it is not just the nervous system, but it

also offers innovations for business. IT has certainly become very vital and the larger

the airline, the more critical it is.

In your long experience with the airline

industry, what kind of transformation you have noticed in technology?

I’ve had the opportunity to work with two airlines— American Airlines and United
Airlines. Both of them use technology as nervous system, or innovation point. The

technology itself has changed greatly from basics like ‘you must invent the

technology’ to creation of specific protocols for the airline industry. And today you

have newer techniques that allow much more innovation and can be leveraged for even better

services for the traveler. It is like a part of the soup that adds to its taste.

That’s been the biggest differentiating change over in the last few years. And

internet is obviously the key to the changes.