British Airways on track to save 20% of IT costs

Six months after the US terrorist attacks that devastated the airline industry, British Airways' IT department is focusing on an...

Six months after the US terrorist attacks that devastated the airline industry, British Airways' IT department is focusing on an ambitious cost-cutting strategy.

"We were in crisis management for two months after 11 September," said Paul Coby, chief information officer at BA. "Now we're in recovery mode."

While traffic carried by Europe's largest airline last month was only 2.5% below February 2001's levels, the company has also instituted several IT measures aimed at saving £45m - about 20% of BA's IT spend - over the next 18 months.

The biggest change Coby has made is to move BA's customer reservation system off the 30-year old Babs system to the third-party Amadeus system which supports more than 120 airlines' booking systems.

"The impetus is cost improvement," he said. "We have moved from a system that had a fixed and growing cost [Babs] to one that is based on per-passenger order charging."

He said the business value will come from what use BA makes of the data to increase the efficiency of customer interaction.

Coby said he has tried to ensure that all his staff are well-informed about the company's current business situation.

"Everyone is worried and concerned," he said. "[Therefore] we've had no opposition to our cuts and we've got everyone thinking how to make savings."

This is despite the fact that IT will have to take its share of the job losses imminent at BA. "We're taking the equivalent of one third out of the manpower," said Coby, although he wants that to be by voluntary redundancies. Already, "Nearly all the contractors have gone, and there are heavy cuts on overtime," he said.

Can BA slash £45m from its IT budget and keep flying >>

ross.bentley@rbi.co.uk

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