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JetBlue—Trial by Fire and Ice
Today’s global society depends on air travel for business and pleasure more than ever before. Services offered by airlines have come under scrutiny due to incidents that point to unreliability. Some of these incidents are caused by the inefficient use of information systems.
On the list of the major corporate disaster recovery challenges of recent times, JetBlue and the St. Valentine’s Day ice storm appears in the top ten. Jet Blue has built a reputation as an airline that caters to the needs of its customers. Plush leather seats, expanded leg room, complimentary beverages and snacks, snooze kits, seat-back displays providing 36 channels of entertainment, satellite radio, first-run movies, wireless Internet, and smiling crew members, all at affordable rates, are amenities rare at traditional airlines. On February 14, 2007, the honeymoon seemed to be over for JetBlue and its customers.
Weather forecasters predicted an ice storm would hit the east coast on Valentine’s Day. While it was unclear how much it might affect air traffic, most airlines took precautionary measures, canceling dozens of flights. In its efforts to please passengers, JetBlue gambled and waited it out until it was too late. Rather than improving, conditions only worsened over the course of the day, leaving hundreds of JetBlue passengers stranded in planes on tarmacs at JFK International airport in New York and other major airports including Washington, DC, and Newark, New Jersey—some for as long as 11 hours. Around 3:00 pm, JetBlue gave up hope and called in buses to rescue the passengers from the planes. By then the damage was done.
Thousands of passengers waiting in airline terminals were hoping to complete their trips despite the storms. More passengers were arriving at airports unaware of delays and cancellations. Still other passengers were returning to the terminals by bus from stranded aircraft. JetBlue wound up with thousands of irate passengers at their counters and no flights departing or arriving on the east coast. Chief executive officer David Neeleman admitted to doing a horrible job. “We got ourselves into a situation where we were doing rolling cancellations instead of a massive cancellation. Communications broke down, we weren’t able to reach out to passengers, and they continued to arrive at the airports… it had a cascading effect.”
Charles “Duffy” Mees won’t ever forget that day. Duffy Mees was vice president and CIO of JetBlue Airways at the time. He came to JetBlue a few months prior to the disaster with years of experience in the airline industry. During his first few months, he oversaw the completion of an enterprise resource planning (ERP) installation at JetBlue. However, his experience did not prepare him for handling the Valentine’s Day crisis.
The impact of the storm on JetBlue’s information systems lasted a week. During the days that followed, many systems were pushed beyond their limits. Massive flight cancellations and rescheduling placed an unprecedented amount of traffic on JetBlue’s reservation systems. Since JetBlue did not support rebooking flights online or at airport kiosks, customers had only one option for rebooking: call the JetBlue reservation office. JetBlue’s Salt Lake City reservation agents were flooded with calls from angry passengers. Limitations in the system allowed only up to 650 agents to work at a time, plenty for normal days, but not for an exceptional demand. Many customers were stranded on hold waiting to rebook flights. Mees worked with their software provider to boost the limit to 950, which helped to open the bottleneck. Still, it was days before many passengers could get through to an agent.
Meanwhile, customer luggage was piling up in huge mounds at airports. JetBlue had no computerized system in place for tracking bags. The company had placed that system on the back burner while concentrating on its new ERP system. JetBlue had to haul mountains of luggage to off-site locations, where extra workers were employed to sort and identify bags. An information system was developed on the fly to scan bag tags and identify the owners from passenger records.
Besides reservations and baggage problems, managers faced outages and failure from important systems that control core operations. SkySolver software, which operations planners use to redeploy planes and crews, could not transfer new schedules to the primary flight scheduling systems. Programmers from the vendors attacked the problem and solved it within hours, but the delay caused more havoc. JetBlue was caught in a tailspin of system failures triggered by too much information all at once.
Mees and his crew spent three days and nights working to bring JetBlue systems back online. They pushed systems to their limits and created databases, tools, and applications on the fly in their efforts to find solutions.
During the crisis, JetBlue management learned many lessons and discovered many solutions, including preventative measures. A new system has now been implemented that allows passengers to rebook canceled flights online. Computer terminals have been installed at airports to allow passengers to rebook onsite. Software allows double the number of booking agents to respond in emergencies. A lost-bag system has been installed to track luggage—which is particularly valuable when flights are cancelled. A new system has been implemented that notifies passengers by e-mail, phone, or Web when flights are cancelled or changed.
Most significantly, the crisis motivated JetBlue to create a customer bill of rights offering compensation to customers whose flights have been cancelled or are left sitting too long on planes.
The cost to JetBlue for the Valentine’s Day disaster has been estimated at around $30 million. What about the cost to JetBlue’s reputation? After JetBlue offered many apologies and fired several top-level executives, it appears that JetBlue is still loved by its customers. J.D. Power and Associates 2007 airline satisfaction survey ranked JetBlue Number 1 by far for the third year in a row. In this case, good intentions seem to have won out over poor management.
1. What could JetBlue have done to prevent the Valentine’s Day disaster in terms of information systems and management decisions?
2. What information systems does JetBlue use to manage air travel?
1. How do you think JetBlue’s disaster affected the airline industry from the airlines’ perspective and the traveler’s perspective?
2. JetBlue offers many amenities to its customers that other airlines have discontinued in order to cut costs. What are the benefits and dangers of JetBlue’s approach, and how does this incident illustrate the dangers?