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Alaska Air Casestudy

Alaska Air Casestudy

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Oracle Customer Case Study
Alaska Airlines Soars in Meeting the Needs of More than 17 Million Customers Annually
Copyright © 2006 Oracle. All rights reserved. Printed in the U.S.A. Published June 2006
Alaska AirlinesAnchorage, Alaskawww.alaskaair.com
Industry:
Travel and Transportation
Employees:
14,584
Oracle Products & Services:
Siebel Business Analytics
Oracle Partner:
AccentureNew York, NYwww.accenture.com
“When evaluating solutions, we looked for something that would require fewer IT resources and less manpower to handle. Siebel Business Analytics was the right solution, at the right  price, with the right sophistication, yet easy to use.” 
 James Archuleta, CRM Director, Alaska Airlines
For 74 years, Alaska Airlines has been providing world-classdomestic airline service. Understanding and responding tocustomer needs is the key to success in the increasinglycompetitive domestic airline industry, where margins are smalland customer loyalty is prized. Over the years, Alaska Airlinesacquired a great deal of customer data, but it resided in disparatesystems throughout the company. Alaska Airlines chose Oracle'sSiebel Business Analytics to tie together customer data fromnumerous sources, and, ultimately, to design marketing programsto drive customer loyalty. Using a forward-thinking approach thatencompasses a methodical look at process improvements, AlaskaAirlines is now able to better understand, respond to, andanticipate customer needs.
 
Founded in 1932, Alaska Airlines now serves more than 17million customers annually. With one of the newest fleets in theindustry, the airline has managed not only to survive, but also to prosper in a highly competitive business environment that isincreasingly dominated by low-cost/low-fare carriers. Much of Alaska Airlines’ success can be attributed to the company’saward- winning customer service and commitment to technicalinnovation. That commitment to service and innovationcontinually drives Alaska Airlines to provide a better experienceand greater value for its customers than competing carriers. AsJames Archuleta, Customer Relationship Management (CRM)Director of Alaska Airlines, puts it, “The competition in the travelindustry, especially airline travel, is cutthroat. Making our customers happy is important because it translates to an ongoingrelationship, whether travel is business or pleasure, which in turnis loyalty. Our customers are at the center of all of our initiatives,
 
 
Oracle Customer Case Study
Key Benefits:
Greatly improved customer tracking
A better understanding of customer behavior andmotivation
The ability to deliver a higher level of service and a morerelevant experience to thecustomer 
The ability to examineprocesses throughout thecompany and target areas for improvement
The ability to make moreinformed and strategic businessand marketing decisions
even operational initiatives. We offer a premium service at acompetitive price, but that customer-centric aspect is essential toeverything we do." It was this ongoing dedication to service thatmotivated Alaska Airlines to seek more effective ways to analyzecustomer data to provide an even better and more relevantcustomer experience.
The Challenge of Data Integration
The problem Alaska Airlines faced was not a lack of data, butrather a wealth of it residing in disparate legacy systems that werenot integrated. The company had data tracking customer behavior, but it was utilized in silos throughout the company. Archuletaexplains, “Our data was utilized and defined by disparate business processes, and each of those products was managed as a separatesilo within the organization.” Alaska Airlines has workedsuccessfully with a home-built CRM system, but recognized thatit lacked the ability to analyze data from numerous other sourcesto fully understand customer trends and purchasing behavior.“Anybody familiar with the travel business will know that it’svery data-intensive and relies on strong business intelligence for future growth,” says Archuleta. Without a robust analyticalcapability, customer tracking consisted primarily of examiningdata such as miles flown or dollars spent. Such lagging indicatorsof customer behavior were helpful, but they did not provide theinsight into customer needs that the company wanted.Alaska Airlines continuously strives for improvement using a philosophy and set of practices based on the Toyota Corporation’s“lean manufacturing” system. Lean manufacturing focuses onoptimizing time, efficiency, productivity, and assets, while alsoimproving the quality of products and services provided to thecustomer. The methodology focuses on continuous improvementof business processes, and Alaska Airlines used the approach toidentify problems and then specify requirements for a solution.Archuleta remarks, “Our goal was to look at process as opposedto a solution. We looked at our customer data across the enterpriseand looked for gaps in the process first. One of those gaps was inaccurate and timely information available to our executive team,for both strategic planning and use by our tactical teams inmeeting strategic objectives.” Alaska Airlines realized that whatwas needed was in-depth and timely analytical information thatwould allow a more strategic approach to customer service. The
Copyright © 2006 Oracle. All rights reserved. Printed in the U.S.A. Published June 2006
 
 
Oracle Customer Case Study
“Siebel BusinessAnalytics provides us theability to be moreproactive as a marketingand service operation andbe more relevant to thecustomer. It also allowsus to be more mindful of customers’ needs while atthe same time beingrespectful of their timeand privacy. That is whereour customers will findthe true value.”
Copyright © 2006 Oracle. All rights reserved. Printed in the U.S.A. Published June 2006
James ArchuletaCRM Director Alaska Airlines
 
company had identified gaps. Now it was time to find a solutionto help bridge those gaps.
Choosing a Solution
 Custom business intelligence solutions are the norm in thedomestic airline industry, and Alaska Airlines was accustomed tousing such solutions to meet its needs. “Many airline industrysolutions are built in-house. It’s very difficult to buy something prepackaged. But given that there’s an analytical aspect to this,we started looking at solutions to fill the gap,” says Archuleta. Next, the company put together a list of requirements and beganevaluating solutions from four different vendors. A keyrequirement was the ability to access data from disparate systemsthroughout the company. “When we defined the project, the focuswas on understanding the customer’s value chain, the informationwe needed about the customer, identifying sources of data, andthen implementing a solution that would enable us to integrate thedata from all those sources and provide relevant information toour executives and marketing department. I’m talking aboutactionable information—not just information that would be anaggregate, but something that would add value to our businessrules. Siebel Business Analytics fit these requirements perfectly.”Integration was a key factor. According to Archuleta, the airlinewas using an off-the-shelf SQL query and reporting tool, but “thatsolution was not giving us the integration that Siebel BusinessAnalytics provides through its metadata layer.”One of the features of Siebel Business Analytics is its ability tocreate dashboards. Dashboards are customized views thatincorporate information from different sources and present it in acoherent and uniform manner. Archuleta comments, “We did acost/benefit analysis and found that Siebel Business Analytics metour executives’ dashboard requirements and fulfilled the goals for location and application transparency.” Alaska Airlines alsowanted a solution that would be powerful yet easy to implement.“When evaluating solutions, we looked for something that wouldrequire fewer IT resources and less manpower to handle,” saysArchuleta. “Siebel Business Analytics was the right solution, atthe right price, with the right sophistication, yet easy to use.”
The Loyalty Metric
 It took approximately six weeks for Alaska Airlines to deploySiebel Business Analytics. “We use Siebel training as opposed to

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