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From build to buy: American Airlines changes modernization course midflight

Robert L. Mitchell and Johanna Ambrosio | Jan. 3, 2013
American Airlines was well into a simultaneous revamp of its Passenger Services System (PSS) and Flight Operating System (FOS), its two most mission-critical families of applications, when the airline changed course last January.

The decision to change focus was driven not just by the need to reexamine priorities as the business reorganized, but by changes in the market that could not have been anticipated when American made its original plans. Initial planning for the projects began with American's outsourcer, EDS, before Hewlett-Packard acquired it in 2008.

But after the projects officially launched in 2010, HP laid off many airline-related programmers, project managers and others associated with the Jetstream project, according to Harteveldt. "That was one of the factors that contributed to the project's problems," he says. "It just became a very frustrating experience for American."

Liebman's response: "I can't comment or speculate on our business partners' internal matters, but HP remains an important and strategic business partner of American Airlines."

It was a good time to take a step back and rethink the strategy, Leibman says. "We questioned whether it made sense to make the tremendous investment of time and resources that go along with building something yourself -- or look for something that others had already built and tested. In this case we made the decision that we wanted to buy," she says.

Jetstream's slow take-off

Jetstream, the new PSS initiative, officially got off the ground in 2010. (Some early work, including the decision to dedicate resources to the project, had started in 2007.) Led by vice president of business technology services Daniel Henry, who reports to Leibman, Jetstream will eventually include modules and sub-modules to handle reservations, passenger itinerary management, shopping, ticketing and pricing, check-in and other functions. "Our ultimate goal is to have a customer-centric passenger services system, which will allow our agents to pull up a customer by name and have all their relevant information at their fingertips," he says.

Henry says American is intentionally taking it slow. "This is not a big bang project. This is the heart of the airline, so we are taking a very methodical approach," he says.

The sheer size of the Jetstream project makes that necessary. "I am not sure you can get more complex than a PSS," Henry says. "There's a lot of data transfer and transformation that goes on," with more than 100 applications sharing or synchronizing data with the core PSS software on the mainframe. The PSS brokers the sharing of data, as well as data transformation and processing.

The new platform must do all of that and enable rapid change. "Our success will be defined by: Can we change it the next day? That's our number one success factor," he says.

Henry's team has made progress in reviewing and documenting business processes, policies and procedures, but programming plans stalled when American made public its decision to terminate its contract with HP in June.


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