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Divina Paredes | Aug. 20, 2013
For Rob Fyfe, innovation and risk management go hand in hand, and he shares how this was demonstrated during his term as CIO and then chief executive at Air New Zealand.

Rob Fyfe: “Ultimately, any business is about people.”

When Rob Fyfe was chief executive at Air New Zealand, he was "able to push the boundaries" in the digital arena — then a new territory for the aviation business — because of the foresight of the previous chief information officer.

Fyfe recalls the airline was then facing one of its biggest projects: a $260 million replacement of the reservation system, "the heart of the architecture of the organisation."

This was the 30-year-old system called Carina, written in assembler language. "No one coming out of university was able to do programming in assembler language anymore," says Fyfe, who was CEO at the airline from 2005 to 2012. "The fear was we will run out of human talent to be able to keep the system alive."

The choices available were all large hosted solutions designed for airlines that were "far bigger and more complicated" than Air New Zealand.

They could adopt one of these systems "at very high cost" and also double their transaction costs, he says.

"We get a little more functionality, but in the ongoing evolution of that application you will be tied to the interests of much larger airlines and whatever priorities they have, because they were the ones that were paying the bigger bills and calling the shots."

The then CIO found that unacceptable, as the airline "would become a hostage to that system and never be able to create any competitive advantage."

"We need to find a way to make our own home-grown system last longer," he says. Air New Zealand brought its website and store front development in-house, which was not possible if they were using one of the big hosted systems.

This critical decision allowed them to launch grab a seat, "one of our greatest successes", says Fyfe. He says other successful projects that followed, like checking in through kiosks at the airport and RFID tags for self-checking of bags, were dependent on also being able to make changes to their core reservation system.

"Here we are a decade later, and we are still using that same system," says Fyfe, smiling. "That is the reason why our main competitors in the region were not able to copy us and replicate those processes."

Indeed, more than 10 years later, Fyfe could recall vividly how the ICT team at Air New Zealand rose to the challenge of its CIO who said "no".

That CIO was Fyfe, who held that role for a year before becoming CEO. "I could go on with a number of other examples, but that one decision that I made as CIO gave me flexibility all the way through my seven years as CEO, which I just constantly leveraged so that we could adapt more quickly than our competitors."


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