Preparing for Turbulence: Business Continuity for Airlines
Within the past two years, there have been seven major technology-related disruptions to the operations of airlines in the United States. Each of these disruptions have been traced back to either failure of a technology component or a disruption in the power supply of a technology component that led to critical applications becoming unavailable. Nearly every major airline has been plagued with such a glitch at some point in recent years. When this happens, local and national newscasts revel in the footage of displeased passengers waiting in lines that are hundreds of people deep. Such a disruption can result in not only in millions of dollars in lost revenue and unexpected costs, but also in the erosion of brand equity.
A key challenge for airlines is that their systems are tightly coupled and highly optimized, with very little buffer to absorb major shocks caused by technology outages. Additionally, very few organizations spend the time and resources necessary to conduct business continuity drills. However, a strong business continuity structure can help speed response times and increase the quality of service to customers during a major interference.
Business continuity planning and preparedness can help organizations cope with situations in which key technology becomes unavailable, regardless of the reason for the technology outage. The concept of continuity planning looks deeper at all of the critical assets that support the normal operation of the business including:
- Physical work locations
- Key Suppliers
- Vital Records
An effective continuity plan should provide a comprehensive layout of the business architecture, as well as a map of how work moves through the organization. It is important to observe this holistic view, in order to quantify the impact of a process interruption. As an example, a critical downstream process may be fed by an upstream application that is listed as “not-critical”. If an outage of this application disrupts the process that feeds the critical downstream process, it must be considered a critical application. These types of relationships are difficult to comprehend without a sound understanding of a business architecture that includes process inputs and outputs. A well-run business continuity program should provide a detailed description of:
- The most likely sources of business interruption
- Critical business processes of the organization
- Assets that support key business processes
- Detailed plans for alternate operating processes when an asset experiences a disruption
- A regular schedule for active testing, drilling, and continuous improvement to the interruption responses
Often, there is not enough organizational capital or effort applied toward maintaining an effective business continuity capability. However, implementing a quality response to a business interruption can make the difference between losing millions in revenue and brand equity, and a successful execution that inspires confidence in customers and employees.
Evan Golly is a Director with over 15 years of experience in quantitative analysis, strategic planning, business process optimization, business operations, and program/project management. His experiences range from developing complex analytical models to leading the program management efforts of a successful systems integration that was critical to the operations of one of the world’s largest airlines. Evan’s diverse skillset and ability to execute have allowed him to lead and deliver successful projects in the energy, transportation, commercial banking, and commercial construction industries. Evan has a proven ability to engage members of diverse functional teams to deliver business solutions. Prior, Evan held positions within corporate finance and operations divisions of NYSE listed companies. Evan earned his BS in Finance from The University of Florida and MBA from The University of Texas at Austin.