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Issue of October 2003 

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A federal way to manage

Kuoni Travel in India has three business divisions and a fully owned subsidiary, each performing its internal affairs and businesses. It has created four independent networks to support the federal style of business. by Soutiman Das Gupta

Kuoni Travel India Private Limited (KTIPL) has three business divisions: outbound travel, inbound travel, business travel, and a fully owned subsidiary Visa Facilitation Services (VFS). With nationwide presence in over 50 locations and more than 900 users, the company relies heavily on IT systemsto carry out its operations.

The four business areas function like a federal system with each unit making its own business decisions and carrying out the related business activities.

Satish Pendse, Head - Information Technnology, KTIPL

And to support operations at these units, the company has created four separate IT infrastructures to facilitate the federal way of functioning.

The scope of business

To understand the scope of each network, let us look at the scope of business at each division.

KTIPL is a subsidy of the Zurich-based Kuoni Travel Ltd. In India, the outbound division caters to the travel arrangements for Indians travelling abroad. The company has acquired the ‘SOTC’ brand in India, and uses the brand for the outbound business.

The inbound division caters to travel arrangements for foreign tourists visiting India. It has acquired the ‘Sita’ brand in India to help with the inbound travel business.

The business travel division caters to the corporate travel needs of different companies.

The VFS operates as a subsidiary organization. The consulates of UK and UAE have outsourced their Visa processing operations to KTIPL.

And the consulate of USA has outsourced its India western region Visa processing operations to the company.

Western Union, the financial services company, has appointed KTIPL as its Indian distributor. KTIPL manages business from 600-odd nationwide agents to handle transfer of large amounts of money.

The company owns other brands like Kuoni Indian Trails and Tour Club. And also operates an educational academy for travel industry-related teaching.

The IT infrastructure

"We believe in empowering the business at the lowest possible level. The different business divisions are empowered to work like individual profit centers. Since the business structure is federal, we felt that the IT infrastructure should also be federal. And since IT must be closely aligned to the business, the four divisions have different network infrastructures," explained Satish Pendse, Head—Information Technology, KTIPL.

The networks however can talk to each other and are administered by separate IT Heads. These Heads functionally report to Pendse.

This arrangement facilitates deployment of common policies, procedures, standards and best practices.

The four divisions have different transaction-processing systems that suit the related areas of business.

The reach of IT

"We use IT for improvement in productivity and market differentiation," said Pendse.

And going by this resolution, Pendse wants to extend the reach and benefits of IT across the value chain, all the way to the user/customer and supplier level.

Transaction processing systems

The outbound travel division uses a transaction processing system called FRAME and has MS-SQL Server as a database.

It operates out of a data center in Mumbai and connects to the Head Office and 14 nationwide locations through 64 Kbps leased lines. The lines are backed up with VPN/ISDN links.

The inbound travel division uses a transaction processing system called Atoms and operates out of a data center in Malcha Marg, New Delhi.

It uses Unix and Oracle platforms for business transactions and is linked with other infrastructure in the data center.

A mix of VPN links from Satyam and leased lines are used for connectivity.

The business travel division is in the process of implementing a transaction processing system called BTSoft.

It uses leased lines and also shares the connectivity infrastructure of Amadeus for ticketing and reservation. It operates out of a data center in New Delhi.

The VFS division uses V-assist for transaction processing. The Head Office in Mumbai shares e-mail and information between the nationwide Visa offices of UK, USA, and UAE.

Corporate financial accoun-ting data is collated from the various divisions for central consolidation.

The best of four

Creating four independent networks that talk to each other has offered the company a number of benefits. Some of them are:

  • De-centralized management - This makes technology-related decisions easier to make and faster to implement.
  • Simpler network management - Since the number of network components are lesser in each division, the task of managing each network is simpler.
  • Business continuity - Even if the network of one division is down, the business in other divisions can carry on without hindrance.

In an integrated network, the performance of other networks may suffer.

  • Ability to talk to each other - Even though the networks are separate, they still allow information to be shared.

This allows vital financial data and other relevant information to be collated at the center.

A challenge

"The biggest challenge was to convince the personnel to change their way of working and operations workflow, so that real value of IT can be derived. Simply automating existing processes does not offer the desired benefit," explained Pendse.

Before automation the personnel had certain processes, checks, and balances in place. Since each business transaction would happen thousands of miles away, there would be chances of error, discrepancy, and even fraud.

With computerization, the processes are faster, easier, and more efficient.

"So a person has to be convinced to change the way he/she works. There's no point putting in money just to automate systems. You need radical improvement enabled by IT," added Pendse.


In future the company plans to deploy a rugged ERP backend, which will interface with all four systems.

It also wants to fulfill its resolution of extending the reach and benefits of IT across the value chain, to the customer.

And KTIPKL will continue to explore IT for radical productivity improvements as well as for competitive advantage.

Soutiman Das Gupta can be reached at

A thought: No ERP for travel verticals
Satish Pendse says, "I'm surprised that no ERP manufacturer provides travel-related solutions. Even the big players who boast more than 20 industry vertical solutions have no offerings in the travel vertical space. However, an ERP vendor should offer solutions in the travel industry vertical space only if it has sufficient domain knowledge."

In a nutshell
The company

Kuoni Travel India Private Limited (KTIPL) has four business divisions with nationwide presence in over 50 locations and more than 600 users. The divisions function like independent business units.

The need

The company needed to build network systems to support business processes at the various divisions.

The solution

Since the company followed a federal style of business by allowing each unit to perform independently, it decided to build four separate networks.

The benefits

The federal style of having separate networks provides benefits like de-centralized management, simpler network management, business continuity, and the ability to talk among each other.

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