GoAir: taking off with IT
Wadia wants to revolutionise the airline industry with his latest venture,
GoAir. He shares his vision with Soutiman Das Gupta and Kumar
Dawada, and reveals ITs role in this venture.
A new low-cost airline, GoAir, will start operations in October 2005. The company
not only aims to attract regular airline passengers but also people who travel
by trains and luxury buses, with air fares as low as one rupee.
17 million airline seats are sold in a year, and around five million people
actually fly as many of them fly more than once. In a nation of one billion,
this is a low figure, declares Managing Director Jeh Wadia. We are
trying to make air travel affordable so that people pay what they do for train
or bus travel.
Wadia insists that these unbelievably low fares are not promotional gimmicks,
and explains how GoAir plans to turn a common mans dream to fly into reality,
and the role IT will play in achieving this.
FROM AN INVESTOR'S PERSPECTIVE
Wadia says that he is first a financial investor and then an airline operator.
As an investor I bring in passion, emotions and team spirit. My main focus
is to create and improve shareholder value.
In order to create shareholder value, he has devised a very IT-centric business
battle plan. IT will be an integral part of my business starting from
the basic functions and will extend to the specific requirements of every business
unit. The first step is to move towards a paperless or near-paperless office.
A paperless office works more efficiently, there is less waste, and less time
is taken to arrive at a decision, he says.
He feels that since GoAir is a start-up, achieving a paperless state will not
be very difficult. This state can be achieved as soon the company resolves issues
with external parties such as travel agents, reservation offices and other business
entities which currently communicate using paper.
REMOVE PERSON FROM PROCESS
firmly believes in removing the person from the process, and believes that IT
will help the organisation achieve this. IT ensures that a business becomes
process-driven and not person-driven, and protects the companys intellectual
If the person is taken out of the process then the company becomes stronger
in the long run. The company can sustain itself in any circumstance, including
when key personnel leave, because key information does not leave with them,
Thus, knowledge gained by a person who is part of the organisation rests with
the organisation and not with the person.
A well-configured and customised yield management solution
can factor information such as current booking levels, probabilities of
reservations and cancellations, and historical patterns to devise a strategy
for optimum pricing
Wadia also wants to use IT to create business-specific solutions that will
allow executives to take quality decisions in real time.
In an airline, seats are a perishable commodity. If they
are not sold, revenue is lost forever. Wadia maintains that an airline can sell
seats to its optimum capacity by making intelligent use of IT. A well-configured
and customised yield management solution can factor information such as current
booking levels, probabilities of reservations and cancellations, and historical
patterns to devise a strategy for optimum pricing.
With this information available in real time, a company can take decisions
to lower or raise prices, and reduce the time taken for seats to be sold. It
is virtually impossible to do so manually, and thus IT will play a critical
role, says Wadia.
But the man is not happy with the solutions available in the market. GoAir will
therefore work with vendors to customise their existing solutions and fill in
the performance gaps. Care will be taken to ensure that the intellectual property
remains with GoAir.
KNOWLEDGE WITH IT
Wadia wants to deploy IT infrastructure that will capture information from the
organisation and turn it into knowledge for the benefit of customers and the
For instance, when a customer calls the company for a query or a problem, the
system should be able to analyse the nature of the problem from the first few
exchanges of information. Based on this learning, the system should be able
to automatically advise and suggest possible solutions to the business executives.
This solution can then be shared by others in the department so that the organisation
is better prepared the next time a similar situation arises.
In the case of off-site problems, Wadia feels that systems should be able to
anticipate problems, tell support personnel how to solve problems when they
occur, and even advise staff on easiest route to reach the solution. The aim
is to improve efficiency and productivity. In this way, IT is a tool that provides
preventive capabilities, rather than simply curative
Although ticket prices will be very low, Wadia believes that his company will
be able to operate successfully, recover costs, pay salaries, and ensure proper
maintenance of aircraft.
According to him, e-ticketing is a key area that will help save costs. The use
of e-tickets will give the organisation a real-time picture of ticket sales,
and help to make strategic decisions to ensure that optimally-priced tickets
are sold at any point of time.
TO THE CIO
Wadia refuses to be drawn into a discussion about what other airlines are doing
wrong as far as their IT strategy is concerned. He suggests, however, that CIOs
should not have a cost-centric focus. Use IT for three benefitsfaster
decisions, reduction of waste, and lessening of time. If these three things
are achieved, cost savings will follow, is his advice.