Qantas technology tsar David Hall today laid out his vision for a more streamlined IT department at the airline that would move past what he described as its "transactional and sometimes antagonistic relationship" with other divisions.
In three years' time I'd like [Qantas CEO Alan Joyce] to say he has the best IT function of all aviators around the globe
Qantas tech chief David Hall
The self-described "quasi-chief information officer" — his formal title is executive manager of corporate services and technology — told a lunch held by the Committee for Economic Development of Australia that he envisaged Qantas could cut its IT costs by $100 million over the next financial year.
Already, Hall said, Qantas had cut its IT costs by about $20 million over the last quarter. However, last week, the airline revealed its ICT costs had risen 6.3 per cent overall to $406 million for the year to 30 June.
The executive did not give the Sydney audience — packed with executives from giant technology suppliers like Sun Microsystems, Fujitsu, Deloitte Touche Tohmatsu and KPMG — much detail around how the airline planned to take such a large amount out of its IT budget.
But he did lay out a few clues.
For starters, Hall pointed out, Qantas had gradually cut its IT department headcount from about 1400 back in 1997 to a total of 375 today.
This week the executive confirmed about 200 of its staff would be offered positions at IBM as the airline handed Big Blue responsibility for IT project delivery. However, Hall did not say whether the 375 total included that number or not.
Over the past months the airline has pursued a number of other outsourcing initiatives; switching desktop support suppliers from Telstra to Fujitsu and signing Perth-based IT services outfit ASG for further application support. Hall said Qantas now had a "leaner and more efficient business and technology team".
In terms of development of the airline's systems in future, the executive said he wanted to take a page out of subsidiary Jetstar's book, as it had made much greater use of commoditised and modular software than Qantas has been able to, due to its legacy platforms.
The IT functions of Qantas and Jetstar are managed separately "at the moment", according to Hall, but Jetstar CIO Stephen Tame reports to Hall.
Hall said Qantas was "in the final stages" of decommissioning its Q reservation and departure systems, with the airline having adopted the Amadeus customer management platform instead. The the airline's legacy environment is sizeable; Qantas currently has some 300 systems and 400 applications, according to Hall.
"Execution costs and overall complexity remain too high," Hall said.
On the supplier side, although Qantas had outsourced the majority of its IT function, outsourcing required "astute management", according to Hall. The airline has appointed a new head of commercial relationships, Paul Hanna, and Hall said he saw Qantas becoming a more demanding customer in future.
"We make no apology for this," he said.
In general, Hall said he wanted to move Qantas's IT department away from the "transactional and sometimes antagonistic relationship" it had had with the rest of the Qantas business, and to a position where it was seen internally as a "genuine and actual partner".
"In three years' time I'd like [Qantas CEO Alan Joyce] to say he has the best IT function of all aviators around the globe," he said.