Two Canadian travel companies recently announced they were signing deals to hand over their online travel reservations and services, enabling them to instead focus on getting customers from A to B.
Montreal-based Transat A.T. Inc. said it is signing a four-year deal with Versus, an IT services company also based in Montreal. The deal, valued at close to $2 million, will see Versus handle all aspects of Transat’s IT infrastucture, including its online application called Exit. Transat’s Web site, at www.exitnow.ca, enables travel booking and other services.
Bernard De Blois, director of outsourcing at Versus, explained that Exit was, a few years back, a subsidiary of Transat that operated on its own. After 9/11, when the travel industry was affected by a decrease in business, Exit was shut down as a standalone company and was merged with Transat.
The company was handling all of its IT equipment and processes, according to De Blois. “So this platform — and we’re talking about 25 servers — was all managed by the MIS dpartment in Transat. These are not e-commerce experts; these are MIS guys, and it was definitely not their first concern. However, (the site) brings in a lot of revenue for Transat, and this platform had been online for more than four years.”
With the site and platform aging, Transat looked to upgrade and decided to outsource so it could better focus on its core competencies, but also to put itself in a good position for the future.
“With an outsourcing approach, they have the flexibility to either increase or decrease the solution they have based on their actual needs,” De Blois explained.
Montreal-based Air Canada, which is currently going through restructuring changes, has inked a five-year deal with Waltham, Mass.-based e-Travel, a division of Amadeus Global Travel Distribution S.A., which focuses on offerings for the travel industry. This deal will see Air Canada’s new site launched in the fall, using e-Travel Planitgo, an Internet booking engine.
Catherine Lafer, director of product strategy for e-Travel said the Internet booking engine is currently used by more than 50 major airlines and travel agencies. That, coupled with the fact it’s an on-the-shelf solution, has an immediate appeal for organizations looking to cut costs, Lafer said.
According to the company, it’s not so much about outsourcing per se, as it is about changing the internal role of IT. The decision to go with e-Travel as opposed to developing the technology in-house is based on Air Canada’s new e-commerce model, said Chantal Belzile, project director, New Business Model at Air Canada.
A redesign of the Air Canada Web site was completed last year; the new arrangement adds new options and functionality, Belzile said. Faced with increasing competition from low-cost carriers such as WestJet and Jetsgo, the Planitgo ASP-based technology allows the organization to take a more modular approach and be flexible and respond quicker to changes including fares.
Air Canada will employ e-Travel’s custom user interface and Web design services, Web hosting services, and offline faring services for its call centres. According to Belzile, the arrangement enables Air Canada to also benefit from the fact that e-Travel is also a supplier of several major airlines.
Air Canada will continue to develop in-house, Belzile said, adding that the role of IT staff is evolving to handle internal tasks including maintaining the look and feel of the Air Canada Web site.