But we have to look at it and say, 'Where are we today? Where do we need to be? What's the best way to get there?' And we've chosen a path that says, 'We can do it more effectively', not just cost effectively but with more capability. More effective capability more rapidly with others and also having to assess core competencies. I make the assessment. This helps to drive the decision making and say, "Even if I could get to whatever capability of expectation that JetBlue needs, would that matter so much that I did it in house?"
But if you had an infrastructure department, if you had that large development team, doesn't it impact those decisions because if you've got that cost already, developing is easier to do rather than trying to create a department from scratch?
Absolutely. So first of all we need to take it on a holistic basis, so we do look at it from an overall IT capability perspective. I think it's very dangerous to kind of go case by case because then you may get this kind of hodge podge of, 'We do some of this ourselves. We use such and such a vendor or business partner for this capability or that capability. We've taken a direction at JetBlue on a broader IT perspective that says - it makes sense for JetBlue - we are not going to build ourselves as much because we don't think it's as value add. We are going to buy but we're also not doing best of breed. There's a difference between best of breed versus platforms, solutions, integrated packages. We're taking more of the latter. I'd rather do business with a smaller number of strategic, deep, broad vendors or business partners, we call them business partners, in terms of capabilities, services that we would obtain and leverage, versus having to get the best of breed of a million and one vendors, business partners and then we are left with this massive integration effort, which actually can be even more complex and that may actually drive you to say, 'Let me just do it myself'.
It strikes me that you're in a way creating an intellectual property around IT. The IT department isn't just solely important to the company because of its ability to run IT, but in fact there is a creative and more strategic thought and intellectual property within that department as well. Do you find that this counters the very widely held view that IT is a cost centre; and therefore, it's something that can be squeezed for cost reductions?
It is a cost centre. But if you are just considered a cost, I don't think you're really part of the strategic agenda of the firm; and so it is about top line as well. It is about creating innovation, driving out new products and services; and so an IT capability needs to be very focused on that. I do agree with the terms you use. It is about creating - it's not just about technology. It's about an intellectual capability - a property, a capability.
The people in IT, many times they're the ones that know how the business works. The business is so automated. When we talk about the business process, well, the business process is actually encapsulated in the systems, in the technology. Many times we find that the business is turning to IT to say, "Well, help me understand how my business works," because it has to do with how the technology works. I think the very important part of IT is to understand the business, know the business, work with the business; and not just drive efficiency, but also help drive the top line as well.
I've read that your projects are measured on revenue generation for the business more than timelines. How does that work within the department and how important then is formal goal setting and recognition programmes for staff versus day-to-day management?
Well, when you talk about recognising the good work of our crew members, we look at it in several aspects. You have to recognise crew members for what we'll call the day-to-day or business as usual things. I think you have to be very careful that if you always recognise the project of the day, you are not recognising a set of crew members that are keeping the engine running; and there are some very special people there too. They may have different measures. Driving efficiency, driving productivity, driving cost reduction, driving improved availability or performance.
Helping an operations leverage technology better. The tools they have to get themselves out of a jam. Then there is another spectrum of working on projects, delivering new capabilities.
It's not just about cost. It's not just about revenue. It could be about how we improve the loyalty, the customer experience. All projects, especially IT projects, have the typical measures or parameters with them. We have a scope. We have a budget or cost. We have a schedule, and these are things that we need to continue to drive to and manage to.
But also every project needs to have a set of business objectives. We're not just doing these projects to go meet a date. We're doing it for a set of business reasons.
Did we drive more top line revenue? Did we create a better customer experience? Did we drive productivity, improvement, or some cost efficiency in the business? Those are ultimately the measures that we look at.
For the full video interview see Meet The Boss TV.