Anyone who has served as chief information officer at a number of different airlines is likely to have experienced a lot of highs and lows.
Technology and teams will have come and gone, investments will have been made and perhaps abandoned, airline distribution strategy will have been formulated, thrown out and come 'round again.
Scott Allard served as CIO of Allegiant between 2011 and 2017 and prior to that held the same role at Spirit Airlines. He now advises airlines and airline technology companies on strategy. In an interview with PhocusWire, he discussed the challenges of legacy systems, the mistakes he sees being made and what he would do if he was a CIO again.
As you look at your previous roles as chief information officer of Spirit and then Allegiant, what have you learned that you wish you knew at the time?
As I started looking at this question, I thought I’d come back to it because it’s so hard. Then, I started examining myself, is it hard because I’m not admitting to my previous mistakes? Why I find it hard became an interesting thing for me, because I feel like I did everything I should have at the time, but clearly not. So, what is it that I wish I knew? The best answer I have is that technology has become more available to more team members over time.
I worked in healthcare before I went to Priceline, surveying home grown systems around the company to assess the risks and offer some sort of mitigation to those risks of having employees build stuff. We came out with something like 1,100 desktop applications users had built that were housing data for some business function, under the radar of IT. That was in '95. Today I cannot imagine the stuff that’s happening in these companies with employees uploading spreadsheets to ChatGPT.
There are so many end-user tools available and frankly the users now, given mobile phones, are so much more comfortable with technology than they were then. There is no way you can keep technology solutions centralized with a command and control approach. That makes collaboration from the top to the bottom through the organization even more important.
IT can’t be a walled garden. Technology in a vacuum does not work. Over the years I think I probably felt a little too big for my britches and like I was authorized to be making decisions and setting technology directions while under appreciating the importance of letting it happen and guiding it. It doesn’t matter that you’ve been anointed with the power to do it if users don’t embrace it. So, I wish I knew the importance of user adoption and real genuine buy-in and not authority based decisions.
If you were CIO of an airline now, what would you do in the first 30 days?
I would embed myself in the operation and shadow everything. The IT team is secondary at that point.
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When I was at Allegiant we got a new chief operations officer, and he spent the first month in the field, taking flights, watching airport operations, almost anonymously. At the time I wondered what he was doing, now I understand better now. That new period, when you’ve got fresh eyes and can look at something from the outside, is so valuable. Obviously you're going to learn your own IT shop, that's going to happen. But what doesn't happen naturally is really embracing and learning the business side and knowing what the challenges and cultures are. I would focus on that almost exclusively in the first 30 days.
As you look at carriers now what do you think are the biggest mistakes they’re making when it comes to technology and systems?
Cloud jumps out at me here as front and center, and I don’t think this is a travel specific issue. Everywhere I go and everyone I talk to, I see irrational exuberance about a move to the cloud. In a lot of cases it is being driven by the chief financial officer saying 'we’ve got to get there because we’re going to save money.' Almost none of them save money and that is not industry specific, that’s just a fact.
You can’t pick up legacy technology and drop it in a cloud environment and think it’s going to be cheaper. If you modernize it, maybe. If you want to pick up your disaster recovery data center and move it into the cloud, now we’re talking because now you're not paying rent for a co-location facility, you’re not buying hardware that is just sitting there unused. But, you’re not likely to save money by picking up your consistent compute consumers and moving them into a pay-per-compute model, you’ve got to keep your eye on the business value. If the application is modern, or you can modernize it, and you can take advantage of the cloud tools and the pay-per-use type functionality, maybe you’re on to something. I think cloud should be taking a back seat to business return.
Cloud aside, there’s this culture of we’re stuck in the legacy system, we’ve got to deal with this death march of a project to get out of the legacy system. Just accept it’s there and focus on finding value around it, in it, at the edge. Probably of more impact to carriers is the ability to add value around and adjacent to it, instead of focusing on what language it’s written in. It’s unfortunate that the technology lifecycle does exist. The older it gets, the harder it gets to modify. I think the mistakes carriers are making is allowing those hard-to-change systems to inhibit their ability to provide business value.
If we accept that and build around the legacy systems, does that mean making the same mistakes?
I think they will, and they are. I’m not sure there’s a fast fix. There’s so much development and interdependencies with these legacy systems that if you endeavor to just recreate it with modern technology, by the time you are finished, it will no longer be modern technology. It’s really hard to keep these monolithic systems on the cutting edge and I don’t think it’s a worthwhile pursuit. I’m not saying don't try but don’t tie your business future to the ability to move those systems. You’ve got to be willing to look beyond and around them while you try to move them forward.
The other thing is that I still think a lot of carriers are afraid to be software development shops. It’s important to overcome that fear. It’s not that hard, there’s no reason to not do it. There is this underlying assumption that you can’t do that, and I think that’s detrimental. I think in this day and age, you have to, if you don’t, your employees will.
You talked about recently about build versus buy but airlines would say their expertise is flying planes and they bring in expertise for other functions, you don't agree?
If you buy a solution, everything you do to make that implementation successful gets you 80% of the way to the capability of building something yourself. You’ve got to first understand your business need intimately. In a lot of cases we’re talking about business process automation, that’s what a lot of software in an airline does. But when you talk about business software automation, you have to know your processes, you're going to have the ability to affect those business processes. You've got to test it with an integrated environment and all those things are true whether you buy or build it so at the end of the day what’s the difference?
There’s so much development and interdependencies with these legacy systems that if you endeavor to recreate it with modern technology, by the time you are finished, it will no longer be modern technology.
Scott Allard
I’m not advocating for reinventing the abacus. If someone has it, use it. But by the time you’ve got to that decision, you’re pretty well in a position to say 'I’ve looked out there, I know what’s out there, it’s not what I'm looking for, I’m going to build it.' In a lot of cases it comes down to fear. There’s this security that you can't fail if you buy — but you can fail, you can fail just as miserably.
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I personally find still it’s cultural. I mentioned earlier that at the line level people are really good at embracing technology these days, with or without their bosses buy in. That is less true as you move up the organization. There is this culture of fear associated with going down these roads that people don’t want to address.
I don’t think it’s that the CFO doesn’t want to invest, I don’t think the legacy systems prevent it from being possible. If there’s ground-up embracing of technology and really good collaboration with an IT shop then the decision is not made top down and it’s not an IT guy saying he's found a system at a conference. It’s a business user along with an IT guy saying 'let’s talk about our problem and here's the solution for it.' Those projects do get funded.
Can you tell us more about CIOs being the casualty of technology development?
In my view I lost my job at Spirit over a really rough Navitaire implementation. It’s not an airline specific thing. A lot of CIOs lose their jobs over SAP implementations or those really big, hard to do projects because they’re not IT projects, they are enterprise projects. They have really got to be modeled that way. The COO has to be just as invested in making it happen. When these projects fail, I wouldn't say the chief information officer is the scapegoat, because I think ultimately it is the CIO’s responsibility to make sure the organization doesn’t see it as technology project in a vacuum but sees it as an enterprise project. If I was the CEO, I would want to make the COO responsible for the implementation because that’s where it happens.
What's your best advice for airline CIOs out there?
They need to get out of the IT department and into the operations. They’re at their best when the IT shop is running itself because the’ve put the right people and processes in place and it doesn’t require a lot of babysitting. That enables them to spend time with the COO or with the head pilot.
Embed yourself in the organization at a very tactical level and make sure your management team does as well. All the conversations that happen around technology don’t happen at IT meetings, they happen at business meetings and you want to be invited to that table. If you’re not walking side-by-side with your COO knowing what his challenges are, you’re sunk.
What’s your proudest achievement? Any regrets?
The team of folks I have assembled. When I look back at Allegiant, I’m not most proud of accomplishing a financial goal or building a given system, it’s that many of the folks that worked for me moved across from Spirit, many moved across the country to join my team again. Many of them are lifelong friends. I think the best run teams transcend a casual business conversation and become friends you have over for dinner.
My personal biggest unaddressed challenge is that I’ve spent all this time in small airlines and low-cost carriers and I've never had an opportunity to test my learning in a big player. I would like to try my hand at that.