To gain insight into the specific challenges faced by the travel and hospitality industry, it’s worth speaking to Gary Edwards, the group CIO of travel agent Thomas Cook.
Edwards faces the daunting challenge of updating the IT infrastructure of a company that’s been around for 170 years, and for an organisation with annual revenues approaching £9bn, 31,000 staff, 1200 IT suppliers and 32 different datacentres, it promises to be quite a task. Like many consumer-facing, service-led organisations, Thomas Cook has had to adapt quickly to a world where new, more nimble entrants have burst onto the scene. The result has been rapid expansion through M&A activity mixed with a liberal dose of experimentation. But now it’s time to consolidate, and Edwards joined the organisation two years ago to do just that. “We recognise this is the right time to invest in the group IT strategy to enable the next wave of business transformation,” he says. Travel and tourism is a traditionally low-margin industry, meaning large-scale investment in support functions such as IT are less common than in other more IT-reliant sectors such as financial services. Instead, according to Edwards, Thomas Cook and its like, must sweat their assets in order to extract every pound of value from every pound of investment made. Edwards is focusing his transformation efforts around four key strategic themes. The first is to simplify the group’s application usage, and Edwards says he can halve the 1000-plus sales, middle-and back-office applications. The second focus is on the technology infrastructure itself, including the consolidation of the group’s 32 datacentres into something more manageable. A third focus is on improving operational excellence – developing IT balanced scorecards, improving tools and people development. A final focus is supplier consolidation. “We’ve got more than 1200 IT suppliers across the group, and our supplier optimisation introduces a sourcing strategy that will ensure we look at what we have in-house and what we are capable of outsourcing, whether on/near or off-shore,” says Edwards. “It’s not just as simple as slicing off a third of them and saying, ‘Hooray, we’ve saved some money’ – it’s a lot deeper and broader than that.” Although Edwards concedes that his role is currently an 80:20 mix of cost control and systems uptime against developing innovative new solutions, he is clearly a firm believer in the power of new thinking. Edwards believes that the immediate challenge is to apply retail-type customisation and CRM to the sector.