In the midst of the worldwide oil price hike, foreign currency fluctuations and stiff competition in the airline industry, major air transport carriers in the United States struggle to maintain profitability. Debra D’ Agostino, Deputy Director for Industry and Management Research (Americas) at The Economist Intelligence Unit and former online editor of the business and technology strategy journal, CIO Insight, presents a case study on how Continental Airlines, the fourth largest US airline, has used ICT to gain competitive advantage. While its competitors adopted a cost leadership strategy by dramatically cutting airfares, Continental used a differentiation focus strategy by concentrating on attracting and strengthening their business relationship with a loyal group of high-value customers who would be willing to pay more for superior customer service. The company consolidated the airline’s CRM systems to create a cross-enterprise database, allowing them to segment their market according to the customer’s value to the business. Aside from upgrading the company’s systems and management structure, the company is looking at improving knowledge transfer from the data systems to the human resource pool as a key factor to the full implementation of their IT strategy. Focusing on the company’s commitment to customer service and value for technology, Continental Airlines’ strategy aims to improve operational efficiency and strengthen its positioning in the industry.
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