"Enabling Innovation: Air Canada's Winning Business Strategy", Alice Keung, Nov. 21, 2002, 11:10 a.m.

Alice Keung, CIO and VP of Air Canada, at "Strategy on the Edge: Charting the course in turbulent times", Strategic Leadership Forum, at the Design Exchange, Toronto, Nov. 21, 2002, 11:10 a.m.

These participant's notes were created in real-time during the meeting, based on the speaker's presentation(s) and comments from the audience. These should not be viewed as official transcripts of the meeting, but only as an interpretation by a single individual. Lapses, grammatical errors, and typing mistakes may not have been corrected. Questions about content should be directed to the originator. These notes have been contributed by David Ing (daviding@systemicbusiness.org) at the IBM Advanced Business Institute ( http://www.ibm.com/abi).

Introduction by Halya Rudiak, IBM

Alice Keung, CIO and VP of Air Canada

[Alice Keung]

Challenges of the airline industry, and how Air Canada is charting its course

Airline industry is suffering, as never before

Air Canada has brought in a surgeon

The only international carrier to return to profitability in 2 quarters

The full-service airline doesn't work any more.

Like Eatons, customers changed.

The airline industry sees these new practices

To transform the Air Canada business model, need a combination of entrepreneurism, technology, ...

Internet lowers costs immensely

Not just product planning, from marketing to sales with IT

Consumer doesn't want one-size-fits-all.

This isn't a new idea

A brief tour of the brands and the markets they serve.

Third prong is exploitation of ancillary businesses


Fourth component was dramatic cost reduction and innovation, through technology

Ultimately, want to see customers returning to the skies

Four strategies are yielding encouraging results


No frills airlines operate at 25% of cost of traditional airlines.  Tango operates 25% below, so there's a 50% gap.

Inspiration for the direction to go Tango?  What was the signal?  Where did it originate?

How has culture changed over the past 18 months?

Destina as a conflict with travel agents?

Long-term, have been discussing short-term.  What about business customers?  Cannibalization?

U.S. market.  Where do you expect growth in the U.S. market?

Brand equity from Canadian or Canadian Pacific?

What measuring of loyalty is happening with brands?


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