Researchers:

Prima Bautista
Destine Grady
Carly Janowiak
Anastasiya Pidhayna

Professor Maneesh
Sharma
DePaul University
November 7, 2016

Overview
Introduction to United Continental Holdings
Companys Financial Standings
Operation Challenges
Operational Enhancement Plan
Projected Financial Growth
Conclusion

Introduction
United Airlines is one of the worlds
largest airlines
Headquarters: Chicago, Illinois (Willis
Tower)
Number of Employees: 87,500
Subsidiaries: United Airlines, United
Express, United P.S., United Cruises

About the Company

Current Financial Standings

Market share: 14.7% (Domestic)
Operating Income: $1,624 M
Net Income: $965 M
Stock Price: $56.25

Operational Issue #1: Widespread Computer

Glitch
*United Airlines experienced a widespread computer glitch in early
October that caused hours of delays and unhappy customers.
Improve the airlines operating system so that:
Computer glitches do not completely shut down operations
UAL can provide enhanced quality and constant customer experience
The flight process is efficient

Operational Enhancement Plan

Suggestion: Invest in improving the computer systems with up-to-date
programs. Instead of combining two legacy systems, choose one legacy
system and build up on it.
Possible result: Systems are less likely to have glitches or crash

Develop and implement strategic backup plans to continue operations

from a secondary data center
The airlines, by building layers upon layers of systems -- each one with
a different configuration and a different purpose -- accidentally
create the threat of something going down in their computer
networks.

Projected Financial Growth

Projected Financial Growth Continued

Estimated Cost for United
$140 M
Not changing or buying a new
system; choosing one OS and
develop it.
Cost would be made up:
-

fixing glitches

efficient flight schedules

less delays

AA plans to make a similar

switch to one operating system
which is reported to cost
around $280 M
1.8 million man hours of
computer programming

Operational Issue #2: Unexpected Delays &

Accommodations
Accommodation for common air travel issues:
Maintenance issues that affects consumers
Unexpected weather

Operational Enhancement Plan

Suggestion:
Leasing more planes
Potential increase in rent expense
Decrease delays and increase demand and better service

The implementation is in place by flying in another aircraft nearby to

service customers / delayed flights

Projected Financial Growth

Operational Issue # 3: Inadequate

Representation in India & Bangkok
127 International Destinations
People use local airlines to travel
internationally
E.g. AirFrance, Japan Airlines, Aeromexico,
Emirates

Price - United is more expensive than other

international airlines
Location - United does not service all
locations of major airports internationally
E.g. Thai Airways, Jenayao Airlines for Bangkok

Operational Enhancement Plan

Gaining customers by expanding international presence
Developing more direct flights at cost appeasing and lower than
domestic airlines
Instead of using the partner airlines, invest in airports such as
Bangkok and India
Enable the use of UAL planes for direct flights instead of usage of
partner airlines

Operational Issue # 3: Inadequate Representation in

India & Bangkok

Operational Issue # 3: Inadequate Representation in

India & Bangkok

Projected Financial Growth

How did UALs competitors do it?

#1 - American Airlines switched to a single flight operating system
instead of having three separate systems.

#2 - Other companies (American Airlines) doesn't have long wait time in

resolving maintenance repair issues and come up with better
accommodation service.

How did UALs competitors do it?

#3 For example, Delta directly service Bangkok unlike United Airlines.

Summary
Enhance operating system by choosing one legacy system instead of
combing prior ones
Better accommodations for occasional occurrences of daily travel
Reallocate funds to direct destination points internationally, especially
in Bangkok and India.

Appendix
Delta Airlines innovation lanes;
so much more efficient than
TSAs

Questions

References
http://www.chicagotribune.com/news/chi-021205ual-timeline-story.html
http://money.cnn.com/2016/10/14/news/companies/united-airlines-delay/
http://www.chicagotribune.com/business/ct-american-airlines-it-switch-20160930-story.htm
l
http://newsroom.united.com/corporate-fact-sheet
http://www.cnbc.com/2016/10/18/united-airlines-is-finally-unlocking-potential-for-growth-c
eo-oscar-munoz-says.html
http://www.chicagomag.com/Chicago-Magazine/November-2016/Oscar-Munoz-United-Airline
s/
http://www.briansumers.com/home/2016/4/9/american-airlines-inches-closer-to-anothermerger-related-milestone