Monday, June 23, 2008

For Alaska Airlines, self-service = big savings + better customer experience

It's rare that businesses really come across a true win-win situation. Normally, when people say win-win, it usually means something more akin to "I win, you don't lose... too much." But Alaska Airlines, in a recent bid to update their terminals to improve customer flow, lessen wait times and congestion, and reduce complaints, has figured out how to do it. (Note: this isn't the first time we've written about their experiments). According to this article at Fast Company, the company has used a combination of traffic control and self-service systems to, "save almost $8 million a year on the [newly-renovated] Seattle terminal if it converts customers the way it has in Anchorage. And the makeover cost just $28 million. Thanks to the fast flow of traffic, trained employees, and eye towards efficiency, "seventy-three percent of Alaska's Anchorage passengers now check in using kiosks or the Web, compared with just 50% across the airline industry." The overall result of this?
During [the author's] two hours of observation in Seattle, an Alaska agent processed 46 passengers, while her counterpart at United managed just 22. United's agents lose precious time hauling bags and walking the length of the ticket counter to reach customers. Alaska agents stand at a station with belts on each side, assisting one passenger while a second traveler places luggage on the free belt. With just a slight turn, the agent can assist the next customer. "We considered having three belts," [Ed White, Alaska's VP of corporate real estate] says. "But then the agent has to take a step. That's wasted time."
We know that self-service alone, even when modestly implemented, has helped airlines to streamline their operations and improve efficiency. However, Alaska shows us how building self-service into the corporation, both figuratively and literally, can boost productivity, lower costs and improve customer satisfaction all at once.

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