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Kuoni is one the largest players in the organized travel industry worldwide.
The company entered the Asia market about 12 years back after acquiring SOTC.
That was the companys first acquisition in India and since then it has acquired
big-ticket companies such as SITA, Tour Club and Distance Frontier, making it
one of the largest inbound and outbound travel operators in the country.
It also set-up its own start up BPO company about six years ago, called VFS,
specializing in visa processing work for diplomatic missions in India and
abroad, with a presence across forty-five countries. In fact, Kuoni has the
unique advantage of being present in almost all segments of travel, which most
other players have not managed to replicate.
The Kuoni Edge
Kuoni has a healthy IT budget which ranges from 3% to 8% of its gross
operating profit, depending on the line of businesses. And all this is being
directed toward some very ambitious and path-breaking projects and deployments.
It has partnered with best of the breed technology companies such as HP,
Microsoft, Cisco, Sify, TCS and Patni, among others. It has also been leveraging
on industry best practices in business and IT consulting with the help of
partners like Ernst &Young and PwC.
Like most companies having a global footprint, Kuoni too has implemented SAP
to handle its backend services on a unified platform, across all businesses. In
addition, this is well integrated with document management system, which has
made operations paperless. Earlier, its different businesses had different
applications in place and were running on multiple accounting systems. About two
and half years ago, Kuoni decided to do away with that and put in place a
unified financial and accounting function on the SAP platform.
The turning point was when the company identified the transition to SAP as
the ideal opportunity for change management where it could move the finance
function from the individual businesses to the shared service center. It created
its very own captive BPO in Gurgaon and Mumbai housing about 200 employees
across all businesses, to create an interoperable set-up catering to all Kuonis
group businesses in India and abroad.
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Growth Pangs
Kuonis growth over the last five years has been mainly inorganic expansion
strategy. The growth also brought in its own set of challenges such as
integrating and seamlessly merging all the acquired companies under the Kuoni
umbrella. Till about four years ago, the company was working on different
platforms powered by four different network providers. It was posed with the
challenge of moving from the four networks provided by Bharti, Reliance, Airtel
and Sify to one common network across India and abroad. The company finally
partnered with Sify and Reliance for setting up the MPLS network in India and
tied up with British Telecom to integrate all its offices internationally.
As Kuoni also operates in the third world countries like Africa, Nigeria,
Ghana, Kenya, Nepal, Bangladesh, it faced a lot of problems in accessing BTs
services due to poor connectivity and local infrastructure. So, it explored
hybrid solutions and put in place VSAT, RF, etc in places where VPN and MPLS was
not feasible. It also explored IPsecure VPN, which is a point-to-point
connection. Today, Kuoni has completely rolled out its MPLS network connecting
300 plus offices spread across 43 countries and managed by Kuoni India.
One of the key projects that the company is focusing on is building a robust
CRM tool that can track customer preferences and consumption patterns. While it
already has in place a CRM application developed jointly by Patni and TCS for
the past couple of years, it now planning to transition toward next-generation
CRM platform. Kuoni is working with Microsoft on a global project on Microsoft
Dynamicsthe CRM tool from Microsoft to develop it for the travel and tourism
industry. Once implemented, the MS Dynamics platform will help Kuoni derive
innovative products, and cross-sell and up-sell its products across all
businesses and geographies more effectively. Kuoni has already created a unified
customer repository with the help of its existing CRM platform to provide a
common identity for the customer across all its businesses.
Crystal Gazring
While Kuoni has an online presence, it is now planning to enter the pure
e-commerce segment and will soon introduce an online transaction gateway. In
fact, the CIO of Kuoni Travels, Dhiren Savla has put in place a focused
e-business and m-business strategy for the company. He is planning to explore
Web 2.0 for the online business and create a collaborative platform. He foresees
features such as discussion forums, blogspace, chatrooms and even consumer
ratings for different packages on the e-portal.
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| Second Life will
revolutionize the way the travel industry reaches out to customers
Dhiren Savla,
CIO, Kuoni Travels |
Interestingly, about six months back, the company explored the concept of
Second Life and has already created a space for itself in the virtual world.
Having introduced the Second Life concept for Kuoni Switzerland, the company is
now planning to extrapolate it for other geographies including India. Though
this concept is still in the nascent stage in India, Savla believes that it will
revolutionize the way the travel industry reaches out to customers. In addition,
Kuoni is also working with Google and some other meta search engines very
closely to get unified search results on the Web. An m-business platform is on
the cards.
Presently, the Kuoni data center is based in Mumbai. In phase I of the
project, which is expected to be completed by December 2008, Kuoni will set up a
secondary data center in London. In phase II, the company plans to set-up two
near DR sites Mumbai will have a DR site in Pune and the London data center
will have a near DR site in Belgium.
While the global recession as well as inflation has not spared the travel and
tourism industry too, one might wonder how Kuoni plans to leverage on IT to
optimize costs. Kuoni has been following a couple of key performance indicators:
one, the IT cost as a percentage of GOP and second, the IT cost per workstation.
Over the last two years, Kuoni has improved its IT cost as a percentage of GOP
by 2% and the IT cost per workstation has come down by almost 15%. This is a
sizeable saving considering low industry margins.
While the company has been investing heavily into technology and new product
developments, it is also exploring the possibility of using software as a
service (SaaS) in certain business units. Technology has proved to be an enabler
for Kuoni in the true sense and has helped it overcome challenges arising from
the typically distributed and fragmented set-up of the travel industry.
Priya Kekre
priyak@cybermedia.co.in
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