American Looks to Avoid Repeat of 2007 Fiasco as Reservation Systems Merge

NEW YORK (TheStreet) -- In March 2007, a year and a half after they merged, US Airways and America West sought to merge their reservations systems. The result was unfortunate.

The intent was to move from the US Airways Sabre system to America West's Shares system, with a one-day transition. But agents on one system couldn't see reservations made on the other, airport kiosks couldn't access many reservations and pilots couldn't access weight and balance numbers. Flights were delayed, bags were lost and complaints soared.

Now, as the management team headed by Doug Parker, which previously ran America West and US Airways, contemplates another reservations system transition following the 2013 merger of American (AAL) with US Airways, it is heeding lessons from the failed 2007 effort and from other airline mergers.

The American/US Airways reservations system merger is likely to begin in July and be completed 90 days after it starts, or sometime in October, said Maya Leibman, American's chief information officer, during a briefing with reporters on Monday.

A reservations systems switchover is "one of the most visible integration activities that any airline does," Leibman said. "It's a complex and kind of hairy process to make it all work seamlessly.

"Being the last of the major carriers (to merge), we've had a little bit of an advantage to see how everybody has approached this," she said.

"Doug (Parker) has been pounding the drum, 'We can't be complacent,'" Leibman said. "We have to be paranoid about every single thing that can possibly go wrong. There's 10 million other things we'd love to be doing, (but) we are setting that stuff to the side right now."

The integration process will be "drain down" rather "knife edge," she said, meaning it will be gradual rather than sudden.

If all goes as planned, the process will begin in July when American and US Airways post new flight schedules 90 days in advance, as airlines usually do. For all flights 90 days out and beyond, the US Airways codes will change to American codes. For example, US Airways flight 123 might become American flight 456.

American customers will not see a change, but US Airways customers will. If they went to USAirways.com to book flights that are 90 days or farther out, they will be directed to American's Web site. Also, they will receive emails if flight codes are changed. The 90th day will be the last day that flights fly with US Airways codes, although the paint jobs eliminating US Airways logos won't be completed until 2016.

It sounds simple, but of course it is extraordinarily complex because all US Airways reservations are migrating from Shares to American's Sabre system -- in effect, a reversal of the 2007 switchover.

Leibman said one way to mitigate risk has been "to limit the number of big changes we had at the same time." One example: American and US Airways frequent flier programs already have been merged, so that changeover will not coincide with the reservations systems changeover.

"We decoupled those two events," Leibman said. "It was more work, but we felt that investment was worth it in order to derisk the program. Not every airline had done that, because it is kind of a pain."

It seems reasonable to assume that the biggest impact will be at Charlotte Douglas International Airport, the biggest US Airways hub and no doubt a place where attention will be focused during the transition. US Airways has 9,000 airport agents and 2,000 reservations agents, all of whom will be trained for a week on the new systems.

 "There will be the most visible change at the airports," Leibman said. "Self-service machines will no longer be US Airways, they will be American, and agents will no longer use Shares."

 Looking ahead, changes will still need to be made in flight operations systems -- those will involve flight crews and dispatch and will continue throughout 2016 and into 2017. Those changes should be less visible to passengers, unless something goes wrong.

 Must Read: Must Read: USAir's Integration Hurdles

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

More from Stocks

Amazon, Procter & Gamble, Southwest and Netflix - 5 Things You Must Know

Amazon, Procter & Gamble, Southwest and Netflix - 5 Things You Must Know

Just How Bad Is Facebook's Diversity Problem?

Just How Bad Is Facebook's Diversity Problem?

2 More Reasons to Sell All Your Stocks and Run Away

2 More Reasons to Sell All Your Stocks and Run Away

Why Aren't Markets Thinking About the Risk of a Syrian Counterattack?

Why Aren't Markets Thinking About the Risk of a Syrian Counterattack?

How Chinese Trade and Security Tensions Could Impact U.S. Tech Companies

How Chinese Trade and Security Tensions Could Impact U.S. Tech Companies