Claydon notes, for example, that JetBlue's paperless cockpits -- the company gave pilots wireless laptops to replace the bulging briefcases they used to carry around -- free up pilot time so they can greet travelers from the front of the cabin. "It makes our pilots happier, less grumpy, more accessible, and gives them more time to interact with the customer," Claydon says.
And although the company has invested heavily to make its Web site and kiosks easy to use, Claydon adds that they don't want these to get in the way of customer interaction. "If you call 1 (800) Jet-Blue, you will not get caught up in IVR [interactive voice response] hell; you'll quickly be able to get through to a live human."
"The key to technology as strategic advantage at JetBlue is a very strong partnership between IT and marketing," says JetBlue CIO Todd Thompson, who used to report to Claydon but now reports to the CFO. "The technology doesn't get in the way of the brand." Thompson also notes that technology investments help keep costs low. "Our cost structure is as much of a competitive advantage as the JetBlue experience is."
Between the home-based agents and the paperless cockpits, Thompson estimates the company saves several million dollars a year. And whereas traditional airlines take in less than 40 percent of their bookings via the Web, JetBlue.com garners 80 percent. "A huge cost savings," Claydon adds.
How sustainable is JetBlue's IT advantage? "There's definitely some technology secret sauce," CIO Thompson says, specifically citing the sophisticated antenna for receiving satellite TV for passengers. And the company's 160-person IT team is working on a next-generation, componentized reservation system that will offer built-on-the-fly, custom vacation packages for customers.
But in reality, Thompson admits, "You can duplicate a Web site, a kiosk, or dynamic packaging." JetBlue's edge really lies in the mind-set of using technology to innovate, he says, plus the laborious process changes the company has gone through -- in getting the paperless cockpit approved, for example. "We had to convince the FAA that we could keep the data current electronically," Thompson recalls.
Also, adds Marketing SVP Claydon, it doesn't hurt that JetBlue CEO David Neeleman sees the potential of technology. "He made the TV thing happen," Claydon recalls. "He understood we were going to have to do something to fully differentiate us. From a technology perspective, nothing was discounted."
Netflix: A logistical edge
In an age of instant downloads and video on demand, who'd have thought a service that sends DVDs through the mail would stand a chance? California-based Netflix has confounded the skeptics, growing to more than 3.5 million subscribers since launching in 1999.
Tom Dillon, the company's COO, attributes much of Netflix's success to using IT to hold down costs. "IT is not a strategic weapon in most companies," Dillon says. "But in our company, IT is the business. We live and breathe [the idea] that the way you get more competitive, lower your costs, and provide better service is through continuous improvement of the information technology."
Dillon, who oversees DVD fulfillment as well as "back-end IT" (everything but the Web site), says Netflix's Web site provides a better customer experience than its major competitor, Blockbuster.com, offering features such as customized recommendations and separate "queues" for each family member.