Easy risk management can prevent costly errors (ask United Airlines)

By Jonathan Hassell, CIO |  IT Management, risk management

In 2007, United honored business-class fare from Los Angeles or San Francisco to destinations in New Zealand that was missing one zero, selling at $1,062 plus taxes and fees instead of $10,620. Once it cancelled those tickets to Hong Kong, the carrier essentially reversed itself on that public position, leading it to write a public relations goodwill check without having to later honor it. Then, United's customer service team had to reach out to each affected customer and explain the action. This costly, time-consuming initiative nothing to raise revenue or cut expenses and, from a financial perspective, was nothing but a cost.

Get together with customer service teams, public relations teams, your finance group, an executive liaison, your compliance group and others. Call it a "Systems Issue Working Group." Come up with a way of explaining how your systems work that is accessible and understandable to this group. Implement a plan for both avoiding glitches and responding smoothly to them in the event they happen. Solicit feedback from other teams on what pain points there are during glitches. Take this feedback to your organization to develop processes to check, pause and otherwise mitigate these points.

It's unlikely that you'll never have a glitch that costs you time and money. With some analysis and preparation, though, you can avoid the dumb mistakes that make everyone's skies a little less friendly.

Jonathan Hassell runs 82 Ventures, a consulting firm based out of Charlotte. He's also an editor with Apress Media LLC. Reach him via email and on Twitter. Follow everything from CIO.com on Twitter @CIOonline, on Facebook, and on Google +.


Originally published on CIO |  Click here to read the original story.
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