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Project Managemant

12Initiating
After reading this chapter, you will be able to:
1. Understand the importance of initiating projects that add value to an
organization
2. Discuss the background of ResNet at Northwest Airlines
3. Distinguish among the three major projects involved in ResNet
4. Appreciate the importance of top management support on ResNet
5. Discuss key decisions made early in the project by the project manager
6. Relate some of the early events in ResNet to concepts described in
previous chapters
7. Discuss some of the major events early in the project that helped set the stage
for project success
ay Beauchine became Vice President of Reservations at Northwest
Airlines (NWA) in 1992. One area that had continually lost
money for the company was the reservations call center. Fay developed
a new vision and philosophy for the reservations call center that was
instrumental in turning this area around. She persuaded people to
understand that they needed to focus on sales and not just service.
Instead of monitoring the number of calls and length of calls, it was
much more important to focus on the number of sales made through the
call centers. If potential customers were calling NWA directly, booking
the sale at that time was in the best interest of both the customer and
the airline. Additionally, a direct sale with the customer saved NWA
13 percent on the commission fees paid to travel agents and another
18 percent for related overhead costs.
Objectives
F
Fay knew that developing a new information system was critical
to implementing a vision that focused on sales rather than service,
and she wanted to sponsor this new information system. Although
the Information Services (IS) Department had worked to improve
the technology for call centers, past projects never went anywhere.
The new reservation system project, ResNet, would be managed by
business area leaders and not Information Services managers—a first
in NWA’s history and a major culture...