Thomas Cook talks tough on IT suppliers

Thomas Cookis set to take a hard line on IT procurement, as it pushes ahead with cost cutting.

The travel company, which runs on SAP core systems, is “taking a more group-wide approach towards IT and indirect procurement”, it said in a statement. This decision had been taken, it said, in order “to ensure we use the group’s global scale to maximise the benefits of our buying power”.

The company reported group pre-tax profits that more than doubled year-on-year to £56.1 million, for the year to 30 September, adding that cost savings had provided “strong foundations” for the next year. But business was made more difficult by fears over travel and swine flu, as well as by the effects of the recession.

It is attempting to offer a stronger online proposition, acting as a web-based travel agent to customers in multiple countries.

“As well as ongoing content management, merchandising, programming and technology investment, we have also ensured that customers booking travel online have access to all the same services that are available in-store and receive a seamless customer experience across channels,” it said.

Thomas Cook has been extensively reorganising its IT. Following a merger with MyTravel in 2007, Thomas Cook said it was “accelerating” the benefits delivered by combining operations and closing around 100 shops.

Efforts to deliver savings from the merger have resulted in total cost cuts of £205 million, and the company expects to deliver a further £10 million of benefits in the next 12 months.

Last year, Thomas Cook completed the migration of MyTravel from the Anite ATOP reservations system onto Thomas Cook’s proprietary Tour Operator system. It has since overhauled its financial, payroll and human resources systems, transferring MyTravel from Oracle systems onto the group's SAP systems.

Thomas Cook has also been moving to the iTour reservations system from supplier BlueSky, in an IBM-run rollout. It expects the rollout to finish by 2011, costing £67 million.

The reservations platform will enable all of Thomas Cook’s high street outlets and businesses to access real time prices online from its partners for complex holiday packages. The aim is to stop the need for extensive, time-consuming enquiries to generate a final quote for customers.

The travel company also has a multimillion pound contract with Atos Origin to provide mainframe services for five years, as well as a 10-year business process outsourcing deal with Accenture, under which the IT services firm provides management services for Thomas Cook's back office systems.

Copyright © 2009 IDG Communications, Inc.

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