fly747first

Do you work for United Airlines to suggest that the increasingly underachieving carrier was simply trying a new algorithm? This would contradict their strategy for the past 5-7 years of just trying to copy whatever DL does, though of course they are too lazy to do it properly so they just take whatever pieces fit for them. The way I see it, if UA doesn't even have the brains to come up with a decent uniform for its employees (the New York Times even mocked UA's lack of vision and creativity previously), testing a new algorithm is out of the question.

Back to our PRM discussion, it is the responsibility of each analyst or group of analysts to monitor their markets' performance and adjust the links/influences in the RM system accordingly. Whilst major sporting events like SuperBowl are easier to predict, a computer is not going to know if, for example, a large teachers' conference changed from year to year, meaning that if the analyst doesn't make the proper adjustments, the computer is going to go by the previous year's performance. Analysts are also expected to override the system as needed... if Network Planning forces you to have an extra flight you didn't have same point in time last year, a good analyst would carefully monitor it and don't just leave it to the RM system to decide.

I have suffered the extreme displeasure of meeting UA' analysts at conferences as well as HR-related events. However, don't take my word for it... do a search on linkedin and you will see that most analysts don't last in UA's PRM for more than a year. The really well-connected ones get promoted to senior manager or director without mastering basic, basic PRM concepts and without even knowing how to manage teams since they never had direct reports before. UA continues to worsen as time goes by, but ultimately, it is their fault for not having common sense. They might as well sell themselves to Spirit and call it a day.

RM requires a careful balance and should be treated as both an art (requiring creativity) and a science (due to its highly predictive nature). I do agree with you that in theory UA should have a lot more data than any of us about its flights, then again if its staff is untalented and careless, having the data won't do much. I still cannot believe Jeff Smisek openly admitted that UA had not performed as well as its competitors due to inaccurate forecasting.

jsloan

LOL I do not. Just offering possibilities...

That makes perfect sense at a macro level; if, e.g., revenue is down markedly for a given market or route, I'd want to know why. I'm not convinced this works at a micro level, due to the massive number of variables that would go into making selections on any given route. I will concede that there was a mismatch between the expected booking curve and the actuals on the flight you mentioned. I'd need to see it happen much more frequently to decide that it was a systemic failure, but, then, I've never met any of UA's back-office staff. :-)

OK -- but surely these newly-promoted managers report to someone else. Eventually, if the pricing power is as bad as you say -- especially considering the built-in advantages of UA's route network and hub structure -- someone in the chain's got to notice. :-)

Well, the first step towards a solution is admitting you have a problem. :-) It's probably my background as a software engineer, but if I were Smisek, I would have started looking immediately for better forecasting tools. Demand signaling is a complicated problem, but we as consumers provide UA with so much data that a competent team of engineers should be able to build a pretty good set of tools on a reasonable timeline -- certainly within two years.

Anyway, considering how often I end up on oversold flights that end up checking in exactly full or allowing a standby passenger or two, they must have put their best team on Austin. Sad for me...

findark

For what it's worth, didn't UA announce recently on an earnings call or similar that its RM software wasn't performing well and they were hoping to improve it as a driver of revenue?

avi8tir

I fly IAH-AMS-IAH about every 4-6 weeks.... what I have noticed happening in the last few months is that even on non-peak days when the biz cabin is wide open, the fares look like J9 C9 D0 Z0 P0... peak days are now J9 C0. And that's looking at something more than 30 days out. It's crazy!

fly747first

Due to the large number of variables that affect both pricing and inventory, you can't leave all decisions to a system that is responding based on the inputs the analysts give it. Typically, many flights are assigned to each analyst, so you work off the exceptions and you should run reports to prioritize your workload (for example, you can extract data to see which flights require more help than others based on how they are doing against forecast); otherwise, it would be impossible to get to all your assigned flights on a daily basis plus all the weekly promotions (pricing has to file the fares and inventory has to make sure all flights have a minimum percentage of seats available or you can get fined for that).

My point on managerial promotions is that at pretty much any company that takes succession planning seriously, it makes no sense to promote someone with very limited skills and third-trier schools from analyst/senior analyst to senior manager or director, instead of analyst/senior analyst to manager. Specifically, how can you be a director responsible for managers when you haven't even managed analysts previously? It's little things like these that make UA the joke of other companies. Then UA wonders why they keep underachieving at everything. And yes UA eventually notices, people get fired, but then they promote other equally unqualified staff and this terrible cycle continues.

UA has been saying this for years even back when Smisek was running the circus freak show--system issues that lead to massive fare mistakes, inaccurate forecasts, etc.