Royal Caribbean Cruises Ltd.

Case Analysis 1 Royal Caribbean Cruises Ltd.

Group 19: Mark Simons, Jessica Jingsi An BAIT 550 Information Technology for Management Carson Woo

Group 19: Jessica Jingsi An, Mark Simons

BAIT 550 – Case 1

Introduction Royal Caribbean Cruises is a profitable company which provides luxury cruises to customers. They were, and are currently, the second largest player in the cruise-line industry, trailing Carnival Corporation. Although before 1997, the IT systems in RCCL were “very poorly regarded by the rest of the company” and “had neither vision nor strategy,” Jack Williams strived to quickly change this. Williams, the new president and COO coming from a highly IT-focused position with American Airlines, began work on improving overall IT efficiencies. In 1999, Tom Murphy was brought in as CIO to manage this transition. Murphy, who was a relationsorientated individual, recognized immediately that there were inadequacies in the reservation systems, supply chain, and HR management. Murphy quickly made use of his interpersonal skills and vision to weed out ineffective managers and position passionately service-orientated people to excel. Next, Murphy orchestrated a large scale, three-sectioned plan for revolutionizing RCCL’s IT management called Leapfrog. While this $200 million project was immediately approved, and had developed very well over the first year, it was unfortunately (yet necessarily) scrapped following the events of 9/11 and the subsequent 50% decrease in cruise-line sales. In the two years following this event, Murphy has been granted a very limited budget to slowly improve the IT systems at RCCL, but many of the inefficiencies that he initially set out to rectify were still apparent. Now Murphy must decide whether to maintain at this level, make marginal improvements to the reservation system, or campaign for a full IT systems overhaul by continuing with the Leapfrog initiative. Industry Analysis The cruise-line industry is a luxury service...