EasyJet 2014 Annual Report Download - page 33

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OPERATIONAL EXCELLENCE CONTINUED
Risk description and potential impact Current mitigation
Scalability and flexibility of key IT systems
The rapid growth of easyJet over recent years, in
particular through the introduction of new sales channels
and initiatives, creates additional complexity in IT systems.
If not managed effectively, the core applications could
lose their flexibility and create issues of scalability, which
could increase cost and cause delays when implementing
required business change.
Enterprise architecture is reviewed and improvements
are made where opportunities arise.
easyJet plans for, and maintains, appropriate capacity for
key systems, and performs structured testing to ensure
that they are sufficiently scaled to meet forecast growth.
easyJet is a member of relevant systems user groups,
which provide contact with other users and the ability
to share any issues and review system assessments.
easyJet holds regular meetings with key providers of
systems and applications to discuss performance,
continuous improvements and future innovation.
easyJet has established an IT Governance and Oversight
Committee (a committee of the Board). The purpose
of this committee is to provide independent oversight
over the governance and control relating to the Group’s
IT business area (see page 65 for further details).
Dependence on third-party service providers
easyJet has entered into agreements with third-party
service providers for services covering a significant
proportion of its operation and cost base. Failure to
adequately manage third-party performance could
adversely affect easyJet’s reputation and its operational
and financial performance. Loss of these contracts or
inability to renew or negotiate favourable replacement
contracts could have an adverse effect on future
operating costs.
easyJet has a centralised procurement team which
ensures that the Group has competitive supply options
or suitable alternatives.
The procurement process is then supported by a supplier
management framework covering business ownership
and accountability.
There are alternative service providers within the major
markets in which easyJet operates.
Industrial action
easyJet, and the aviation industry in general, has a
significant number of employees who are members
of trade unions. Industrial action taken by easyJet
employees, or by the employees of key third-party
service providers, could impact on easyJet’s ability to
maintain its flight schedules.
This could adversely affect easyJet’s reputation and
its operational and financial performance.
Employee and union engagement takes place on a
regular basis.
As easyJet operates across Europe, there are multiple
unions of which crew are members. Each of the countries
have localised employment terms and conditions which
mitigates the risk of large-scale internal industrial action
occurring at the same time.
Processes are in place to adapt to disruptions as a result
of industrial action.
The level of standby crew cover in place recognises
the external factors and volatility that impact the
airline industry.
www.easyJet.com 31
Strategic report