Alaska Airlines announced Friday it has contracted global consulting firm Accenture to conduct a complete audit of its technology systems, part of a broader initiative to improve reliability after two major IT outages in recent months. The review will include a comprehensive examination of the airline’s systems, standards, and processes.
The decision follows a major outage last week that grounded flights for eight hours. The Seattle-based company indicated more than 49,000 passengers experienced travel disruptions and more than 400 flights were canceled across Alaska Airlines and its subsidiary Horizon Air. The outage was severe enough to postpone the company’s scheduled quarterly earnings call.
Alaska stated the outage resulted from a failure at its primary data center and was not related to a cybersecurity incident.
In a new regulatory filing, the airline indicated it does not plan on rescheduling its third quarter call and will provide updated guidance for its fourth quarter in early December, “once the full financial impact of the recent IT disruptions is understood.”
A separate July outage, caused by a failure of a “critical piece of hardware” at Alaska’s data centers, was expected to reduce earnings by approximately $0.10 per share, or roughly $12 million.
Alaska indicated it has increased IT infrastructure spending by nearly 80% since 2019, investing in redundant data centers and migrating more guest-facing systems to the cloud.
The airline operates a hybrid infrastructure, combining its own data centers with third-party cloud platforms, according to an interview last year with Vikram Baskaran, Alaska’s vice president of IT.
Alaska began migrating workloads to Microsoft Azure around 2015 and continues to maintain its own data centers for critical workloads, according to the interview.
Earlier this week, Alaska experienced another IT disruption, but this time attributed responsibility to Microsoft Azure, which itself had an outage that temporarily disrupted operations for customers worldwide. The disruption impacted Alaska’s subsidiary Hawaiian Airlines.
The Accenture engagement representing Alaska Airlines’ acknowledgment of systemic technology problems, with the external audit decision signaling that internal IT leadership either lacks the expertise to diagnose infrastructure weaknesses or that company executives want independent third-party validation before making expensive remediation investments that could reshape technology strategy.
The comprehensive systems, standards, and processes review scope indicating Alaska recognizes problems extend beyond isolated hardware failures, with the holistic examination suggesting concerns about architectural decisions, operational procedures, vendor management, and organizational capabilities that contributed to multiple outages rather than simply replacing failed equipment.
The eight-hour flight grounding duration representing catastrophic operational disruption, with the extended outage far exceeding typical IT incident recovery times indicating either severe technical damage requiring extensive restoration, inadequate disaster recovery procedures, or both failures combining to prevent rapid service resumption.
The 49,000 disrupted passengers and 400 canceled flights quantifying the customer impact, with the massive scale affecting travelers throughout Alaska’s route network creating not just immediate inconvenience but long-term reputation damage as passengers question whether the airline can reliably operate its technology-dependent modern aviation systems.
The postponed quarterly earnings call demonstrating the outage’s severity from management perspective, with the unusual decision to delay investor communications suggesting executives needed time to assess financial impacts, develop remediation plans, and prepare explanations for board members and shareholders demanding accountability.
The primary data center failure causing the outage indicating centralization risks, with the single point of failure demonstrating that despite Alaska’s claimed investment in redundant infrastructure, the airline’s disaster recovery capabilities proved inadequate when the main facility experienced catastrophic problems that backup systems couldn’t compensate for.
The cybersecurity incident denial addressing investor and customer concerns, with Alaska’s explicit statement that the outage didn’t result from hacking or malicious activity attempting to prevent speculation about data breaches or ransomware attacks that would create additional reputation and regulatory problems beyond operational disruption.
The canceled third quarter earnings call without rescheduling representing unusual corporate communications decision, with the indefinite postponement suggesting Alaska’s financial results and IT problems create messaging challenges that management prefers to address through written updates rather than live question-and-answer sessions where analysts might demand uncomfortable specifics.
The early December fourth quarter guidance timing providing three-month window to assess IT disruption costs, with the extended evaluation period indicating Alaska expects lingering financial impacts from customer compensation, lost revenue, remediation expenses, and potentially reduced bookings as travelers avoid an airline experiencing repeated technology failures.
The July outage’s $0.10 per share or $12 million impact establishing baseline for assessing recent disruption costs, with the earlier incident’s financial damage providing reference point suggesting the more recent eight-hour grounding likely cost substantially more given its longer duration and greater operational disruption.
The “critical piece of hardware” failure description in July indicating equipment rather than software problems, with the characterization suggesting aging infrastructure, inadequate maintenance, or insufficient redundancy where single component failures can cascade into system-wide outages that modern fault-tolerant architectures should prevent.
The 80% IT infrastructure spending increase since 2019 demonstrating substantial investment, with the nearly doubled budget allocation indicating Alaska recognized technology weaknesses and attempted to address them, yet the continued outages suggest the spending either targeted wrong areas or that implementation failures prevented the investments from delivering promised reliability improvements.
The redundant data centers and cloud migration investments representing standard industry practices, with Alaska’s technology strategy mirroring approaches that other airlines have successfully implemented raising questions about why similar investments produced different reliability outcomes, potentially reflecting execution problems rather than strategic errors.
The hybrid infrastructure approach combining proprietary data centers with cloud platforms creating complexity, with the dual-environment architecture requiring Alaska to maintain expertise managing both traditional server operations and cloud services while ensuring seamless integration between the two systems that each have different operational characteristics and failure modes.
Vice President of IT Vikram Baskaran’s public discussions of technology strategy providing transparency, with the executive’s willingness to describe Alaska’s infrastructure approach in interviews demonstrating confidence in the technical direction before recent outages potentially called those architectural decisions into question.
The Microsoft Azure migration beginning around 2015 indicating decade-long cloud adoption, with the extended timeline suggesting either gradual workload transition ensuring service continuity or difficulties migrating legacy systems that proved more complex than initially anticipated requiring prolonged hybrid operations.
The retained on-premises data centers for critical workloads reflecting risk management, with Alaska’s decision to keep essential systems in company-controlled facilities rather than fully embracing cloud infrastructure demonstrating cautious approach where the airline maintained direct physical control over technology supporting flight operations, reservations, and other mission-critical functions.
The subsequent Microsoft Azure outage affecting Hawaiian Airlines demonstrating third-party dependency risks, with the cloud platform’s worldwide disruption impacting Alaska’s newly-acquired subsidiary highlighting how cloud adoption creates vulnerabilities to vendor problems beyond the airline’s control regardless of internal infrastructure investments.
The Hawaiian Airlines subsidiary impact indicating integration challenges, with the recent acquisition creating additional technology complexities where Alaska must now manage two distinct airline IT environments potentially with different architectures, vendors, and operational procedures while attempting to achieve synergies justifying the merger.
The multiple outages in short timeframe creating cumulative reputation damage, with each incident reinforcing negative perceptions about Alaska’s operational reliability even though the causes varied from internal hardware failures to external cloud provider problems, demonstrating how IT problems regardless of source erode customer confidence.
The Accenture selection over other consulting firms potentially reflecting the global consultancy’s aviation industry experience, with the Big Four firm’s portfolio likely including similar technology audits for other airlines providing relevant expertise though critics might question whether management consultants can diagnose technical problems that Alaska’s own IT staff couldn’t identify or correct.
The audit timing during peak holiday travel planning season creating additional pressure, with the disruptions occurring as customers book Thanksgiving and Christmas flights potentially causing booking slowdowns if travelers choose competitors perceived as more reliable, making rapid remediation essential to prevent extended revenue impacts beyond direct outage costs.
The Seattle headquarters location creating local economic stakes, with Alaska’s status as major Puget Sound employer meaning the airline’s operational and financial health affects thousands of regional jobs, supplier businesses, and the broader economy making the technology problems matter beyond just Alaska shareholders and customers.
The broader airline industry context where Southwest Airlines experienced similar catastrophic December 2022 meltdown, with the competitor’s multi-day operational collapse from outdated crew scheduling systems demonstrating that Alaska’s problems reflect wider industry challenges maintaining complex legacy technology while attempting modernization without disrupting operations.
