1. What impresses me the most about Jet Blue and its strategy in 2005 is that In 2005 JetBlue
Airways made a name for itself in the airline industry with a strategy that prioritized customer
experience, efficiency, and innovation. By giving a combination of low-cost fares and premium
upgrades like in-flight entertainment systems and comfortable seating, JetBlue captured the
attention of travelers that are trying to save money while seeking quality service. Their
commitment to efficient operations, including quick aircraft turnaround times and technology
integration like online booking, enabled them to maintain competitive pricing while delivering
superior travel experience. JetBlue's strong branding and marketing further cemented its position
as a customer-centric airline, standing out from the competition with its friendly image. Overall,
JetBlue's strategy in 2005 impressed customers for its successful fusion of affordability, quality,
and innovation in an industry known for its challenges. The founder David Neeleman was just a
39-year-old entrepreneur from Salt Lake City. All he had was a vision to bring back humanity
when it comes to air travel. In all honesty, I am actually more impressed with David’s dedication
to JetBlue air travel and how good of a person he is. I admired how even though he was the
CEO, he could be seen on a JetBlue flight serving biscotti or Terra Potato chips to passengers. He
was nicknamed “Snack Boy” even though he was the CEO. Neeleman also became a jack of all
trades. He developed skills in accounting, salesmanship, and technology. He was doing that
while also being burdened with attention deficit disorder. He wouldn’t let that stop him though,
he figured he could use it to an advantage for his creativity. I believe that JetBlue would have not
been successful if it wasn’t for David Neeleman. He was a guy with humble beginnings and a
strong vision that cares about looking out for people. Now he has a successful airline company
that offers excellent customer service and low flight costs. Customers admired his company so
much they were willing to stand in the cold for a chance to get free airline tickets.
2. David Neeleman, who was the CEO and Founder, did a great job. His vision was to create an
airline that would offer elite services to passengers at a low cost which was competitive in the
market. As the CEO of a startup company, Neeleman was able to make his airline stand out from
the competitors. The vision from Neeleman also involved to create an outstanding culture in the
company that encouraged equality. Everyone was called a crew member no matter who you were
even if you were part of the lower staff to the CEO.. The five stages involve developing a
mission and having values, setting objectives, crafting the strategy to achieve the objectives,
executing the strategy, and then monitoring developments and evaluating performance while
making correct adjustments. David Neeleman did a tremendous job doing that. For developing a
mission, Neeleman’s vision for JetBlue was to create an airline that offered elite services to
passengers at a low cost, making it competitive in the market. He also wanted everyone working
in the company to remain equals. This mission provided a clear direction for the company's
operations and employee culture. For setting objectives, Neeleman had set objectives for JetBlue,
such as offering elite services at a low cost, standing out from competitors, and maintaining a
culture of equality within the company. These objectives helped guide the company's strategic
decisions and actions. For Crafting the strategy to achieve objectives Neeleman created many
strategies to achieve JetBlue's objectives like Airbus aircraft to reduce maintenance and repair
costs and getting through the hard times of terrorist attacks. For Executing the strategy Neeleman
was able to deliver the strategies he developed. He guided JetBlue through challenging periods
and made sure the company was still competitive in the market. For Monitoring developments
and evaluating performance Neeleman continuously looked over developments in the airline
industry and evaluated JetBlue's performance against its objectives. He made necessary
adjustments to the company's strategies to adapt to changing market conditions and ensure
continued success.
3. David Neeleman’s original strategic vision for Jetblue:
To start an airline company that combines low fares that make fliers feel like their own
cozy home. Aircraft should be equipped with comfortable and modern entertainment
devices. The first priority is best customer service in the industry. His words were,
‘bringing humanity back to air travel and making the experience of flying happier and
easier for everyone.’
The present strategic vision for JetBlue has changed from the one in 1988. In 1988
Jetblue’s vision was to be a low cost airline, but now with increasing partnerships, the
airline has increased fares for Economy, Business and other class passengers. With the
introduction of new ways of handling customer queries, the customer ticketing system,
and the quality of entertainment system JetBlue’s vision has changed.
Elements of JetBlue’s new strategic vision:
Maximizing workforce productivity, improving quality of service provided, introducing
sustainable innovative practices, low cost ticketing system and efficient aircraft
utilization.
Develop the management in a way to be more people-centric and customer focused.
Increase partnership with other airlines in the industry to improve on reachability in
different markets may it be by increasing fares and catering to the business and first
class flyers.
Efficient operational system was introduced to reduce air traffic and usage of costly
softwares. JetBlue’s aircraft planned a long route by landing at a point in between,
getting the aircraft checked and continuing their journey towards the final destination.
This aircraft will carry passengers from Point A to Point B, few will disembark the aircraft
and few more passengers will embark the aircraft from Point B to Point C. This strategy
not only reduces cost of using costly software but also helps the airline in generating
more profit.
4. The key strategies and competitive advantages of JetBlue are the maximisation of its
workforce productivity, high quality of service and innovation with affordable prices, low
cost ticketing system, and efficient aircraft utilisation.
The original Mr. Neeleman’s strategic vision was to create an airline where passengers
would be able to save money while they munched on gourmet snacks, sat in leather
seats, and watched television . This strategic vision looks directional, focused, easy to
communicate but incomplete and uninspiring.
The airline business has seen more than its fair share of companies rapidly entering
and exiting the business. It is an infamous industry for not making money and for failing
to deliver on strategic vision. Margins are tight, costs are high, competition is fierce and
demand cyclicality is constant and often dramatic. There are notable exceptions to the
rule and jetBlue is one of them. JetBlue Airways is synonymous with value for money
and good service, basing its success on a clear and consistent vision and value
offering, balancing low prices with efficient operations and friendly service. In addition
jetBlue has an inclusive and proactive vision that forges an aspirational and deliverable
corporate strategy. This vision is clear and consistent to all stakeholders and
straightforward in its manifestation both as a customer value proposition and an
organizational business model.
But every market is dynamic and the timeframe of this timing effect depends of many
factors (e.g.: the evolution of the technology, natural resource availability, human
capital, new ideas and initiatives, change in people choices). The interaction of all
factors will define the timeframe of the market evolution. For example environment
consideration is a relatively new idea to be incorporate in the vision of the companies;
fifty years ago few companies expressed concern about the environment protection.
Another interesting example is Henry Ford’s vision about one car per garage, in Alberta
there are around of 2,600,000 . vehiclesand 1,300,000 households; what Henry Ford
would think today about his own vision? Should Ford Company work with this strategic
vision in Alberta today? Finally, the vision of the company could be reviewed based on
all those potential changes, and more, under the boundary conditions that the company
operates. Thus, jetBlue has changed its strategic vision to bringing humanity back to air
travel.
In the case of airlines companies, many of those factors affect the company evolution;
and specifically for jetBlue, changes in management, environment and the vision itself
when it looks that it is not working correctly. Many of these scenarios were present at
jetBlue (external and internal), therefore the strategic vision of the company could be
reviewed. Nevertheless to change the strategic vision of the company could imply a
major change in the business and the re-education of many people (mainly managers
and seniors).
5.
6. There are some factors that are driving change in the airline industry and their impact on the
future of the industry. The factors are increased globalization, advancements in technology,
factors in economy, and global crises. The increasing globalization economy causes an increase
in demand for both international and intercontinental travels. Airline alliances with a global
reach and no weaknesses in service delivery will pose a competitive advantage over others for
business people who need to be all over the world constantly. Airlines also can extend its market
reach without making huge capital investments. Technology continues to reshape the airline
industry from having more fuel-efficient aircraft to advanced booking systems and in-flight
entertainment. AI and data analytics also play significant roles in enhancing operational
efficiency and customer experience. Automation is also there for technological advancements
because it’s there for like pilot assistance systems, air traffic management, and baggage handling.
Factors in the economy such fuel prices, exchange rates, and overall market demand all have a
significant impact on the airline industry's profitability. Economic downfalls can lead to less
travel demand and increased price budgeting among consumers. Economic growth can increase
travel and expansion opportunities for airlines. For Global crises, events like natural disasters,
pandemics, and terrorist attacks can have huge impacts on the airline industry. These events can
disrupt travel patterns, lead to changes in government policies, and affect consumer confidence
which ultimately changes the industry's attractiveness and profitability towards customers. A
good example would be the September 11th attacks. Security and paranoia increased when that
happened. Before 9/11, there was practically no airport security. Passengers were able to board
their plane as they pleased. The TSA was literally created just to make sure another terrorist
attack like 9/11 would never happen. To sum up everything I just said, all those factors I listed
all are a driving change to the airline industry and I don’t know what else to expect from airline
travel 20 years from now.
7. Low cost airlines strive to meet the basic demand of airline customers at a relatively low
price. In order to be successful, they have to carry out their business from a certain value-based
perspective and concentrate their attention on the following Key Success Factors of their
industry. These key factors are overall low costs (Overall low costs are essential to be able to
offer cheap fares. e.g.: Point-to-point services, cheaper product design, standardized fleet, use
of secondary airports, direct sales via Internet as main distribution channel), high operational
efficiency (high aircraft utilization is crucial to maximize the profits of the airline. e.g: quick
turnaround times at the gates are required to reduce the time on the ground, where aircrafts do
not make profits), high core service standards (e.g.: safety, customer support, customer
satisfaction, reliability (punctuality, reliable baggage delivery)), and strong direct sales capability
via the Internet.
JetBlue’s resource strengths and competitive capabilities overtake some of these KSFs and add
other ones. JetBblue’s KSFs could be described as the attractiveness of airline's service (one of
the most important values from jetBlue), a highly talented workforce (e.g.: Aviation University
Gateway), productivity, in airline capacity per employee and morale (e.g.: HR policies aims to
develop this), highly effective promotional expenditures (e.g.: pilot laptops), strong direct sales
capabilities (e.g.: special software), a well known and well-respected brand name (e.g.: it has
won several awards), airplane utilization in hours per day (e.g.: efficiency in death time), high
load factor relative to the industry average, quality control know-how (e.g.: IT system developed
to increase in efficiency), product innovation capabilities (e.g.: high HR effort and initiatives
maintaining the moral and performance of the work force), good financial management, and
overall low cost so as to meet customers' expectations of low prices (e.g.: company vision and
mission).
8. In 2006, JetBlue dealt with problems that had some setbacks on its day-to-day operations and
financial performance. Competition was the first problem. The airline industry has a lot of
competition, and JetBlue had dealt with competition from both normal airlines and budget
carriers, which could have an impact on the company's pricing strategies and overall earnings.
Fuel costs was another problem. Even though JetBlue was well liked, it didn’t make them
immune to this problem. JetBlue was at risk of higher fuel costs, which could raise its expenses
and lower its profits. Employee collaboration is another factor. In 2006, there were reports of bad
behavior between the JetBlue management and some of its employees, specially the pilots. This
could lead to disruption in day-to-day labor and ultimately its operations. Employee
collaboration is important because if your employees can’t get along, how will the business run
smoothly. Teamwork is essential for a successful company. Finally there is the utilization of
capacity. JetBlue has the reputation for having excellent service and spacious seating, but this
also meant that its planes had fewer seats than many of its competitors. If the company can’t
effectively manage the capacity utilization, it could lead to increased costs and reduced
profitability. If resources are wasted, profitability is down the drain.
Despite all these problems, JetBlue's management knew how to deal with all of this. They
focused on finding ways to manage capacity problems, still have profitability even there is rising
fuel costs, competitive pressures, and improve employee collaboration to make sure that there is
no potential disruptions and setbacks to the company's operations. Every company out there is
going to have their worries about certain factors in their business no matter how successful they
are. As long as they have an effective management team, they will be able to overcome any
potential challenge that is in their way. As long as you have a great leader and a staff that is
willing to listen to your guidance, everything will work accordingly.
9.