Business / Strategic Management And Business Policy

Strategic Management And Business Policy

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Autor:  anton  26 December 2010
Tags:  Strategic,  Management,  Business,  Policy
Words: 1129   |   Pages: 5
Views: 530

Introduction

Jet Blue Airways is a major airline operating in the United States. The company was founded by David Neeleman in 1999. Since then the company has had many high and low points but continues to progress, working toward company goals as well as stockholder needs. (jetBlue.com, 2007) In this paper I will be addressing the current concerns of the Jet Blue Airways Corporation. I will be focusing on what I believe are the best recommendations for the company, based on my education in project management and from personal experience. These recommendations will address priorities for the company, the stakeholder, and the community. I will also touch on the important balance between the commitment to shareholders and the commitment to the community.

Jet Blue airway has had a strong presence in the airline industry as a low cost carrier since its founding in 1999. After the tragic events of the 9/11 attacks on the World Trade Centers it became one of the only airlines to continue to be profitable, while many of the larger companies like American Airlines were having financial difficulties. (Indiana University, 2007) Until recent, unfortunate, events Jet Blue had continued to grow and be profitable. However, in February of this year Jet Blue suffered a tremendous blow. The airline had massive delays causing passengers to be stranded all over the country. At the JFK Airport in NY a fully booked aircraft was left on the tarmac for six hours. The reason for this delay was an ice storm; however this caused delays in other cities. These massive delays caused a public relations crisis for the Jet Blue image. (The New York Times, 2007)

The current concerns of the Jet Blue airways company can be broken down into four categories. The first being Sociocultural forces. Sociocultural forces are the values, knowledge, beliefs and other practices that unite a country. (csupomona.edu, 2007). When the massive delays from the Jet Blue airlines in February hit the media it caused a large stir in public opinion of the airline. The company faced Major criticism and the company image was damaged because of public opinion. (CBS News, 2007) The second factor is Economic Forces. The rising prices of fuel costs pose a major issue for all airlines and Jet blue is no exception. Quarterly profits for the company plummeted nearly $6 million. (JRank, 2007) The third is Technology forces. Jet Blue has implemented many technologically advanced techniques. However, large technology advancements are difficult with a low cost airline. (Indiana University, 2007) The final concern is Political-Legal forces. After the February delays and public out cries Jet Blue became a political target. Internal forces that are also affecting the company are the change in upper management. Founder David Neeleman stepped down as CEO on May 10, 2007 and Dave Barger is now the President and CEO, and how this affects the employees. (JetBlue.com, 2007)

Under the current circumstances my recommendations to the Jet Blue Airways Corporation would be to continue to work on public relations, advancing technology, and cutting costs where possible to help alleviate the economic issues they are facing. Dave Barger should also turn some of his focus inward to the employees to help them ease into the transition of a new CEO. The most important recommendation which will help in analyzing other priorities is to strongly suggest that the company have a SWOT analysis conducted to pin-point key issues facing the organization, giving them a better understanding of how to fix many of the current concerns.

The first priority I see for the company is public relations. The founder David Neeleman has been conducting many public appearances and even announcing compensation for stranded travelers on YouTube. This is a good step; however, the damage done from the delays is intense and public image is one of the largest factors for a company. The next priority would be the use of technology now to help alleviate costs in the future helping to increase potential profit. After increasing public image and technology I suggest cutting current costs if possible, while still supporting primary stakeholders.

Balancing a commitment to shareholders and the community is difficult, especially for this situation. A SWOT analysis and company values will help to determine how a company balances these two goals. Jet Blue has five different values, none of which are specific to the community or the shareholders. (Indiana University, 2007) These Values are safety, caring, integrity, fun and passion. From these values the focus of the company appears to be more geared toward the employees and the customers. However, shareholders want returns and profit and the community wants tax revenue and a reliable community partner from the organization. (AIU Online, 2007) These two things can be achieved if a company’s values and goals are balanced to accommodate them. Theoretically, Jet Blue could raise their prices to increase profit, therefore accommodating stockholders, and increase the number of planes and destinations they fly which will require more jobs and accommodate the community. However, this may not satisfy customer relations, which at this point in time are under concern.

Conclusion

In conclusion the Jet Blue Corporation has had a turbulent year so far for 2007, however with the right analyses and effort toward improvement the company can once again be a leader within their market. If strategic management concepts are put into place to analyze and structure the companies needs, values and primary stockholders, Jet Blue Airways will continue to be an industry innovator. (Wheelen & Hunger, 2006)

References

AIU Online (2007). MGT_485_4_1 Unit 1 Chat 2 Retrieved on August 23, 2007 from https://mycampus.aiu-online.com

Carroll, A. and Buchholtz, A. (2003). Business and Society: Ethics and Stakeholder Management. Thomson. Ohio

CBS News (2007). JetBlue Attempts To Calm Passenger Furor Retrieved on August 23, 2007 from http://www.cbsnews.com/stories/2007/02/15/national/main2480665.shtml

Csupomona.edu (2007). Sociocultural Forces Retrieved on August 23, 2007 from http://www.csupomona.edu/~wcweber/301/301slide/ch04301/sld016.htm

Indiana University (2007). Teaching Notes – JetBlue Case. Retrieved on August 23, 2007 from http://users.ipfw.edu/todorovz/teaching/Strategy/Case22_JetBlue.pdf

Jetblue.com (2007). About JetBlue: Our Company-Our history Retrieved on August 21, 2007 from http://www.jetblue.com/about/ourcompany/history/about_ourhistory.html

Jetblue.com (2007). Press Releases: JetBlue Airways Names Dave Barger President and chief Executive Officer; Founder David Neeleman Will Continue to Serve as Chairman of the Board Retrieved on August 21, 2007 from http://investor.jetblue.com/phoenix.zhtml?c=131045&p=irol-newsArticle&ID=998672&highligh

JRank (2007). Jetblue Airways Corporation Business Information, Profile, and History Retrieved on August 21, 2007 from http://companies.jrank.org/pages/2288/Jetblue-Airways-Corporation.html

The New York Times (2007). Long Delays Hurt Image of Jet Blue Retrieved on August 21, 2007 from http://www.nytimes.com/2007/02/17/business/17air.html?ex=1329454800&en=e8ec4290afb76497&ei=5124&partner=permalink&exprod=permalink

Wheelen, Thomas L. and Hunger, David J. (2006). Strategic Management and Business Policy Upper Saddle River, New Jersey



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