Jetblue Airlines

JETBLUE AIRLINES

OCTOBER 2006

JetBlue started their business in a positive approach, by ensuring the main elements were in place prior to starting operations. Compared to JetBlue's counterparts that started up their airlines in the 1980's and 1990's, JetBlue began with a highly experienced senior management team, dedicated core values, and plenty of capital to ride out the low times.

JetBlue's strengths and opportunities compared to the industry are:

Strength & Opportunities:

* Highly experienced leadership team

* Above industry level wage compensation and benefits

* Customized employee compensation packages

* Fun, caring work environment

Weaknesses & Threats:

* As with any new startup companies, the unknown syndrome

* Will they attract the 'right people' to work and will they attract enough business

* Will the economy take a turn for the worse, such as fuel prices rocketing out of control

* Will the employees automatically ask for the unions to take over

CSFs:

* Must get the minimum amount, $130 million, for financing prior to starting operations

* Must have key elements of senior and top management teams in place

* Must obtain key location for first hub for operations

* No unions

David Neeleman, JetBlue CEO and owner, had the right idea for starting up his JetBlue airline. With this idea firmly in mind, he began by selecting highly experienced individuals with like-minded values to the senior management team. Each individual brought in their expertise in their particular areas, and each wanted to start a company from scratch and do everything in the "right way."

Before starting the hiring process, Ann Rhoades, Executive Vice President of Human Resources, wanted to take the best parts of human resources and incorporate them into JetBlue. She surveyed the top management team to define the core values they wanted for the organization. The results are the five core values for JetBlue: Safety, Caring, Integrity, Fun, and Passion.

The only value that stands above the rest as a priority is safety. Without safety, any organization would have a very difficult journey to success. The remaining four values are equals amongst themselves and are caring, integrity, fun, and passion. By incorporating these values, JetBlue created a new airline category - an airline that offers value, service, and style (Staff Writer, "JetBlue Airways Celebrates Significant Construction Milestone at JFK's Terminal Five," JetBlueAirways.com, 17 October 2006. URL: http://investor.jetblue.com/phoenix.zhtml?c =131045&p=irol-newsArticle&ID=917707&highlight=, accessed 16 October 2006.)

The leadership strove to provide the employees a fun and caring work environment. They wanted to ensure their employees received as fair treatment as possible, just like the customers of JetBlue. The organization provided above average compensation/benefits, excellent training, career opportunities, and a great environment to work. By providing an employee friendly environment, there was no need to bring unions into the organization. Rhoades set up a customized employee package for their compensation and benefits. The choice of packages allowed the employees to pick the package that aligned best with their individual preferences. Highly trained and happy employees teamed with technologically equipped aircraft, provided first class accommodations at coach fares. Passengers from all types of backgrounds flew JetBlue for the service, price, and pleasure. Michael Eisner, formerly the CEO of Disney, flew to New York City on JetBlue (Harvey Levin, "Michael Eisner is Blue -- Jet Blue," TMZ.com. URL: http://www.tmz.com/2006/08/23/michael-eisner-is-blue-jet-blue/, accessed 18 October 2006.)

Human Resources provided customized employee compensation/benefits packages. By giving each employee their choice of benefits, they supported the value of caring. Customized compensation packages were unheard of within the industry because it made the Human Resources Departments work too hard. This process gave the employees some say in their compensation packages and served as an incentive to future recruiting