United Airlines Case Study

NAME OF ARTICLE: David Dao on United Airlines

AUTHOR: Benjamin Edelman and Jenny Sanford

PUBLICATION: Harvard Business Journal

Investigate and Analyze the Company’s History and Growth. A company’s past can greatly affect the present and future state of the organization. To begin your case study analysis, investigate the company’s founding, critical incidents, structure, and growth.

In 1920 United Airlines was born. Walter T. Varney started Varney Air Lines (United Airlines) in 126 and Varney Speed Lines (Continental Airlines) in 1934. United pioneered having female flight attendants in the 1930s. This created a new profession for women. Several of the first flight attendants were registered nurses. In 1936 United was the first to have inflight dining, this allowed hot meals, they paid addition to the altitude and how it would affect the taste of the food. In 1937 United was the first airline to use electronic flight simulators and computers to aid in flight paths. In 1957 United became the first airline to equip all of its fleet with airborne radar. In 1957 United introduced Mainliner the world’s first inflight magazine. In 1961 United acquired Capital Airlines. In the 1960s Continental introduced live television and in 1963 Marlon DeWitt Green became the first African-American pilot hired. In 1984 United was the first airline to fly to all 50 United States. In 2016 United was the first U.S. airline to use biofuel. Also in 2016 United introduced United Polaris, this included expanded onboard seating and storage in the hopes of increasing comfort and privacy for fliers.

United Airlines was very innovative. They were the first airline to accomplish many things and often might have done so with unpopularity.

Identify Strengths and Weaknesses Within the Company. Using the information you gathered in step one, continue your case study analysis by examining and making a list of the value creation functions of the company. For example, the company may be weak in product development, but strong in marketing.

Strengths

• Long and well established company
• Brand Recognition
• Well known for a high quality product
• Modern Fleets
• Solid financials through the years
• Innovative/ground breaking
• Not afraid to take risks
• Ability to create new offerings
• Industry leading loyalty program

Weaknesses

• Negative affiliation with 9/11 terrorism and David Dao incident
• Strong Competition
• Strong Unions
• Lack of New innovation
• Company policies
• High Debt Burden
• Bad Acquisitions
• Cost Structure
• Management

Gather Information on the External Environment. The third step in a case study analysis involves identifying opportunities and threats within the company’s external environment. Special items to note include competition within the industry, bargaining powers, and the threat of substitute products.

Opportunities within the company’s external environment.

• New Technology
• Online Marketing
• Innovation
• Emerging Markets
• International Expansion

Threats within the company’s external environment.

• Bad On-Time reliance
• High fuel costs
• Bad Economy
• Unknown/Uncertainty of the future
• Other airlines
• Emission regulations
• Government Regulations
• Unions
• Other airlines not overselling flights/bumping less

Analyze Your Findings. Using the information in steps two and three, you will need to create an evaluation for this portion of your case study analysis. Compare the strengths and weaknesses within the company to the external threats and opportunities. Determine if the company is in a strong competitive position and decide if it can continue at its current pace successfully.

Even though United has brand recognition and in a well-established company in the day and age of price watching and social media that is not enough. United also has a tarnished brand recognition with David Dao and if you google ‘United Airlines forces passenger off plane” many results occur. It would be hard to feel that United cared about you as a customer. Also, if you needed to get to your destination you would be willing to pay extra to make sure you would not have to give up your seat.

Identify Corporate Level Strategy. To identify a company’s corporate level strategy for your case study analysis, you will need to identify and evaluate the company’s mission, goals, and corporate strategy. Analyze the company’s line of business and its subsidiaries and acquisitions. You will also want to debate the pros and cons of the company strategy.

United Airlines mission statement is connecting people. Uniting the world. Every day we help unite the world by connecting people to the moments that matter most.

United Airlines goals: More on-time arrivals, fewer cancellations, reducing carbon footprint.

United Customer Commitment: Advise about lowest available fares, notify customers of known delays, cancellations and diversion. Deliver baggage on time. Allow reservations to be canceled for a certain period after purchase. Provide prompt ticket refunds. Properly accommodate passengers with disabilities and special needs, meet customers’ essential needs during lengthy tarmac delays, treat passengers fairly and consistently in the case of over sales, disclose travel itinerary, cancellation policies, frequent flyer rules and aircraft configurations, notify customers about travel itinerary changes in a timely manner, ensure responsiveness to customer complaints, provide service to mitigate inconveniences resulting from cancellations and misconnections.