Jetblue: Managing Growth Essay example

1254 Words Apr 27th, 2011 6 Pages
JetBlue
Managing Growth

JetBlue Case JetBlue’s main strategy is to be a low cost carrier (LCC) and use differentiation as a competitive advantage. The main problem that concerns this case is that JetBlue has the need for slower capacity growth but the exact size of the cuts from each of the airlines’ two aircrafts was far from obvious. The contents of this case analysis will show how they managed to get to this point through the use of business strategy tools. Also I will give some recommendations on how to resolve the issue at hand. First, let’s take a look at the SWOT analysis (strengths, weaknesses, opportunities, threats). This strategic planning method should give us an overall understanding of all the aspects of JetBlue
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For JetBlue, this meant there was an opportunity to gain and retain new customers, again by offering low prices. On the other hand, fuel prices have been rising which has been a huge concern. Socioculural: There is a greater consumer awareness of JetBlue and consumers want to be entertained. The addition of the tv’s to each individual seat played to that need of being entertained. Technological: The lower fares that JetBlue offered were supported by providing incentives to the customers to book their flights over the internet. For the people who wanted book their flights ovr the phone there were agents who worked part time from their homes. This was a huge cost saver for JetBlue. Environmental: The weather is always a huge concern for JetBlue. Flight delays and cancellations lead to disgruntled customers and its tough to get them to trust your airline again (i.e. the Valentines Day Crisis). Legal: The non skid floors on the E190’s ended up doing more harm for the health and safety of the employees because they were used to the sliding the bags instead of picking them up. This lead to more injuries which in turn leads to more Workers Compensation expenses. Scope clauses in the Pilots’ contracts limited the number and seating capacity of flights.

Next, we’ll take a look at the Porter’s Five Forces model (micro-environment) to determine the competitive intensity of competitors and

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