Essay on Westjet: Building a High-engagement Culture

3340 Words Mar 13th, 2014 14 Pages
WestJet: Building a High-Engagement Culture

Executive Summary
WestJet is facing an urgent problem. The pilots’ contract expires in two weeks’ time and the pilots are unhappy with the offer that has been presented. This has created conflict between management and the pilots as the pilots feel that too many things are being taken away. If a quick agreement is not reached, flights would be grounded, which would impact the bottom line and negatively affect culture. A collaborating approach will need to be applied in order to come to a swift resolution.
WestJet is also facing a strategic problem, the longer term impact that growth is having on WestJet’s culture. WestJet’s success and competitive advantage have been a direct result
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International market share.
Threats
Losing culture due to growth; lose market share.
No longer an upstart, becoming more bureaucratic.
Cost structure (fuel, labour, airport).
Cheap flights for people who live close to the US border.
Demand heavily relies on economy.
Rapid advances in technology, specifically plane design. Could render WestJet’s fleet obsolete or provide competitive advantage to other airlines.
PEST Analysis
Assumption: analysis based on WestJet’s current situation.
Political
Regulation changes could affect the competitive environment.
Government influence, especially with respect to taxes.
Costs associated with international regulations.
Economic
Recession likely means decrease in passenger numbers.
Oil prices drastically affect fuel costs.
Low interest rate market could mean that people have more disposable income to spend on travel.
Are there any other low cost airlines?
Lower labour costs in emerging markets.
Potential lower availability of capital due to downturn in capital markets.
Social
Demographics - More baby boomers retiring (snow birds); high disposable income.
Terrorism - Reluctance to fly (after 9/11). Tighter security measures (passports required).
Threat of organized labour (unions).
Green movement (carbon footprint, reduce greenhouse emissions).
Technological
Technology is becoming cheaper and cheaper.
How much to invest in R&D?
E-commerce for selling tickets is well established so less

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