JetBlue Case Analysis
04-78-651-03 Business Strategy
Case Analysis: JetBlue Airways: Managing Growth
Major issue JetBlue, already a successful airline company, is considering a proper way to allocate its existing resources between the long-haul and short-haul routes in order to control or even reduce the costs within its capability. To be specific, how to reduce costs across E190 and A320 without damaging the stakeholders’ interests and customer satisfaction is a key issue for JetBlue’s top management. In addition, due to the introduction of E190, problems arise, including how to allocate these two types of aircraft, how to train the pilots, how to meet the expectation of existing customers, and how to integrate the new airplane and so on.
Internal analysis
The VRINE Model The VRINE model is a useful tool in doing a company’s internal analysis. We analyze JetBlue in details respectively from these dimensions as following:
Value
JetBlue was founded in 1999 by David Neeleman and started operations with 10 airplanes as a low-cost carrier in 2000. It provides low prices and comfortable services for passengers, which helps JetBlue establish its own customer groups. From 2003 to 2006, JetBlue utilized its limited resources created increasing operation revenues each year, respectively, $998 million, $1,265 million, $1,701million, and $2,363 million. It only took JetBlue four years to become one of the largest airlines by operating revenues exceeding $1 billion in 2004. It is obvious that JetBlue is a valuable company.
Rarity
Rarity means that the resources are scarce relative to demand. As for JetBlue, it successfully differentiates itself from competitors by offering high standards service and reliability at a discounted price. JetBlue combined the model of LCCs and legacy carrier to its own operations. Compared to Southwest, JetBlue provides passengers with comfortable
Case Analysis: JetBlue Airways: Managing Growth
Major issue JetBlue, already a successful airline company, is considering a proper way to allocate its existing resources between the long-haul and short-haul routes in order to control or even reduce the costs within its capability. To be specific, how to reduce costs across E190 and A320 without damaging the stakeholders’ interests and customer satisfaction is a key issue for JetBlue’s top management. In addition, due to the introduction of E190, problems arise, including how to allocate these two types of aircraft, how to train the pilots, how to meet the expectation of existing customers, and how to integrate the new airplane and so on.
Internal analysis
The VRINE Model The VRINE model is a useful tool in doing a company’s internal analysis. We analyze JetBlue in details respectively from these dimensions as following:
Value
JetBlue was founded in 1999 by David Neeleman and started operations with 10 airplanes as a low-cost carrier in 2000. It provides low prices and comfortable services for passengers, which helps JetBlue establish its own customer groups. From 2003 to 2006, JetBlue utilized its limited resources created increasing operation revenues each year, respectively, $998 million, $1,265 million, $1,701million, and $2,363 million. It only took JetBlue four years to become one of the largest airlines by operating revenues exceeding $1 billion in 2004. It is obvious that JetBlue is a valuable company.
Rarity
Rarity means that the resources are scarce relative to demand. As for JetBlue, it successfully differentiates itself from competitors by offering high standards service and reliability at a discounted price. JetBlue combined the model of LCCs and legacy carrier to its own operations. Compared to Southwest, JetBlue provides passengers with comfortable