Jetblue: Managing Growth
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 airlines.
SWOT Analysis
Strengths:
• High level of comfort with A320
• Consistent profit for first 5 years
• Low fares, up to 65% lower than legacy competitors
• A320 has high fuel efficiency
• With A320 as sole aircraft: standardized training and servicing process; gained flexibility in scheduling and capacity management
• Assigned seating, leather upholstery, satellite TV’s in every seat
• More long haul flights than Southwest
• Numerous overnight “red eye” flights
• Able to run reservations function significantly lower than other airlines because of part time agents working from home
• Extra leg room on A320 because of the removal of two rows
• Employees were not unionized, therefore did not face limitations on the size of planes it could use to serve on routes traditionally served by RJ’s
• More comfortable flight on the E190 than a typical RJ
• Played significant role in designing E190 interior to improve passenger comfort
• Transfers at focus cities with the E190 improves utilization of existing airport facilities, therefore increasing productivity and reducing downtime for airport crewmembers
• E190’s are utilized at least 2 more hours each day than RJ’s
• E190 made it easier to penetrate new markets
•
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 airlines.
SWOT Analysis
Strengths:
• High level of comfort with A320
• Consistent profit for first 5 years
• Low fares, up to 65% lower than legacy competitors
• A320 has high fuel efficiency
• With A320 as sole aircraft: standardized training and servicing process; gained flexibility in scheduling and capacity management
• Assigned seating, leather upholstery, satellite TV’s in every seat
• More long haul flights than Southwest
• Numerous overnight “red eye” flights
• Able to run reservations function significantly lower than other airlines because of part time agents working from home
• Extra leg room on A320 because of the removal of two rows
• Employees were not unionized, therefore did not face limitations on the size of planes it could use to serve on routes traditionally served by RJ’s
• More comfortable flight on the E190 than a typical RJ
• Played significant role in designing E190 interior to improve passenger comfort
• Transfers at focus cities with the E190 improves utilization of existing airport facilities, therefore increasing productivity and reducing downtime for airport crewmembers
• E190’s are utilized at least 2 more hours each day than RJ’s
• E190 made it easier to penetrate new markets
•