B. PROBLEM DEFINITION
1. State the problem symptoms: Customer service is JetBlue’s opportunity as well as its strength. JetBlue is in danger of losing sight of its original customer service foundation. Without a strategy focusing on customer service as a priority, the initial success resulting from JetBlue’s commitment to exceeding customer’s expectations is in jeopardy. When planning objectives for accomplishing strategic goals, each objective should be built around customer satisfaction.
2. Define what is intended the probable result of not taking action to correct the problem: JetBlue began by being innovative and should continue to find ways to do this even as they make plans to boost profits. Continuing to build customer trust while increasing brand recognition is one way to sustain and increase profits. JetBlue aims to maintain its standing amongst LCCs while increasing its foothold in the FSA market.
3. Examine the causes of the problem: The problem is that JetBlue focused on expansion during its’ initial success. Profits realized at this time were used to acquire a larger fleet, expand routes, enlarge staff and increase terminal space. Seemingly, the primary focus was rapid growth, with an assumption that it would be rewarded with future profits. When profits began to decline, JetBlue chose to focus on competition making changes that would allow them to compete more directly with larger airlines. JetBlue became vulnerable to its competition when management made the choice to shift focus from customer service to expansion.
A. ALTERNATIVE SOLUTIONS
1. An alternate strategy for JetBlue to return to profitability is to expand the market it services. A large part of JetBlue’s business is transporting customers from cold cities to warm ones. By expanding more services to Latin America and the Caribbean the airline can be the number one air carrier for the region with nonstop flights from many US cities. Selecting the destinations would be the key to the success of expanding the services though. JetBlue should focus on beautiful Caribbean locations where tourists desire to go with an increased number of flights during the winter months when more Americans are travelling to warm tropical regions (CAPA, 2013).
Strengths of expanding to the Caribbean and Latin American cities include a low operating cost (cost per available seat mile) which is one of the lowest reported among US airlines. With popular tourists destinations selected the airline can expect high aircraft utilization and low distribution costs as they fill as many seats as possible on each flight. The airline already has a high brand awareness with high customer satisfaction so adding additional destinations to cities that Americans want to travel to will keep customer satisfaction high (Bennett, Gruenstein, Raman, Sachse, & Walsh, 2010).
Weaknesses of adding additional destinations to the Caribbean and Latin America include the potential for higher...