JetBlue Hits Turbulence
1.What types of information systems and business functions are described in this case? The information systems that were described in this case were as follows: -Transaction processing system (TPS). Automated key processes such as; ticket sales, baggage handling, and reservation system. -Management information system (MIS). The system used for managing planes, crews and scheduling was run by an outside contractor. -Communication System was in place but was not adequate in maintaining stability and proven to be unsuccessful, during this crisis.
2.What is JetBlue’s business model? How do its information systems support this business model? To provide top-notch service at an affordable low price was JetBlue’s business model. JetBlue maintained a simple atmosphere; employing non-union workers, flying only the Airbus A320 permitting standardized flight operations and maintenance procedures, and updating its business processes to the minimum level of efficiency. The management information systems were also ran by one outside contractor, allowing a small staff that permitted in-house development of systems instead of relying on outsourcing or consultants. Lastly, the company spent 1.5 percent of its revenue on information technology, unlike their competitor’s investment of 5 percent. 3.What was the problem experienced by JetBlue in this case? What management, organization, and technology factors were responsible for the problem? JetBlue’s spending of only 1.5 percent of its revenue on information technology compared to 5 percent by competitors, was a bad decision. Increasing the spending on IT would have been a proven investment, reflecting greatly in a crisis such as this ice storm. Cutbacks in spending are appropriate at times however the following problems are a result of the lack of IT within the JetBlue company: -TPS used by JetBlue was adequate for normal operating conditions, however when flights were cancelled the...
...Individual Case Analysis
JetBlue Headquarters, Forest Hills, New York.
JetBlue Airways, an American low-cost airline, headquartered in Forest Hills, New York started flying out of John F. Kennedy Airport in February of 2000.JetBlue started by following Southwest’s approach of offering low-cost travel, setting themselves apart from their competitor’s through the amenities they offer like in-flight entertainment, flat-screen TV’s on each seat, live digital satellite radio for all passengers, one-way tickets and no weekend stay over requirements to receive their cheaper fares.
The case of JetBlue illustrates JetBlue’s plan to succeed, and be among the few airlines that have had longevity. Dave Neeleman was the founder of Morris Air, which was later purchased by Southwest Airlines in the mid 1990s. Neeleman models the operation of JetBlue after Southwest Airlines, in doing so JetBlue only operates one type of airline, the Airbus A 320, as a result they will only need to train and FAA certifies their crew of pilots, flight attendants and mechanics on only that kind of plane. JetBlue also operates from smaller airports instead of the busy international airports, in an effort to save on landing fees there’s also a lot less traffic, so airlines are easier to turn. JetBlue is also able to save on flight cost due to the fact that they operate newer airlines that require less maintenance, and a nonunionized...
1. A need is a state of felt deprivation that includes basic physical needs for food, clothing, warmth, and safety; social needs for belonging and affection; and individual needs for knowledge and self-expression. Marketers did not create these needs; they are a basic part of the human makeup (Kotler and Armstrong, page 6). A want is the form human needs take as they are shaped by culture and individual personality. Wants are shaped by one’s society and are described in terms of objects that will satisfy those needs (Kotler and Armstrong, page 6). A demand is human wants that are backed by buying power (Kotler and Armstrong, page 6). JetBlue customers demonstrate the physical need for snacks and beverages by showing the company that they enjoy the free snacks and beverages that are being offered by the company. The customers may want the brand name snacks and beverages and the demand is demonstrated by the customer having the buying power to purchase Dunkin Donuts coffee, Terra Clue Chips and Chocobilly cookies. JetBlue customers also demonstrate the need to be comfortable while flying by wanting extra leg room and more space. The demand is demonstrated by the customer having the buying power to pay an extra $10 dollars to reserve one of JetBlue’s “Even More Legroom” seats, which offers more space and a flatter recline position. Another example JetBlue customers demonstrate is the need to be entertained...
A CaseStudy of JetBlue and Human Resources Management
Building any company from the ground up is difficult, but building an airline from the beginning is an enormous undertaking. From decisions on what routes to fly, the types of airliners to use, and the prices to charge, the founders of JetBlue Airways had their work cut out for them. The human resources department of any company is one of the most integral parts of a business. Without the right people to do the right job a business is doomed to fail. What goes into finding the right people for the right job? What must be considered during recruitment and the interview process? From the start, companies must be mindful of federal employment laws.
JetBlue, like most other employers, is subject to federal employment laws. When recruiting potential employees, interviewing possible employees, and even when offering salaries to these potential employees, JetBlue must be conscious of these laws. While all federal employment laws must be abided by, the three that will be discussed here are: 1). Age Discrimination in Employment Act, 2). Americans with Disabilities Act of 1990, and 3). Pregnancy Discrimination Act of 1978. All three of these laws deal with discrimination. What exactly is discrimination? Discrimination is when a person or a group of people are shown favoritism over another person or group of people based on any number of...
...JetBlue Airways: CaseStudy
1. Draw up a SWOT analysis and describe JetBlue’s Strategy.
* Low cost airline fares and operations
* Experienced management
* Creating demand in under-served markets
* Customer service oriented (i.e. leather seats with more legroom, in-flight entertainment, better refreshments than competition)
* Political backing and support
* Competitive pay and benefits increasing employee retention
* Sustaining low cost fares and operations with a down economy
* Unpredictability of the market
* Political backing and support
* Does not run service to all major airports
* Increased destinations (inside and outside the U.S.)
* Growth and increased profitability
* Make competition irrelevant
* International growth
* Airport security causing travelers to use other means
* Unpredictable fuel prices
* Competitors using JetBlue strategies to provide similar service
* New competition
* Recession / Depression
* Unsustainable growth rate
* Weather / Natural disasters
2. What are the dangers of rapid growth? Or not growing fast enough?
* Overburdening employees which creates excessive turnover
* Not enough overhead to meet consumer demand
* Product quality and service decreases
* Competitors learning from your...
...ALDUS CORPORATION CASESTUDY
Western Governors University
This essay will examine in detail the human resource strategies, policies, and practices that were developed by Ann Rhoades who was the Executive Vice President of People at JetBlue Airways. Ms. Rhoades was very innovative with the development of the new HR policies, which up to that time had never been implemented by any other startup airline organization. Along with the strategies, policies, and practices, there were ﬁve core values that were also established. These values provided an overarching vision for JetBlue Airways in order to direct all organization activities whether internal or external. The five core values were safety, caring, integrity, fun, and passion, which from JetBlue Airway’s management viewpoint was that if employees were happy then that would lead to greater successful recruitment and greater employee retention rates, which would potentially reduce or eliminate the likelihood of a union organization attempting to unionize the company.
Three National Equal Employment Opportunity Laws
JetBlue Airways hiring practices were compliant with the equal employment opportunity laws, which included the following:
• Title VII of the Civil Rights Act of 1964 Title VII, which prohibits employment discrimination based on race, color, religion, sex, or national origin
...JetBlue Airways Case 20
On February 11, 2000, JetBlue Airways launched its first ceremonial flight from New York City to Buffalo, NY, making John F. Kennedy International Airport its official hub. David Neeleman founded JetBlue after raising $130 million from investors and also contributing $5 million of his own money. Neeleman’s idea was to start a company that would combine the low fares of a discount airline carrier with the comforts of a small cozy den in people’s homes. By April, 2002, the airline company had flown over five million passengers, sold public stock at a starting price of $27 a share and acquired LiveTV, LLC, its provider of in-flight satellite entertainment systems. Despite its early promise and strong organizational culture, JetBlue failed to deliver value to its stockholders over a five year period ending in 2006. Because of this, JetBlue was forced to improve their business strategy and make changes that would save their organization from going under.
When JetBlue began its operations in 2000, they realized that it would be nearly impossible to compete with Southwest as the leader of low cost providers. JetBlue also realized that it was crucial to distinguish themselves from other major competitors such as US Airways, American and Continental because they could not compete at their price level because of a lack of name recognition and the loyal customer base advantage that these companies already had. These factors led...
Intel® Xeon® Processor E5649
Cloud Computing and Virtualization
Using cloud technology to deliver quality taxi services
Taiwan Taxi makes use of a cloud computing system powered by Intel® Xeon® processors to develop a variety of
IT services that provide passengers and drivers with a comfortable and safe riding experience, challenging
stereotypes about taxi services
• Ensure smooth operation and efficiency of IT framework. Proper maintenance of
backend systems and supporting computers should be monitored all the time despite limited
• Simplify existing systems. Ensure efficient integration of a large number of systems onto a
small number of physical computers to cut down on maintenance time.
• Find stable hardware to support rolling out of new IT services. IT facilities being set
up should be supported by necessary hardware to keep with the rapid pace of software
Taiwan Taxi is a publicly-listed
company established in 2002.
It places great importance on
the commuting environment of
its drivers and passengers, and
strives to actively reform its
operations to create a safe and
comfortable commute for all. By
providing innovative IT services,
Taiwan Taxi continuously
improves its service quality
and brand image. Taiwan Taxi
has become a high-technology
passenger service enterprise,
delivering quality taxi services to
passengers all over Taiwan....
...application of the two methods, free cash flow to firm is preferred to price start-up firm or new listing firm as their capital structure is not stable and may be varied proportionally. Free cash flow to equity, on the other hand, is suitable for those maturity firms such as DELL, BHP in their industry.
In this case, JetBlue is just considering going public and its capital is almost fully funded by debt, therefore free cash flow to firm is the better valuation method compared with free cash flow to equity.
3.2 Relative Valuation Method
Relative valuation method is a kind of technique to price a firm’s value, share price or value of an investment. The key assumption under this method is that similar assets are identified in similar prices which indicate the market is comparable.
The general procedures for share pricing using this technique are select similar company, choose an appropriate multiplier, calculate the estimated share price and finally adjust this price by some specific benchmarks.
In addition, others financial ratios can also be used to price a company’s share, for example, Price Earning ratio, Return on Equity, Price to Book ratio and so on.
In this case, JetBlue belongs to low-fare airline companies and there are several similar competitors such as Southwest, WestJet, Alaska Air whose financial performances are comparable with JetBlue. Therefore, the techniques like P/E ratio, EBIT multiple can be used to price its share as...