JetBlue Airways: A New Beginning SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of JetBlue Airways: A New Beginning
JetBlue Airways grew rapidly from its founding in 2000, focusing on providing low-cost service to previously underserved cities, while giving passengers a high-quality experience, ("bringing humanity back to air travel"). An ice storm at JFK airport on February 14, 2007 caused 1,195 flights to be cancelled over a six day period, and stranded several planes on the taxiway for many hours. JetBlue, previously viewed as one of the best airlines (if not the best) for customer service, took extensive criticism from the public, press, and Congress. In addition, the disruptions caused by the storm cost the company over $41 million. The 2007 storm highlighted deficiencies in JetBlue's operational infrastructure. Some top-down changes were made, but disruptions caused by thunderstorms in summer 2008 demonstrated that the airline's ability to deal with irregular operations (IROPs) was woefully inadequate. The company instituted a program (IROP Integrity) that utilized the talents of more than 200 employees, from all levels, and all parts of the airline, to address these problems. This was done through process mapping, root cause analysis, and cross-discipline cooperation working on 100 projects to improve both technology and processes. In February 2010, an ice storm far worse than the 2007 event again disrupted operations at JFK. This time, the airline had to cancel far fewer flights, which were mostly done before passengers arrived at the airport, operations the next day, and the cost was a small fraction of the cost of the 2007 disruption. This case describes the IROP Integrity project-its origins, the role of executive sponsors, project leadership and organization, and the processes used to identify and carry out improvement projects. It also describes the legacy of IROP Integrity on the JetBlue organization and culture.
Authors :: David W. Hoyt, Charles A. O'Reilly, Hayagreeva Rao, Kerry J. Sulkowicz
Swot Analysis of "JetBlue Airways: A New Beginning" written by David W. Hoyt, Charles A. O'Reilly, Hayagreeva Rao, Kerry J. Sulkowicz includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Irop Jetblue facing as an external strategic factors. Some of the topics covered in JetBlue Airways: A New Beginning case study are - Strategic Management Strategies, Change management, Leadership, Leading teams, Motivating people, Organizational culture and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the JetBlue Airways: A New Beginning casestudy better are - – technology disruption, increasing transportation and logistics costs, central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices,
there is increasing trade war between United States & China, increasing energy prices, etc
Introduction to SWOT Analysis of JetBlue Airways: A New Beginning
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in JetBlue Airways: A New Beginning case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Irop Jetblue, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Irop Jetblue operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of JetBlue Airways: A New Beginning can be done for the following purposes –
1. Strategic planning using facts provided in JetBlue Airways: A New Beginning case study
2. Improving business portfolio management of Irop Jetblue
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Irop Jetblue
Strengths JetBlue Airways: A New Beginning | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Irop Jetblue in JetBlue Airways: A New Beginning Harvard Business Review case study are -
Ability to lead change in Leadership & Managing People field
– Irop Jetblue is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Irop Jetblue in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Irop Jetblue is one of the most innovative firm in sector. Manager in JetBlue Airways: A New Beginning Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Irop Jetblue has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Irop Jetblue has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Low bargaining power of suppliers
– Suppliers of Irop Jetblue in the sector have low bargaining power. JetBlue Airways: A New Beginning has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Irop Jetblue to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the JetBlue Airways: A New Beginning Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Irop Jetblue has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Irop Jetblue to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Irop Jetblue has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Learning organization
- Irop Jetblue is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Irop Jetblue is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in JetBlue Airways: A New Beginning Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Irop Jetblue are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Diverse revenue streams
– Irop Jetblue is present in almost all the verticals within the industry. This has provided firm in JetBlue Airways: A New Beginning case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to recruit top talent
– Irop Jetblue is one of the leading recruiters in the industry. Managers in the JetBlue Airways: A New Beginning are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Irop Jetblue is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses JetBlue Airways: A New Beginning | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of JetBlue Airways: A New Beginning are -
Capital Spending Reduction
– Even during the low interest decade, Irop Jetblue has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Lack of clear differentiation of Irop Jetblue products
– To increase the profitability and margins on the products, Irop Jetblue needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Irop Jetblue has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners
– Because of the regulatory requirements, David W. Hoyt, Charles A. O'Reilly, Hayagreeva Rao, Kerry J. Sulkowicz suggests that, Irop Jetblue is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
No frontier risks strategy
– After analyzing the HBR case study JetBlue Airways: A New Beginning, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Products dominated business model
– Even though Irop Jetblue has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - JetBlue Airways: A New Beginning should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Irop Jetblue has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Irop Jetblue supply chain. Even after few cautionary changes mentioned in the HBR case study - JetBlue Airways: A New Beginning, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Irop Jetblue vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study JetBlue Airways: A New Beginning, in the dynamic environment Irop Jetblue has struggled to respond to the nimble upstart competition. Irop Jetblue has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Irop Jetblue needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Need for greater diversity
– Irop Jetblue has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Opportunities JetBlue Airways: A New Beginning | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study JetBlue Airways: A New Beginning are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Irop Jetblue can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, JetBlue Airways: A New Beginning, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Irop Jetblue to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Irop Jetblue to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Irop Jetblue can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Irop Jetblue can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Irop Jetblue can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Learning at scale
– Online learning technologies has now opened space for Irop Jetblue to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Irop Jetblue can use these opportunities to build new business models that can help the communities that Irop Jetblue operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Irop Jetblue can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Irop Jetblue can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Leveraging digital technologies
– Irop Jetblue can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Irop Jetblue is facing challenges because of the dominance of functional experts in the organization. JetBlue Airways: A New Beginning case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Irop Jetblue can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Irop Jetblue has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Irop Jetblue can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats JetBlue Airways: A New Beginning External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study JetBlue Airways: A New Beginning are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Irop Jetblue can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study JetBlue Airways: A New Beginning .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Irop Jetblue needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Irop Jetblue with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Irop Jetblue
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Irop Jetblue.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study JetBlue Airways: A New Beginning, Irop Jetblue may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Shortening product life cycle
– it is one of the major threat that Irop Jetblue is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Irop Jetblue needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Irop Jetblue can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Irop Jetblue can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Irop Jetblue has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Irop Jetblue needs to keep up with the evolution of technology in the Leadership & Managing People sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Consumer confidence and its impact on Irop Jetblue demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Irop Jetblue high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Irop Jetblue will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of JetBlue Airways: A New Beginning Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study JetBlue Airways: A New Beginning needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study JetBlue Airways: A New Beginning is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study JetBlue Airways: A New Beginning is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of JetBlue Airways: A New Beginning is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Irop Jetblue needs to make to build a sustainable competitive advantage.
