The Battle for Logan Airport: JetBlue Airways versus American Airlines SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Battle for Logan Airport: JetBlue Airways versus American Airlines
JetBlue Airways is only five days away from entering the Boston market by establishing a presence at Logan International Airport. The VP of strategy for JetBlue considers the range of potential competitive responses that he might expect from such established airlines as American Airlines, so he can anticipate and prepare. As the largest major carrier operating out of Logan, American had more at risk than the other major carriers and had not yet decided how best to compete with the LCCs. How would American respond?
Authors :: Jared Harris, Mike Lenox, Rebecca Goldberg
Swot Analysis of "The Battle for Logan Airport: JetBlue Airways versus American Airlines" written by Jared Harris, Mike Lenox, Rebecca Goldberg includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Logan Jetblue facing as an external strategic factors. Some of the topics covered in The Battle for Logan Airport: JetBlue Airways versus American Airlines case study are - Strategic Management Strategies, Growth strategy, Marketing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Battle for Logan Airport: JetBlue Airways versus American Airlines casestudy better are - – increasing energy prices, increasing commodity prices, technology disruption, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of The Battle for Logan Airport: JetBlue Airways versus American Airlines
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Battle for Logan Airport: JetBlue Airways versus American Airlines case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Logan Jetblue, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Logan 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines can be done for the following purposes –
1. Strategic planning using facts provided in The Battle for Logan Airport: JetBlue Airways versus American Airlines case study
2. Improving business portfolio management of Logan Jetblue
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Logan Jetblue
Strengths The Battle for Logan Airport: JetBlue Airways versus American Airlines | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Logan Jetblue in The Battle for Logan Airport: JetBlue Airways versus American Airlines Harvard Business Review case study are -
Highly skilled collaborators
– Logan Jetblue has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in The Battle for Logan Airport: JetBlue Airways versus American Airlines HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Logan Jetblue has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Logan Jetblue to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Logan Jetblue has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Logan 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.
Operational resilience
– The operational resilience strategy in the The Battle for Logan Airport: JetBlue Airways versus American Airlines 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.
Strong track record of project management
– Logan 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.
Cross disciplinary teams
– Horizontal connected teams at the Logan 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.
High switching costs
– The high switching costs that Logan 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.
Superior customer experience
– The customer experience strategy of Logan Jetblue in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Logan Jetblue is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Jared Harris, Mike Lenox, Rebecca Goldberg can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Logan Jetblue digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Logan Jetblue has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Logan 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 Logan Jetblue is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Battle for Logan Airport: JetBlue Airways versus American Airlines Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Logan Jetblue has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Battle for Logan Airport: JetBlue Airways versus American Airlines Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses The Battle for Logan Airport: JetBlue Airways versus American Airlines | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Battle for Logan Airport: JetBlue Airways versus American Airlines are -
Aligning sales with marketing
– It come across in the case study The Battle for Logan Airport: JetBlue Airways versus American Airlines that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case The Battle for Logan Airport: JetBlue Airways versus American Airlines can leverage the sales team experience to cultivate customer relationships as Logan Jetblue is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Logan 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 star products
– The top 2 products and services of the firm as mentioned in the The Battle for Logan Airport: JetBlue Airways versus American Airlines HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Logan Jetblue has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Logan 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Battle for Logan Airport: JetBlue Airways versus American Airlines, it seems that the employees of Logan Jetblue don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Increasing silos among functional specialists
– The organizational structure of Logan Jetblue is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Logan Jetblue needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Logan Jetblue to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Logan 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.
Products dominated business model
– Even though Logan 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 - The Battle for Logan Airport: JetBlue Airways versus American Airlines should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As The Battle for Logan Airport: JetBlue Airways versus American Airlines HBR case study mentions - Logan Jetblue takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of Logan Jetblue, firm in the HBR case study The Battle for Logan Airport: JetBlue Airways versus American Airlines needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Logan 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.
Opportunities The Battle for Logan Airport: JetBlue Airways versus American Airlines | 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines are -
Building a culture of innovation
– managers at Logan 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 Strategy & Execution segment.
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. Logan Jetblue can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Logan Jetblue to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Logan 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, The Battle for Logan Airport: JetBlue Airways versus American Airlines, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Logan 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. Logan 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
– Logan 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Logan Jetblue can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Logan Jetblue in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Logan 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 Logan Jetblue to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Logan Jetblue can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Logan Jetblue is facing challenges because of the dominance of functional experts in the organization. The Battle for Logan Airport: JetBlue Airways versus American Airlines 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Logan Jetblue in the consumer business. Now Logan Jetblue can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Logan Jetblue can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats The Battle for Logan Airport: JetBlue Airways versus American Airlines External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Battle for Logan Airport: JetBlue Airways versus American Airlines are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Logan Jetblue in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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. Logan Jetblue needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Environmental challenges
– Logan 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. Logan Jetblue can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Stagnating economy with rate increase
– Logan Jetblue can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Logan Jetblue with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Logan Jetblue is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Logan Jetblue in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing wage structure of Logan 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 Logan Jetblue.
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. Logan 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.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Logan 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines, Logan 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 Strategy & Execution .
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Logan Jetblue can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of The Battle for Logan Airport: JetBlue Airways versus American Airlines 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines 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 The Battle for Logan Airport: JetBlue Airways versus American Airlines 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 Logan Jetblue needs to make to build a sustainable competitive advantage.
