Case Study Description of JetBlue Airways: Deicing at Logan Airport
To maximize their effectiveness, color cases should be printed in color.The case explores a deicing capacity expansion decision made by JetBlue at Boston Logan International Airport in the summer of 2010. The need for capacity expansion was driven by significant challenges faced during the previous winter combined with substantial scheduled growth for the upcoming winter.
Swot Analysis of "JetBlue Airways: Deicing at Logan Airport" written by Douglas Fearing, Robert S. Huckman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Deicing Logan facing as an external strategic factors. Some of the topics covered in JetBlue Airways: Deicing at Logan Airport case study are - Strategic Management Strategies, Business processes, Financial management, Manufacturing, Marketing, Personnel policies, Strategic planning, Time management and Technology & Operations.
Some of the macro environment factors that can be used to understand the JetBlue Airways: Deicing at Logan Airport casestudy better are - – there is backlash against globalization, technology disruption, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, geopolitical disruptions, increasing commodity prices, challanges to central banks by blockchain based private currencies,
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, etc
Introduction to SWOT Analysis of JetBlue Airways: Deicing at Logan Airport
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in JetBlue Airways: Deicing at Logan Airport case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Deicing Logan, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Deicing Logan 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: Deicing at Logan Airport can be done for the following purposes –
1. Strategic planning using facts provided in JetBlue Airways: Deicing at Logan Airport case study
2. Improving business portfolio management of Deicing Logan
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Deicing Logan
Strengths JetBlue Airways: Deicing at Logan Airport | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Deicing Logan in JetBlue Airways: Deicing at Logan Airport Harvard Business Review case study are -
Innovation driven organization
– Deicing Logan is one of the most innovative firm in sector. Manager in JetBlue Airways: Deicing at Logan Airport Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Deicing Logan has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study JetBlue Airways: Deicing at Logan Airport - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Deicing Logan in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Deicing Logan 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.
High brand equity
– Deicing Logan has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Deicing Logan to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Deicing Logan
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Deicing Logan does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Deicing Logan 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 Deicing Logan is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in JetBlue Airways: Deicing at Logan Airport Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Deicing Logan is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Technology & Operations industry
– JetBlue Airways: Deicing at Logan Airport firm has clearly differentiated products in the market place. This has enabled Deicing Logan to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Deicing Logan to invest into research and development (R&D) and innovation.
Training and development
– Deicing Logan has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in JetBlue Airways: Deicing at Logan Airport 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.
Successful track record of launching new products
– Deicing Logan has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Deicing Logan 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 Deicing Logan in the sector have low bargaining power. JetBlue Airways: Deicing at Logan Airport has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Deicing Logan to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses JetBlue Airways: Deicing at Logan Airport | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of JetBlue Airways: Deicing at Logan Airport are -
Lack of clear differentiation of Deicing Logan products
– To increase the profitability and margins on the products, Deicing Logan needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study JetBlue Airways: Deicing at Logan Airport, it seems that the employees of Deicing Logan 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.
Aligning sales with marketing
– It come across in the case study JetBlue Airways: Deicing at Logan Airport 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 JetBlue Airways: Deicing at Logan Airport can leverage the sales team experience to cultivate customer relationships as Deicing Logan is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study JetBlue Airways: Deicing at Logan Airport, is just above the industry average. Deicing Logan needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the JetBlue Airways: Deicing at Logan Airport 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 Deicing Logan has relatively successful track record of launching new products.
High cash cycle compare to competitors
Deicing Logan 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.
No frontier risks strategy
– After analyzing the HBR case study JetBlue Airways: Deicing at Logan Airport, it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
High operating costs
– Compare to the competitors, firm in the HBR case study JetBlue Airways: Deicing at Logan Airport has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Deicing Logan 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Deicing Logan is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Deicing Logan needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Deicing Logan to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As JetBlue Airways: Deicing at Logan Airport HBR case study mentions - Deicing Logan 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.
Skills based hiring
– The stress on hiring functional specialists at Deicing Logan 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.
Opportunities JetBlue Airways: Deicing at Logan Airport | 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: Deicing at Logan Airport are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Deicing Logan 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. Deicing Logan 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.
Buying journey improvements
– Deicing Logan can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. JetBlue Airways: Deicing at Logan Airport suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
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 Deicing Logan 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, Deicing Logan 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: Deicing at Logan Airport, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Deicing Logan can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Deicing Logan 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.
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 Deicing Logan in the consumer business. Now Deicing Logan can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Deicing Logan has opened avenues for new revenue streams for the organization in the industry. This can help Deicing Logan to build a more holistic ecosystem as suggested in the JetBlue Airways: Deicing at Logan Airport case study. Deicing Logan can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Deicing Logan to increase its market reach. Deicing Logan will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Deicing Logan can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Deicing Logan 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.
Building a culture of innovation
– managers at Deicing Logan 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 Technology & Operations segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Deicing Logan in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Threats JetBlue Airways: Deicing at Logan Airport 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: Deicing at Logan Airport are -
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.
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: Deicing at Logan Airport, Deicing Logan may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Environmental challenges
– Deicing Logan 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. Deicing Logan can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
High dependence on third party suppliers
– Deicing Logan 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.
Stagnating economy with rate increase
– Deicing Logan 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Deicing Logan in the Technology & Operations industry. The Technology & Operations 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.
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. Deicing Logan 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.
Increasing wage structure of Deicing Logan
– 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 Deicing Logan.
Shortening product life cycle
– it is one of the major threat that Deicing Logan is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Deicing Logan needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Technology & Operations industry regulations.
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.
Consumer confidence and its impact on Deicing Logan 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.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Deicing Logan business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of JetBlue Airways: Deicing at Logan Airport 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: Deicing at Logan Airport 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: Deicing at Logan Airport 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: Deicing at Logan Airport 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: Deicing at Logan Airport 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 Deicing Logan needs to make to build a sustainable competitive advantage.