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 - – wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs,
there is increasing trade war between United States & China, increasing energy prices, 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 -
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.
Ability to recruit top talent
– Deicing Logan is one of the leading recruiters in the industry. Managers in the JetBlue Airways: Deicing at Logan Airport are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
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.
Cross disciplinary teams
– Horizontal connected teams at the Deicing Logan 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.
Analytics focus
– Deicing Logan 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 Douglas Fearing, Robert S. Huckman 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.
Diverse revenue streams
– Deicing Logan is present in almost all the verticals within the industry. This has provided firm in JetBlue Airways: Deicing at Logan Airport 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.
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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Deicing Logan digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Deicing Logan 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.
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.
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.
Highly skilled collaborators
– Deicing Logan 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 JetBlue Airways: Deicing at Logan Airport HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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 -
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.
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.
Low market penetration in new markets
– Outside its home market of Deicing Logan, firm in the HBR case study JetBlue Airways: Deicing at Logan Airport needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Deicing Logan 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Douglas Fearing, Robert S. Huckman suggests that, Deicing Logan 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.
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.
Products dominated business model
– Even though Deicing Logan 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: Deicing at Logan Airport should strive to include more intangible value offerings along with its core products and services.
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.
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.
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.
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.
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 -
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.
Manufacturing automation
– Deicing Logan can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Deicing Logan can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Deicing Logan has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study JetBlue Airways: Deicing at Logan Airport - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Deicing Logan to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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.
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.
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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Deicing Logan can use these opportunities to build new business models that can help the communities that Deicing Logan operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
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.
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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Deicing Logan 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.
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.
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 -
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.
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 Deicing Logan.
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. Deicing Logan needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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 Deicing Logan in the Technology & Operations sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Deicing Logan with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 .
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.
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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Deicing Logan 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: Deicing at Logan Airport .
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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Deicing Logan can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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.