Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation
The U.S. air transportation system flies high on some indicators, mostly involving capacity to take to the air, but lands low on others, mostly involving ground facilities and processes. This note provides an overview of the history and current state of air transportation in the U.S., covering industry costs; types of airlines, including passenger and cargo (e.g., Delta, Southwest, Alaska, and Frontier); airport issues; and the role of technology. It reviews some opportunities for innovation that will solve the pain points and bottlenecks facing the system and outlines high-priority policy areas. It becomes clear that individual airlines have often been managed back to health and focus on innovation, but the overall system itself and its governmental connections need attention, including the desire for NextGen air traffic control and revisiting Open Skies agreements.
Swot Analysis of "Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation" written by Rosabeth Moss Kanter, Aditi Jain, Ai-Ling Jamila Malone includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Air Transportation facing as an external strategic factors. Some of the topics covered in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation casestudy better are - – geopolitical disruptions, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google,
technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Air Transportation, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation can be done for the following purposes –
1. Strategic planning using facts provided in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation case study
2. Improving business portfolio management of Air Transportation
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 Air Transportation
Strengths Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Air Transportation in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation Harvard Business Review case study are -
Successful track record of launching new products
– Air Transportation has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Air Transportation 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation firm has clearly differentiated products in the market place. This has enabled Air Transportation to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Air Transportation to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Air Transportation is present in almost all the verticals within the industry. This has provided firm in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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.
High switching costs
– The high switching costs that Air Transportation 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.
Training and development
– Air Transportation has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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.
Superior customer experience
– The customer experience strategy of Air Transportation in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Air Transportation is one of the leading recruiters in the industry. Managers in the Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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
– Air Transportation has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Air Transportation to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Air Transportation 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.
Organizational Resilience of Air Transportation
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Air Transportation does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Air Transportation 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 Rosabeth Moss Kanter, Aditi Jain, Ai-Ling Jamila Malone 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.
Weaknesses Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation are -
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 Air Transportation supply chain. Even after few cautionary changes mentioned in the HBR case study - Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Air Transportation vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation, is just above the industry average. Air Transportation 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.
Capital Spending Reduction
– Even during the low interest decade, Air Transportation 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 cash cycle compare to competitors
Air Transportation 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, Rosabeth Moss Kanter, Aditi Jain, Ai-Ling Jamila Malone suggests that, Air Transportation 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.
Skills based hiring
– The stress on hiring functional specialists at Air Transportation 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.
Interest costs
– Compare to the competition, Air Transportation has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Need for greater diversity
– Air Transportation 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Air Transportation is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Air Transportation 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 - Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation, 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.
Opportunities Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation | 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Air Transportation is facing challenges because of the dominance of functional experts in the organization. Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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.
Better consumer reach
– The expansion of the 5G network will help Air Transportation to increase its market reach. Air Transportation 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 Leadership & Managing People industry, but it has also influenced the consumer preferences. Air Transportation can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Air Transportation in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
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 Air Transportation in the consumer business. Now Air Transportation can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Air Transportation 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.
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. Air Transportation can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Air Transportation 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Air Transportation 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, Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Air Transportation 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.
Buying journey improvements
– Air Transportation can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Air Transportation can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Air Transportation 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 Air Transportation to hire the very best people irrespective of their geographical location.
Threats Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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.
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. Air Transportation can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Air Transportation is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Air Transportation 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.
High dependence on third party suppliers
– Air Transportation 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.
Environmental challenges
– Air Transportation 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. Air Transportation can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Air Transportation needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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 Air Transportation business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Air Transportation 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 Leadership & Managing People industry regulations.
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.
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 Air Transportation in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation .
Stagnating economy with rate increase
– Air Transportation 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.
Weighted SWOT Analysis of Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Flying High, Landing Low: Strengths and Challenges for U.S. Air Transportation 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 Air Transportation needs to make to build a sustainable competitive advantage.
