Chaos in the Skies

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Exploring Corporate Strategy
CLASSIC CASE STUDIES

Chaos in the skies – the airline industry pre- and post-9/11 Gary J. Stockport
The case provides an opportunity to analyse the Airline Industry both pre- and post-9/11. It shows how one major event in the business environment can reshape many aspects in both the macro and competitive environment of an industry. In turn this requires a reshaping of strategies for most of the individual companies in the industry in order to cope with this new environment. It also provides an opportunity for students to recommend how airlines might better plan for, as well as react to, disruptive events such as 9/11 happening in the future. ● ● ●

This is a true story from the many stories of 11 September 2001. It was a typically routine early morning flight home. United flight 890 had left Narita Japan several hours earlier, and the sun would be coming up any minute. Captain Jim Hosking was looking forward to getting home to see his wife in LA. Suddenly a message from the cockpit teleprinter came in from the US Federal Aviation Authority (FAA). Such messages were routine, advising of bad weather or maintenance requirements. However, this message was different and it read:

UA890 NRTLAX – –MESSAGE FROM CHIDD– THERE HAS BEEN A TERRORIST ATTACK AGAINST UAL AND AAL AIRCRAFT. WE ARE AT HIGH ALERT. WE ARE ADVDa THERE MAY BE ADDTLb HIGHJACKINGS IN PROGRESS. SHUT DOWN ALL ACCESS TO FLIGHT DECK. UNABLE TO ELABORATE FURTHER. a b

ADVD – Advised ADDTL – Additional

Source: USA Today, 12 August 2002, p. 1A.1

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A. Levin, M. Adams and B. Morrison, ‘Four hours of fear: decision-making in a crisis’, USA Today, 12 August 2002, p. 1A.

This case study was written by Professor Gary J. Stockport and MBA student, Norman Roberts, Graduate School of Management, University of Western Australia, Perth, Australia. It is intended as a basis for classroom discussion and not as an illustration of either good or bad management. This case was prepared entirely from published sources. © Gary J. Stockport, 2004. Not to be reproduced or quoted without permission.

Exploring Corporate Strategy by Johnson, Scholes & Whittington

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Chaos in the skies – the airline industry pre- and post-9/11

Ironically, it was the United Nations (UN) International Day of Peace. At 8:46 am, American Airlines flight 11 (a fully fuelled Boeing 767) crashed at a speed of roughly 490 miles per hour into the north side of the northern tower of the World Trade Centre (WTC) in New York, approximately between floors 94 and 98. This was the start of one of the most deadly terrorist attacks in the history of the world occurring concurrently in New York City, Washington DC and near Pittsburgh, all in the US. Four passenger jets were hijacked and three were deliberately crashed into the WTC and the Pentagon. Moments before the second crash, a passenger on Flight 175 called his father from the plane, reporting that hijackers were stabbing flight attendants in order to force the crew to open the cockpit doors. At 9:02:54 am, United Airlines flight 175 (another fully fuelled Boeing 767) crashed with a speed of about 590 miles per hour into the south side of the southern tower, banked between floors 78 and 84. Parts of the plane continued through the building at its east and north sides, falling to the ground some six blocks away. At 9:59:04 am, the south tower of the WTC collapsed and then at 10:28:31 am, the north tower collapsed. New York was the scene of a nightmare as people on fire jumped in terror from the towers just before the buildings collapsed. At the Pentagon, part of the building was destroyed in the ensuing fire. The fourth hijacked plane crashed in a Pennsylvania field after passengers and crew tried to retake control of the plane from hijackers. Casualties were in the thousands: 265 on the planes, 2,650 people at the WTC, including 343 firefighters who had rushed into the towers, and 125 at the Pentagon. At 9:24...
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