Classic Airlines is facing many monumental challenges. The key word is monumental as immediate future decisions will determine the fate of Classic Airlines in terms of surviving in the airline industry, filing for bankruptcy, or bought out by the competition. Classic Airlines is at a fork in the road. As the airline industry shares the pain with rising costs, particularly in fuel and labor, Classic Airlines is struggling internally. They are bleeding in regard to customer retention, which is decreasing by approximately 20%. Classic has one of the highest labor costs per seat-mile as they pay top salaries to pilots and other employees, even while competitors are cutting in those professions. To counter any further financial crisis, the board of directors recently mandated a 15% across-the-board cost reduction over the next 18 months. The deepest wound to keep from hemorrhaging is the internal strife between Senior Management. The entire management group needs to work cohesively and fast before the company flat lines. How will Classic Airlines find a way to survive these pressures? First and foremost, Senior Management at Classic Airlines needs to embrace the marketing concept. According to Kotler and Keller (2006), the marketing function needs to be seen as one of several equally important functions in a check-and-balance relationship (p. 16). As seen with Amanda Miller, CEO of Classic Airlines is described as, “Her pragmatic approach to operational excellence often leaves her little patience for “soft” business disciplines such as marketing.” This does not sound good and to make matters worse, Catherine Simpson, who is CFO is described as, “Catherine is “driven by numbers,” and her practical philosophies about business are frequently in line with Amanda’s.” This says potential disaster in flashing lights. Luckily, Classic Airlines is showing some glimmers of hope with other department heads. Kevin Boyle, who is Chief...
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