JetBlue Airways “Before” & “After”
Group A/Academic Group 10
Jet blue – Competitive advantage
Use of IT by JetBlue IT to create competitive advantage
a. Ticket sales moved to online system through user-friendly website (www.JetBlue.com) or electronic ticketing (kiosks at the airport) led to: * Decreased costs required for on-call reservation and * Saved on enormous amount in travel agency commissions * Lesser burden at the airport.
b. Paperless business process that save time and money– Industry’s first paperless cockpit c. Automated systems that could calculate Point to point routes in high volume corridors and thereby saving costs and business complications associated with hub-and-spoke system used by others in the industry. d. Integrated electronic ticketing, internet booking and revenue management tool (taken from open skies) that : * Allowed tracking operational data nearly real time * Allowed fetching reports for the management as required enabling quick decisions. * Sharing of data with all the crew via intranet integrating the work teams. e. Reduced on-call reservation costs by moving on-call reservation system to home-based remotely located agents connected through VoIP lines f. All IT development was in-house leading to saving costs on IT. g. Stabilized IT network, enabling it to handle high volume of internet reservations traffic. h. Moved away from legacy systems.
i. IT projects were measured per CASM (Cost per Available Seat Mile) before a GO-NO GO decision. j. Included incident management through JEMS (JetBlue Event Management System) for reporting and responding to all irregular operations thereby improving customer experience targeted at repeat customer footfall. k. Targeted innovations – lowered average checking time, electronic baggage tagging, hidden cabin camera targeted at customer experience and customer security.
How did JetBlue create Customer friendly image
a. High-end customer service at low-end prices
b. No compromise on the cabin comfort – leather upholstery and seat-back TVs c. The philosophy of taking the customer where he wants to go on a given time d. Tracking customers after check-in and before boarding
e. Immediate update on delays to all customers through online systems and automated email f. Compensation granted in case of delays
g. No overbooking or “bumping”
h. Designing a policy on no more than five hour stay on the plane before a reschedule is arranged and working towards it. Operational problems that led to virtual shutdown after V-day
a. Jet Blue had an organizational bias against cancellation – it cancelled the least number of flights in the industry in its quest for serving maximum possible customer. b. Jet Blue had a very lean infrastructure which worked well under normal conditions but could not cope with a crisis which involved a dangerous cocktail of bad weather, cascading flight delays, cancellations and rising toll of customers at the airport. c. Domino Effect of flight cancellations:
* Cancelled flights meant re-booking of customers on later flights. The later flights may not operate on the particular routes where the left-behind passengers were to be dropped. Also, re-booking or rescheduling of flights would require additional crew to handle the extra passengers. An absence of a proper work schedule database meant that adequate crew was not available to handle extra passengers. * In case Jet Blue’s own flights were not available, it meant that Jet Blue had to book the affected passengers by cancelled flights on other carriers which involved additional time and additional cost in terms of higher ticket rates. All the above had a domino effect and multiplied the delay for the passenger in reaching his...