January 28, 2012
1.) What is JetBlue’s strategy for success in the marketplace? Does the company rely primarily on a customer intimacy, operational excellence, or product leadership customer value proposition? What evidence supports your conclusion?
JetBlue’s strategy for success in the marketplace can be summed up, as “a leading low-fare, low-cost passenger airline by offering customers high-quality customer service and a differentiated product” (JetBlue 10-K/A Report, 2005). They believe that by offering low rates, their demand will increase, offering travelers with a low-cost alternative. They believe that having low operating costs allows them to keep unit costs down. They also research areas that have little travel and those with high travel and high costs. This allows them to target another travel point. Offering a more luxurious travel accommodation is JetBlue’s key to staying innovative and separate from the rest.
JetBlue feels that customer intimacy, operational excellence, and product leadership customer value proposition are all important. They spend time hiring honest, friendly workers to give the ultimate in customer satisfaction, while only using one type of aircraft so that all of the maintenance required would be the same on all engines. By offering low fares and extra amenities during the flight, the company also focuses on product leadership and customer value proposition. 2.) What business risks does JetBlue face that may threaten the company’s ability to satisfy stockholder expectations? What are some examples of control activities that the company could use to reduce these risks?
JetBlue already states that they have billions of dollars in debt and will continue to have more with their fixed obligations. “Our ability to make scheduled payments on our debt and other fixed obligations will depend on our future operating...