Jetblue Case Study

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JetBlue is a low-cost domestic airline in the United States that utilizes a combination of low-cost and value-added differentiation as its market strategy. From its launch in February 2000 to the time of the case, the airline grew to become the 11th largest player in the airline industry in a short span of 4 years. Moving into the growth phase, JetBlue transitions from launch mode to an established product stage where it needs to focus on growth of scale. Executive leadership has determined that JetBlue must increase its existing route network by adding service to mid-sized markets. Vincent Stabile, Vice President of People for JetBlue Airways has a challenge: How must the organization understand the current organizational structure’s successes and evolve these learnings to support this growth? JetBlue’s core strategy capitalizes upon superior customer service paired with a low-cost structure achieved through use of brand new single model planes that reduced maintenance and training costs, better use of technology including automated processes, a smaller and more productive workforce, and the staffing of content yet non-unionized workers. JetBlue’s organizational structure is a modified hierarchy – divisional design so that “important decisions regarding strategy and implementation could be more easily executed by crewmembers at all levels of the organization.” This balances with a corporate policies designed to create integration and standardization across divisions such as the Holiday Helper program through which office-based staff volunteered in customer service operations during peak holiday travel times to aid in the operational heavy workload as well as to interact with customers and stay in touch with the core product. This aggressive growth plan mandates a departure from low-cost competitive advantage of supporting only one type of plane because a smaller plane is required to deliver service to these markets - the Embraer 190. This will directly...
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