Sas Case Analysis

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  • Topic: Star Alliance, SAS Group, Scandinavian Airlines
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International Case #: 6-2
T h e C a s e o f (Scandinavian Airlines S A S System)

INTRODUCTION
SCANDINAVIAN AIRLINES SYSTEM (SAS) originated when the airlines of Sweden, Norway and Denmark formed a consortium. 1970’s - competition are fierce and resulted in a loss market share. 1981 - Jan Carlzon, The CEO, undertook drastic decentralization. Top-Down authority replaced by open communication. SAS Strategies is to become known as “the businessman’s strategy” (with rather high fares), with upgraded service, on-time performance, good food and comfort.

For the Future SAS has 2 goals 1. To become the most efficient airline in Europe by 1992 2. To be one of the five major airlines in Europe after 1995 Keystone is SAS’s global strategy is to form strategic alliances. -  An agreement to exchange equities with Swissair was reached in 1989. -  Alliance was also made with All Nippon Airways, LanChile, Canadian Airlines Intl and Finnair.

I. TIME CONTEXT

II. VIEWPOINT

1981

Jan Carlzon SAS CEO

III. CENTRAL PROBLEM
Fierce competition, Loss of market share & Reduced profitability

IV. STATEMENT OF OBJECTIVE
Must: to cope up with competition Wants: to become the most efficient airline in Europe by 1992 and to be one of the five major airlines in Europe after 1995

V. AREAS OF CONSIDERATION
THREATS 1.  Competition with larger airlines 2.  High fuel price 3.  Rising operational costs 4.  Decrease in demand for air service 5.  Price Wars

OPPORTUNITIES 1.  Strategic alliances with other airlines 2.  Offer high-quality service

V. AREAS OF CONSIDERATION
WEAKNESSES 1.  Deterioration of services 2.  Low morale of the workforce

STRENGTH 1.  Workforce 2.  Upgraded Services 3.  On-time performance 4.  Good food & comfort 5.  Decentralization

VI. ALTERNATIVE COURSES OF ACTION
1. Continuous implementation of decentralization (+) Faster decision-making Address and solve the problem right away Open communication Training and development for...
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