Jetblue Airways

JetBlue Airways

JianPeng Ding

BUS630: Managerial Accounting

Instructor: Milan Havel

06/27/2011

1. What is JetBlue 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?

Jet Blue’s strategies for success are product leadership and customer value proposition. They are pround of themselves on low fares and great customer service. In addition, they are concentrating on bringing low airfares to customers which need low fare options to fly to destinations with high airfares. Jet Blue has been so successful in their strategies of having the highest percentage of seat capacity utilized.

2. What business risks does JetBlue face that may threaten its ability to satisfy stockholder expectations? What are some examples of control activities that the company could use to reduce these risks?

Jet Blue faces two businesses risks that may threaten its ability to satisfy stockholder expectations, which are jet fuel prices and operating costs. A control activity that the company could implement to reduce these risks is putting into place a contract that puts jet fuel at a fixed price for a certain amount of time. Also, another possible risk is foreign exchange and a contract should be entered to protect their proceeds. JetBlue’s workforce could seek to unionize. This process could result in work slowdowns or stoppages and it could increase operating expenses. Control activities: Establish a Human Resource Management Department that proactively works with employees to ensure that their morale remains high and that they feel fairly treated.

3. How can the concept of unit level activities be applied to an airline? More specifically, what are 2 examples of unit level activites for JetBlue? What steps has JetBlue taken to manage these unit level activities more efficiently?

According to a manufacturing concept,...