Jet Blue

Jet Blue

Question 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.

Answer 1

Product leadership and customer value proposition are definitely Jet Blue’s strategies for success. They pride themselves on low fares and great customer service. The company is focused on bringing low airfares to customers. This formula has worked out for the company.

Question 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?

Answer 2:

Jet fuel prices and operating costs are two of the risks that the company faces. An example of a control activity 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. In addition, another possible risk is foreign exchange and a contract should be entered to protect their proceeds.

Question 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?

Answer 3:

• Concept unit level activities can be applied to an airline. Examples of unit level activities are operating the airplane on the air which affects the cost of jet fuel and providing ancillary services to passengers which affect the crew's salary. JetBlue, to manage its jet fuel costs, has embarked on fare promos such as cheaper fares for passengers with no check in baggage - heavier load means higher jet fuel costs. On the other hand, it manages its labor cost by shortening the turnaround times of its airplanes.

Question 4

How can the concept of batch-level...