Lufthansa Case Study

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1) Which of Drunker's "7 tasks of tomorrow's manager" does Wolfgang Mayrhuber undertake? Are there any he doesn't undertake and should? ANSWER Manage by Objective : He is expecting operating profits of €1bn in 2008. As part of the treatment, Mr Mayrhuber acquired Swiss, the national airline, in 2005, and improved Lufthansa’s business and first class offerings with better seats and a raft of extra services, including a bespoke first-class terminal at its Frankfurt hub. As a result, premium revenues are up by 50 per cent. Take more risk : 1) Mr Mayrhuber ordered big cost cuts and the sale of non-core units 2) Mr Mayrhuber revised the airline’s financial reporting to identify loss-makers as a prelude to remedies, even if this made it easier for investors to grumble about the business mix. The less transparent Air France group faces no such complaints, he notes. Take strategic decisions : 1) Mr Mayrhuber acquired Swiss, the national airline in 2005, and improved Lufthansa's business and first class offerings with better seats and raft of extra services. As a result, premium revenues are up by 50%. 2) He hived non-core businesses and improved transparency. Build an integrated team : He helped a flight attendant get the in-flight entertainment system running. His engineering expertise has allowed him to help his customers on more than one occasion. Communicate quickly and clearly : When he took charge of Lufthansa's passenger business in 2001, he wanted to gauge the scale of the difficulties facing the airlines. So he asked his controller to find out what would have happen for the company to wipe out €1bn in operating profit. See the organisation as a whole : He appears to care people and particularly employees think abou him. Understand the external environment : (He knows about his competitors) 1) He introduced low fare offers in Europe in order
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