Problem Analysis: Classic Airlines

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Running head: PROBLEM ANALYSIS: CLASSIC AIRLINES Problem Analysis: Classic Airlines Your Name Here University of Phoenix Problem Analysis: Classic Airlines Classic Airlines is in a highly competitive market facing rising fuel and labor costs, and intense competition to maintain a loyal customer base. As the fifth largest airline with over 32,000 employees, Classic wants to boost stakeholder confidence by increasing overall satisfaction while keeping costs down. To accomplish this task, Classic will need to analyze feedback to determine long-term marketing and forecasting objectives accurately. Among other things, Classic will need to find a cost effective way to differentiate its brand from competitors. In doing so, Classic will come closer to meeting the company’s goal of increasing shareholder wealth and global growth. The purpose of this paper is to facilitate management’s decision on how to implement the required changes to keep the company on the leading edge of aviation innovation. By addressing Classic’s situation, shareholder perspectives, end-state vision, and accurately defining the problem, the paper will provide a reasonable foundation for making the necessary decisions. Describe the Situation Issue and Opportunity Identification Classic’s Rewards Program is failing to attract new customers and failing to retain current customers. A 19% measured decrease in the number of new members and a 21% decrease in flights per new members highlight the level of dissatisfaction. Rising fuel and labor cost hinders Classic’s ability to effectively compete for valued frequent fliers. Repercussions from September 11, 2001, have caused Classic to face a restrictive cost structure unlike younger airline companies. Classic, as a whole, faces a 15% cost reduction over the next 18 months. Classic should target frequent business travelers

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