JetBlue Airways: Challenges Ahead STRATEGIC MANAGEMENT INPUTS 1. Summarize the external environment, including conditions in the general, industry, and competitor environments. The general environment is focused on the future and can be analyzed by considering six environmental segments; analysis of the industry environment is focused on the factors and conditions which influence a company’s profitability within its industry; and analysis of competitors is focused on predicting the dynamics of competitors’ actions, responses, and intentions. In combination, the results of these three analyses are used to understand the company's external environment and influence its vision, mission, and strategic actions. a. The General Environment Demographic: • Routes include New York City and Fort Lauderdale, FL – distinct populations are found in each of these cities, including (but not limited to) corporate, retiree, and student/spring break travelers. • Expanding destinations to include airports in California, Florida, New York, Utah and Vermont. • Significant decrease in corporate customers since 2001, but trend reversing by 2006. Economic: • 1978 Airline Deregulation Act created intense rivalry between airlines. • Downturn in U.S. after 2001 terrorist attacks - most airlines struggled, but JetBlue reported eighteen consecutive quarterly profits. • IT spending continued, despite 2001 terrorist attacks (and industry losses).
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This case examines JetBlue's business model and studies the factors behind the airline's initial rapid growth and early success.
» The growth of a startup in a turbulent and highly competitive industry, and the challenges it faces.
» The difficulties in sustaining the initial momentum of growth for a company operating in a volatile business environment.
» The effect of a dynamic business environment on a company's performance and the importance of strong strategic planning in sustaining long term growth.
JetBlue Airways Inc, US Airline Industry, Low cost carriers, Value Player, Full Service Airlines, Budget airlines, Return to Profitability Plan, Growth Strategies
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