Written Assignment: Choose a Part 121 air carrier (such as American, Delta, Southwest, etc.) and provide data that shows how that enterprise has successfully employed competitive advantage obtained through the utilization of information technology to win and keep loyal customers or operate more efficiently in the reservations, maintenance, or operations departments. You may provide a historical example that would be found going back several decades. Learning from the past is a great way to succeed in the future.
Air Carrier Chosen
The Part 121 air carrier that I have chosen to use as a case study is JetBlue which originates from the United States of America (USA). JetBlue was launched as a low-cost carrier with substantial amounts of investments, one of which was when Jet blue which was known as ‘New Air’ placed a $4 billion purchase order with Airbus industries for 75 new A320 aircrafts (Jet Blue.com, 2018). But disaster struck the airline industry when the 9/11 World Trade Centre attacks happened in 2001 just years after JetBlue began to run.
Information Technology (IT)
– Live TV
Most of the renowned, established airlines around the world were going out of business when JetBlue decided to focus on upgrading their Information Technology (IT) services. First of which was through the acquisition of a technology company known as LiveTV (The Balance, 2018) , this allowed JetBlue to flourish and grow its profits despite being one of the more unknown carriers during that period of time as well as the threats to aviation through customers’ fears of terrorism. The incorporation of LiveTV made JetBlue known as the first and only American air carrier to provide free satellite TV with up to 24 channels. This was enabled through the usage of IFE (In Flight Entertainment) which offered each passenger a TV screen set up in front of them within the flight.
This was a huge innovation plus point for the air carrier as low-cost passengers kept returning. The technology advancement that JetBlue had implemented kept JetBlue ahead of any competition such as ‘Song’ and ‘Ted’, which were launched by low-cost carriers, Delta Airlines and United Airlines. (The Balance, 2018)
With the success of their IT implementations, JetBlue decided to focus its main growth strategies on IT. A paperless check-in system was then introduced with the aim of eliminating having to stand in line when doing a flight check-in. This innovative procedure works with the use of JetBlue’s system which checks the passengers in immediately and sends the boarding pass to the passenger’s given mobile device 24 hours before the flight departs (The Balance, 2018). This improves efficiency by reducing the workload of check-in officers and offers passengers a lot more time to explore the stores within the airport itself without the need to stand in line.
JetBlue also introduced the Apply Pay system within the aircrafts’, where flight attendants use iPads’ on-board to accept payments, inform passengers who may have connecting flight about delays and the alternatives available. This is the first of its kind on any airlines and the incorporation of the Apple Watch to provide this usage is also in the works (The Balance, 2018). This provides convenience and early notification to the concerned passengers which would then allow the passengers to make their necessary arrangements to work with any delays or issues encountered.
Difference to methods used by other Air Carriers
By improving the check-in methods through automation, customer communications through the iPad system as well as improving the passenger flight experience with the adding of TV options through LiveTV, JetBlue has kept its competitive advantage always a step ahead from its competitors such as Song and Ted by Delta Airlines and United Airlines with customer returns at a high.
Financial Performance with the competitive advantages.
End of financial year 2017: JetBlue achieved revenue of $1.8 billion with revenue from passenger miles increasing by 5.0% to $12.1 billion.
JetBlue reported second quarter operating revenues of $1.8 billion. Revenue passenger miles for the second quarter increased 5.0% to 12.1 billion on a capacity increase of 4.8%, resulting in a second quarter load factor of 85.2%, a 0.2 point increase year over year.
Jetblue.com. (2018). JetBlue | About | History. online Available at: https://www.jetblue.com/about/ourcompany/history.aspx Accessed 14 Jan. 2018
The Balance. 2018. JetBlue’s Award Winning Use of Technology & Automation. ONLINE Available at: https://www.thebalance.com/jetblue-s-award-winning-use-of-technology-and-automation-2533531. Accessed 14 January 2018
US Department of Transportation. 2018. Certificated Air Carriers List | US Department of Transportation. ONLINE Available at: https://www.transportation.gov/policy/aviation-policy/certificated-air-carriers-list. Accessed 14 January 2018
Mediaroom.jetblue.com. (2018). JetBlue Announces Second Quarter 2017 Results. online Available at: http://mediaroom.jetblue.com/investor-relations/press-releases/2017/07-25-2017-123010153 Accessed 14 Jan. 2018