Jet case odc section c_group 9
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Transcript of Jet case odc section c_group 9
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Ishpreet Singh – 12P139 Karan Jaidka – 12P141Lucky Sharma – 12P145 Prabhat Singh– 12P154Vignesh Patil – 12P177 Viswanath Kuppa – 12P180
PGPM – Section C – Group 9
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Founder: Naresh Goyal
Timeline:- April1,1992 - Jet Airways is formed & operator
license for air taxi May 5,1993 - Commenced operations 1995 - Gets a scheduled airline status March,2004 - Jet Airways goes International March,2005 - Jet Airways goes public April,2007 - Acquires Air Sahara - Jetlite
Introduction
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Turbulence: 50% of ground-staff has quit; Jet
losing cabin crew and ground staff to foreign carriers
Fall in number of passengers post 9/11 Load factors suffering Increase in fuel prices decreasing margins Sahara taking on Jet’s dominance
Problems being faced in 2003
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Very successful GSA Manages most of the operations himself Is energetic, rustic, bold and impatient Made Jet a world class airline by 2000 Built a vast network of contacts, attended every IATA
meeting These relations helped in setting up Jet Airways Best decision – To hire expatriates for critical functions Audacious decision – To buy 10 Boeing aircraft, with 10
more in the pipeline, given the poor condition of the industry after 9/11
The Stalwart named Naresh Goyal
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This style of leadership is now causing
problems as the airline grows (stifling growth; facing problems of retaining managers)
Persistent instability in the top management – clueless shifting of people around, based on personal appraisal
Unfamiliar with processes and standards Ad-hoc style of functioning
Problems with Goyal’s style of Leadership
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Jet had to prune costs an bring down break-even
levels Jet cut down salary hikes, refresher training, released
6 expats and leased out 2 aircraft Jet stopped innovating, focussed on cutting costs Sahara took centre-stage as Jet began to stagnate Poor timing for Jet to stop innovating (possibly due to
Goyal’s failure to have a decision-making structure at the top)
Jet did not alter its pricing strategies during the price war
The Rise of Sahara – at the cost of Jet
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Forces for change Forces against change
Competitive pressure Lack of delegation of authority
Hire external expertise Founder too involved in daily activities
Foreign alliances Cost reduction & layoffs
Bold investments Informal power structure
Forces for and against Change at Jet Airways
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Failed to keep customers satisfied
Loss of competitive advantage
Vulnerable to attack from competition
Lost “Innovative” brand identity
Consequence of change/no change at Jet Airways
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Fleet size = 81, average fleet age = 4.2 years (among
the lowest globally at that time) Massive international expansion plan Goyal’s mission, focus and experience came in very
handy International strategy included tying up with the region’s
domestic carrier; as many as 120 code-sharing agreements globally
Goyal planned to fly to Dubai and on the Mumbai-Shanghai-San Francisco route
Jet’s aircraft preference = 787-9 Dreamliners and Boeing 737-400s
Jet Airways’ Rise in 2008
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