Classic Airlines

Classic Airlines

Running head:   PROBLEM ANALYSIS: CLASSIC AIRLINES

Problem Analysis: Classic Airlines

University of Phoenix

Problem Analysis: Classic Airlines
Classic Airlines is the fifth largest airline and while very profitable, it is facing similar challenges as its competitors in the airline industry.   Classic Airlines consist of 32,000 employees and earned $10 million on $8.7 billion in sales (University of Phoenix, 2009).   Due to consumer uncertainty about flying, Classic Airlines must formulate a strategy to remain profitable and minimize exposure.

Describe the Situation
Issue and Opportunity Identification
Classic Airlines leadership team has received direction to decrease its marketing budget by 15% while dealing with the increased public scrutiny regarding Classic Airlines’ 10% decrease in the price of shares.   While this has created many issues for Classic Airlines, it has simultaneously created opportunities.
Decreased consumer confidence, flights and rewards programs are only a few of Classic Airline’s issues.   The absence of stakeholder alignments has put a halt to their ability to initiate new products and services.   Lack of trust by Amanda, Miller, CEO, in the company’s marketing programs has made it difficult for the leadership team to present their ideas to her and Catherine Simpson, CFO.   Additionally, the 10% decrease in share prices over the last year is bad timing since the costs of fuel and labor are on the rise.   Wrapped around this package of issues is a sharp decline in employee morale.   The negativity from the media, Wall Street and the public have caused the lowest point in employee moral ever seen by Classic Airlines (University of Phoenix, 2009).   The investment community is keeping a watchful eye, which brings scrutiny from all directions.
All problems create an opportunity.   In the case of Classic Airlines, there are opportunities to turn every issue around and make a positive outcome.   The decline in consumer confidence...