Managing in Troubled Times Case Study

Crisis Management- The Jet Blue Way

OR

Abstract:

In February, 2007 JetBlue, a leading low-cost airline of US cancelled around 1096 flights in a week leaving hundreds of passengers and aircraft grounded due to an ice storm and enormous operational shortcomings. During the ice storm when most other airlines responded by canceling more flights earlier, JetBlue did not follow the same path. It did not cancel the flights well in advance and as a result, thousands of passengers ended up trapped at New York’s John F. Kennedy International Airport, the hub of its operations. While other airlines took just a day or two to get back to the schedule, JetBlue took a week and affected around 130, 000 passengers.

The flight delays, cancellations and ambiguity in operations caused customer dissatisfaction and affected its brand image. However, JetBlue aggressively put in efforts to mange the crisis and regain customers’ trust. The Founder and CEO of JetBlue, David Neeleman apologized in public and tried to convince people, investors and customers that the airline would recover. JetBlue announced to reimburse 130, 000 passengers which would cost it more than $30 billion. After the crisis, to restore is stained reputation the company introduced “customer bill of rights”, the first of its kind in the industry.

The case discusses about the crisis management and issues highlighting JetBlue’s tactics to manage the crisis and restore its corporate image. The case also talks about Neeleman’s leadership in crisis management.

Pedagogical Objectives:

• To discuss crisis management at JetBlue
• To understand the role of leadership in times of crisis.

Keywords : Managing in Troubled Times Case Study; Jet Blue; Low-cost carriers (LCCs); Issues and crisis at JetBlue; Crisis Management; Leadership; David Neeleman; Brand Image; Brand Building; Regaining Corporate Image; Customer Bill of Rights; Customer Satisfaction; Aviation Industry in US; Business model of LCCs