Transcript: Sons of Maxwell, traveling to Nebraska The Taylor guitar was witnessed being thrown The guitar was severely damage By the end of that day the video had received 150,000 hits. External factors Costumer needs an improved security to feel safe - (terrorist attack ?) Requirement for better service - high expectations - comparing with competitors Costumer complains (poor service, arrival time, delays, fees) - cause a lack of credibility It becomes a "trend" to use other transport carriers ( high speed trains or Ships ) Respond quickly and honestly Own up and apologize Tell "your" side of the story Be open to communication (never say "no comment) Keep the media, customers, staff and suppliers informed Make sure to have well trained staff Show the good side of the company when everyone is looking at it anyway Opportunities - The title, Song - Humor - Make them share - share Grab their attention Build their interest Create the desire take action Weaknesses Opportunities Economic factors $1.25 Wednesday, December 2, 2015 What suggestions do you have for brands in a world in which customers may communicate about their brands? Are there opportunities for brands in this situation? SWOT analysis - Internal Political factors Economical factors Socio-cultural factors Technological factors Environmental factors Legal factors × Political factors Environmental factors climate/weather changes = (delays) = complains new recycling constitutions (expensive) CSR (Corporate Social Responsibility) United Airline´s pollution Why did the video gain so much attention ? Customers can say good things about the company and make a good word of mouth Celebrity endorsement Learn and grow Bad publicity in the media Political issues in countries that supplies fuel Anticipating the situation Options PESTEL analysis Caroll keeps quiet No bad PR Keeps a good reputation Become trustworthy Socio-cultural factors Vol XCIII, No. 311 Growth in population and economy Growth in airline industry Technological expansion Costumer satisfaction Better developed technology from their competitors (interior design, air carriers) Cheaper and faster way to transport consumers and their luggage is available Over capacity - not desirable for new costumers Financial crisis - people not able to afford tickets Currency change External Many flight departures A big variety of destinations (330) Strong partnership with other major airlines (Continental Airlines) Many well take care of employees Listen to criticism Make sure that the company know about how to deal with bad PR Act fast and be honest Get all facts first Always respond Might have to spend money which could have been avoided May not find them sincere in their apology Technological factors Pay Caroll Apologize Video as a lesson Tell they made a mistake Financial issues Bad strategic management Poorleadership Minimization of damage to the brand Disadvantages Bad economy Terror threats NO growth in population Carroll lost his Taylor guitar Strength Facts Advantages Press release Threats Caroll wanted an apology Kept trying to reach different people Told the company about the videos Communication about brands United breaks guitars
Transcript: General and Industry Environments 1931- United Airlines emerged. Provided passenger transport and mail services to consumers Questions??? Industry Environment Results Business-Level Strategy Acquistion of Continental Recommendations Cost-Effective General Environment 2012- Merged with Continental Airlines creating United Continental Holdings 2008- Largest Loss Differentiation 1994- Largest majority employee-owned corporation in world Merging SWOT Analysis Strategic Issues Demographic Economic Sociocultural Technological Global Competitive Rivalry High – unattractive Reasons: 34 US based companies 6 airlines control 72% of the US market All airliners are competing for the same customers with business travel decreasing. Competition Sources Porter's 5 Forces Model http://www.unitedcontinentalholdings.com/documents/FactSheet.pdf?file=united_factsheet.pdf&type=pdf Topics Bankruptcy Threat of new entrants Low – Attractive Reasons: Congested industry High cost of Entry Tightly regulated industry Customer loyalty to existing airliners SWOT Analysis United Airlines 2010- Proposed merge with Continental Airlines Opportunities Growing airline industry Opportunity to strengthen financial position Target travel and tourism industry Threats Future oil prices Low cost carriers 1978- Airline Deregulation Act Delta US Airways American 2001- Bankruptcy General and Industry Environment Where Are They Now?? Recommendations Corporate-Level Strategy Porter's 5 Force Model Strengths Strong operational network Hub & Spoke Company Market Share Weaknesses Tarnished Image Financial Position Unit revenue is down in every region except in the Pacific region Corporate-Level Strategy International Growth Allie, Craig, Kayla, Meghan, and Brandon Bargaining power of the Buyer High – Unattractive Reason: Technology – gives potential customers a wider range of options when choosing airlines. Threat of Substitutes Low – attractive Potential substitutes: Road Rail Marine Bargaining power of supplier High – Unattractive Reasons: Boeing and Airbus are the only two suppliers Labor – typically unionized Global Strategic Alliance Rivals Customer Strategy Business-Level Strategy Strategic Issues -Basu, C. (n.d.). How Do Monetary & Fiscal Policies Affect the Airline Industry?. Retrieved from http://www.ehow.com/facts_7568199_do-policies-affect-airline-industry.html -Boyle, R. (2009, April). Technological Trends and Their Impact on the Airline Industry. Retrieved from http://www.sita.aero/content/technological-trends-and-their-impact-airline-industry -Diversity and inclusion. (2013). Retrieved from http://www.united.com/web/en-US/content/company/globalcitizenship/diversity.aspx Gallagher, J. (2012, February 21). United and Continental to Officially Become United Airlines in March. Retrieved April 1, 2013, from Yahoo! News: http://news.yahoo.com/united-continental-officially-become-united-airlines-march-191800227.html Goldschein, E. (2011, Sep 8). 13 Ways the U.S. Airline Industry Has Changed Since 9/11. Retrieved from http://www.businessinsider.com/how-the-us-airline-industry-has-changed-since-911-2011-9?op=1 Hitt, M. A., Ireland, D. R., & Hoskisson, R. E. (2011). Concepts and Cases Strategic Management Competitiveness and Globalization. Mason: South-Western Cengage Learning. Michael A. Hitt, R. D. (2011). Strategic Management: Competitiveness & Globalization. Mason, OH: South-Western Cengage Learning. Mouawad, J., & de la Merced, M. J. (2010, May 2). United and Continental Said to Agree to Merge. Retrieved April 22, 2013, from New York Times: http://www.nytimes.com/2010/05/03/business/03merger.html?_r=0 Passenger demographics. (2012). Retrieved from http://www.unitedmediaservices.com/our-audience/passenger-demo.php Pawlowski, A. (2011, March 18). Why Aren't More Women Airline Pilots?. Retrieved from http://www.cnn.com/2011/TRAVEL/03/18/female.airline.pilots/index.html Reed, T. (2012, October 26). Is united fixed yet?. Retrieved from http://www.thestreet.com/story/11748597/1/is-united-airlines-fixed-yet.html Research and Innovative Technology Administration (RITA). (2013). TranStats. Retrieved April 22, 2013, from RITA: http://www.transtats.bts.gov/ United Continental Holdings, Inc. (2013). About United Continental Holdings. Retrieved April 21, 2013, from United: http://www.unitedcontinentalholdings.com/index.php?section=about United Continental Holdings, Inc. (2013, January 24). United Announces Full-Year and Fourth-Quarter 2012 Results. Retrieved April 23, 2013, from United: http://ir.unitedcontinentalholdings.com/phoenix.zhtml?c=83680&p=irol-newsArticle&ID=1777521&highlight= United Continential Holdings, Inc. (2010). United. Retrieved April 1, 2013, from United Continential Holdings: http://www.unitedcontinentalholdings.com/ United States Inflation Rate. (2013). Retrieved from http://www.tradingeconomics.com/united-states/inflation-cpi Current Status United Airlines History
Transcript: Reserve Seats on Passenger Flights Set aside 4 to 6 seats on flights for deadheading crews Will not have to bump passengers anymore Can sell the seats if not being used by a flight crew (win, win) "This is an upsetting event to all of us here at United. I apologize for having to re-accommodate these customers." -CEO Oscar Munoz COMMUNICATION Q&A LETTING THE PASSENGERS BOARD FIRST 1.) Limit use of law enforcement to safety and security issues only. 2.) Not require customers seated on the plane to give up their seat involuntarily unless safety or security is at risk. 3.) Increase customer compensation incentives for voluntary denied boarding up to $10,000. 4.) Establish a customer solutions team to provide agents with creative solutions such as using nearby airports, other airlines or ground transportation to get customers to their final destination. 5.) Ensure crews are booked onto a flight at least 60 minutes prior to departure. 6.) Provide employees with additional annual training. 7.) Create an automated system for soliciting volunteers to change travel plans. 8.) Reduce the amount of overbooking. United admitted in its report that Flight 3411 was overbooked by one passenger before boarding began. 9.) Empower employees to resolve customer service issues in the moment. 10.) Eliminate the red tape on permanently lost bags by adopting a "no questions asked" policy on lost luggage. 10 Policy Changes United Airlines is making OFFER 1: $400 OFFER 2: $800 OFFER 3: $1000? OFFER 4: forced removal?? changed dynamic of the situation Risks United is already facing: Reputation Lost Customers Risks associated with the possible solutions United provide: Who gets kicked off? Too many volunteers. Planes not filled. Other Airlines Issues in recent days United Airlines Future Spirit 5/8/17 Security Deposit Similar to hotel Refundable Opens up seats (makes plane seem less crowded SITUATION The Bottom Line for United and All Airlines, is that the majority of customers care about price of flights and not service. And the Best price will typically earn the business of customers in the future. highly visible, risk of going viral BLAMED THE VICTIM Southwest 5/9/17 Alternative Transportation for Deadheading Charter planes for flight crew use only Drive crews between local airports TIFFANY JASMINE ZACH DREW KENNY COMPENSATION LIMIT ON VOUCHERS UNITED AIRLINES creates the problem of having to get them off didn't explain how people were chosen "Is UA racist?" -China blamed the victim RISKS ALTERNATIVES RESULT PROBLEM(s) what can they do to prevent overbooking and bumping? How United has been effected since the Incident on April 9th, 2017
Transcript: - Seek media positive media publicity - Appeal to bloggers - Surveys on surveys on surveys - Twitter responses -Employee reactions - Scholarship fund Crisis Comm 6 month campaign Social Media WOM/Internal Comm Giveaways - $50 K Employee incentives - $50 K Website revamp - $100 K Twitter - $30 K Scholarship - $100 K Cust. Serv. - $500 K Surveys - $10 K Backup cash - $100 K Total - +/- $1 million THE SITUATION Budget/Schedule Community Relations PR - Improved website - More engaging and interactive Twitter - FBT contest - Encouraged post-flight Twitter mentions - Direct response to gripes Media Relations Evaluation The company that once dominated domestic flight has fallen on tough times due to its poor customer relations practices. While other airlines have been able to find a unique selling proposition for attracting repeat customers, United has failed to find its niche. Because of this, United has seen an annual reduction in market share, which has forced them to file Chapter 11 bankruptcy. - Employee incentive program - Improved personnel interaction with customer - Better compensation for United's mistakes -Timely response to crisis from CEO
Transcript: My job at United is A pilot. I get $40,000 a year (Reduced Salary for project) 10 of yearly pay = 3,333 Monthly pay after 10% = 3,000 My Apartment Cosmopolitan Apartments 225 Hyde Street San Francisco It is a studio apartment with all utilities included. $1,200. If I am a pilot, I would be away from San Francisco. I travel all around the world. Put aside all that flying, I drive a Ford F-250 Platinum. Truck Payment : $635 $27,229 for 48 months at 5% = $635 Food Food: $200 OMG Another Bill Verizon Wireless Unlimited Talk & Text $127 TV/Internet Bundle=$75 Insurance = $75 Entertainment Paddleboats $10 Sports Games $50 Concerts $ 50 Friends House $ 0 Total $110 Left Over Money : Money goes to Savings, clothing, debt, pocket change and investments. Monthly take home pay = $3,000 Housing 40% = $1,200 Auto 21% = $635 Food 6.75% = $200 Cell Phone 4% = $127 Internet/TV 2.5% = $75 Insurance 2.5% = $75 Entertainement 3.75% $110 Savings 5% $150 Clothing 3.5% $100 Debt 3.5% $100 Pocket Money 1.5% $50 Investments 6% $178 Total: $3,000 Music: K Camp - Money Baby (Clean Version) All logos go to their rightful owners. By : Jeramy Carullo United Airlines Salary Verizon Wireless Unlimited Talk & Text
Transcript: United Airlines ranked #6 in overall customer satisfaction. -J.D. Power and Associates Proposal Results Advancement Customer Satisfaction 2012 North American Airline Satisfaction Survey Recognition Lead Flight Attendant Supervises flight attendant Performs regular tasks Provides discipline and evaluation Pick certain flights Flexibility • Current customer service practices have proven a competitive disadvantage • Ranked as a below average North American airline • Process and people > price Check Flight Attendant In flight crew Manages cabin duties Delays Unorganized Customer experience was more like an "patience-building exercise" -Business Insider Continental merges with United Airlines -Houston Business Journal On-board checks Market Share • Cost and fees • In-Flight Services • Boarding/deplaning/baggage • Flight crew • Aircraft • Check-in • Reservation Policies Creative Management Award Revenue Customer Service Award Incorrect balances in frequent flyer accounts -Business Insider United Airlines Problem Customer Service Review Customer Service Review Flight Attendant Supervisor
Transcript: United Airlines By:Bobby Loesch United/Continental Merger -Last year, United Airlines Inc. merged with Continental Airlines Inc. History -Set up in 1931 as United Airlines being the "Worlds Largest Transportation System" -On June 7,1995, United recieved their first Boeing 777 aircraft.The 777 is Uniteds newest aircraft. TED- TED was a divisio n of United but only survived for a year or so. TED only operated the Airbus aircarft. United used TED to operate their Airbuses Above is the 777
Transcript: 1. Stakeholder Analysis/Mapping Conclusion Key Actions Increase overall revenue and reputation Results: Boost overall reputation 3. New strategy Keep clam and damage control (Source: Keep calm-o-matic, 2016) Results Operational Excellence Limitations Difficult to balance out both needs (Forbes, 2017) Management Stakeholder (Source: Project Smart, 2017) Key Incident 2 Named as America's worst legacy airline. No flexibility Aftermath Requires strong communication Lost trust and loyalty of guests Require a proper understanding 2 x Management theory for each United Airlines Plane (Source: United Airlines, 2017) Linking of incident to racism and discrimination. Operational Excellence Only acts as damage control Badly received Results logo ( Source: Yo Yo Job, 2016) Lessen the damage Self harming PR session Overcoming Personal Limitations (Source: Do something!, 2016) Required to make a second apology Attracting more attention Showcased bad PR management Picture of an explosion (Source: Specialeffectstock, 2017) Man dragged off plane leaving him with injuries to his face. ROOT CAUSE SUMMARY Decline in service/Reputation To be able to handle treats sequentially and to lessen the damage. World's Third-Largest airlines regarding revenue Questioned the Moral and ethics of the Company. Key Incident 1 Intensive Planning First apology Limitations United Airlines Logo (Source: United Airlines, 2016) Before and After (Source: Twitter, 2016) Good service certified logo (Source: Emaz, 2017) Ahead of competitors Crafting strategy Following the incident an apology was issued to the company. (d). Two way symmetrical model of communication Self-Caused PR Disaster Crisis management Boost overall revenue Badly worded, no acknowledgment of the wrong doing of the company, Blaming the Victim and didn't mentioned what was the remedy. (Salzewski, 2017) Made the case even worse!! 1. Introduction Operational Excellence Results: Boost overall reputation Operational Excellence Prevent crisis from happening Self-caused PR crisis 2. Emergent strategy Limitations Balance between effective and efficient (Source: Idolosol, 2017) Incident was videotaped and published on Social Media. 1. Incident Crisis Sign (Source: Jennifer jones blog, 2016) Requires a strong management team Stakeholder Trust (Source: The Compliance and ethics blog, 2015) Increase the reputation and trustworthiness Very angry Emoji (Source: Emoji Island, 2015) United Airlines Stakeholder management Theory (United Airlines, 2017) Adds flexibility CEO of United stating his apology (Source: ABC news, 2017) Failed first apology (b). Crafting strategy Cut cost/Task Oriented 2. Key incidents and Aftermath (c). Crisis management Self-Caused PR Disaster Key Actions 1. Pre-Crisis Phase Results Weighing scale (Source: Clipart, 2015) Ken, Kanta, Selina, Kobi and Bella PR management overview (Source: AirPR, 2017) The Two - Way Symmetrical model of Communication Key Actions 2. Develop Tailor made strategy 2 x Root problems Root Cause United Airlines Plane (Source: United Airlines, 2016) Emergent strategy concept 4. Management Theories (a). 3. Implementation The two - way symmetrical model Boost overall revenue Strong communication medium High communications skills Ear for listening (Source: Noun Project, 2016) Limitations 3. Root Cause Company's Market value plumed by $1 Billion. Increases overall revenue and reputation Crisis Management Scope Loss of revenue Stakeholder management 2. During/After Crisis Identify the stakeholders, to know what they want and to craft strategies surrounding them. Improve all stakeholder's satisfaction To be more efficient, cost friendly and Customer friendly . Focus too much on cutting cost and forgets the customers Meet the needs of all parties 4 x Management Principles I'm sort of sorry (Source: Huffington post, 2017) 2. Strategic Planning Getting to the root cause (Source: Quality Magazine, 2017) Price Tag (Source: American discount cruises, 2014) Second Apology Results Stakeholder Management Theory Results signage (Source: Jo's Cervical Cancer Trust. 2016) Defined as Superb Operations and execution. Crafting Strategy Increases reputation and trustworthiness. References American Company (HQ located in Chicago) Emerging seed (Source: The next web, 2017) Key Actions Results Management Theories United Airlines Multiple problems No limits (Source: Errors of enchantment, 2016) 5. Conclusion 1. Listen (America Customers Satisfaction Index, 2017) Decisions should be beneficial between itself and its audiences. Man being dragged off plane (Source: ABC News, 2017)
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