Delta Air Lines Inc Case Study

The past decades have seen many challenges face the air travel industry whole over the world. The problems are of no exception even to the giant companies including Delta, United, American airline to mention a few. The challenges they have faced range from fuel price volatility, dealing with economic cycles, changing customer demographic to increased local and international competitions among other factors.

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Going by the thoughts of Delta CEO Bastian's view, the company is in need of strategies that will help it in dealing with competition which has increased globally, and also the effects of changing demographic trends among other business threatening factors to create a competitive advantage to other such companies. Considering the internal and external environment for Delta Airline, and anchored on Delta Air Lines, Inc.'s attached case study, the CEO Mr. Bastian needs to employ some strategies. The strategies will be in response to the changing demographics of the U.S. for its products and services.

Since the U.S Census Bureau projection gives statistics of a significantly changing population with older and more racially and ethnically diverse groups by 2060, the changing demography has numerous implications to airline and traveling industry. Some of the needed strategies should include; advancing to a new form of technology that can be embraced quickly by all. In the coming years, the millennial generation (that which was born between 1980 and 2000) which tends to have the broader world interest will be the highest in population estimation. As they enter their peak earning in the coming five to ten year, they will become a lucrative market in the travel industry. The group is composed of individuals who are more likely to focus on convenience and amenity splurge (Rothaermel & King, 2017). The Millennial generation tends to use mobile applications and OTAs which are on mobile devices and computers. They mostly like to travel alone and loves a lot of leisure during trips (Rothaermel & King, 2017). Operating point-to-point network if introduced by Delta management will also be one of the strategies to overcome competition. Instead of focusing more on international flights, this demographic group is most likely to travel domestically, and introducing point-to-point network is a strategy to bring more customers on board. Improving customer service by ensuring that the arrival and departure time is well stated, avoiding extreme delays, making sure that mishandling of baggage does not occur and involuntary bumping of customers does not happen.

Ensuring that the airports are hypermodern with luxury hotels having swimming pools, splash lounges, and high-speed Wi-Fi among other crucial amenities. Introduction of frequent flyer rewards will also be a strategy that if used, will ensure there is an excellent competition since most of the travelers consider luxury more when traveling. For the female genders, introducing flying nannies to help in taking care of the kids while on board will be one of the strategies that if added, will be of immense help while also boosting the number of travelers with the airline.

As an airline company, Delta Air Lines, Inc. has faced many challenges, but in this case, only the most critical issues are discussed in into. One of the main problems is the competition. The advantage that most successful firms have in common is that for their sustained advantage, they have better ways of managing workforce (Pfeffer, 2005). Ensuring the security of employees, selectivity in recruiting and paying high wages and on time will provide a smooth running of operations. Assurance on the protection of the employees of their jobs will ensure that factors like strikes are easily averted since they will feel that even when economic times are worse, they won't be sacked (Pfeffer, 2005). Such security assurance though might be difficult to handle when unexpected losses come about, and there is a need to do retrenching. Selectivity in recruitment is another strategy that if employed, can always ensure the firm competes well since only those that are highly qualified will get the chance to serve.

On the other hand, it will be a disadvantage to the company since many individuals who can offer more services to the firm will be left out. Another way to reduce competition is for the Delta Air Lines, Inc.to look for new markets especially in Asia. Here, there is already a third of the world's air traffic with its growth projected to be increasing immensely (Rothaermel & King, 2017). Even though venturing to the Asian market will be costly and involves buying new planes and making some improvements, it will be worth trying.

The company should also enter into partnerships and resort to the low-cost carriers and purchasing new aircraft like the Airbus and Boeing which are fuel efficient as compared to the older, fuel consuming wider-body airliner. Resorting to this plan will be expensive as it will require more finances, but in the end, it will save off fuel and also have the same competitive advantage brought by Qatar and Emirates Airlines.

The other problem faced by Delta is the vulnerability caused by cybersecurity on its operations. Delta operations were brought down twice by computer problems which caused the company to incur losses worth millions of dollars (Rothaermel & King, 2017). The same repeatedly happened when telephone switches were overwhelmed. In solving this issue which will continuously cost the company loses, the company needs to invest in new forms of modern technology. Even the planes should be fixed with this technology to prevent such occurrences from repeatedly recurring. It will be expensive, but the result will be improved efficiency, customer relation, and highly managed operations which will increase the income and competitive advantage over other local and international airlines.

The final proposed action is for the company to improve employees' relationship and enable them to get more involved in the operations. All these will enhance efficiency and avert strikes. Upgrading to fuel efficiency fleets to replace older-wider body aircraft, and also invest in new technology as they improve on structures and airport facilities. Lastly, introducing low-cost carriers and accessing new markets will be the only way to improve service delivery, make profits and remain one of the biggest players in the industry

References

Rothaermel, F. T., & King, D. R. (2017). Delta Air Lines, Inc. McGraw Hill Education.

Pfeffer, J. (2005). Producing sustainable competitive advantage through the effective management of people. Academy of Management Perspectives, 19(4), 95-106.