Jet Blue Case Study
1 - Jet Blue Case Study introduction. What types of information systems and business functions are described in this case? The information systems that were described in this case were as follows: -Transaction processing system (TPS). Automated key processes such as; ticket sales, baggage handling, and reservation system. -Management information system (MIS). The system used for managing planes, crews and scheduling was run by an outside contractor. -Communication System was in place but was not adequate in maintaining stability and proven to be unsuccessful, during this crisis. 2. What is JetBlue’s business model?
How do its information systems support this business model? To provide top-notch service at an affordable low price was JetBlue’s business model. JetBlue maintained a simple atmosphere; employing non-union workers, flying only the Airbus A320 permitting standardized flight operations and maintenance procedures, and updating its business processes to the minimum level of efficiency. The management information systems were also ran by one outside contractor, allowing a small staff that permitted in-house development of systems instead of relying on outsourcing or consultants.
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Lastly, the company spent 1. 5 percent of its revenue on information technology, unlike their competitor’s investment of 5 percent. 3. What was the problem experienced by JetBlue in this case? What management, organization, and technology factors were responsible for the problem? JetBlue’s spending of only 1. 5 percent of its revenue on information technology compared to 5 percent by competitors, was a bad decision. Increasing the spending on IT would have been a proven investment, reflecting greatly in a crisis such as this ice storm.
Cutbacks in spending are appropriate at times however the following problems are a result of the lack of IT within the JetBlue company: -TPS used by JetBlue was adequate for normal operating conditions, however when flights were cancelled the reservation system could not handle the increased number of users. -There was not an existing MIS to manage the crews. -An inadequate communication system prevented crews from having the ability to call and receive new assignments. Days went by before the company was able to contact crews. The allocation of pilots and crews to flights was hindered because the department responsible for doing so was too small for the extra workload. -No system was in place for the unclaimed, lost baggage. -The phones were understaffed and not capable of handling the surge in telephone calls from customers. -The Web site was not able handle the increase of users and stopped responding. -Lack of a DSS. This prevented JetBlue form managing its crew assignments. 4. Based on what you’ve learned in this chapter, what kinds of systems and business functions were involved in JetBlue’s problem?
The lack of systems and business functions were involved in JetBlue’s problem. Lack of: Decision support system (DSS), Executive support system (ESS) Lack of integrated systems such as: enterprise applications, customer relationship management, or knowledge management systems. 5. Evaluate JetBlue’s response to the crisis. What solutions did the airline come up with? How were these solutions implemented? Do you think that JetBlue found the correct solutions and implemented them correctly? What other solutions can you think of that JetBlue hasn’t tried? JetBlue’s response made by CEO David G.
Neeleman was positive, promising, responsible, and sincere. He accepted full responsibility for the failure of his management and systems during a crisis. JetBlue’s solutions included purchasing new software to improve communications with pilots and other crew members. 100 new employees from corporate were trained to serve as backups for departments that were understaffed. The customer bill of rights was created to enforce standards for customer treatment and airline behavior. Weather conditions were also taken into consideration and prepared for appropriately.
I do believe that JetBlue corrected the problems that arose during that specific crisis. However, I believe that the following solutions should also be implemented: -Increase information systems in the company -DSS for crew management -TPS for baggage -A more efficient Website for reservations & communication 6. How well is JetBlue prepared for the future? Are the problems described in this case likely to be repeated? Which of JetBlue’s business processes are most vulnerable to breakdowns? How much will a customer bill of rights help? Until JetBlue increases its information systems, they may experience similar occurrences in the future.
It is necessary to “invest” in IT to prevent such problems from being repeated. There is a huge gap between 1. 5- 5 percent of revenues, and it is apparent that the spending is necessary to be able provide top-notch service to customers. The most vulnerable business processes that are most vulnerable to breakdown are: reservations, communications, and plane maintenance. As far sales, customer relations, and marketing are concerned; the bill of rights helps. However, it is essential for the company to create a solid foundation to support the policy in the event of another crisis.