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Problem Solution: Classic Airlines
Donald Howard
University of Phoenix
Introduction
Classic is known as the fifth largest airline in the world and commands a fleet of more 375 jets that serve 240 cities with more than 2300 daily flights (University of Phoenix, 2007). Classic Airlines is now faced with decreasing sales resulting from customers having concern flying with the high costs and the 911 attack. Although the travel downturn that followed September 11, 2001 has subsided, Classic and many of its rivals overestimated the reversal and expanded too quickly. Classic Airlines is now facing troubled times with customer satisfaction and union threats. Classic has grown to an organization of 32,000 employees, and last year, it earned $10 million in sales (University of Phoenix, 2007).
Describe the Situation
Issue and Opportunity Identification
With a concerned investment community on the watch, the airline industry operates under a microscope, subject to scrutiny from all sectors. 9-11, rising fuel costs and bad forecasting about customer turn around has forced Classic Airlines to develop an effective rewards program that will enhance their ability to compete for the valued frequent flier with the objective of regaining their leadership in the airline industry and satisfying stockholders.
Stakeholder Perspectives/Ethical Dilemmas
The shareholders are very important stakeholders in this dilemma. While the stakeholders do not own the company, and do not have active control over decisions that Classic makes, they maintain voting rights that elect the board of directors. They are mainly concerned with their return on investment in the company. The next stakeholders are m ...