Jet Blue Airways- Starting from scratch

Group 4- Chetna, Pankaj, Smrithi, Sai Praneeth, Vishak, Sanika

Values to organizational culture

• Leverage on best technology for better safety

Safety • Employees expected to be safe- no alcohol, no drugs

• Equity work environment

• Paying above industry standards
Caring • Positive team environment
• Flying to customer preferred locations
• Providing best services

Integrity • Integrity in operations

• Team of people with good business knowledge

• Fun at work for employees

Fun • Best experience for customers ensured

• Team spirit encouraged

Passion • Meets the needs of customers and employees both in best manner
Vision and beliefs to organizational culture

Vision
• Seeking new technologies and being the best
Value driven
• Efficient operational performance increasing financial returns
Surpass customer
expectations • Better in flight experience for customers
Maintain industry
standards

• Supervisors functioning as coaches

• Equity pay- fair compensation/benefits programs
Beliefs of • Great two way communication
• Customized employment packages
leaders to • Career growth opportunity
• Safe, fun environment
culture • Non unionization for increased team spirit
• Friendly customer service
• Hassle free technology
Jet Blue Vs Competitors Competing values
framework

Flexibility and discretion

Clan Adhocracy
South

differentiation
External focus and
West JetBlue
Internal Focus and
integration

Air Asia

Hierarchy Market
Stability and Control
 HR Strategy model reflected in JetBlue Airways

They wanted to take the best from other airlines and apply the lessons in Jet blue
They adopted Best Practices approach. But since it is necessary to align the best practices
to lead to competitive advantage. AMO model would be the best HR strategy model to
explain the same. Other models in the approach lead to the black box problem

A M O P
(Ability) (Motivation) (Opportunity) (Performance)
 People and Performance Model-
AMO Framework

T&D: Terrific Appraisal based on Career Growth Job

values, 360 degree Opportunity Security

Recruitment:
Attitude Fit, Ability
Behavioral Organization
Interviews Commitments,
Motivation Values Motivation & Job
satisfaction
Pay Satisfaction:
Ensuring Overall
Equity, Tailored Opportunity
Benefits and Pay Supervisors: coaches Performance
not bosses Outcomes

Tailored Job
design and Job
Autonomy Involvement: Based on fun
and passion
Stock option
Team Working: Lacking
unions
Great Two-way
Communication
Focus on being Non-Union Company
• Not having union creates team environment
– Ingroup & outgroup Bias
• Startups find it difficult by having unions
– Managing costs is difficult
• Having a strike would impact the reputation of the company
• Go slow and other mechanisms adopted by the unions would
affect their turnaround time
• It would affect Jet blue values:
– Safety
– Caring
– Fun: Creates enthusiasm for the job
– Passion: Creates new barriers, lack of team spirit
– Integrity: lack of trust with the management
Leadership of Ann Rhoades as charismatic HR
1. Position the HR team:
She aligned herself to the business plan of adding 10 new planes every year through the end of 2003,
bringing the fleet to 40; with 100 new people hired for each plane ,5000 people will be there within next 4
years. She was committed to attracting, developing, retaining outstanding people who could make JetBlue
concept a reality.
Background:
She had more than 30 years of experience in service-based businesses. Six of these years were spent at
Southwest Airlines during its rapid growth years. She was part of various significant committees and
boards and her greatest asset was her sense of humor. She believed in being a builder, not a maintainer.
2. Guide communication and culture:
She wanted JetBlue to care about employees for real like Southwest Airlines but that doesnot mean they
need to stay forever or to treat everyone the same. Rhoades wanted to take the best lessons from all the
other airlines in building JetBlue. Thus she wanted to define values for JetBlue, one of her conditions to
join. For values several people wanted financial goals but she argued they shouldn’t be there. Thus 5
values came up with Safety being the priority rest 4 were equal.
3. Change Manager-

(A)She wanted fair compensation/benefits programs, great two-way communications,

terrific training, career growth opportunity thus best place to work in town.

(B)A non-union environment-In America where 80% of the employees were organized, she
preferred non union. She gave customized employment packages to stop the formation of
unions as with a choice likelihood of people forming unions is less.

(C)Customized Employment Packages-This tailored jobs, pay and benefit packages to the
distinct needs of different employee groups but was intended to ensure overall equity in
treatment. The customized packages met or exceeded the industry standard. Benefits
started on day 1 with no such “probationary period” which gave rise to unions.

(D) Selecting the right people-Ann Rhoades gave enormous importance on hiring the right
people. JetBlue covered cost of seven weeks of pilot training for qualification on the A320-
roughly $30000. Attrition after such an investment was costly, so finding culturally fit was
crucial.

(E)Training and Development-Emphasis is placed on initial orientation of employees. Ann

Rhoades began orientation by 3 major things all employees had to do-(1)they had to show
up and be productive; (2) they had to be safe, no alcohol or drugs; (3)they had to be
customer oriented. She emphasized on safety, 30 minute turnaround time.

(F)Performance measurement and mgmt.-She introduced 360 degree feedback. Delays

were discussed only if it was productive. When they have a problem she picks worst
complainers, they are put in TIGER TEAM, They solve the problem and bring
recommendations. Power of language is practiced-employees are referred as “crew
members” and supervisors as “coaches”.

(G) Values- She was instrumental in not including financial goals as a part of values.
Strategy Mapping
Key Success Factors: Low cost, great personal
service, new planes, leveraging technology
• Raising huge venture capital funding before starting the business
• Sticking to its own strategy and continuously adapting to changes
• Wisely building the Top Management Team
• Operation Strategy:
 “Paperless” Airline thereby increasing efficiency, convenience and reducing costs
 Buying the airplanes rather than leasing
 Providing flights only where there was demand
 Low cost High service experience
 Leverage technology for safety and efficiency and with a commitment to people:
 e-tickets
 turnaround time of 30 mins
 Choosing Airbus over Boeing:
• Better financial deal
• Each seat with an extra inch relative to Boeing
• Wider back rows
• Leveraging Human Resources:
 Values defined in behavioral terms: Not focusing on financial goals rather safety, care,
integrity fun and passion
 Work culture: Employees given lot of autonomy and rather than controlling people
through rules and supervision, employees judged on how their decisions fit with the
values
 A Non-Union Environment
 Customized Employment Packages
 Selecting the right people
 Flexibility given to team to work without disrupting their family lives
Lessons Learned
 Implementing core values of corporate culture on company`s policies,
practices and systems
 Build solid teamwork through innovative and entrepreneurial culture in
result to competitive environment
 Nonhierarchical organization aligned with their innovative customer oriented
service strategy
 Managing talented executive people with their diversity to create shared
values