WestJet Airlines Case Analysis

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Table of Contents

Introduction
Problems facing WestJet Airlines
Alternatives
Solution
Conclusion
Works Cited

Introduction

WestJet Airlines is an airline company in Canada that has gone beyond all odds and managed to be at the helm of the hospitality industry. All of its founders have always believed that the key behind the company’s success is their consistency in culture and service production. The origin of this company is 1994 when one entrepreneur, Clive Beddoe, thought it was cheap to own a private jet to facilitate his weekly business travels between the two cities of Vancouver and Calgary.

Amazingly, this did not just end at that. Clive and other partners thought it wise to offer charter transport to other likeminded business people who made trips to and from the two cities just like them. This eventually became a business opportunity for Clive and his crew. They realized the potential in commercializing the charter transportation of the likeminded business people.

After extensive consultation with other entrepreneurs, Clive and his crew partnered with Neeleman to come up with a comprehensive financial model and business plan. They then came up with cheap, point-to-point airline services that were proposed to operate in the western region of Canada.

This business plan seemed so viable and attracted quite a number of investors who miraculously raised the needed capital worth millions of US dollars in less than a month. The company’s first employees moved to their very first offices in downtown Calgary (Ken, and Gerard, 52). It is important to note that in November of the same year of its conception, the company managed to purchase two Boeings 737-200 and bought a third in early January of 1996.

During its first stages of operation, WestJet Airlines flew its jets to the cities of Kelowna, Calgary, Vancouver, Winnipeg and Edmonton. It was not long before the company extended its wings to the cities of Ottawa, Moncton and Hamilton; where it actually built an international airport as its eastern base. Since then, WestJet Airlines has registered enormous growth.

Problems facing WestJet Airlines

The company’s culture could be a possible problem. WestJet Airlines’ founder, Beddoe, had once said in an interview that the success of the company lies entirely on its culture. The company is famous for its culture. Its director for communications and public relations describes the culture as youthful, fun and relaxed (Ken, and Gerard, 53).

This is particularly true because it involves doing things in a standard way and in a completely different manner from other airline companies. For instance, the authorities at the call center where travelers make their bookings have the mandate to override fares. That notwithstanding, the authorities have the power to decide whether to charge clients for cancelling their flights or not. In some occasions, these personnel have the power to decide whether to charge unaccompanied minors or not.

To some extent, this culture has played a vital role in making WestJet Airlines a unique company. It might not seem like a problem or setback to the effective management of the company at this moment. However, this culture may pose serious challenges in the near future especially due to the fact that the company is growing rapidly.

At this juncture, it is wise to say that the senior management still trusts the company’s representatives in having the company’s interests at heart. This may not be the case especially when the company expands and extends its branches to numerous cities. The reason for this is the difficulty in monitoring the extended branches remotely.

Apart from the difficulty in monitoring company branches remotely, other managerial loopholes like overriding of fares and policies of cancelation of bookings needs unequivocal monitoring. This can only be done comprehensively when the number of such anomalies is manageable. In the event that the management has to monitor such scenarios in quite a number of branches, there is bound to be untraceable discrepancies.

This should be a cause of alarm because of the high rate of growth of the company and especially because the errors involve money. First, additional employee training is inevitable when new patterns emerge in these trends (Ken, and Gerard, 53). The training obviously needs time and money. Additionally, there are probably no previous events to base the trainings on hence everything becomes pure guess work and bogus.

Another problem is the fact that WestJet Airlines only flies one type of aircraft (Ken, and Gerard, 54). That notwithstanding, the company relies so much on internet tickets, provided limited in-flight services and does not have flyer programs. This is an indication that the company does not diversify its services.

This translates to attracting only one type of client. At the moment, this could not seem like a possible challenge to growth. The company does well in its overall productivity and perhaps this is attributed to the standard procedures that have been operational since the inception of the company.

In the future, however, this could be a serious hindrance to continued growth as it gives clients no diversified services. It is important to note that competition will do whatever it takes to woo clients. In this hospitality scenario, utter guest satisfaction is the key to success. For instance, WestJet Airlines does not offer any meals and offers only one class services (Ken, and Gerard, 54). This might be seen as a weakness by competition.

Alternatives

Provide meals for travelers
Offer different types of flights
Offer different classes of services
Provide standards for operation as opposed to employee own judgment

In a hospitality industry like WestJet Airlines, impressing the customer is paramount. Clients have a weakness of revisiting only the places where they were previously most satisfied and impressed. In as much as the company does well in its overall performance without offering meals to clients, it should think about doing better by giving its clients a reason to smile.

It is important to note that if the company does not impress its customers another company will. For this reason, the management of WestJet Airlines should not wait until their customers are impressed by other companies before they do the same.

The fact that WestJet Airlines offers only one type of flights indicates that it attracts only one type of clients (Ken, and Gerard, 56). There are customers who would want to hire jets to their destinations. However, they are driven away to other airlines by the fact that WestJet Airlines only has Boeings. The last thing a business institution should do is create market for its competitors. In this case, a client will less likely return to WestJet Airlines even if he or she needs ordinary transport services.

WestJet Airlines does not provide different classes of services (Ken, and Gerard, 54). In business, differential pricing helps in maximizing the profits. There are obviously clients who are willing to pay more than others for traveling in the same aircraft and covering the same distance simply because of a little more comfort. The company should take advantage of this and make more money.

The reason why WestJet Airlines is able to tally its financial records even after its representatives at the call center make independent decisions of whether to fine clients for late cancellation of bookings and whether to charge unaccompanied minors is because of the manageable number of clients. While considering the enormous growth of the company, it is important to note that the number will be unmanageable soon. The company should, therefore, consider implementing a standard procedure for handling such issues.

Solution

The best of the alternatives that WestJet Airlines should be keen about is formulating standard policies for handling certain issues as opposed to giving employees the liberty to make certain independent decisions. For instance, the decision of whether to charge unaccompanied minors should be standardized.

The management should decide whether the minors should be charged for services or not. Whatever decision it makes should become a policy and a standard procedure for handling all similar cases. This may be part of a longtime strategy to factor in the possibility of registering an increased number of clients in future.

This is perhaps the most reliable means of avoiding all the financial discrepancies that may be associated with dissimilar pricing. It is sometimes important to have standard prices especially in rapidly growing organizations like WestJet Airlines in order to ease auditing. It is, therefore, imperative that the company considers having in place strategies projected to counter future anomalies (Ken, and Gerard, 59).

Conclusion

WestJet Airlines has been, for a long time, ranked among the few most money-making airlines in North America (Ken, and Gerard, 52). It has overcome serious challenges including high fuel costs and the dwindling economy. Nonetheless, the company should opt diversifying its services in a bid to attract a variety of clients.

Works Cited

Ken, Mark D., Gerard, Seijts T. “WestJet Airlines.” The culture that breeds a passion 38.3 (2001): 52-61. Print.

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