Sas Case Analysis

International faux pas 6-2 T h e C a s e o f (Scandinavian Airlines S A S System) INTRODUCTION Scandinavian AIRLINES SYSTEM (SAS) originated when the airlines of Sweden, Norway and Denmark formed a consortium. 1970s competition are bowelless and resulted in a loss market share. 1981 Jan Carlzon, The CEO, undertook drastic decentalisation. Top-Down ascendance replaced by open communication. SAS Strategies is to become known as the businessmans strategy (with rather high fares), with upgraded supporter, on-time performance, good nutriment and comfort.For the Future SAS has 2 goals 1. To become the most streamlined airline in Europe by 1992 2. To be one of the quintet major airlines in Europe afterwards 1995 Keystone is SASs global strategy is to form strategic alliances. -? An contract to exchange equities with Swissair was reached in 1989. -? Alliance was also made with All Nippon Airways, LanChile, Canadian Airlines Intl and Finnair. I. TIME CONTEXT II. VIEWPOINT 1981 Ja n Carlzon SAS CEO III. CENTRAL PROBLEM knockabout competition, Loss of market share & Reduced profitabilityIV. STATEMENT OF heading Must to cope up with competition Wants to become the most efficient airline in Europe by 1992 and to be one of the five major airlines in Europe after 1995 V. AREAS OF CONSIDERATION THREATS 1.? Competition with large airlines 2.? High fuel price 3.? Rising operational costs 4.? lessening in demand for air service 5.? Price Wars OPPORTUNITIES 1.? strategic alliances with new(prenominal) airlines 2.? Offer high-quality service V. AREAS OF CONSIDERATION WEAKNESSES 1.? Deterioration of services 2.?Low team spirit of the workforce STRENGTH 1.? Workforce 2.? Upgraded returns 3.? On-time performance 4.? Good food & comfort 5.? Decentralization VI. ALTERNATIVE COURSES OF ACTION 1. Continuous implementation of decentralization (+) Faster decision- reservation Address and solve the problem right away surface communication educational activity and develop ment for employees (-) Mistakes or wrong decisions are commonplace Policies and rule must be reviewed and change Training cost neat deal of time in communication a.? b.? c.? d.? a.? b.? c.? d.?VI. ALTERNATIVE COURSES OF ACTION 2. Strategic alliance with other airlines (+) Access to different airlines hub Leverage Able to debate with larger airlines Opportunity to sell shares (-) a.? Control issue b.? Possible wipe out of money a.? b.? c.? d.? VI. ALTERNATIVE COURSES OF ACTION 3. Upgrade service strategy (+) a.? High-quality service b.? Punctual and on-time performance (-) a.? High fares b.? Research and development cost c.? Training cost VII. RECOMMENDATION Adapt ACA 2 (Strategic Alliance) VIII. ACTION PLAN individual Responsible Jan Carlzon / Marketing Research Jan Carlzon Jan Carlzon Jan Carlzon / Negotiating Team Negotiating Team Jan Carlzon / Allies pay Department Activities Gather data through business intelligence & free-enterprise(a) analysis Set a meeting with the SAS Board Form a negotiating team Set meetings with possible allies Time Frame 30 years 1 day 7 days Prepare proposals/MOA/Service agreement Contract signing / sign-off Prepare budget 3 days 1 day 5 days Mistakes can usually be corrected later the time that is lost in not making a decision can never be retrieved. Jan Carlzon