Continental Term Paper

Pages: 10 (2764 words)  ·  Bibliography Sources: ≈ 13  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business

SAMPLE EXCERPT . . .
As a recommendation, Continental should be approaching different companies in other related industries in order to form mutually advantageous partnerships that will reduce its costs. In this sense, I am referring to catering companies, for example. A partnership with such a company will be benefic to both companies. Continental will ensure not only the timely deliver of its food to the planes, but also a preferential price on the overall service. The idea of having partnerships with companies operating in some part of the supply chain is not new, but it can be successfully be applied by airline companies, especially with the present requirement for excessive cost reduction.

In terms of future strategy recommendations, I would consider diversification. Of course, such a concept is hard to be applied for an airline company, where, more or less, all the companies provide the same type of service. However, one has to provide an incentive so that the customer will buy ticket from you and not from the competitor. We should jot down some of the first things that come to mind when choosing an airline company: accessibility in terms of ticketing and location, reliability (everything related to the flight, from on time policies to security), etc. Concentrating on the businessmen sector would allow Continental to provide quality services and charge an extra amount of money for them.

6) Specific Functional Strategies

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If we keep in mind the two strategic concepts, diversification and strategic partnerships, we will be able to create the strategies for each of the sectors in question here.

Term Paper on Continental When We Are Discussing Assignment

In terms of marketing, Continental specifically needs to determine a certain segment of consumers that is most likely to bring it stable high revenues in the future. In my opinion, the non-business segment is unreliable, mainly because of its seasonality: vacations and holidays tend to be periods when sales will increase in this category, but, on the other hand, regular periods are not so profitable. Continental should insist on the business segment. This segment does not look at the price, but it wants quality. This should work fine for a market where an economy of costs is more and more difficult to perform.

In terms of human resource, there isn't much to add on the policy that the company has followed ever since 1994-1995. Teamwork and the atmosphere at the workplace are key factors for the success of any endeavor. As a note, I would add special training sessions where the personnel will be introduced to the company's future strategies and plans of actions, as well as to the directions it will be following. Also early retirement should be encouraged so as to avoid further lay offs.

As for finance, the financial situation needs to be kept stable, on the path that the company is already following upon, with a close eye for the company's debt.

In terms of Management Information Systems (MIS), Continental has already successfully implemented several information technology related programs, included the widespread of e-ticketing. In my opinion, this positive trend should be emphasized in the future as well. Indeed, the company should acknowledge the fact that a proper use of management information systems simply will save a lot of money, because the resources that are replaced can be used for something else.

The operational management area will probably prove the most difficult to handle, because it will include a day-to-day tracking of all operations. The policies that the company has applied in the 90s, with a certain decentralization (for example, the episode where the company regulations were burnt so as to induce the employees to think for themselves and act in different key situations), seem relevant in the future as well. The day-to-day partnership with the caterer, for example, does not need to be handled by a high level executive. Decentralization seems a key point in the company's future challenges.

7) Specific Annual Objectives

7.1. Marketing:

Increasing the company's share of the market

Determine and successfully approach the business segment of consumers -- increase in the number of consumers from this category

Build the Continental brand

7.2. Operational Management

Day-to-day relationship with the partners

Decentralization

7.3. Human Resource

Increase employee satisfaction, measured by the number of employees leaving the company each year

Increase workplace efficiency (the company has already worked in this sense for a decade)

Encourage early retirement

7.4. MIS

Increase e-ticketing proportion in the system

Implement information technology at all levels of the company

Implement tracking software

7.5. Finance

Sell the unprofitable planes (in terms of the occupation rate)

Solve the debt issues that may appear

Set a profit margin goal for the 2004-2009 period

8) Corporate Social Responsibility Issues

In my opinion, both in the past and in the future, the most important issues related to the company's social responsibility issues are those that characterize its product: product safety and reliability, as well as the treatment of employees.

As we have seen from the case study, the first issue, related to product safety and reliability, was the most important endeavor during the 90s. Most of the financial problems that Continental had had derived from its inefficient handling of luggage, from not respecting the flight schedules and canceling flights, etc. Statistics in this sense were obvious: not being on time cost the company $5 million dollar each year. The solution was quite simple: take half of this amount and turn it into bonuses for the employees, in the case they managed to pursue on time policies. The rest of the sum was the company's own profit.

In this sense, it is to be expected, in my opinion, to continue this policy into the future as well. Reliability, both in terms of schedule and luggage delivery, has the greatest advantage of being relatively cheap: besides the employee bonuses, there is no real cost associated with doing a better job out of it. As such, increased reliability may later become a competitive advantage for the company.

The treatment of employees was the second issue that the management used in order to be able to turn things around and be able to bring Continental out of the financial mess it was in the beginning of the 90s. The treatment of employees is directly proportional with the way they do their job and with the efficiency they have at the workplace. The fact that there were wage cuts and serious fights between departments for the company's resources could be of no help to the company's overall progress and improvement.

So, in this sense, a teamwork atmosphere in the workplace seems essential in the future as well, especially given the tougher times the industry is passing through, times which are affecting Continental as well. I would recommend some of the employee programs and activities that have been largely successful in the past, emphasizing the company spirit and communion. Things like barbecues, field trips, etc. represent only a small proportion of the company's overall spending, while the impact and benefits are much more important.

Bibliography

1. www.continental.ro

2. Porter's Five Forces. A model for Industry Analysis. Strategic Management. On the Internet at http://www.quickmba.com/strategy/porter.shtml

3. Grant, Robert M. Case 3. THE U.S. AIRLINE INDUSTRY IN 2004. 2002. On the Internet at http://www.blackwellpublishing.com/newgrant/docs/03USAirline2004.pdf

4. http://www.csuchico.edu/mgmt/strategy/module8/tsld044.htm

5. 2003 Annual Report- Continental Airlines. On the Internet at http://www.continental.com/company/investor/docs/continental_ar_2003.pdf

6. 2004 Airline Industry Economic Report. On the Internet at http://www.airlines.org/econ/files/2004AnnualReport.pdf

Porter's Five Forces. A model for Industry Analysis. Strategic Management. On the Internet at http://www.quickmba.com/strategy/porter.shtml

Ibid.

Ibid.

Grant, Robert M. Case 3. THE U.S. AIRLINE INDUSTRY IN 2004. 2002. On the Internet at http://www.blackwellpublishing.com/newgrant/docs/03USAirline2004.pdf… [END OF PREVIEW] . . . READ MORE

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