MARK270 Final Exam Case Study

MARK270 Final Exam Case Study

Section B (40%)
Instruction: This section contains ONE (1) case study essay question with TWO (2) sub
questions, this section is worth FORTY (40) marks. The total length of this question’s answer
should be around two to three pages. Answer the essay on the answer booklet provided.

Please DO NOT bring this case study into the exam venue, a copy will be provided to you
during exam.

JetBlue and the Valentine’s Day Ice Storm at JFK

When JetBlue Airways began flying daily in 2000 from New York City to Fort Lauderdale,
Florida, and Buffalo, New York, it promised fares that would be as much as 65 percent lower
than their competitors’. At that time JetBlue had 300 employees and provided its customers
with comforts like assigned seating, leather upholstery, and satellite TV on individual screens
in every seat. The low fares were an immediate hit with passengers, as they found friendly,
snappily dressed flight attendants who served animal crackers, Oreo cookies, and blue potato
chips on flights very appealing. Indeed, by early 2007 JetBlue had 9,300 employees and 125
jetliners, operating about 575 daily flights to 52 destinations in the United States and the
Caribbean. Customers had come to love the airline. It had won many awards for its service and
had regularly been ranked near the top of airline satisfaction ratings by J.D. Power and
Associates, among others.
JetBlue’s reputation for excellent service was challenged on Valentine’s Day, February 14,
2007, when a severe storm dumped two inches of ice at New York’s JFK Airport. Although
the weather created headaches for just about all air carriers in the eastern United States that
Wednesday, it was JetBlue who received the most attention. Why? The airline that had
developed a reputation for its customer-friendly approach had suffered a startling
breakdown. More than 1,000 flights were canceled over the next six days. Passengers were
stuck on planes for up to nine hours. Delays averaged nearly 4 hours. It took nearly a week for
JetBlue to return operations to normal.
What actually happened? Bad weather and poor management decisions led to full gates
and a substantial queue of planes waiting for gates. JetBlue’s initial responses to the
weather disruptions on Valentine’s Day were not good. While the storm was occurring, and
even immediately afterward, JetBlue failed to cancel flights, leaving some passengers
stranded on the tarmac for as long as 10 hours. The policy of initially postponing, but not
canceling, flights resulted in snowballing 很多 cancellations for nearly a week, with long
lines at the airport as customers attempted to get on flights.
Unfortunately for JetBlue, this happened in the Jrmedia capital of the world—thus, its service
failures received major attention in the press. Perhaps the most devastating blow of all was
delivered by BusinessWeek; the magazine described the situation as “one extraordinary
stumble” on its March 5 cover touting its first-ever rating of the best firms in customer service.
Customers obviously would prefer to not have experienced such a failure, but even more
important in many situations is how a firm responds to such a situation.
Answer your essay by referring to this case study.
Hard standard and Measure
- Thing that can be counted, timed or observe through audit
o Time, number of event

Soft standard Measure

- Opinion based measure that cannot be observed and must be collected by talking to
customer
o Such as perception or belief

Process for Setting Customer-Defined Standards

1. Identify existing or desired service encounter sequence
- Done by listing the sequential step and activity that the customer experience in receiving
the service
- Identify the standard that meet customer expectation for each interaction
- The company open to discovering customer service encounter sequences, exploring the
ways customer want to do business with the firm
- Firm also have to consider its service encounter have the greatest impact on customer
- A strong finish in the final event of the service encounter sequential has a greater impact
on overall satisfaction
- Eg: some business traveler doesn’t view air travel as a simple product but as inconsistently
performed sequential process that include checking-in, waiting, boarding, in flight time
o This service encounter can leave a strong impression to customer
o For the case scenario, Jetblue airline can have a negative impression from the
customer although there have a good reputation previously because the climate
issue and company failed to cancel flight and let passengers stranded on the tarmac
for as long as 10 hours
2. Translate customer expectation into behavior
- Company have to understand and identify the customer requirement and expectation and
turn it into concrete 具体 with specific behavior and action associated with each service
encounter
- The airline company can identify the customer preference by outsource the research firm
to get the information
- When get the information, the company can translate the customer expectation into
specific action in order to fulfill customer satisfaction
- These behavior and action that defines the performance expected by customer
- Eg: Jetblue airline did well in the beginning and they can clearly identify the customer
expectation such as provides lower fare air ticket with quality service can attract customer,
therefore, they turn it into action and implemented it
o In the result is surprised most of the customer can get this such service quality such
as the flight attendant is friendly with warm smile and serve its customer different
kind of snack on flight to ensure the customer wont be bored
3. Determine appropriate standards
- Determine whether the soft or hard standard should be used to capture a given behavior
and action
- The company must design standard to ensure that all service delivery are in the scope such
as customer expectation from services being offered at time to evaluate and set the
standard
- Both soft as well as hard aspect have to be incorporated in the standard
- Can based on the most important criteria for creation of appropriate service standard
o Standard are based on behavior and action that are very important to customer
o Standard cover performance that needs to be improved or maintained
o The standard cover behavior and action employees have control over and can
improve
o The standard are understood and accepted by employees
o The standard and predictive rather than reactive based on current and future
customer expectation rather than past complaint
o The standard are challenging but realistic
- Hard standard: consists of quantifiable measure of employee behavior
o Eg：Jetblue can translate most of the customer requirement into hard standard by
reliability standard which can institute that ‘right on time’
o Which mean that the service is performed at the scheduled time and the company
representative when promised the delivery service is made at time the customer
expected
o This is because that Jetblue airline failed to deliver this such reliability standard by
postpone their customer flight due to the climate issue but lastly cancel the flight
without earlier inform to customer
o Throughout this scenario, Jetblue have to improve their reliability standard in order
to meet the customer satisfaction
- Soft standard: concern with more abstract requirement or issue, not easily quantifiable and
much more subjective
o Soft standard is important for person to person interaction, it can be through
provide direction, guidance and feedback to employees in way to achieve customer
satisfaction
- Eg: Jetblue has failed to meet the soft standard as well. This is because that the
management of Jetblue cannot react quickly to solve the problem immediately and do not
have a proper communication to their customer and let them to wait for gate more than 8
hours but in the result the flight is ald cancelled
- Conclusion: Jetblue are required to improve the both hard and soft standard

4. Develop measurement for standard

- Develop feedback measure that get capture the standard
- To development the measurement can have a clearly picture that the problem of the
company and in order to meet the customer standard
- Understand the most important requirement of the customer
- Link this requirement to tangible and measureable aspect of service provision
- Use feedback from these indexes to identify and improve service problem
- 2 type measurement
o Hard measurement: involve mechanical counts or technology-enable measurement
 of time
 Measured continuous and operationally without asking the customer’s
opinion of them
- Eg: the measurement of hard standard of Jetblue measurement service quality index
o On-time flight: identify the percentage of Jetblue flight delay after commitment
time. Not only Jetblack airline, most of the airline company can have the problem
of flight delay but it depends on the number of times.
o Soft measurement: based on customer perception that often cannot be directly
observed
o Jetblue can through the trailer call to observe customer perception and meet their
standard and this research method will be more suitable for airline company
because:
 Trailer call: associated with specific service encounter, administered as
close in time to a specific service encounter as possible
 Long-term requirement and document customer, higher level of
abstraction such as attribute level.
 Annual relationship survey can document customer perception by
periodic basic
 Administered continuously, whenever customer experience a service
encounter of the type being consider, to provide data on
continuously basic.
5. Establish target level for the standard
- To ensure the standard is to fit the requirement
- Can through the simple perception action correlation technique
- When the service consists a repetitive process, company can relate level of customer
satisfaction with actual performance of a behavior or task
- Eg: Jetblue airline can gather the customer perception while they queue in line for stamped
the entry time on ticket
o As the customer exited the line at the end of transaction, the flight attendant
restamped the ticket while the exit time and asked the customer 3 to 4 question
about perception of the wait in line and satisfaction with the transaction
6. Track measure against standard
- A careful and comprehensive fact-based system that provide information about the
operation can lead to successful business
o Continually examine how the company is performing the comparison to its service
standard
o Jetblue airline can through statistical process control by create the chart, tracking
the wide range issue such as the emotion of passenger and the service quality by
flight attendant
o any customer complaint can track through the root-caused analysis and all the
customer complaint have to update generate a report
o the report has to cover how long it takes to resolve customer complaint and provide
detail quarterly analysis of trend
o the report can be used for reference for other employee in airline company in order
to reduce the number of time of customer complaint from the same issue
7. provide feedback about performance to employee
- after company have determined appropriate standard, develop specific measures that best
capture customer requirement and set appropriate target level for the standard
- then have ton develop mechanism to provide feedback on employee action and bahaviour
- So that, Jetblue airline can monitor their employee no matter flight attendant, pilot or
ground crew with customer service department
- The purpose of it is to provide often feedback on employee performance to the service
standard which set by an organization
o For instance, it can focus on how the employee no matter is flight attendant or
ground crew handles the passenger request in any accidentally incident
 For the case study above, the Jetblue was failed to handle well the
passenger request and let the passenger complaint in order to receive a
major attention in press
8. Periodically update target level and measures
- Revising the target level and even customer requirements regularly enough to keep up with
customer expectation
- Jetblue can have some flexibility in changing service standard based on the passenger
requirement and the issue has been met previously
- For instance, Jetblue airline can provide a recuperate room for the passenger while the
flight postponed,
- it can provide some entertainment equipment for the passenger or the kids to pass the time
instead of stranded on the tarmac for long hour
- Furthermore, to provide some snack or entertainment equipment such as game machine
can reduce the restless of passenger