Don Honorio Ventura State University

College of Hospitality and Tourism Management

A.Y 2020-2021

Eastern State Air Environment Case Analysis

Presented by:

Alfonso, Rubie Ann D.

Dizon, Janine S.
Figueroa, Andrea Sol
Parico, Junearlsan G.
Razon, Andrea Louise Q.
Reyes, Herson M.
Tolentino, John Lei P.

BSHRM 4B

Adviser: Mr. John Paul L. Espiritu

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 INTRODUCTION:

Airline industry is highly competitive, and customers are most important factor of the
traveling process. Besides enhancing service quality, flight safety. Customer satisfaction is the
most important strategies of the airlines (Fried, 1989; Gardner, 2004; Zaid, 1995). Customer
complaints serve as a critical dimension of service quality and customer satisfaction. Complaint
handling (Davidow, 2003) has a great effect on customer retention and the positive usage of
complaint handling for service quality improvements have been extensively acknowledged by
the airlines and evaluative firms (Strauss & Schoeler, 2004). Complaint management is still a
focal point of study as more firms are convinced that defensive marketing is a highly cost-
effective (Davidow, 2003). Customer complaints offer organizations with a chance to correct
their mistakes, retain dissatisfied customers, and manipulate customers’ future. Customers’
attributions about breakdown and recovery of service then complaint satisfaction (Stauss, 2002)
[6], repurchase intentions (Palmatier, 2002) satisfaction and service quality attitudes
(McCollough, 1998, Swanson & Kelley, 2001). The nature of customer attributions about
complaint handling is necessary to make sure that the service improvement offered by the
airlines satisfies customers’ expectations. The airlines’ serious concern regarding customer
complaints and compliant satisfaction (Stauss, 2002) would make airlines more likely to meet
the customer’s expectation in case of a problem. Once customers get to know this customer
might regularly use complaining behavior as a strategy to take benefit of the airlines every time
it is possible. There are number of evidences which tells that the complaint satisfaction has a
direct relation to response of a company which in end has a huge impact on customers’ future
behaviour (Strauss, 1993, 2002)
As a business owner and leader, you’re going to have to make a lot of important
decisions for your company. On everything from marketing to sales, operations to human
resources, your team will look to you for guidance and ask which direction they should go in. In
addition to keeping profitability in mind, you also have look at decisions from an ethical
standpoint. The role of ethics in decision making affects how you approach decisions, how you
decide which action to take and whether or not you need to consult someone else for their
viewpoint (Ahmed, 2020) The success of a business depends on whether the products and
services it sells produce enough revenue to pay for its costs, but profit is not the only
consideration that can weigh on business decisions. Ignoring considerations like the violation of
laws and accepted business norms, or the effects decisions can have on others, can result in
unethical decisions. Addressing ethics in personal decisions requires a thoughtful approach to
decision making (Hamel, 2020)
Eastern States Air were known as “the airline that put the frills back into flying.” For
them to satisfy the passenger’s needs, they made some adjustments and add some new
features in their service. They add a lounge to all planes that could accommodate one. For
people not wanting to leave their seats, two complimentary drinks per passenger per flight,
delivered to the seat, became the standard. The Eastern States Air had to put the trills back into
flying, they were surveyed by the passengers, and the results showed that the passenger’s
satisfaction was off the chart at the top. The airline was considered in to providing outstanding

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 service with no complaints. They proved that it was possible to have zero defects in airline
service. For that, they had to raise its fares. But these adjustments also resulted in declining of
sales of the company. They did again another adjustment for them to cope up with the declining
number of sales. They implement a new strategy, Eastern States Air cut back on the number of
seats class but increased their size, along with first-class appointments and level of service, to
retain the airline guests who had been satisfied to have the frills put back into flying and were
willing to pay for them. Throughout the rest of the plane, however, economy became the
watchword. More seats were stuffed into each plane, the number of flight attendants was
reduced, and “meals” consisted of dry finger food, mainly pretzels. They not only added a fee for
luggage, they even charged for carry-ons. But these new strategies they implemented also have
consequences. More people complains about their service. This also resulted in dropping of
Morale among the pilots and flight attendants.
This study aims to provide answers to the following dilemma that the management is
experiencing. We will be identifying some of the problem and provide possible solutions.

BACKGROUND OF THE STUDY:

In the social and life sciences, a case study is a research method involving an up-close, in-
depth, and detailed examination of a particular case. For example, a case study in medicine may
examine a specific patient a doctor treated, and a case study in business might study a particular
firm's strategy. Generally, a case can be nearly any unit of analysis, including individuals,
organizations, events, or actions.
Case studies can be produced by following a formal research method. These case studies
are likely to appear in formal research venues, as journals and professional conferences, rather
than in popular works. Case study research can mean single and multiple case studies, can include
quantitative evidence, relies on multiple sources of evidence, and benefits from the prior
development of theoretical propositions. Case studies may involve both qualitative and
quantitative research methods (Invernizzi, et al., 2020) Single-subject research provides the
statistical framework for making inferences from quantitative case-study data. Another suggestion
is that case study should be defined as a "research strategy", an empirical inquiry that investigates
a phenomenon within its real-life context. A case study does not necessarily have to be N=1, as
there may be many observations within a case (many individuals and entities across many time
periods) (Yin and Lamnek, 2010,2013)
The resulting body of case study research has long had a prominent place in many
disciplines and professions, ranging from psychology, anthropology, sociology, and political science
to education, clinical science, social work, and administrative science. Case study research have
also played a prominent place in business and management research (Taylor and Søndergaard,
2017).

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 STATEMENT OF THE PROBLEM:

The study aims to provide solutions to the dilemma that Eastern State Air Environment
and Ms. Gloria Rooney is facing. Specifically, the study seeks to answer the following questions:
 How will Gloria Rooney resolve her impulsive way of implementing new strategies to
the company?
 What strategies will the company implement to increase their sales?
 How will they able satisfy the wants and needs of their customer?

AREAS OF CONSIDERATION/SWOT ANALYSIS:

STRENGTHS:
 The company’s ability to embrace and adopt changes rapidly.
 Ms. Rooney’s steady vision in the goal they want to achieve.
WEAKNESSES:
 Not considering the opinion of others.
 Very impulsive in terms of decision making.
OPPURTUNITIES:
 They can generate new and innovative ideas for the development of the company.
 Percentage of people travelling in airlines is gradually increasing.
THREATS:
 Very competitive industry.
 Inconsistent customer preferences/demand.


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 ALTERNATIVE COURSE OF ACTION (ACA):

1. Ms. Rooney can do a thorough research and consider the opinion of the stakeholders
before implementing new strategies.
i. Advantages – Since she did a thorough research and consult the stakeholders,
she might find a solution that will benefit both sides.
ii. Disadvantages – Since there are many opinions and solutions being suggested,
they might confuse each other and have a miscommunication.
2. They can implement both the 2 changes they made. They can section the plane seats. There
will be a section for those seats with a lounge area and there will be also normal seats. Or
they can lessen the size of lounge area, have a variety of snacks, and have a complimentary
drink for each passenger.
i. Advantages – By sectioning the plane seats, those passengers who wants to avail
the normal seat before but can’t, can avail it now.
ii. Disadvantages – Since the lounge area will be smaller, those passengers who will
avail it might complain because they are paying a higher price. And if they will be
having variety of snacks and complimentary drinks, their expenses will increase.

3. They can ask the passengers to fill out survey/feedback forms online.
i. Advantages – They will be able to know what part they need to improve based on
the passenger’s responses.
ii. Disadvantages – The passengers might not answer the forms or they might not take
it seriously, resulting on having irrelevant responses.

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 REFERENCES:
Fried, L. I. (1989) Continental Airlines: shooting for the ultimate service. Management Review,
78(5), 46-50.

Gardner, E. S. (2004) Dimensional analysis of airline quality. Interfaces, 34(4), 272- 279.

Zaid, A. M. (1995) Measuring and monitoring service quality at Malaysia Airlines. Managing
Service Quality, 5(2): 25-27.

Davidow, M. (2003) Have you heard the word? The effect of word of mouth on perceived
justice, satisfaction and repurchase intentions following complaint handling. Journal of
Consumer Satisfaction, Dissatisfaction and Complaint Behavior, 16(1), 67-80.

Strauss, B. & Schoeler, A. (2004) Complaint management profitability: what do complaint

managers know? Managing Service Quality, 14(2):147-156.

Stauss, B. (2002) The dimensions of complaint satisfaction: process and outcome complaint
satisfaction versus cold fact and warm act complaint satisfaction. Managing Service Quality,
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Palmatier, R. W. (2002) Integration of customer satisfaction and relationship marketing models

for predicting repurchase intentions: an attribution approach. Proceeding of American
Marketing Association Summer Educators’ Conference. San Diego, CA, P. 163.

Ahmed, A. (2020) Decision Making in Business Ethics,

https://smallbusiness.chron.com/decision-making-business-ethics-446.html

Hamel, G.(2020) How to Address Ethics in Your Personal Decision Making, What Do You Do
When You Need to Make a Decision & No Policy Exists? (chron.com)

Invernizzi, Diletta Colette; Locatelli, Giorgio; Brookes, Naomi; Davis, Allison (2020-11-01).
"Qualitative comparative analysis as a method for project studies: The case of energy
infrastructure". Renewable and Sustainable Energy Reviews. 133: 110314.
doi:10.1016/j.rser.2020.110314. ISSN 1364-0321.

Yin, Robert K. (2013). Case Study Research: Design and Methods (5th ed.). Thousand Oaks, CA:
SAGE Publications. ISBN 978-1-4833-2224-7.

Lamnek, Siegfried (2010). Qualitative Sozialforschung: Lehrbuch (in German). Weihnhein, Basel:
Beltz. p. 4. ISBN 978-3-621-27770-9.

Taylor, Marilyn L. and Søndergaard, Mikael (2017). Unraveling the Mysteries of Case Study
Research: A Guide for Business and Management Students. Edward Elgar Publishing. ISBN 978-
1786437235.

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