AMERICAN AIRLINES

America Airlines was formed in

1934 when aviation subsidiary
sold off the unconnected
coast-to-coast network of
small aviation companies that
it had consolidated under the
name of American Airways.
Under the president C. R.
Smith, it faced decline until Mr.
Crandall joined it as a chief
financial officer.
Swot analysis
 STRENGTHS (S):-

 Trained employees
 computerized reservation system
 Recognizable brand name
 Largest global airline in terms of passenger traffic
 National and International routes serving all corners of the
globe
 High profit-earning rate
 Ranked at Top in U.S in customer service and employees
satisfaction.
 Employees suggestion program as it saved 31 million in a
single year.
 WEAKNESSES(W)

 pilot union is pushing for salary increase

that would raise the cost
 Increase in production cost
 Over weight female attendants
 To many divisions
 High cost for trained employees
OPPURTUNITIES(O):-

 Exploit the customers by offering

customer’s demand and satisfaction
 Trained employees help in enhancing the
customer’s satisfaction level and loyalty.
 New fuel efficient engines
 Travel increasing in general
THREATS (T):-

 Rising costs of production

 Union pilots demand for raising
salaries so it will increase the cost
 Increased air travel inconvenience
(security related)
 Business travel declining
 Terrorism threat
 Threat of new entrants
 New services and innovations offered by
competitors
 high fuel prices
 government intervention
 Question no # 1
How does American Airlines
address employees’ needs?
 Job security
 Profit sharing
 Lower-wage scales for new
employee so that they put their full
efforts and work up to bring
themselves at the level where the
experienced employees are
 Implementation of employees ideas
as it saved 400,0000$
 Training of employees to take initiative when
solving problems and training of managers to
delegate authority
 Employees involvement
 Employees motivation by rewarding them for
their initiative good ideas and performance
with travel and merchandise
 Employees recognition programs, mangers
give employees point towards merchandise
for good work such as helping a passenger
with an emergency.
 Performance feedback system with regular
reports on customer satisfaction.
 QUESTION NO:- 02
What about American’s decisions
to delegate authority and to
encourage employees’ to takes the
initiative involving problem? How it
is likely to affect the performance.
 American’s decisions to delegate authority and
to encourage employees’ to takes the
initiative involving problem. it will affect the
performance as follows:-
 They will feel sense of ownership

 When they will feel that the owner is trusting

in them then they work at their fill potential

 Employees loyalty

 High morale of employees

 Their ability to handle difficult and
suddenlly aroused situations will be
increased
 New and innovative ideas
 Employees are encouraged and
determined with the great feelings of
appreciation for their ideas
 Fast speed of decision making
Question # 3
How could Crandall use motivational
theories to help resolve this problem with
flight attendants opposition to weight
rules? How does the issue of weight rules
relates to organizational goals and
societal trends?
 To help resolve this problem Crandall can use
the motivational theories in these ways:
 he can use the Need theory by fulfilling the
needs of employees
 ERG theory by fulfilling
E: EXISTENCE NEEDS
 R: RELATEDNESS NEEDS
 G: GROWTH NEEDS
Can use two factor theory by providing
 Recognition, policies,advancement,job
 security,achievement,supervision,personal
growth, work conditions,,salary,responsibility

Using Adam's equity theory by giving them Fair

And Equitable Reward
Using process theory in a way that
 must give abilities to succeed
 link reward to performance
 rewards must be attractive for individual
( wide variety), intrinsic and extrinsic rewards
 Using Reinforcement theory by
 Providing them positive reinforcement
 Expectancy theory by giving them rewards,
incentives and bonuses
So these motivational theories can be used by
Candrall to motivate the female attendants to
remain fit and smart and to reduce their weight.
Because smart and active employees can
contribute a lot towards organizational success.
Customers like active and smart attendents and
customer satisfaction is the objective of
organization so this issue of weight rule relates
to organizational goals and objectives.
 What concept guide Crandall
in designing a profit-sharing
plan that would reward
American baggage handlers for
improving customer services?
 Crandall is designing a profit sharing
plan, that could reward American
baggage handlers for improving
customer services, because when they
motivate the baggage handlers by
sharing profit with them on better
performance then they can perform well.
When they will be satisfied with the
company then they are motivated and
want to perform well so that they can
remain well within that company that
fulfil their needs and wants very well.
 When they have no worries about their
wage, incentives and rewards then They
have no fear regarding job insecurity and
they can communicate with the customers
in a better way and they help them in
resolving their problems and customer
satisfaction will be increased. So the
result in increased productivity, profit
generated for American Airlines.