Delta Executive Summary

Delta Airlines is the largest airline carrier on the Atlantic Coast. In terms of scheduled passengers carried they were world’s largest airline with 277.6 billion in 2013. Also the second largest

Delta “focuses on shifting their cost structure from fixed to variable costs as much as possible.” (https://rctom.hbs.org/submission/delta-airlines-flying-high-in-a-competitive-industry/) Delta also understands the importance the importance of delivering top notch customer service to appeal to their principal demographic, business travelers. They have incorporated a training work-shop so employees have a better understanding of how to solve travel disruptions that customers deal with. Employees also learn how to help insure that baggage performance is up to par with a low amount of mishandled bags reports from customers. Delta has done this by incorporating a way for customers to track their bags using a mobile app. In the Business Travel News Delta has been ranked #1 by corporate flyers for four years in a row. I believe the business level strategies that Delta has incorporated have been a good choice for their business. Their strategies have helped them to gain a competitive advantage from customer service and great operating cost flexibility.

AMR Corporation is the parent company of American Airlines. It is headquartered in Fort Worth, Texas. They are one of the largest airlines in the world. American Airlines is also one of the largest scheduled air freight carriers. American Airlines provides a wide range of freight and mail services onboard their passenger aircrafts. (http://www.aa.com/i18n/aboutUs/corporateResponsibility/company/profile-and-fast-facts.jsp). On April 8th, 2015, all of US Airways airframes were transferred to American Airlines when a Single Operating Certificate was awarded by the Federal Aviation Administration allowing the merger to be complete and making the airline one of the largest in the U.S. (https://en.wikipedia.org/wiki/American_Airlines_Group).

This research led me to compare the current strategy of the company and visualize the gap between this and the key issues that they have to tackle. Furthermore, in order to conclude this

Through this plan the management has increased productivity, creativity, quality and innovation in the company. Boeing has companywide diversification

corporate-level strategy you think is most important to the long-term success of the firm and

Considering our analysis of the company, it is recommended that shares of Boeing should be bought or held. This recommendation is based on factors such as company valuation, financial analysis of comparable firms, and a sensitivity analysis. In using the CAPM, the value of the stock calculated is equal to $192.48, which is more than the current trading value of $153.24 (Apr 13, 2015). In addition, the shares are also undervalued when using EV/EBITDA and P/E ratio analysis. Every analysis and calculation used for Boeing has implied that the company’s stock is undervalued, so we are confident this is would be a safe and profitable investment.

What aspects of the company’s strategy do you believe represent the biggest challenges for Delta?

Delta Airlines is one of the leading airline industries in the market based on on-time performance, revenue per available seat, customer satisfaction, and it is well positioned in taking advantage of the new positive economic outlook for the airline industry. It is a domestic Airline carrier that provides passengers and cargo services throughout the US and other international destinations. Some of its hubs are in Atlanta, Detroit, Minneapolis, Amsterdam, JFK and Tokyo-Narita as well as in partnering with the existing regional airlines. Currently, the assets of Delta Airline are valued $54,252 million and the composition can be divided into three main groups including PPE (Property, Plant, and Equipment), Current Assets and other Assets (Luo, 2014).

In some respects they're comparing themselves to Home Depot because Frank Blake was on the Board of Home Depot and now he's on the Board of Delta. He's the champion for taking free cash flow and increasing the dividend, and this growth in the dividend and shareholder buybacks is the template that Home Depot kind of did for a long time here. And now he's trying to implement this from the Board at Delta. Home Depot would be one. You could throw out one of the better industrial company. People also talk about the railroads as well, and basically the consolidation in the industry. There's a corollary to the airlines as to the railroad

The Delta Beverage Group is a bottling and canning company from the United States. Delta had some very strong brand names, like Pepsi and Mountain Dew, included in their franchises. Around 1988, a price war occurred and Delta suffered from compressed margins. About a year later situation became critical and a new management team from was hired. The new management stopped the fall in prices, the decline in market share and increased margins by changing the cost structure. Delta also acquired some other bottling companies at the same time increasing their sales and operating cash flow. After a couple of years operating profits increased by almost 100% and net income made a solid upward progress.

31 million pieces of luggage are delivered late worldwide each year. Delta Airlines is one of the worst offenders when it comes to losing passengers baggage. Delta loses 30% more bags than the best airline in the industry. Since passengers are now charged a fee for each bag checked, the expectation is that Delta should be doing a better job with baggage handling. The airline generates $952 million a year in checked bag fees and spends about $250 million a year on the labor costs of handling the baggage. While the company is generating $952 million, the cost of dealing with lost baggage averages $3 to $4 billion each year. The company will be able to reduce the number of lost bags by investing in new and better technology to track each

Boeing was recently faced with the scandals which hurt the reputation of Boeing. The top management recognized the problem and tried to figure it out by effective management strategies.

In August 2016, Delta Airlines face a massive system shutdown (Martin, 2016). This system failure caused Delta Airlines 150 million dollars in revenue. Because of the shutdown the company

External pressures are beyond a company’s control and will happen at one point or another. These issues must be addressed quickly and by directors who are not faint-hearted. Sally Bigger Moses was elected as chairman just three weeks ago. The decision she makes will drastically affect Mega Corporation’s future. We’ve mentioned week after week how the company doesn’t have a strategy for the future. Now would be a good time for the board to gather and come up with a plan on where they want to go before a decision is made.