2. Introduction
Founder: Naresh Goyal
Timeline:-
April1,1992 - Jet Airways is formed & operator license for
air taxi
May 5,1993 - Commenced operations
1995 - Gets a scheduled airline status
March,2004 - Jet Airways goes International
March,2005 - Jet Airways goes public
April,2007 - Acquires Air Sahara - Jetlite
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3. Problems being faced in 2003
Turbulence: 50% of ground-staff has quit; Jet losing
cabin crew and ground staff to foreign carriers
Fall in number of passengers post 9/11
Load factors suffering
Increase in fuel prices decreasing margins
Sahara taking on Jet’s dominance
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4. The Stalwart named Naresh Goyal
Very successful GSA
Manages most of the operations himself
Is energetic, rustic, bold and impatient
Made Jet a world class airline by 2000
Built a vast network of contacts, attended every IATA
meeting
These relations helped in setting up Jet Airways
Best decision – To hire expatriates for critical functions
Audacious decision – To buy 10 Boeing aircraft, with 10
more in the pipeline, given the poor condition of the
industry after 9/11
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5. Problems with Goyal’s style
of Leadership
This style of leadership is now causing problems as
the airline grows (stifling growth; facing problems of
retaining managers)
Persistent instability in the top management –
clueless shifting of people around, based on personal
appraisal
Unfamiliar with processes and standards
Ad-hoc style of functioning
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6. The Rise of Sahara – at the
cost of Jet
Jet had to prune costs an bring down break-even levels
Jet cut down salary hikes, refresher training, released 6
expats and leased out 2 aircraft
Jet stopped innovating, focussed on cutting costs
Sahara took centre-stage as Jet began to stagnate
Poor timing for Jet to stop innovating (possibly due to
Goyal’s failure to have a decision-making structure at the
top)
Jet did not alter its pricing strategies during the price war
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7. Forces for and against Change
at Jet Airways
Forces for change Forces against change
Competitive pressure Lack of delegation of authority
Hire external expertise Founder too involved in daily
activities
Foreign alliances Cost reduction & layoffs
Bold investments Informal power structure
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8. Consequence of change/no
change at Jet Airways
Failed to keep customers satisfied
Loss of competitive advantage
Vulnerable to attack from competition
Lost “Innovative” brand identity
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9. Jet Airways’ Rise in 2008
Fleet size = 81, average fleet age = 4.2 years (among the
lowest globally at that time)
Massive international expansion plan
Goyal’s mission, focus and experience came in very
handy
International strategy included tying up with the region’s
domestic carrier; as many as 120 code-sharing agreements
globally
Goyal planned to fly to Dubai and on the Mumbai-
Shanghai-San Francisco route
Jet’s aircraft preference = 787-9 Dreamliners and Boeing
737-400s
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