Human Behavior in Organization

Group 1 Report Case Study

The first thing you notice when getting on board is the new-car smell. No wonder, says the
flight attendant, hearing your remark. She points to a metal plaque on the doorway rim that says the
Airbus A320 was delivered 1 month ago. Other notable features are the free cable on your personal
video screen and the leather seats. Flight attendants are trained on how to give service with a retro flair.
Al attendants have to learn how to strut proudly, as if there were an imaginary string between their chin
and belly button.

JetBlue attendants have a sense of fun about their jobs, and the can-do pilot informs over the
public address system that yes, theres a major storm coming into the New York City area but that well
get there on time anyway. And the plane and passengers do. So the travelers wonders. Is this for real?
Or maybe the right question is, How long can they keep up this nonsense? JetBlue was rated highest in
customer satisfaction of all U.S. airlines in Conde Nast Traveler magazines 2005 Business Travel Awards-
the fourth time in 6 years.

Just as discontent with airlines was mounting in 2000, JetBlue Airlines came into being with a
new attitude, new planes, and a new concept of service. What perfect takeoff timing for a carrier that is
trying to bring pleasure and even style back to flying. JetBlue is low-price and all-coach, like Southwest
Airlines, yet hip and sassy, like Virgin Atlantic. In the air, JetBlue offers the plush seats and satellite TV;
on the ground it offers a high level of efficiency.

Credit CEO David Neeleman, who founded the firm at age 41, for piloting JetBlue past the early
disasters that befall fledging carriers. For starters, Neeleman raised $160 million from investors-almost
triple what other new airline entrants have managed to obtain. The hefty sum is insurance against any
unforeseen cash crunch.

Consumers are usually concerned about the safety issue with new airlines that fly 25-year-old
planes. JetBlue flies only factory-fresh, state-of-the-art A320s. Neeleman has fitted each with 162 seats-
versus the a320s 180-seat maximum. Flyers are ecstatic abou the JetBlue experience. It begins with
pricing, which is competitive and doesnt torture consumers with requirements like Saturday-night
stays. JetBlue is attracting business travelers, the industrys most valuable passengers and the source of
up to 50 percent of its profits.
A JetBlue spokesperson said We see our customers as the same ones who can afford more but
shop at Target because their stuff I hip but inexpensive. That kind of thinking drove decisions like
JetBlues choice of leather seats instead of less expensive cloth. Its a nicer look, a better feel, says
Neeleman, in full salesman mode. Nevertheless, as JetBlue became several years old, their sections of
airline terminals, such as JFK (serving New York City,) had the same worn-down look with cracked
leather seats as other airlines.

Neeleman obsesses over keeping employees happy, and with good reason. Airline watchers say
JetBlues ability to stay union-free is critical to its survival as a low-cost carrier. The industrys labor-
relations record is weak. But if there is anyone who realizes the importance of their employees right,
its the management team at JetBlues, says airline analyst Holly Hegeman.

JetBlue employees get profit-sharing checks, amounting to 17 percent of their salary in recent
years. Also, 84 percent of JetBlue employees participate in a company stock purchase program, in which
they can but a stock at a 15 percent discount.

On September 21, 2005, JetBlue Flight 292 in Los Angeles narrowly escaped a crash when its
front landing gear stuck sideways, so the plane had to land while metal scraped the runway instead of
the wheels rolling in their intended manner. The day after the mishap Neeleman released a statement
acknowledging the problem, and thanking everyone concerned for their assistance and emotional
support. Neelemans public statement included these words:
The crew of Flight 292 has asked us to communicate their appreciation to the 140 customers on
board for their cooperation, and they are also grateful for the messages of support sent to JetBlue by
thousands of people. The crew looks forward to returning to their families and loved ones, and to their
normal lives as quickly as possible.

Neeleman is one of the seven siblings, and has nine children of his own. He has been dreaming
about airplanes since he saw a red one on his second birthday cake. A serial travel entrepreneur, he has
launched four airlines, including Morris Air and Canadas WestJet Airlines, with each one being more
successful than the last. Neeleman, with the strong interest in information technology, developed the
computer system that became the basis for e-ticketing.

Neeleman notes that despite heavy competition, JetBlues profit margins are the highest in the
industry. He attributes part of the companys success to selecting the right people, which is especially
important because an airline is a people business. We have a saying at JetBlue that youre either
serving a customer or serving someone who is serving a customer.

An example of the selection process at JetBlue was an applicant pilot who was furious about
being rejected. The pilot telephoned Neeleman and explained that he had 15,000 hours of flying
experience. Neeleman then spoke to the interviewer, who said that she asked the pilot, Youve flown
for 15,000 hours, tell us one thing that youve done besides sitting there and flying the airplane. He
couldnt come up with a single example. He retorted, What do you mean by that? Im pilot, and thats
what I do. The interviewer explained that the pilot was not somebody JetBlue wants in the company.

To manage the company, Neeleman emphasizes the quality of supervisors. The company has
one supervisor for every 80 employees. Neeleman tells the supervisors, You can know 80 people. You
can know who theyre married to, you can know who their kids are, and what their challenges are. In
this way JetBlue employees know there is a personal touch to the company.

Questions:
1. In what way does Neeleman demonstrate an understanding of organizational behavior?
2. So whats wrong with a pilot staying in the cockpit in terms of being contrlbutor to a people-
oriented business?
3. How else might Neeleman make use of organizational behavior knowledge to improve the
chances of JetBlue Airlines staying successful?
Answers:
1. In a way where he is obsessed about keeping the employees happy and with good reason.
He thinks that treating employees right will make the management team strong.
2. In all actuality, there is nothing wrong about it because they can interact with their
passengers with communicating through announcing or broadcasting with the use of
intercom.
3. By training to improve his supervisor and employees in their specific specialties.