Harvard Case - Strategy Execution and Collective Emotions: National Air
"Strategy Execution and Collective Emotions: National Air" Harvard business case study is written by Quy Nguyen Huy, Lisa Duke. It deals with the challenges in the field of Strategy. The case study is 9 page(s) long and it was first published on : May 27, 2013
At Fern Fort University, we recommend that National Air (NA) adopt a comprehensive strategy execution framework that integrates a digital transformation strategy with a change management approach focused on fostering a culture of innovation and employee engagement. This framework should be underpinned by a strategic leadership approach that emphasizes communication, collaboration, and empowerment across all levels of the organization.
2. Background
This case study focuses on National Air, a major airline struggling to execute its ambitious growth strategy. Despite a strong financial position and a clear vision for expansion, NA faces internal resistance, low employee morale, and a lack of effective communication. This is compounded by a rapidly changing industry landscape characterized by technological advancements, fierce competition, and evolving customer expectations.
The main protagonists are the CEO, who is determined to implement the growth strategy, and the employees, who are resistant to change and feel undervalued. The case highlights the critical role of leadership and organizational culture in driving successful strategy execution.
3. Analysis of the Case Study
Strategic Analysis:
- Porter's Five Forces: The airline industry is characterized by high competition, low barriers to entry, powerful suppliers (aircraft manufacturers), and price-sensitive customers. This suggests a need for cost leadership and product differentiation to gain a competitive advantage.
- SWOT Analysis:
- Strengths: Strong financial position, brand recognition, extensive network.
- Weaknesses: Internal resistance to change, lack of communication, outdated technology.
- Opportunities: Growing demand for air travel, technological advancements (e.g., AI, automation), emerging markets.
- Threats: Economic downturn, fuel price volatility, increased competition from low-cost carriers.
- Value Chain Analysis: NA's value chain needs to be optimized to improve efficiency and reduce costs. This includes streamlining operations strategy, optimizing supply chain management, and leveraging technology and analytics for better decision-making.
- Business Model Innovation: NA needs to explore business model innovation to adapt to the changing industry landscape. This could involve exploring new revenue streams, expanding into new markets, or partnering with other companies.
Organizational Analysis:
- Organizational Culture: NA's current culture is characterized by a lack of trust, poor communication, and a resistance to change. This needs to be addressed through a change management program that fosters a culture of innovation and employee engagement.
- Leadership: The CEO needs to demonstrate strong strategic leadership by clearly communicating the vision, fostering collaboration, and empowering employees to contribute to the strategy's success.
- Decision Making: The decision-making process needs to be more transparent and inclusive. This can be achieved by empowering employees, fostering open communication, and leveraging technology and analytics for data-driven decision-making.
4. Recommendations
1. Implement a Digital Transformation Strategy:
- Invest in new technologies: Implement AI-powered solutions for customer service, operations, and marketing.
- Upgrade IT infrastructure: Ensure a robust and secure IT infrastructure to support digital initiatives.
- Develop a digital strategy: Define clear objectives, target audience, and key performance indicators (KPIs) for digital initiatives.
- Leverage social media: Engage with customers and build brand loyalty through effective social media marketing.
2. Foster a Culture of Innovation and Employee Engagement:
- Implement a change management program: Develop a comprehensive change management program that addresses employee concerns, provides training, and fosters a sense of ownership.
- Encourage open communication: Establish transparent communication channels and encourage feedback from employees at all levels.
- Empower employees: Delegate decision-making authority to employees, fostering a sense of responsibility and ownership.
- Invest in employee development: Provide training and development opportunities to enhance employee skills and knowledge.
3. Enhance Strategic Leadership:
- Communicate the vision clearly: The CEO needs to articulate the growth strategy clearly and consistently, emphasizing the benefits for employees and customers.
- Foster collaboration: Create a culture of collaboration across departments and levels, encouraging cross-functional teams and knowledge sharing.
- Empower employees: Delegate decision-making authority to employees, fostering a sense of responsibility and ownership.
- Lead by example: The CEO needs to model the desired behaviors and values, demonstrating commitment to innovation and employee engagement.
5. Basis of Recommendations
These recommendations are based on a comprehensive analysis of NA's internal and external environment, considering:
- Core competencies: Leveraging NA's existing strengths in brand recognition, network, and financial position.
- External customers and internal clients: Addressing the needs of both customers and employees, fostering a positive customer experience and a motivated workforce.
- Competitors: Staying ahead of the competition by embracing technological advancements and focusing on cost leadership and product differentiation.
- Attractiveness: The recommendations are expected to enhance NA's profitability and market share, leading to increased revenue and shareholder value.
6. Conclusion
By implementing a comprehensive strategy execution framework that prioritizes digital transformation, change management, and a culture of innovation, NA can overcome its internal challenges and achieve its ambitious growth goals. This approach will require strong leadership, effective communication, and a commitment to employee empowerment.
7. Discussion
Alternatives:
- Outsourcing: NA could consider outsourcing certain non-core functions to reduce costs and focus on core competencies.
- Mergers and acquisitions: NA could explore strategic alliances or acquisitions to expand its network or acquire new technologies.
Risks:
- Resistance to change: Employee resistance to change remains a significant risk. This can be mitigated through effective communication, training, and employee engagement.
- Technological disruption: Rapid technological advancements could render NA's investments obsolete. This can be mitigated by staying abreast of industry trends and adopting a flexible approach to technology adoption.
Key Assumptions:
- NA's financial position will remain strong, allowing for investments in technology and employee development.
- The airline industry will continue to grow, providing opportunities for NA to expand its market share.
- Employees will be receptive to the change management program and embrace a culture of innovation.
8. Next Steps
Timeline:
- Month 1-3: Develop a comprehensive strategy execution framework, including a digital transformation strategy and a change management program.
- Month 4-6: Implement the change management program, focusing on communication, training, and employee engagement.
- Month 7-9: Invest in new technologies and upgrade IT infrastructure to support digital initiatives.
- Month 10-12: Monitor progress, adjust the strategy as needed, and celebrate successes.
Key Milestones:
- Increased employee engagement: Measure employee satisfaction and engagement levels.
- Improved customer experience: Track customer satisfaction and loyalty metrics.
- Increased revenue and profitability: Monitor financial performance and market share.
By taking these steps, NA can transform itself into a leading airline in the digital age, achieving its growth goals and creating long-term value for its stakeholders.
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Case Description
The case illustrates how seeming good strategy (in terms of content) can fail in the process of implementation. A brilliant CEO strategist failed to convince his employees to buy into his strategic vision by trying to implement it too quickly.
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