The Components of Theory of the Business at Continental Airlines
The core components of Continental Airlines’ theory of the business included a focus on customers, collaboration, and innovation. To be more precise in the wording, the main components of this business included people, processes, partners, and material supplement – planes. Before Greg Brenneman joined the company, most of these critical components of Continental Airlines needed to be in better condition. The business experienced significant financial difficulties, and proper customer service required to be established (Brenneman, 1998).
In addition, there were violations in the well-coordinated work of the team and a decrease in the motivation of employees to perform their tasks qualitatively (Brenneman, 1998). When Brenneman analyzed the underlying data and what he would have to work with, he stepped up activity in several priority areas. Properly improving these issues would save the company from complete financial and image collapse.
Prioritizing Employee Engagement and Brand Loyalty
First of all, Brenneman turned his attention to employees since the survival of the brand and the loyalty of customers depended on their work and moral qualities. The most important innovations were establishing an open-door policy, creating a good background for the manifestation of initiative and personal attributes of employees (Brenneman, 1998). He also tried to provide proper training and material supply for them, improving the quality of their work.
Revamping the Fleet for Enhanced Air Travel Quality
Secondly, Brenneman initiated the replacement of the obsolete airline fleet and reduced the number of aircraft in favor of the quality of air travel (Brenneman, 1998). This improved the company’s representation and raised the quality of its services.
Streamlining Operations and Ensuring Competitiveness and Sustained
Brenneman also implemented new processes, such as a simplified fare structure, which made it easier for customers to book flights and reduced the complexity of the airline’s operations (Brenneman, 1998). Improved workflows have helped modernize the airline and allowed it to keep up with the demands of the times and technological advances rather than being left behind. Finally, he has ensured the competitiveness and prosperity of Continental Airlines (Brenneman, 1998). He achieved that result through partnerships and collaborations with other significant carriers.
The Alignment of Greg Brenneman’s Actions with Valid Theories and Transformative Business Models
Business Theories
All of the above steps are aligned with a valid theory and transformative business model, contributing to the success of Greg Brenneman as CEO of Continental Airlines. As Peter Drucker suggests in his article “The Theory of the Business,” businesses must continuously challenge and question their fundamental assumptions about their industry, customers, and competitive advantages (Drucker, 1994). This is precisely what Brenneman did, thoughtfully analyzing the current situation within the company and determining the main priorities of the company.
The Transformative Business Model Framework
In addition, Brenneman’s rescue plan actively used the transformative business model framework, which consists of the following steps: sensing, seizing, and transforming. This framework is described in “The Transformative Business Model” by Kavadias, Ladas, and Loch (Kavadias et al., 2016). Brenneman sensed the need for change and seized the opportunity to transform the business by focusing on its main priorities. As a result, he implemented changes aligned with the airline’s core competencies and mission while also addressing the market’s changing needs.
Summary
Greg Brenneman’s actions at Continental Airlines aligned with a valid theory of the business and a transformative business model. Brenneman recognized the need for change and identified critical business areas that needed to be transformed. His ability to single out the main thing and intensify activities in a specific direction helped the airline stay in business, reach a new level, and become one of the industry leaders.
Reference List
Brenneman, G. (1998) “Right Away and All at Once: How We Saved Continental,” Harvard Business Review, 76(5), pp. 162–173.
Drucker, P.F. (1994) “The Theory of the Business,” Harvard Business Review [Preprint].
Kavadias, S., Ladas, K. and Loch, C. (2016) “The Transformative Business Model,” Harvard Business Review, pp. 90–98.