One week ago, on February 13, 2007, your company was having a normal day. You work in the Systems Operation Center (SOC) at JetBlue Airlines and most days are fairly predictable - always some cancellations, some weather delays, a few computer problems, but in general most problems can be solved. The most important factor is to get the passenger to his or her destination safely and happily. You and most other employees are proud to work at JetBlue; it has responsive and interactive employee relationships, is a very well-thought-of company, and has the highest customer satisfaction ratings from its passengers.

But everything changed on Valentine's Day, February 14. The airport weather forecasters were watching an ice storm approaching New York, one of your major hubs, and all forecasts had the snow turning to rain before reaching there. The forecasts were wrong, however, and that day, February 14, the ice storm refused to turn to rain, and chaos descended upon JFK airport in New York. JetBlue flights had been loaded with passengers and were moved to the runways before airport officials, watching the storm and following FAA regulations, refused to let them take off.Planes in the air were allowed to land, and in the icy weather conditions, planes were unloaded at the gates and were stuck there while fully-loaded planes and passengers had no gates to return to. Passengers were stranded on planes for hours. JetBlue flight 751 was on the runway for more than eight hours and the flight attendants did their best to help passengers. They offered unlimited snacks, power to charge phones, entertained children, made sure in-seat televisions were working, kept bathrooms functioning, and even opened the aircraft doors to let fresh air in, but it was still a nightmare for passengers. That day only 17 of 156 scheduled JetBlue flights out of JFK were able to take off, causing delays and cancellations at other airports, and passengers, planes and crewmembers were stranded. Compounding the situation, JetBlue wasn't fullyfunctioning again for six days.

During this time, the company image was suffering more each day as the media descended and reported disorganization and customer dissatisfaction. Headlines included, "Long Delays Hurt Image of JetBlue", and "Can JetBlue Recover?".

JetBlue employees all wanted to help, but even sitting in the SOC, you saw employees trying but unable to help. Now you have been asked to serve on a task force to help the CEO make sure this doesn't happen again, make amends to customers, and rebuild the employee confidence that existed prior to this chaos. What ideas can you recommend?

The Context:

Only two out of 58 start-up jet airlines since the U.S. airline deregulation in 1978 stayed in business, and JetBlue Airways was one of the successful ones that thrived. There are many challenges: airline operations have fixed costs because scheduled planes have to take off whether they are full or not, and expenses often increase as jet fuel fluctuates in price. Margins are so thin that a few passenger seats left unfilled can mean a loss, and legacy airlines competitively cut prices to selected locations to drive new airlines out of business.

CEO David Neeleman founded JetBlue in 1999 on the idea that low cost flights could come with top-notch customer service. This dedication to "customers come first" had made the company one of the only profitable airlines after 9/11, and JetBlue was routinely ranked at the top of customer service surveys. David was a veteran of the airline industry, had started an airline six years earlier and sold it to Southwest airlines, and saw an opportunity to exploit the weakness of the legacy airlines' attitudes towards customers. He was an active CEO, and interacted with his staff onsite to solve problems before customers noticed there were problems at all. He met frequently with "crewmembers" - JetBlue staff - to make sure they understood the company ideals, and actively took suggestions from all levels of employees, from pilots to ground crew, to improve safety, efficiency and employeemorale.He was known for personally answering every customer letter or e-mail he received.

JetBlue not only offered low prices, but new technology and a pleasant experience to their customers - new planes, leather seats, Dunkin Donuts coffee, 30 DirecTV channels in individual seat monitors, XM Satellite radio, and free wireless hotspots at several airports. Their planes had more legroom and served generous packaged snacks, including their signature blue Terra potato chips.

Whereas legacy airlines like United and Delta were hampered by business models of higher paid employees and unions, JetBlue was able to offer their non-unionized workforce incentivized pay, including stock options and profit sharing. Call center personnel were based in Salt Lake City, and could work part time from home, saving the company overhead. The company used web-based bookings rather than travel agents, no paper tickets, and automatic baggage handling, using technology to save money.

The Crisis

JFK frequently has bad weather, and the ice storm caused all airlines to cancel flights at JFK that day, but other airlines cancelled flights earlier, sent passengers home, and were back up within a couple of days. JetBlue's problems continued for almost a week - why?

The CEO apologized and admitted that there were inadequate internal communication systems to direct the company's pilots and flight attendants on where to go and when, an overwhelmed and unprepared reservation system, and a lack of cross-trained employees to step up during an emergency. Also, the system took longer than it should have to reset.

The inadequate internal communications protocols kept 11,000 pilots and crew stranded in hotel rooms, and the emergency control center was staffed with people who didn't know how to locate and reassign them. Pilots were emailing offering to help, and employees throughout the companywanted to help, but didn't know how.

The reservation system broke down under heavy usage when thousands of passengers needed to rebook at once. Customers couldn't get information on flights or rebooking. They called JetBlue's reservations hotline, only to get a recording that call volume was too high; JetBlue's website listed some flights as on schedule for departure when they had already been cancelled. The kiosks at JFK didn't offer self-serve rebooking. Then there were mounds of luggage spread out at JFK, with no discernable system for passengers to sort through them.

Questions to consider:

• What were some of the elements of JetBlue's organizational culture and structure?
• What vulnerabilities were in JetBlue's operating system on Feb 13, the day before the storm?
• What in the JetBlue organizational structure and culture could help them respond to the crisis?
• What should JetBlue do to prevent this from happening again?
• What should JetBlue do to restore customer faith in their company?
• What should JetBlue do to improve employee morale?
• What are examples of JetBlue's downward, upward and lateral communications?