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The Evolution of Delta Airlines: Introduction to Delta Airlines, Research Paper Example

Pages: 5

Words: 1302

Research Paper

In modern times, the majority of airline organizations have been dismantled in different ways as a result of federal deregulation. However, Delta Airlines remains perhaps the most prolific and independent of the bunch, because the airline has not folded under the pressures of deregulation, and yet remain a successful business. The primary reason for their survival was the ongoing evolution of its management team and its ability to exercise self-preservation in the wake of consistent change. From its earliest days, Delta began as a crop dusting company in 1924, founded by C.E. Wolman, an aviation enthusiast with a background in agricultural engineering. Mr. Wolman joined a company known as Huff Daland, Inc. as an entomologist, and sought to develop a dusting product which could be used to apply to crops through an aerial spraying technique, to prevent crop damage from the boll weevil species. Over time, the business shifted its operations to accommodate season changes, and to also rotate its operations to Peru to improve performance. After some time had passed, Wolman returned from South America, as his company was identified as a rising star in the South, and as a result, his division was sold by its parent company to a group of businessmen in Mississippi. As a result, the company’s name was born from the name known as the Mississippi Delta, and the company began to shift its gears towards cargo and passenger transportation.

Shifting Gears in Management after Deregulation

With the federal government’s involvement in the airline industry, it sought to develop a number of new perspectives in regards to how airlines were managed. Therefore, under deregulation, Delta Airlines possessed the ability to manage its operations from one location, known as a hub, which enabled them to schedule a number of flights to and from the hub, Atlanta, on a daily basis, which facilitated financial growth for the organization (U.S. Centennial of Flight Commission). Under these conditions, “regional and major airlines inaugurated new routes in droves. Airlines competed in a no holds-barred competition for passenger business. As a result, fares dropped dramatically and total operating revenues for the major national and international airlines rose to a high in 1979. The same year was also the peak year for passengers: an unprecedented 317 million passengers flew through American skies” (U.S. Centennial of Flight Commission). This was an important step for Delta Airlines and its competitors to take to ensure that they could effectively grow and expand their operations, while attracting new customers (U.S. Centennial of Flight Commission).

In addition to new routes to attract customers, Delta Airlines joined many others in the industry by offering its customer base such options as frequent flyer programs and discounted fares, each of which represented an opportunity for Delta to expand its business operations, both domestically and internationally (Hall et.al, 2008). These efforts were instrumental in enabling the organization to achieve new heights, and to recognize that there is a much greater demand for services than ever before (Hall et.al, 2008). At the same time, Delta Airlines faced a number of challenges as a result of deregulation, including but not limited to the increased potential for bankruptcy, as well as expanded price consciousness by consumers (Hall et.al, 2008). Under these conditions, it was necessary for Delta Airlines to consider other options and opportunities to expand its overall growth, including potential mergers with other airlines to increase sales and to streamline operations to reduce overall operating costs (Hall et.al, 2008). Therefore, Delta Airlines, facing its own concerns with bankruptcy, sought to merge with Northwest airlines to create a more cohesive airline that could effectively compete with others in the industry (Hall et.al, 2008).

Overall, deregulation was met by many airlines with mixed results, but one possible advantage of the Delta-Northwest merger was as follows: “The merger between Delta and Northwest would be a major step toward that end, given their broad American network and extensive list of cities in Asia, Europe and elsewhere” (Maynard, 2008). Under these conditions, it is expected that Delta could essentially recoup some of its lost revenues under a plan to improve sales growth. Therefore, the organization believed that there was a chance to overcome dramatic sales decline in prior years through the merger event, while also improving its overall customer service and expanded services to new cities (Maynard, 2008). These alternatives were significant for Delta Airlines to develop a new approach to doing business, and to remain competitive within the industry as a whole, while also considering other means of improving its overall bottom line. There was a necessity for deregulation throughout the airline industry as a means of enabling organizations, including Delta Airlines, as a means to achieve the desired outcomes.

Innovations for the Future

Throughout the airline industry, there is a marked perception of stagnancy and lack of growth, due to significant economic concerns and massive financial losses. Therefore, it has been difficult in many ways for Delta Airlines to overcome past problems and to remain innovative and fresh for the future. At minimum, Delta must remain competitive through its ongoing approaches to customer service, including providing its customers with different types of deals or discounts that may improve growth. For example, Delta recently partnered with Living Social to expand its social networking abilities and to be in tune with the current marketplace that thrives on innovation and social networking on a regular basis (Wasserman, 2011). Furthermore, Delta Airlines offers its customers a chance to book flights through its Facebook page, which represents a highly innovative portal to enhance and drive customer service and satisfaction rates (Wasserman, 2011). These efforts are two examples of alternatives that the airline has pursued in recent years to enhance its social networking capabilities to attract new customers (Wasserman, 2011).

Strategy for Growth

In expanding its current portfolio, Delta Airlines must pursue new alternatives for growth that will incorporate a high level of quality and service offerings to improve customer satisfaction, and to ensure that its customers are provided with a variety of benefits to continue its operations in a successful manner. The company must focus on such areas as on time departures and arrivals, travel routes, frequent flyer programs without significant barriers, and competitive rates, each of which is likely to contribute to a successful endeavor over time. These efforts must enable Delta’s management team to heavily focus on its customers, and to recognize that they are essentially the bread and butter of organizational operations. If customers do not support Delta Airlines, the company will not remain afloat for the foreseeable future.

Conclusion

In exploring the different dimensions of Delta Airlines, from its humble beginnings in crop dusting to deregulation, bankruptcy, and mergers, there have been a number of critical challenges that the company has met and overcome over the years. Furthermore, the company continues to struggle in its efforts to remain fully operational, viable, and profitable. In reviewing some of the decisions made by the organization, there have been some advantages as well as some missteps, and the organization’s struggles have been very public and very difficult to manage. As a result, the company has experienced both positive rewards and negative outcomes in recent years. With the continued struggles throughout the airline industry, it is important for Delta Airlines to expand its level of growth and service to its customers, and to recognize how to best overcome their primary operational issues through the creation of new programs and strategies which will enable the business to remain competitive, while also influencing its future in positive ways through expanded means to generate revenue on a consistent basis.

References

Hall, A., Sheik, A., and Schwartz, D. (2008). Uffta Y’all: The Delta-Northwest Merger. Retrieved from http://nexus.umn.edu/courses/ce5212/case6/ce_5212_group_project_final_paper.htm

Maynard, M. (2008). Did ending regulation help fliers? Retrieved from http://www.nytimes.com/2008/04/17/business/17air.html

U.S. Centennial of Flight Commission. Deregulation and its consequences. Retrieved from http://www.centennialofflight.gov/essay/Commercial_Aviation/Dereg/Tran8.htm}

Wasserman, T. (2011). Delta Airlines customers get LivingSocial deals. Retrieved from http://mashable.com/2011/07/29/delta-living-social/

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