Airline is designed for MBA and undergraduate courses in Strategic Management, Operations Strategy, and general strategy courses. Students are organized into teams and implement their strategic recommendations for a regional airline. Up to 12 teams compete directly against each other, with the results being dependent upon how the competitors interact, what market routes are entered, and what services are provided to air travel customers. A unique aspect of Airline is its service context, which is very applicable to issues in today's economy. The simulation and supporting materials are co-authored by Jerald Smith and Peggy Golden, both of Florida Atlantic University. Airline is an excellent complement to traditional teaching methods, allowing students to apply business concepts in a dynamic, integrative environment.
The Case: Groups of 3-5 students are put in the role of a management team that takes over a regional airline with three planes. The company currently operates in multiple cities but has the option of expanding into new markets including international and resort routes. Groups must decide how best to position their airline and develop an operational plan to support that strategy.
Decisions in Airline include:
Overall Strategy: Corporate positioning, routes to pursue, fleet acquisitions, potential entry into cargo business.
Marketing: Pricing of tickets, advertising, promotion, number of salespersons, promotional fares in each market served, type of cabin (food) service, and market research studies.
Operations Management: Scheduling of aircraft and number of trips in each market, maintenance level, fuel forecasting/pricing, quality programs budget.
Human Resource Development: Wages paid, bonus or other incentive plans, training and development.
Financial: Lease or buy new aircraft, capital acquisition through equity or borrowed funds (short- or long-term), cash management through the purchase of CDs, dividends.
Asset Management: Equipment acquisition and disposal. Firms may choose between seven different configurations and sizes of aircraft (actual manufacturer's specifications are given).
Behavioral elements presented in the form of up to 14 mini-cases or incidents designed to encourage class discussion on different business and management topics.
Student performance can be compared on a number of metrics including stock price, net income, standard financial and operational measures, as well as an instructor-weighted balanced scorecard. Each company begins the simulation in the same starting situation allowing for easy performance comparisons. All Interpretive simulations include a pre-simulation quiz and peer review. Now browser-based, the new version of Airline successfully builds on the underlying model that has been used by thousands of students and executives around the world for over a decade.
Covers Strategy
Intermediate Level
Direct Competition