Organizational History
West Jet is a young company started in 1996 by a small group of entrepreneurs. According to the References for Business website for WestJet the WestJet founder Clive Beddoe was born in England and came to Canada and made a “fortune in developing commercial real estate in the Calgary area (References for Business website 2010)”. Clive Beddoe teamed up with Tim Morgan, Don Bell and Mark Hill to start a now frills airline according to the References of Business website. The WestJet Annual Information Report 2009 says WestJet started with three planes flying to five Canadian cities; Vancouver, Kelowna, Calgary, Winnipeg, and Edmonton. WestJet’s IPO was in 1999 on the Toronto stock exchange as WJA with Steven Smith as CEO (References for Business website 2010). WestJet Airlines Limited is made up of four subsidiaries; WestJet Aircraft Acquisition Corporation, WestJet Investment Corporation, WestJet Operations Corporation, WestJet Vacations Incorporated(WestJet Annual Information Report 2009 p.9) . The WestJet mission statement is “to enrich the lives of everyone in WestJet’s world by providing safe, friendly and affordable air travel (WestJet Annual Information Report 2009 p. 18)”.
Organizational Strengths and Weaknesses
Organizational Strengths First Organizational Strength
A major strength of WestJet is the corporate culture. Corporate culture affects performance. WestJet was named Canada’s 10 Most Admired Corporate Cultures for four years in a row by Waterstone Human Capital and recently inducted into the Canada Corporate Hall of Fame. WestJet’s corporate culture is one of entrepreneurship, and fun. WestJet offers their employee’s profit sharing, an Employee Share Purchase Plan, Travel Privileges, and flexible benefits, flexible hours, day care, scholarship programs, employee and family assistant programs, maternity top up programs, a career mapping program (ConnectMoms May 15, 2009). WestJet employees are called WestJetters and the company makes an effort to keep employees happy. A study by both “Waterstone Human Capital Ltd. and Canadian Business, WestJet stood out as having the most admired Canadian corporate culture, noted for its "entrepreneurial spirit," "delivering what they promise," and its "winning attitude."(Canadian Business online October 10, 2005)”. WestJet An organizational culture is very hard to define and almost impossible to recreate. WestJet has been able to keep their employees union free by giving them a great working environment. This great working environment is why WestJet was listed in 2009 as a Progressive Employers of Canada. Progressive Employers of Canada is an organization which list companies which are “mom-friendly”. The good will and great reputation is something that has been build into the company since the beginning. The corporate culture gives WestJet a distinctive competence. Cheerful employees are not mandated by the company. Cheerful employees are created by the management giving employees what they want, a fun workplace. Second Organizational Strength WestJet strives to give the best service in the industry. In combination with the corporate culture WestJet researches guest expectations and provides exceptional service with a cross departmental team called “Guest Experience Management Team”. This team promotes communication with all parts of the organization to ensure a consistent and excellent guest experience from the first contact with WestJet. Some of the research has given WestJet some great products and services such as “above average on-time operational performance (WestJet Annual Information Report 2009)”. Since this type of service is so deeply connected to a unique corporate culture it might be very hard to reproduce. WestJet allows some of the front line employees to have “some authority to make decisions about waiving fees and rescheduling people on its flights (Canadian Business Online October 9, 2006)”. This strategy is not unique to WestJet but with the combined corporate culture and the employees as part owners it would difficult to reproduce in another company and be successful.
Organizational Weakness First Organizational Weakness Odd as it may sound a possible organizational weakness could be the fast amount of growth of the company. It may be hard to recruit new quality employees. The amount of employees the company hires is astounding. According to Workopolis.com because WestJet is on the “Best Employer” list its hiring practices so many people apply so the recruiters are interviewing a great number of people. For example “400 new flight attendants in a six-week period-which was about double the number of cabin crew that the airline typically took on every year. With just one in six pre-screened applicants making it to an interview and just half of those ultimately being hired, that meant nearly 2500 candidates were considered (Workopolis.com 2010)”. WestJet needs to consider the amount of growth and maybe slow down. The idea of promoting from the inside is good but also the company should consider reward program like DeVry has for recommending new hires that stay so the there is less pressure on the recruiters. Second Organizational Weakness Although the cost of a WestJet flight is low the fact that you have to pay for food and beverages is something that might not go over well with business class travelers. Westjet has tried to overcome this weakness by initiating a “buy on board” program. I would suggest that the frequent flyer program not only the WestJet Dollars but also free food for premium customers. By being low cost WestJet can keep the bottom line healthy but premium customers are return customers and should be given more consideration.
Opportunities
First Opportunity The first opportunity for WestJet is as I see it is the opportunity to partner up with other airlines. Other countries airlines already know the market and regulations so a partnership would be very useful for a growing company. The general environment that comes into play here is the political-legal dimension because the US has laws and regulations about security and WestJet can take advantage of that knowledge. The force acting on this is a competitive force since WestJet was originally going to develop a partnership with Southwest Airlines but the deal fell through so WestJet jumped at the chance to partner with American Airlines. This will give WestJet a better opportunity “to grow its market share and snatch customers from its chief rival, Air Canada (Yahoo News October 19, 2010)”.
WestJet just announced a partnership with American Airlines. By doing this it can expand the amount of cities it services and give better service to its customers. WestJet can have its customers check the bags once when this partnership continues to grow reducing the amount of lost baggage and security checks. By having an understanding with an established American company WestJet can continue to give better service without hiring more employees.
Second Opportunity Recently WestJet’s biggest Canadian competitor has made worldwide news by bungling a security measure and let a passage on an Air Canada flight wearing a mask. From a security standpoint Air Canada has made a mistake that WestJet could use as an opportunity. The aspect of the general environment that key to this opportunity is the political legal dimension. The forces acting on this dimension is the threat of substitute product. If Air Canada cannot keep people off the plane who should be on the plane that is a major security risk and customers might stay away from Air Canada flights. The publicity from that bungle might give WestJet a chance to show how this couldn’t happen on its planes. Because of the fun culture on a WestJet flight the flight attendants are more approachable and WestJet should capitalize on this with a marketing plan for safety to show how this mistake couldn’t happen on a WestJet flight.
Threats
First Threat The first threat to WestJet comes from the Political legal dimension. The force acting on this dimension is regulations. The Canada Government is currently investing new technologies to screen airport cargo. This is a five year plan to increase air cargo screening at Canadian airports. While this might seem like a good idea for security purposes a report from the BBC News quotes transport minister John Baird as saying “75% of commercial cargo is transported in aircraft that transports passengers (BBC World News July 8, 2010)”.
Backlogs can occur and flights can possibly be delayed due to security checks. This can create unhappy customers. Since there is no clear idea of how or when the plan will come into place this creates an atmosphere of uncertainty. Second Threat The second threat to WestJet comes from the economic dimension and is a threat that comes from the power of suppliers. The cost of fuel is “an increasing portion of our operating cost (WestJet Annual Information Report 2009)”according to the annual information report from WestJet. WestJet is trying to use complicated “fuel-hedging” program to lower fuel cost. WestJet has also looked into using other fuel sources such as jet fuel derivatives. The fluctuation of fuel cost can cripple a company who can only use one type of fuel. This can be a serious threat to WestJet. A plane cannot fly without fuel obviously, and WestJet would be hard pressed to increase cost since the company takes pride in having lowest price in the market.
Summary
I think the opportunities WestJet has today are to continuing to partner up with other Airlines to give customers more destinations. This will increase customer satisfaction and give WestJet the chance to grow without needing to hire so many employees. The airlines from other countries will already have the expertise in the political legal dimension of each country on which WestJet can capitalize. A seem less experience for WestJet customers in terms of security and luggage handling will increase satisfaction for everyone but WestJet competitors. The second opportunity would be a marketing plan to show how WestJet’s biggest competitor Air Canada made a mistake that WestJet never could by letting an unauthorized passenger on a plane. WestJet’s culture is one of fun and safety so WestJet should capitalize on that fact and show customers how this couldn’t happen on a WestJet plane. The threats to WestJet are changes to cargo security possibly slowing down planes full of passengers and the fluctuating price of jet fuel. The first threat of changes in cargo security should be met head on by being proactive in setting up internal regulations for cargo. By streamlining the cargo documents and standards of shipping cargo WestJet could do its own security checks to minimize waiting times once the government decides just what they are going to do. The second threat of fluctuating jet fuel cost could be minimized by lightening the weight of all parts of the plane as much as possible. Overall WestJet is a strong company whose growth is an inspiration to entrepreneurs everywhere.

References

BBC World News (July 8, 2010). Canada mission to boost air cargo security Retrieved: November 7, 2010 from http://www.bbc.co.uk/news/10340545
Canada.com (October 11,2006) WestJet culture seen as tops in country. Retrieved: November 11, 2010 from http://www.canada.com/calgaryherald/news
/calgarybusiness/story.html?id=1cec87b5-bab-4e1e-a63a-e64f91b15fa6&k=24339
Canadian Business Online (October 11, 2005) Culture shock: A survey of Canadian Executives reveals that corporate culture is in need of improvement. Retrieved
November 11, 2010 from http://www.canadianbusiness.com/managing /employees/article.jsp?content=20060106_160426_5512&page=1
Canadian Business Online (October 9, 2006) Just be nice: Providing good customer
Service. Retrieved: November 11, 2010 from http://www.canadianbusiness
.com/managing/strategy/article.jsp?content=20061009_81513_81513
Connect Moms(May 15, 2009) WestJet-Progressive Employer List Retrieved: November 6, 2010 from http://connectmoms.com/2009/05/westjet/
References for Business website (2010) Company History Index for WestJet. Retrieved:
November 11, 2010 from http://www.referenceforbusiness.com/history2/70/
WestJet-Airlines-Ltd.html.
WestJet Annual Information Report (2009). Retrieved: November 11, 2010 from http://www.westjet.com/pdf/investorMedia/financialReports/WestJet2009AIF.pdf p. 9, 18.
WestJet website (2010) Great Jobs. Retrieved: November 11, 2010 from http://www.westjet.com/guest/en/jobs.shtml
Workopolis.com (2010) WestJet culture gets employees on board. Retrieved: November
7, 2010 from http://www.workopolis.com/work.aspx?action=Transfer& View=Content/Common/ArticlesDetailView&articleId=brent20071128File1Article1&lang=EN
Yahoo News (October 19, 2010) WestJet and American Airlines partnering up through interline deal. Retrieved: November 7, 2010 from http://ca.news.yahoo.com/s/
capress/101019/business/westjet_american_airlines