Running head: CONEPTUALIZING A BUSINESS

Part 1: Conceptualizing a Business
BUS/475
December 14, 2010

Part 1: Conceptualizing a Business
When the executives of American Airlines (AA) conceptualize the mission and values of the airline, they need to visualize how the needs of the customers, employees, and shareholders intertwine to direct the goals of the company. The objectives of the executives of AA must be well thought out and captured in a comprehensive mission statement. The mission statement needs to represent the vision and values of the company as a whole. This paper will define the business of AA; define, create, and analyze the vision of AA; and evaluate and analyze the alignment between the stated values and actual plans and actions.
American Airlines was first established in 1934 after combining several small aviation companies. AA specializes in air transportation of people and cargo domestically and globally. Today, AA ranks as one of the largest global airlines partnering with several international carriers to form the OneWorld® alliance. AA coupled with American Eagle (AE) is represented in the stock market under AMR. AMR Corporations is the parent company of AA and AE. AE services short routes for commuters on regional jets and AA services passengers and cargo on longer routes domestically and internationally on various large jet aircrafts. According to www.hotstocked.com, the AMR Corporation operates, on average, more than 3,400 daily flights in 40 countries. AA and AE serve various types of passengers to include business travelers and families traveling on vacations. AA and AE also have many contracts to transport cargo to domestic and international destinations. AA and AE are full-service airlines offer services that many of the low-cost carriers do not offer. AMR Corporations was the first passenger airline to offer frequent flyer rewards, AAdvantage ® miles, to loyal passengers and to attract new passengers offering free flights and upgrades based on the number of miles earned. Other services offered by AMR have included pre-reserved and priority seating, AAdmirals Club® lounges, meal service, and first and business class seating. When traveling on AA or AE, passengers have come to expect superior service and amenities.
The mission statement for the AMR Corporation currently states, “Setting the industry standard for safety and security; providing world-class customer service; creating an open and participative work environment which seeks positive changes, rewards innovation and provides growth, security and opportunity to all employees; and providing consistently superior financial returns for shareholders" (www.flyertalk.com, 2010). The proposed new mission statement would be as follows, “Providing world-class service around the world with the most choices of destinations. AMR is committed to focusing on the safety of their customers and employees. AMR will continue to expand its destinations to ultimately reach every corner of the globe. AMR will follow environmental regulations demonstrating its obligation to protect and preserve the environment. AMR will continue to invest in new technologies to modernize its aircraft and enhance the overall customer experience. AMR is committed to providing the highest returns possible for its shareholders.”
Based on the mission statement proposed for AMR, the vision for the successfulness of the corporation as a whole would build on the mission statement to forecast what corporation needs to be to consumers, employees, and shareholders in the future. The proposed vision for the future of AMR would include expansion of international partnerships to provide more choices and destinations for passengers and contracted cargo partners. Focus on safety while implementing more enticing benefits to retain current passengers and to attract perspective passengers. Empower experienced employees with more involvement in business enhancement changes. Offer shareholders the highest return on their investments exceeding any other airline. Great companies must do the following right; hire good people, define clear expectations, recognize excellence and praise it, and finally, show customers that they care. American Airlines faces the responsibility to keep employees actively engaged in the company because doing so ultimately results in moving the company forward. Success is defined by a company’s culture and culture stems from leadership. Hence, active engagement of employees is essential in building an ethical atmosphere because a passionate and enthusiastic employee is more likely to go the extra mile for the company he or she feels a connection. In order for employees to become and remain actively engaged, a manager’s leadership must be evident.
American Airlines guiding values and principles read as follows, “We are in business to provide safe, dependable, and friendly air transportation to our customers, along with numerous related services in the hopes that you will fly us again and again. We work very hard to make your entire experience with us, from making a reservation to deplaning at your final destination, a positive one” (American Airlines, 2010); these guiding values and principles allow every American Airline flight to be a special one.
The previously defined can only be accomplished through the company’s ethical atmosphere, culture, and social responsibility. American Airlines is ethically responsible to take social issues into consideration when conducting daily operations. The ethical responsibility by American Airlines can prove beneficial since customers can be more vested in an organization with high ethical standards.
In order to stay on target with the corporation’s current mission and values while continuing to focus on the future vision, AMR must stay true to its core principles. AMR has remained a top competitor in the airline industry for nearly a century. AMR has been able to remain a leader in the industry because of its unwavering commitment to providing quality service, offering amenities consumers want, providing excellent benefits to employees, empowering employees, and maintaining an overall good return for investors. Offering innovative solutions during economic plunges, terrorist attacks, and government regulations have enabled AMR to be a leader and not a follower in the very competitive airline industry.
Media has played a key role in revealing customer frustrations with the airlines and the demands made by passengers. The United States Department of Transportation through its Aviation Consumer Protection and Enforcement department informs consumers of his or her rights (United States Department of Transportation, 2010). To fulfill the requirements as set forth by the Department of Transportation, American Airlines and its partner American Eagle also inform passengers on what to expect from the carrier. American Airlines ‘Customer Service Plan’ last updated on March 31, 2010 informs passengers of the carrier’s commitment to provide safe, dependable, and friendly air transportation to all customers (American Airlines, 2010).
The Customer Service Plan addresses the airline’s commitment to customers on: lowest fair availability, baggage delivery, baggage liability, guaranteed fares, ticket refunds, accommodations of customers with special needs, and oversold flights. American Airlines’ approach to deliver superior customer value through operation excellence, customer intimacy, and product leadership gives the airline a competitive advantage to make the passengers flight experience its top priority (Pearce & Robinson, 2009).
AA degree of alignment between the stated values and actual plans and actions are in alignment. The stated values are “We are in business to provide safe, dependable, and friendly air transportation to our customers, along with numerous related services in the hopes that you will fly us again and again. We work very hard to make your entire experience with us, from making a reservation to deplaning at your final destination, a positive one” (American Airlines, 2010). According to (airline safety records), "[AA has 4.1 accidents per 1,000,000 takeoffs. No fatal accidents and 2.2 incidents per 1,000,000 takeoffs. These number are based on a five year average]” (Five year average, para. 1). According to American Airlines (2010), "[They base their dependability of on-time arrivals through a metric that all U.S. airlines disclose to the Department of Transportation. DOT defines an on-time arrival as any flight that arrives within 14 minutes after its published scheduled arrival time. American Airlines has improved on-time arrival performance overall for the past three years]” (Corporate Responsibility, para. 8). “[Certain aspects of on-time arrival are outside of our control, such as congestion on the ground at airports and weather conditions in the air. Our success with this metric, however, depends in part on actions we take within our operations. For example, we are continuing our practice of pairing pilots and flight attendants with aircraft so that they do not need to switch to other aircraft at each departure point. We also carefully plan and track overnight maintenance so that all our aircraft are ready to fly at their scheduled time]” (Corporate Responsibility, para. 8).
When discussing the friendliness of the airlines AA did establish the Customer Experience Leadership Program. This program allows for employees throughout the company to work collaboratively to develop solutions to enhance the experience. The areas that are being assessed are the dependability, gate interactions, cabin interior conditions, baggage resolution and baggage handling.
To compare the values of American Airlines and Team A we believe that they are in alignment. We think that dependability is very important when making the decision of taking a business trip or traveling with family on vacation. We all agreed that choosing the flight with less aggravation would be our choice. Safety is important when our loved ones are be considered. We want to fly with an airline that has the highest standards of safety to make sure that we have a safe trip. Friendliness is also important since the stress of flying can be overwhelming for some have employees that understand and are willing to assist you if it is needed is a relief. Overall the values that American Airlines has meet the values of Team A.
AA is one of the best airline companies that offer services both domestically and globally. The company has managed to provide many flights and services to thousands each year. AA is consistently reaching to exceed the expectations of individuals who use them for both business trips and family vacations. In order for AA to continue this reputation they must continue to offer programs and great experiences for the individuals using them.

REFERENCES www.flyertalk.com www.hotstocked.com
American Airlines. (2010, March 31). Customer Service Plan. Retrieved December 12, 2010,

from American Airlines:http://www.aa.com/i18n/customerService/customerCommitment

customerServicePlan.jsp#csp.

Pearce, J. A. II, & Robinson, R. B. (2009). Strategic management: Formulation, implementation,

and control (11th ed.). New York: McGraw-Hill.

United States Department of Transportation. (2010, August 31). Aviation consumer protection

and enforcement. Retrieved December 11, 2010, from United States Department of

Transportation: http://airconsumer.dot.gov/publications/flyrights.htm#delayed

Federal Aviation Administration, the NTSB, and the U.S. Department of Transportation. (2010). Airline Safety Records. Retrieved from http://www.airlinesafetyrecords.com