Classic Airlines

A Nine Step Cost Reduction Plan

Describe the Situation

Identifying the Potential Cause of the Problem

Verifying the Likely Causes by Gathering Data

Identifying Possible Solutions

Evaluating Alternative Solutions

Determining the Best Solution

Identifying and Assessing the Risks

Implementing the Solution

Evaluate the Results

Classic Airlines is currently the world's fifth largest airline which is operating a remarkable 2,300 flights daily to over 240 cities. In the previous period, net profits were roughly $10 million on $8.7 billion in revenues. However, Classic is experiencing negative publicity, declining stock prices, as well as the rising costs of fuel and labor over the past year. Furthermore the destructive reports coupled with low employee morale resulted in Classic's Board of Directors requiring a 15% cost reduction over the next 18 months. Management must quickly act to implement a nine-step problem solving method to overcome the obstacles and provide solutions to meet...
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