Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
The company has been able to demonstrate entrepreneurial skill in the past with the Star Alliance, but it is in a mature industry that is characterized by a slow pace of change. Lufthansa's business model works well, and aside from 2009 when most airlines lost money Lufthansa has largely been profitable since its troubles in the early 1990s. The company's path to ongoing success is more likely to be incremental improvements to its operations punctuated by the occasional strategy tweak, rather than the introduction of an entrepreneurial culture.
10. Describe what strategic leadership actions should be recommended for reducing complexity at Lufthansa.
Lufthansa is not an especially complex company. However, reducing complexity can have cost advantages, which are important for a firm in a mature industry. The first step is to ensure that the organizational structure has clearly delineated chains of command. Complexity occurs when workers or managers must report to multiple people. Once the organizational structure is clean, it is also important to partition tasks and roles, so that there is role clarity throughout the organization. This is particularly important with respect to the Star Alliance, which is under close control of Lufthansa. The company needs to ensure that the Star Alliance -- even if closely controlled -- it not seen as an arm of Lufthansa. The two are separate entities and should remain so. Subsystem boundaries in other areas of the organization should also be delineated, such that different parts of the organization do not compete. It is evident that Lufthansa already has a clear sense of this simplicity. It has avoided introducing a discount...
& Sattelberger, T. (2001). Lufthansa's transformation marathon: Process of liberating and focusing change energy. Human Resource Management Vol. 40 (3) 249-259.
Goudy, G. (2007). International expansion -- risk sharing considerations. Business Credit. Retrieved June 8, 2010 from http://www.allbusiness.com/finance-insurance/credit-intermediation-related-activities/4012083-1.html
Lufthansa 2009 Annual Report. Retrieved June 8, 2010 from http://reports.lufthansa.com/2009/ar/servicepages/welcome.html
Middlemist, D. (2004). Cooperative Strategy. Kent University. Retrieved June 8, 2010 from http://www.personal.kent.edu/~vberardi/44285/44285 -- ch09notes.pdf
No author. (2006). Lufthansa's corporate university wins top award. HR.com. Retrieved June 8, 2010 from http://www.hr.com/SITEFORUM?&t=/Default/gateway&i=1116423256281&application=story&active=no&ParentID=1119278002800&StoryID=1141916987133
QuickMBA.com (2007). Porter's generic strategies. QuickMBA.com. Retrieved June 8, 2010 from http://www.quickmba.com/strategy/generic.shtml
Star Alliance website, various pages. (2010). Retrieved June 8, 2010 from http://www.staralliance.com/en/about/organisation/
World Airline News. (2000). Lufthansa continues to reap benefits of integration strategy. World Airline News. Retrieved June 8, 2010 from http://findarticles.com/p/articles/mi_m0ZCK/is_34_10/ai_64699387/
Works Cited:
Bruch, H. & Sattelberger, T. (2001). Lufthansa's transformation marathon: Process of liberating and focusing change energy. Human Resource Management Vol. 40 (3) 249-259.
Goudy, G. (2007). International expansion -- risk sharing considerations. Business Credit. Retrieved June 8, 2010 from http://www.allbusiness.com/finance-insurance/credit-intermediation-related-activities/4012083-1.html
Lufthansa 2009 Annual Report. Retrieved June 8, 2010 from http://reports.lufthansa.com/2009/ar/servicepages/welcome.html
Middlemist, D. (2004). Cooperative Strategy. Kent University. Retrieved June 8, 2010 from http://www.personal.kent.edu/~vberardi/44285/44285 -- ch09notes.pdf
No author. (2006). Lufthansa's corporate university wins top award. HR.com. Retrieved June 8, 2010 from http://www.hr.com/SITEFORUM?&t=/Default/gateway&i=1116423256281&application=story&active=no&ParentID=1119278002800&StoryID=1141916987133
QuickMBA.com (2007). Porter's generic strategies. QuickMBA.com. Retrieved June 8, 2010 from http://www.quickmba.com/strategy/generic.shtml
Star Alliance website, various pages. (2010). Retrieved June 8, 2010 from http://www.staralliance.com/en/about/organisation/
World Airline News. (2000). Lufthansa continues to reap benefits of integration strategy. World Airline News. Retrieved June 8, 2010 from http://findarticles.com/p/articles/mi_m0ZCK/is_34_10/ai_64699387/
Lufthansa Structure and Governance. Performance and Competition. Five-force analysis. Lufthansa is one of the oldest and most successful commercial airlines in the world, and is the fourth-largest in terms of passengers. However, the company has not always been so successful, and in fact was teetering on the brink of bankruptcy just a short while ago. By examining Lufthansa's history, structure, governance, and contemporary strategies and goals, one is able to see how the company
Southwest vs. Lufthansa quality management Creating value through quality management Southwest Airlines is famed for having one of the most unique business models and philosophies of any airline. It began as a ground-breaking organization that offered bare-bones, low-cost services to passengers. Flight crews were entertaining and responsive to passenger needs, and even though no in-flight meals were served, customers flocked to Southwest. The company openly advertises that it selects its employees because they
The company's promotional literature emphasizes the synergistic effects of this corporate structure: "IAG combines the two leading airlines in the UK and Spain, enabling them to enhance their presence in the aviation market while retaining their individual brands and current operations. The airlines' customers benefit from a larger combined network for both passengers and cargo and a greater ability to invest in new products and services through improved financial
drivers of using biofuel in the airlines industry are closely linked to the evolution of oil prices in the last decade, as well as to the risks associated with the use of petroleum fuel. First of all, the oil prices have continuously increased over the last decades and the evaluations that this would happen date back to after 2003. As early as 2009, the predictions for the period 2009-2016 reflected
Southwest Airlines The airline industry has been one that has consistently lost money during the last decade. Even before that, if an airline did not have a good business strategy, they were most likely doomed to failure. Many people do not remember Braniff, TWA or Pan American, but for a long time they were among the largest air carriers in the world. He present model, for airlines as well as other
" (Knorr and Eisenkopf, 2004) the fifth and final strength identified for Emirates Airline in the work of Knorr and Eisenkopf (2004) is stated to be the Emirates "...award-winning service in all classes, which is matched or exceeded only by very few other carriers such as Singapore Airlines. Sixth, clever marketing - for example, Emirates, not Lufthansa - was named official carrier of the 2006 FIFA World Cup hosted by