American Airlines Business Analysis

In April 1992, American Airlines introduced "Value pricing". This is a complete simplification of the complicated pricing structure developed over the past ten years to deregulate the aviation industry in the United States. Americans anticipate that a new pricing scheme will benefit consumers and restore profitability within and across the United States. The crucial question raised is whether US bold initiatives are effective. The problem encountered in exercising price leadership has shifted industry practices from complex spread and promotion structures to simplified daily low-cost structures.

The purpose of this white paper is to show how to use Business Information System (BIS) to analyze SABER reservation system manufactured by American Airlines and to gain strategic advantage. This is accomplished by explaining the overall approach adopted by American Airlines and explaining how SABER brings a competitive advantage. I will also explain factors that may cause an American airline to lose its competitive advantage. One of the key elements for providing the best service to customers is ensuring convenience, information flow, time saving, and effective utilization of available customer service resources. On the other hand, in times of severe competition, companies must be able to provide such services at the lowest cost and in the most convenient way (Linoff and Barry, 2011).

American Air's external environment in SWOT analysis consists of opportunities and threats it faces. The opportunity American Airlines found is a good factor indicating the prosperity of the company. American airlines opportunities are market growth, positive business ideas, and unified business activities ("2012 College Business Conference, 16 July 2012, Kissimmee, Florida", 2012). (Reservation place) Judging from the opportunity of good market growth in the air transportation business, competition with other companies puts great pressure on improving the company's system. Training workers should be efforts to confirm that American Airlines is ready to face competition. Technological changes are also factors to consider in the company's external environment.

The operation of the airline company is a hard work. In the past 20 years nearly all major airlines have applied for bankruptcy of United Airlines in 2002, American Airlines in 2004, American Airways in 2005 and American Airlines in 2012. Severin Borenstein, an economist at the Haas School of Business in the US said that total industry loss exceeded $ 6 billion between 1992 and 2012. The chief executive (CEO) of the airline shows public concerns about the current state of the aviation industry. As we all know, Robert L. Crandall, former chief executive officer of American Airlines, expresses the aviation industry as "a messy and corrupt company."