Mgmt 362 ( problem solving skills) united airlines case study

PROBLEM-SOLVING APPLICATION CASE

United’s Turbulent Communications Strategy

United Airlines is one of the world’s largest airlines serving 353 destinations across five continents. The Chicago-based carrier has approximately 92,000 employees and earned more than $41 billion in revenue in 2018.105 Oscar Munoz started as United’s CEO in 2015, and by March 2017 was named “Communicator of the Year” by PRWeek. Unfortunately, he fell from grace a month later due to United’s botched response to a flight-related incident.106

Let’s consider how United communicated about the incident.

SUNDAY, APRIL 9: CHAOS ON FLIGHT 3411

A fully booked United flight 3411 was preparing to depart from Chicago to Louisville when gate agents realized that four airline crew members needed to get to Louisville. The gate agents asked for four volunteers to give up their seats in return for compensation. No one accepted United’s offer because the flight was the last one to Louisville that evening. United then decided to enact an “involuntary de-boarding situation,” in which four random passengers were directed to deplane. Three of the passengers deplaned without incident. The fourth, Dr. David Dao, refused, saying “I can’t get off the plane. I have to get home. I’m a doctor. I have to get to the hospital in the morning,” according to The Sentinel News.107

United employees responded to Dao by contacting the Chicago Department of Aviation Security. A scuffle broke out between the officers and Dao when they tried to forcibly remove him from the plane, resulting in a concussion, broken teeth, a broken nose, and other injuries for Dr. Dao. The bloodied image of Dr. Dao was posted on social media and rapidly spread around the world.108

MONDAY, APRIL 10: UNITED’S INITIAL RESPONSE

A series of communication blunders transpired the next day:

United released a statement apologizing for the “overbook situation.” The airline would later backtrack and clarify that the flight was not actually overbooked, and passengers were removed to make space for United employees.

CEO Munoz released a public statement on Twitter calling the incident an “upsetting event,” but did not address the treatment of passenger Dao. He apologized to the passengers who were involuntarily deplaned but called their removal “re-accommodation.”109 According to Sean Czarnecki of PRWeek, the word “re-accommodate” was then “lodged in the Internet lexicon as a United Airlines euphemism for brutally assaulting your customers.”110

CEO Munoz sent an internal letter to United employees blaming Dr. Dao for what happened, calling him “disruptive and belligerent.” He also stated that he fully supported his employees’ handling of the situation.111 The internal letter quickly became public, which flamed the negative publicity.

News outlets compared videos of a bloodied and bruised passenger being dragged off an aircraft with United’s defensive, un-empathetic, written responses.112 The result was outrage on social media with thousands of flyers signing a petition demanding Munoz’s resignation. Many also called for a boycott of United, whose slogan of “Fly the Friendly Skies” was tarnished by the incident.113 In fact, a survey conducted by Morning Consult found that nearly half of the respondents said they would pick a more expensive, longer flight to avoid giving United their business.114

TUESDAY, APRIL 11: UNITED CHANGES COURSE

A turbulent day on Wall Street kicked off after United’s initial response to the incident. The airline started the morning losing nearly $1 billion in stock value.

Munoz responded by releasing another written statement. This time he struck a different tone and took “full responsibility” for the episode and said that Dr. Dao should not have been “mistreated” the way he was. The airline also pledged to conduct a review and quickly release findings. Although the statement helped reduce the stock’s slide, United still closed the day down around $250 million.115

WEDNESDAY, APRIL 12: MUNOZ APPEARS ON TV

On Wednesday morning, Munoz utilized another medium of communication by appearing on ABC’s “Good Morning, America.” His body language was ­solemn as he said he felt “shame” when he saw the video of Dao being dragged off the plane. “This can never—will never—happen again on a United Airlines flight. That’s my premise and that’s my promise,” Munoz told viewers.116 Page 376

The airline’s efforts may not have been enough to turn the tide. A survey taken by LendEDU after Munoz’s TV appearance found that 42 percent of millennials, the most frequent business travelers of any generation, would still not fly with United.117

A TOUGH COUPLE OF WEEKS FOR MUNOZ AND UNITED

The crucial conversations spurred by flight 3411 continued for weeks after the incident. United published full-page ads in several major U.S. newspapers in late April. The ads included an apology from Munoz. “That day, corporate policies were placed ahead of shared values,” said United’s CEO. The ads also outlined how the airline was changing its policies to prevent the reoccurrence of such an incident.118

Munoz’s handling of the situation took a toll on his career at United. The airline’s parent company, United Continental Holdings, denied the CEO’s planned promotion to chairman weeks after the incident.119 Ironically, he too lost a seat he expected to receive.

APPLY THE 3-STEP PROBLEM-SOLVING APPROACH TO OB

Use the Organizing Framework in Figure 9.6 and the 3-Step Problem-Solving Approach to help identify inputs, processes, and outcomes relative to this case.

STEP 1: Define the problem.

Look first at the Outcomes box of the Organizing Framework to help identify the important problem(s) in this case. Remember that a problem is a gap between a desired and current state. State your problem as a gap, and be sure to consider problems at all three levels. If more than one desired outcome is not being accomplished, decide which one is most important and focus on it for steps 2 and 3.

Cases have protagonists (key players), and ­problems are generally viewed from a particular protagonist’s perspective. In this case you’re asked to assume the role of a business owner.

Use details in the case to determine the key problem. Don’t assume, infer, or create problems that are not included in the case.

To refine your choice, ask yourself, Why is this a problem? Focus on topics in the current chapter, because we generally select cases that illustrate concepts in the current chapter.

STEP 2: Identify causes of the problem by using material from this chapter, which has been summarized in the Organizing Framework for Chapter 9 and is shown in Figure 9.6. Causes will tend to show up in either the Inputs box or the Processes box.

Start by looking at the Organizing Framework (Figure 9.6) and decide which person factors, if any, are most likely causes of the defined problem. For each cause, explain why this is a cause of the problem. Asking why multiple times is more likely to lead you to root causes of the problem. For example, do employee characteristics help explain the problem you defined in Step 1?

Follow the same process for the situation factors. For each ask yourself, Why is this a cause? By asking why multiple times you are likely to arrive at a more complete and accurate list of causes. Again, look to the Organizing Framework for this chapter for guidance.

Now consider the Processes box in the Organizing Framework. Social media policies and practices can be but are not necessarily a cause. Are any other processes at the individual, group/team, or organizational level potential causes of your defined problem? For any process you consider, ask yourself, Why is this a cause? Again, do this for several iterations to arrive at the root causes.

To check the accuracy or appropriateness of the causes, map them onto the defined problem.

STEP 3: Make your recommendations for solving the problem. Consider whether you want to resolve it, solve it, or dissolve it (see Section 1.5). Which recommendation is desirable and feasible?

Given the causes you identified in Step 2, what are your best recommendations? Use the material in the current chapter that best suits the cause. Remember to consider the OB in Action and Applying OB boxes, because these contain insights into what others have done that might be especially useful for this case.

Be sure to consider the Organizing Framework—both person and situation factors—as well as processes at different levels.

Create an action plan for implementing your ­recommendations.

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