Quality Control Group Project
Company Overview
US Airways Group Inc. is one of the major U.S. airline companies that delivers air transportation services for cargo and passengers. The company is the 5th largest airline company in the United States as being measured by available seat miles and revenue passengers. The U.S. Airways Group was formed in 2005 through its merger with former U.S. Airways Group and American West Holdings. The company scheduled passenger services for approximately 3,100 flights daily to more than 200 communities in the United States, Europe. Canada, Mexico, Central & South America, and the Middle East. U.S. Airways is owned by the U.S. Airway Group with headquarter in Tempe, Arizona, and the company uses 1,818 U.S. Airways Express and 1,210 U.S. Airways Mainline for its daily flight operation. The U.S. Airway is a member of Star Alliance Network that utilizes fleet of 285 regional jet, 346 mainline jet aircraft and turbo-prop aircraft. As of January 2013, the U.S. Airline employs approximately 32,213 people globally. The challenges facing the airline industry in the last few years has extremely affected the U.S. Airway Group. In 2008, the company recorded the annual operating loss of $1.8 billion. Although, the company recovered between 2009 and 2012, however, the company net income was still behind the TTM (Trailing Twelve Month) figures.
Objective of the report is to use the DMAIC (Define, Measure, Analyze, Improve and Control) methodology to solve the problem facing the U.S. Airways. To identify the key problems facing the company, the report carries out a comprehensive audit using DMAI model.
Define the Problem
The purpose of this section is to clearly articulate the business problem facing the U.S. Airways Group. The section defines the problem, and the customer's voice that is critical to the quality of the service delivered by the company.
Starting from 2000, the U.S. Airways Group has suffered from the financial decline due to a reduction in the number of air passengers. After September 11, 2001, there has been a drastic reduction in the number of air passengers forcing the company to declare bankruptcy in 2002. Unlike other airline companies that recover and emerge stronger following the introduction of Chapter 11 protection, however, the U.S. airway never recovers until 2009. The combination of tough labor negotiation and fuel costs has forced the company into the financial problems. In June 2007, a Consumer Report survey of approximately 23,000 readers revealed that U.S. Airway ranked as the worst airline that delivered customer satisfaction. A follow-up survey also revealed that U.S. Airways remained in last place making the company to be rated as the worst airline in the United States. Typically, the U.S. Airway scored 5/30 for food, 10/30 for comfort, 15/30 for the online reservations system and 10/30 for service. (Farolino, Gathje, & Hudes, 2008). The U.S. Airways has been accused of constantly delaying and cancelling air schedule that irritate customers.
Similar problem facing the company is that the U.S. Airway ceased to provide its passenger with complimentary beverages in 2008. The company also requires passenger to purchase soda or bottled water for $2. Customers were also asked to pay $1 for tea or coffee. However, the company resumed serving complimentary drinks to passengers in 2009. The overall problems made the U.S. Airway to be ranked last out of the 20 major domestic Airlines in the United States in 2007. In 2008, the U.S. Airway ranked seventh in term of on-time arrivals. Moreover, the U.S. Airways has a very poor record of addressing client's complaints, and the company has been accused of answering only 50% of the telephone calls directed to the customer service department. The company also has higher record of customer delay. According to the U.S. Department of Transportation (2013), the company records 234 flight delay in the September 2013.
The entire issues make the company financial record to be deteriorated. In 2009, the U.S. Airway incurred a net loss of $205 million, which represent 90% reduction in the company net income. In 2008, the company lost $2.22 billion from its entire revenue of $12.12 billion. The company also faces a stiff competition from low cost airlines. Major competitors of the U.S. Airway include:
American Airlines (AMR),
Delta Air Lines Inc. (DAL),
United Airlines (UAUA),
Continental Airlines (CAL),
Southwest Airlines Company (LUV),
JetBlue Airways (JBLU), and AirTran Holdings (AAI).
The high cost of fuel has also been the major problem facing the company. Over the years, there has been a constant fuel rise making the company to record...
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now