aith and poor ethics to request sacrifice on the part of workers while management did not make similar sacrifices. The CEO resigned over the matter, and a new man, Arpey, took over the helm.
Arpey was charged with changing the management style of the airline to keep it flying û dealing with costs and employee relationships, as well as improving the overall ethics and social responsibility of the way the airline is run. To do so, Arpey was charged with coming up with a different plant that would take legal issues and corporate social responsibility into consideration.
Problems: The deregulation in the airline industry caused a lot of changes that affected AA directly. These included barrier to entry factors such as the development of central hubs in which airlines consolidate their airport gates. Airlines also competed through proprietary data base reservations systems (CRSs); of which AAÆs was the largest in the business. Degree of Rivalry: increased competition from lower priced airfare, usually for people willing to endure no frills flying to save money; entry of more discount options. Airlines competed on quality of service on time performance and price. It is relatively easy to choose to switch between
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