The Story of Continental Airlines remarkable turnaround in 1994 is Essay

The Story of Continental Airlines remarkable turnaround in 1994 is well known in business policy and strategy classes worldwide - Essay ExampleContinental Airlines is presently Americas fifth largest airline that carries around 50 one million million million passengers a year across the globe to more than 227 destinations. But a couple of decades back in 1993, it was facing its third and final bankruptcy when the innovative CEO Gordon Bethune and Consultant, Brenneman created history in the turnaround of Continental Airlines. Their leadership initiatives turned the loss of $613 million in 1994 to $224 million profit in 1995 (Brenneman, 1998). The discontented and exceedingly demotivated workforce became the major enabling elements of success that contri merelyed to its renewal. The turnaround strategy was overcritical factor that was conceptualized around four simple strategic principles that required strong belief, labor and constant motivation. The creative approach highlighte d leaders vision which was used to inspire the workforce for higher productive outcome.Turnaround strategy of Bethune and Brenneman was mainly focused on how the firms falling fortunes can be turned around into success. They did not place undue emphasis on cost cutting and rather made judicious plans for building strong team of high performance members who believed in collective proceedings and shared goals. The leadership of new management was admonitory in their forward looking outlook and expedited the process of recovery with single focus on defined goals and objectives. The strategies that were implemented are as follows 1. Strategic action plans for recovery Bateman and Snell (2009132) assert that strategic plans facilitate organizations to be innovative and develop linkages to meet the needs of the markets. Flexibility of approach and well laid out plans pass on firms with clear direction for the future (Montgomery, 2008). In Continental case, action plan was made with fe edback from the customers and employees, which was communicated across the workforce. The recovery plan was distinct in its simple targets but strict in its timeframe so that recovery could be fast. The necessity of fast action was communicated to workforce so that they could understand and become proactive in fashioning it a success. It worked in Continental case because the high frustration in the workforce was mainly due to unclear and frequently changing strategies of the past. The lack of terse directions and target had led to disillusionment, adversely impacting their motivation for higher achievement. The new plans were clearly defined by the management and communicated on regular basis to the workforce that helped to uphold their confidence and motivated them to work towards the goals with renewed enthusiasm. 2. Leadership initiative and team building Drucker (1999) believes that external and internal environment hugely contributes to business performance and managerial le adership innovatively exploits them for the organizations advantage. The open communication approach used by Bethune and Brenneman helped in adapting to the strategic changes that were introduced to transform business dynamics. Leadership initiative is critical factor to develop an organizational culture of proactive participation, shared learning and strong teamwork (Shapiro, Slywotzky and Tedlow, 2000). The leaders looked for opportunities and exploited them with a sense of high urgency by dint of a team of motivated