Carnival Cruise Lines: This Company has had its image damaged severely by mishaps, bad publicity, angry customers, etc. Competition is stiff and in a shock to Carnival management, people have more money than they ever had before and demand better and better service. Customers are also smart! Slick advertisements are not going to convince them that a product has high quality. The Super Bowl ads may not have been so effective. Revenue is strong, but profits are tight. The situation is very serious. On the other hand, this is an opportunity to think strategically. Consider yourself an MBA working for the company. How could you propose a strategic solution to its challenging situation? Please consider the following: • How is Carnival performing compared to the other major cruise lines? Look at Yahoo Finance or the Wall Street Journal. Be specific!
• Make an overall assessment of the situation including the status of the cruise industry and the actions of competitors. • How can Carnival improve its situation by adopting or achieving an effective strategy? Strategy is not operations. • Provide a general strategic assessment showing how the company can improve. Provide a specific plan with annual goals. Things to keep in mind: • This is a course in strategy. Apply strategic concepts from the course. Look at the textbook and follow your class notes/class discussion. Read about the topic as much as you can. Go immediately to The Wall Street Journal. If you miss a major development, your credibility will be shot. • Use Street Smarts. Think of Carnival management as smart. So, treat them as experienced and knowledgeable. Give advice based on careful analysis and your best thinking. • Find out what the more successful cruise lines are doing and apply their ideas. But, use common sense. Carnival cannot sell its ships or copy unfeasible ideas from other cruise lines. Profits are tight.
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