This document gives strategic failure of Delta airlines and how the management did adopted various strategies for the revival of the Airlines .Delta Air Lines, Inc., commonly alluded to as essentially Delta, is a noteworthy United States carrier, with its base camp in Atlanta, Georgia. The carrier, alongside its backups and provincial associates, works more than 5,400 flights day by day and serves a broad local and worldwide system that incorporates 304 goals in 52 nations on six landmasses, as of October 2018.

1. FINANCIAL CRISIS AND
REVIVAL OF DELTA
AIRLINES

2. FINANCIAL CRISIS AND REVIVAL OF DELTA AIRLINES
1
Delta Airlines
Introduction
Delta Air Lines, Inc., commonly alluded to as essentially Delta, is a noteworthy United States
carrier, with its base camp in Atlanta, Georgia. The carrier, alongside its backups and
provincial associates, works more than 5,400 flights day by day and serves a broad local and
worldwide system that incorporates 304 goals in 52 nations on six landmasses, as of October
2018. The Atlanta-based airline voluntarily sought Chapter 11 protection from creditors with
the bankruptcy court in New York, listing total assets of $21.56 billion and $28.27 billion in
debt.
Financial Crisis of Delta Airlines
 The organization confronted the monetary emergency in September 2005. The
organization caused high work cost. A switchgear disappointment brought about an
emergency for Delta Airlines Corporation, making numerous negative effects its
business. On August eighth 2016, Delta lost access to Georgia Powers and its save
generator, because of a power blackout. This brought about a "shutdown of Delta's
server farm, which controls appointments, flight activities and other basic
frameworks." Even when the power was re-established, Delta's "basic frameworks
and system hardware didn't change over to reinforcements. Different frameworks
did." Because of this power blackout, Delta perceived vulnerabilities in its present
frameworks. Because of this happening in its Atlanta base camp, it dropped 2,300
flights more than three days and its income for August 2016 declined around $100
million.
 Delta's erroneous conclusions of the IT frameworks affected its business forms no
matter how you look at it. Any harm to its innovation foundation could bring about
affecting client administration business interruption and its unfavourable money
related and reputational results. They know about then potential harm from the
frameworks being down for significant lots; notwithstanding, they didn't treat or end
this hazard and rather, endured the hazard, which brought about expanding its general
hazard.
 The airline's business procedure builds its monetary hazard, in light of the fact that
their clients and staff were discontent with their procedure, by repaying its clients and

3. FINANCIAL CRISIS AND REVIVAL OF DELTA AIRLINES
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paying its workers for extra minutes. Its present business process is paying its staff
extra time, which results in monetary harm for Delta.
 Delta attempted to mastermind flights that addressed its clients' issues at no extra cost,
which additionally influenced their "Passenger Revenue per Available Seat Mile
(PRASM)" since now they were giving business to their rivals. The company’s
revenue declined to 9.5 percent in the year 2008. Because the airline paid for overtime
and reimbursed its customers.
 Delta had no other choice between reputation and financial loss. Aditionally, there
was a higher financial risk in the coming months because it had to repair and improve
its IT infrastructure, which took toll on its budget
 Delta had a weak internal coordination because it did not have a strong method in
place for crisis management. Delta lost about $7.78 dollars in the year 2004.
 On top of this, cost pressures from rising jet fuel prices more than 20 percent since the
start of the year created an additional difficulty to the airlines company. The stiff
competition from low fare carriers has kept everyone in the industry from recouping
the higher costs through increase in ticket prices.
Revival of Delta Airlines
The company emerged from bankruptcy after the year 2007.The following were the steps
taken by the Delta Airlines to revive from bankruptcy.
 Delta’s first step was to adjust along with other airlines to new market realities. Delta
would have to further strengthen its culture and pursue more innovative strategies.
 The airlines company took two years time for its revival by restructuring itself. It had
an employee profit sharing program that continues to differentiate it from peers. The
company’s restructuring cost accounted to $3 billion.
 Delta airlines survived by merging with Northwest Airlines and by cutting the costs.
It also added stock ownership plan that gave the pilots, ground crew members and
support staff 15% of the company’s equity.
 The company deepened its foreign partnership by buying a minority stake in three
overseas carriers.
 Delta signed a 10 year agreement with the Pinnacle Airlines Corporation to provide a
regional service. Pinnacle, which also flies for Northwest, will fly 16 regional jets for
Delta starting in December.

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 Delta will issue new common shares which fell 2.2 percent to $20.46 in trading on a
“when issued” basis giving its market value of about $8.1 billion, which was the
second highest after the Southwest Airlines.
Role of Finance Manager
The suggestions from my perspective if I were to be a Finance Manager of Delta Airlines
are
 Delta’s competitiors have chosen cost-leadership strategy but The former has
chosen the product differentiation strategy after its revival. Because of this the
company’s ticket prices may fall but the service and accommodation will increase
the customer’s willingness to pay.
 Customers choose among the services which costs them low fare. But customers
will be definitely willing to pay more when the overall travel experience is good
by which the company can increase its ticket fares.
 Delta must formulate the hub and spoke model which saves them large amount of
money and can invest those money in creating a better customer experience.
 The company must also have a clarity on crisis management which was one
among the cause for its failure.