Swissair Failure Essay

Swissair was started in 1931 by the merger of two main Swiss airlines and it was in the market till 2002. In its total span of market presence - total 71years - it has been the national airline. Amongst the world’s airlines, Swissair has long been one of the most respected. Created in 1931, the Swiss national transporter was known for security and service that instilled deep constancy with travelers. Swissair was ‘‘renowned as a flying bank and it came to be regarded as a Switzerland’s national symbol’’ due to its strong financial position. In 1997 Swissair Group adopted a holding structure and changed its name to SAirGroup. In the 2002 the economical and political changes in Europe started affecting Swissair

(Helga,2002).

Political:

Greater political influence on company governance was the major factor for Swissair 's failure. Swiss politicians and the Swissair management immediately launched a campaign against the banks. Thousand closed their accounts with the two banks, and demonstrations of Swissair employees were supported with sympathy and enthusiasm. Swiss ruling circles have come to the conclusion that they should now follow the policy of cuts in social spending and wages long.( Saad,2012)

Board: (he never knows what to do, if anything; no degree of involvement)

Swissair 's board membership, instead of reflecting capability and experience, reflected political association due to the domination of political norms in Swiss business

The role of the Board of Directors is to adopt the strategy that the Executive Director wants to implement and evaluate without follow-up if the strategy is successful.The Board also allowed the company to obtain many other companies facing many financial problems, such as, Sabena 49.5%, LOT 37.6%, South Africa 20%, without taking into account that these decisions will exacerbate the financial crisis itself.