{"id":11032,"date":"2016-11-04T04:46:06","date_gmt":"2016-11-04T08:46:06","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/crystal-cruises-llc-exploiting-climate-change-or-making-the-best-of-an-unfortunate-opportunity\/"},"modified":"2016-11-04T04:46:06","modified_gmt":"2016-11-04T08:46:06","slug":"crystal-cruises-llc-exploiting-climate-change-or-making-the-best-of-an-unfortunate-opportunity","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/crystal-cruises-llc-exploiting-climate-change-or-making-the-best-of-an-unfortunate-opportunity\/","title":{"rendered":"Crystal Cruises LLC: Exploiting climate change or making the best of an unfortunate opportunity?"},"content":{"rendered":"

A Once in a Lifetime\u00a0Experience<\/strong><\/p>\n

\u201cThis [is] kind of a bucket list thing.\u00a0 I\u2019d love to see a Walrus before I die\u201d Sue Pendleton remarked, preparing for her cruise on the Crystal Serenity.[1]<\/a>\u00a0\u00a0 The ship, owned and operated by Crystal Cruise lines, was beginning her maiden voyage through the treacherous Arctic Northwest Passage in August\u00a02016.\u00a0 Small, ice-strengthened ships had regularly conducted cruises through this passage, the first of which sailed 30 years ago. However, at nearly 8 times the size, without any ice-strengthened construction, the Serenity would be the largest and most vulnerable ship to ever sail the passage with 1070 passengers aboard.[2]<\/a>\u00a0 At a\u00a0$22,000 ticket price per passenger, the cruise sold out within 3 weeks.[3]<\/a>\u00a0 Publicity was widespread within the travel community bringing awareness to the rapidly growing subsidiary of Genting Hong Kong.[2]<\/a>\u00a0 However, reactions were mixed.\u00a0 Travelers seemed unsure whether to embrace this new operating model or shun it.\u00a0 On the one hand, it educated passengers on climate change and improved the economy for local communities hit hardest by global warming.\u00a0 Still, the cruise wouldn\u2019t be feasible without melting ice caps and diminishing glaciers.\u00a0 Is Crystal Cruises LLC exploiting the negative effects of climate change or are they making the best of an unfortunate opportunity?\u00a0 As a leader in this new market, the company must decide how to position itself.\u00a0 The company\u2019s answer to this question may determine its long term success.<\/p>\n

\"Voyage<\/a>
Voyage 7320: The Northwest Passage – Cruise Route<\/em><\/figcaption><\/figure>\n

Crystal Cruise Lines\u00a0Seizes an\u00a0Unfortunate Opportunity<\/strong><\/p>\n

The decision to conduct this maiden voyage through the arctic was one of several ambitious moves made by CEO Edie Rodriguez since she had taken the helm of Crystal Cruises in 2013.\u00a0 In three years, she set out a rapid growth plan including the company\u2019s acquisition by Genting Hong Kong, expansion into residences at sea, yachts and even luxury airlines in the attempt to be an all-inclusive travel service.[3]<\/a>\u00a0Melting ice caps presented the company with an opportunity to traverse the Northwest Passage with the largest cruise ship to date. The company also had an opportunity to bring over $100,000 in business to poverty stricken Inuit communities.[1]<\/a>\u00a0 The popularity of the initial voyage was so successful for the business that they\u00a0began selling tickets for the 2017 summer transit before Crystal Serenity set sail\u00a0in 2016.\u00a0 The overwhelming success encouraged competitor, Regent Cruises, to enter the market as well.[1]<\/a>\u00a0However, enthusiasm was not shared by all. \u00a0Some viewed it as a cavalier operating model that also\u00a0exploited a dramatically negative\u00a0global warming epidemic.<\/p>\n

\"2017<\/a>
2017 Northwest Passage Brochure Cover<\/figcaption><\/figure>\n

The Risks of Sailing the Northwest Passage<\/strong><\/p>\n

The primary threats to this model were the risky nature of the Northwest Passage and the impression that Crystal Cruises was betting against the climate. Concerns quickly rose from maritime officials that subsequent shipowners would enter the market with a lack of adequate planning resulting in a devastating accident.[4]<\/a>\u00a0 While most inaugural passengers felt safe, a small accident, even by a competitor could derail the entire initiative.\u00a0 It often took maritime officials over two days to successfully reach areas in the Northwest passage.\u00a0 Additionally, the idea of cashing in on \u201cextinction tourism\u201d was very troubling to some.[5]<\/a>\u00a0 \u201cIt is an abomination – a massive, diesel-burning, waste-dumping, ice-destroying, golf-ball smacking middle finger to what remains of this planet\u201d one reporter remarked.[6]<\/a>\u00a0 This association with global warming exploitation, coupled with any sort of environmental disaster could pose a risk to the strong Crystal Cruises brand.<\/p>\n

Green Initiatives and Risk Mitigation<\/strong><\/p>\n

To mitigate risk, the company was escorted by logistical ship specializing in ice reconnaissance and oil pollution containment equipment.[1]<\/a> \u00a0To address the concerns of environmentalists, the ship took two actions. It offered a \u201cStudy in Global Warming\u201d excursion, highlighting the negative effects of climate change for passengers.[1]<\/a> \u00a0 Additionally, the ship promised to surpass minimum requirements by using a pricier but environmentally friendly low-sulfur fuel.[1]<\/a><\/p>\n

An Opportunity to Set the Example as a Leader in a New Market<\/strong><\/p>\n

These initiatives only slightly appeased environmentalists.\u00a0 In its unique market position as a leader, Crystal Cruises can do more.\u00a0 It has an opportunity to set the example for a small niche of businesses that find opportunity specifically in the negative effects of climate change.\u00a0 Consumer perception continues to shift with an increasingly stronger emphasis on improving the climate.\u00a0\u00a0 Crystal Cruises could look for ways to become greener company and take an active role in climate talks as its business serves on the front line of global warming.\u00a0 Doing so will not only differentiate the cruise line, it will hedge what could be dramatically negative effects of an environmental mishap.\u00a0 The irony is not lost on inaugural passenger Moira Somers.\u00a0 She remarked, \u201cOne kind of feels \u2013 I won\u2019t say guilty, but you are taking advantage of what is happening\u201d[7]<\/a><\/p>\n

 <\/p>\n

[800 words]<\/p>\n

Sources:<\/strong><\/em><\/p>\n

[1]<\/a> Schwartz, Karen. \u201cAs Global Warming Thaws Northwest Passage, a Cruise Sees Opportunity.\u201d New York Times, July 6, 2016. http:\/\/www.nytimes.com\/2016\/07\/10\/travel\/arctic-cruise-northwest-passage-greenpeace.html?_r=0<\/a>. \u00a0Accessed 3 November 2016.<\/p>\n

[2]<\/a> Sloan, Gene. \u201cA history of cruises through the Northwest Passage.\u201d USA Today, October 7, 2016. \u00a0http:\/\/www.usatoday.com\/story\/travel\/cruises\/2016\/10\/07\/northwest-passage-cruise-history\/91720028\/<\/a>.\u00a0\u00a0Accessed 3 November 2016.<\/p>\n

[3]<\/a> Gollan, Doug. \u201cHow Crystal Cruises Pulled off its Massive Expansion.\u201d Forbes, July 23, 2015. \u00a0http:\/\/www.forbes.com\/sites\/douggollan\/2015\/07\/23\/how-crystal-cruises-pulled-off-its-massive-expansion\/3\/#3957852b3a12<\/a>.\u00a0\u00a0Accessed 3 November 2016.<\/p>\n

<\/a><\/p>\n

[4]<\/a> Paris, Costas. \u201cLuxury Cruise to Conquer Northwest Passage.\u201d Wall Street Journal, May 10, 2016. \u00a0http:\/\/www.wsj.com\/articles\/luxury-cruise-to-conquer-northwest-passage-1462872605<\/a>.\u00a0\u00a0Accessed 3 November 2016.<\/p>\n

[5]<\/a>\u00a0Michael Byers, “Here and Now”, National Public Radio, September 12, 2016. http:\/\/www.wbur.org\/hereandnow\/2016\/09\/12\/northwest-passage-cruise<\/a>. \u00a0Accessed 3 November 2016.<\/p>\n

[6]<\/a> Oremus, Will \u201cThe Upside of Global Warming: Luxury \u201cNorthwest Passage\u201d Cruises for the Filthy Rich\u201d, Slate, August 17, 2016. \u00a0http:\/\/www.slate.com\/blogs\/future_tense\/2016\/08\/17\/crystal_serenity_s_northwest_passage_cruise_is_a_festival_of_environmental.html<\/a>.\u00a0\u00a0Accessed 3 November 2016.<\/p>\n

[7]<\/a> \u201cRachel Waldholz, Weekend Edition Saturday, National Public Radio, August 27, 2016. \u00a0http:\/\/www.npr.org\/2016\/08\/27\/491337521\/in-warmer-climate-a-luxury-cruise-sets-sail-through-northwest-passage<\/a>, accessed November 2016. \u00a0\u00a0Accessed 3 November 2016.<\/p>\n

 <\/p>\n

Image Sources:<\/strong><\/em><\/p>\n

“Crystal Cruises Northwest Passage Explorer 2017 Brochure.” \u00a0http:\/\/www.crystalcruises.com\/voyage\/details\/northwest-passage-explorer-7320<\/a>\u00a0&\u00a0http:\/\/viewer.zmags.com\/publication\/06b0f96d#\/06b0f96d\/1<\/a>. \u00a0Accessed 3 November 2016.<\/p>\n","protected":false},"excerpt":{"rendered":"

Climate Change has created innovative opportunities – but what if the opportunity is dependent on the negative effects of global warming?<\/p>\n","protected":false},"author":2214,"featured_media":11033,"comment_status":"open","ping_status":"closed","template":"","categories":[1218,1397,1463,1462,138,326],"class_list":["post-11032","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-climate-change","category-crystal-cruises","category-glacier-melting","category-snowcaps-melting","category-travel","category-travel-services"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/climate-change-challenge-2016\/","yoast_head":"\nCrystal Cruises LLC: Exploiting climate change or making the best of an unfortunate opportunity? - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/crystal-cruises-llc-exploiting-climate-change-or-making-the-best-of-an-unfortunate-opportunity\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Crystal Cruises LLC: Exploiting climate change or making the best of an unfortunate opportunity? 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