I. Current Situation
A. Current Performance
Despite the decline in travel demand, Carnival managed to carry a record 8.5 million guest.
2009 sales were below the 2008 record, the company still posted a $1.8 billion net income
European expansion proceeded smoothly and expansion initiatives in Australia and Asia produced positive results
Global economic recovery, the U.S. government’s advisory against travel to Mexico, terrorist fears, fuel price uncertainty, and other factors, and the company expected to see a return to the historical growth patterns it experienced in previous years for the coming years.
B. Strategic Posture
Carnival currently holds approximately 50% of the cruising market & the strategic outlook through 2012 and beyond was projected to be highly favorable.
Carnival Corporation’s management believed that only 20% of the U.S. population, 9%–10% of the UK population, and 4%–5% of the continental European population had ever taken a cruise. This left a large number of potential cruise guests.
European growth potential was consistent with the North American market 12 years ago. Anticipating this growth, Carnival Corporation intended to continue average annual capacity growth in North America at a 3% rate and European capacity growth at 9% through 2012.
Carnival’s 98 ships had a capacity of over 190,000 passenger berths.
Occupancy rates usually hover at or above 100%.
Carnival Corporation continued to expand through internally generated growth by adding new ships. Additionally, Carnival seemed to be willing to continue with its external expansion through acquisitions, if the right opportunity arose.
The 11 cruise lines competed in all of the three operational sectors of the cruise market (contemporary, premium, and luxury)
1. Mission
“Our mission is to deliver exceptional vacation experiences through the world’s best-known cruise brands that cater to a variety of different lifestyle and budgets, all at an outstanding value unrivaled on land or at sea.”
2. Objectives
To become an exceptional vacation experience
To become the largest cruise line in the world offering always competitive & comparable prices to also land and flight vacation packages & to work in an environmentally friendly way.
Management wanted the company to be perceived as a responsible corporate citizen for guests, workers, and the world community.
Quote: “ . . . While our targeted brands and strategic growth initiatives remain important ingredients for success, and entrepreneurial spirit is what our company thrives on. . . . Our culture empowers our brand managers to make daily decisions to the best interest of building their respective operating companies. Each brand is accountable for its individual performance.”
3. Strategies
“Do one thing and do it better than anyone else”
4. Policies
Affordable
To deliver exceptional vacation experiences
To become the world’s best-known cruise brands that caters to a variety of different lifestyle and budgets

II. Strategic Managers
A. Board of Directors
14 members of Carnival’s Board of Directors, of whom three served as internal officers and four others were retired company employees or had previous ties to Carnival Corporation or one of its subsidiaries.
1. B. Top Management
Mickey Arison owned approximately one-third of the company’s stock. (He also owned the Miami Heat, a basketball team) The Arison family and its trusts controlled roughly 36% of the stock. All other directors and executive officers, as a group, owned or controlled approximately 30% of the total shares outstanding.
Mickey Arison - Chairman of the Board and CEO
Howard S. Frank – Vice Chairma of the Board and COO
David Bernstein – Senior VP and CFO
Richard D. Ames – Senior VP – Shared Services
Arnaldo Perez – Senior Vice President, General Counsel & Secretary
Larry Freedmann – Chief Accounting Office & VP - Controller
III. External Environment
1. A. Natural Environment
1. Despite the 2008–2009 current economic