Qantas - Products, Services and Facilities, Position in Tourism and Hospitality Industry - Example

ASSIGNMENT 2 By Name Course Instructor Institution City/State Date Abstract Qantas, which was founded in 1920 in Queensland, is acknowledged to be amongst the top long distance airways in the world. Nowadays, Qantas offer flight services in more than 170 destinations in over forty countries, and has almost 35,000 workers. Additionally, the Qantas group provides subsidiary businesses like Jetstar, budget airlines, as well as other specialist businesses services: Qantas Holidays and Qantas Catering. This report talks about Qantas, and its position in the overall tourism and hospitality industry. Qantas products, services and facilities as well as its capacities will also be discussed. As it will be evidenced in the report, in spite of the determined governmental efforts to strengthen tourism and commercial aviation after the 9/11 terrorist attack in U.S., the number threats from terrorist groups such as al-Qaida together with other Islamist extremist groups such as Islamic State have continued to increase; so contemporary issues in tourism/hospitality industry will be discussed comprehensively. Table of Contents ASSIGNMENT 2 1 Abstract 2 Introduction to Hospitality and Tourism 4 Introduction 4 Aviation Sector Contribution to Tourism/Hospitality Sector 5 Qantas Products, Services, Facilities and Capacities 6 Target Market 7 Attributes and qualifications of Qantas Staff 8 Legal Compliance Issues 9 Sustainability Issues 9 Trends in the industry 11 Contemporary issues and Future challenges 11 Conclusion 14 References 15 Appendices 18 Introduction to Hospitality and Tourism Introduction Without a doubt, tourism is a major contributor to the success of global economy; for instance, in 2012, it contributed almost $2 trillion directly into the world’s gross domestic product (GDP) and offered more than one hundred million jobs worldwide, which constitutes 3.4 per cent of the total employment (ATAG, 2013). The World Travel & Tourism Council (WTTC) projects that by 2024 the tourism industry will offer direct employment to over 126 million persons worldwide. According to Dobruszkes and Mondou (2013, p.23), tourism is essentially important for global economy. This is evidenced by GDP and jobs supported by tourism, the numbers are suggestively higher at 9.3 per cent of the global economy ($6.6 trillion) as well as 8.7 per cent of employment (more than 260 million jobs) (see appendix 1). Statistical projections show that tourism by 2024 will support over $11 trillion in GDP and almost 347 million jobs. According to Corrie et al. (2013, p.1317), expenditure in the tourism sector can enable other industries to grow by means of the local market, thus initiating a endogenous growth system. In this case, Qantas plays a crucial role in promoting tourism considering that more than 52 per cent of global tourists use air travel as means of transport. Essentially, tourism is crucial for scores of countries including Australia, given that it contributes to economic growth (OECD, 2008, p.9). Qantas is expansively considered as the leading extended distance airline in the world, and it is the strongest brand in Australia. Qantas promotes tourism not just in Australia but also globally since it moves tourists from one country to another. In this report, Qantas contribution to tourism/hospitality industry will be discussed expansively. Aviation Sector Contribution to Tourism/Hospitality Sector As mentioned by Dobruszkes and Mondou (2013), aviation has for decades been acknowledged as a key driver of global tourism, particularly on long destinations. Qantas belongs to aviation sector, and this sector has made a substantial contribution to tourism, not just in Australia, but also globally. In tourism, air transport is an important element, given that it offers the crucial connection between the tourist spawning zones as well as destinations. Good transport accessibility, as mentioned by Graham et al. (2010, p.73) is an important factor for the growth of all tourist destinations. Furthermore the aviation sector also benefits from tourism due to the additional demand in passengers that could be created. Aviation sector is therefore a progressively more crucial means of transport for hospitality/tourism industry. Even though natural features have indicated that air travel has at all times been the prevailing means for extended distance travel, deregulation and particularly the development of the low-cost airlines, have as well boosted the importance of aviation for short as well as medium transport. Therefore advances in aviation sector can have crucial effects for lots of tourism markets. According to Dobruszkes and Mondou (2013, p.23) most of current tourist destinations would not be existent devoid of air transport. The figure below shows the propensity to travel in 2012: Fig 1: Propensity to Travel in 2012 (ATAG, 2013) Qantas Products, Services, Facilities and Capacities Variety of products and services are offered by Qantas, and they include Qantas (which is the premium brand), and Jetstar (which is the low cost brand). Qantas flights are divided into domestic and international: so, in domestic flight, two travel classes are offered: Economy and business class. The inflight services at domestic level consist of snacks, meals as well as audio-visual entertainment (Qantas, 2013). Besides that, Qantas' City flyer offers travellers moving between Sydney, Adelaide, Brisbane, Perth, Canberra, and Melbourne an extra seats and flights as compared to its competitors with additional services like free newspapers and wine during the weekdays. In international flights, different classes such as premium, business, economic, and economy class are offered, whereby depending on the class, passengers get dissimilar services. Another product offered by Qantas is Qantaslink, which offers expedient interstate, intrastate, as well as international connections (Qantas, 2013). Qantas Freight is furnished to handle all forms of freight, from high technology to primary produce products. Services offered by Qantas Freight include cargo, express, and mail services. Target Market Basically market target is defined by competition, and according to Gaggero and Piga (2011, p.552), competition obstructs the ability of airlines to price discriminate, even though this effect is reduced during the peak periods. Qantas market segmentation can be considered multifaceted, bearing in mind the fact that market segments have various expectations, requirements as well as needs. In this case, behavioural segmentation is largely espoused by Qantas for selection of target market. Qantas carrier services are positioned as one, which offers never-ending luxury as well as the service whose quality is top-class. Qantas use safety as an attribute for attracting customers, considering that every passenger would desire to feel safe when travelling currently, Qantas is targeting business travellers moving outside or inside Australia. This audience target is divided further into emergency business travellers, conference travellers, as well as routine travellers. Besides that, Qantas also targets the leisure travellers, and this target is further divided into multiple destination travellers as well as weekend tourists (Ahmed, 2014). The Qantas target audiences are never hesitant while paying for luxuries offered by the airline thanks to its Qantas Frequent Flier, a popular program for customer loyalty. The program is one of its kind in Australia since it has over 9 million members. The figure below shows that Australia domestic passengers have been reducing, so there is need to concentrate on international passengers. Fig 2: Australia Traffic Development (source: Bureau of Transport and Regional Economics (BTRE)) Attributes and qualifications of Qantas Staff As mentioned by Sutherland (2012, p.198), job attribute inclinations differ with worker attributes, particularly, domestic circumstances, gender, occupation, and qualifications held. Basically, all airlines have different goals, visions as well as different methods of handling their customers. Still, nearly all companies anticipate their staffs to have particular competencies: in Qantas case, staffs are required to have these competencies: interpersonal and communication skills, cultural sensitivity, team player, adaptability and flexibility, dependability, conscientiousness, professional image, and high ethical standards. So, without the abovementioned competencies, working at Qantas can prove to be tough. Qualifications to work at Qantas include; at least 21 years, university graduate in the job applied for, and fluent in English. Legal Compliance Issues Qantas as employers often require support with countless legal compliance issues, and so it has contracted a number of legal service providers to offer valuable support and counsel to its businesses on various areas of concern. Additionally, the legal service providers are tasked to carry out investigations of a grievance of harassment or discrimination as well as to carry out audits on employment practices and other compliance practices. The legal issues that face Qantas include: issues on employee discharge, employment agreements and audits on employment practice, social media issues, wage and hour issues, employment selection procedures, and drug testing programs. Sustainability Issues Modern transportation issues as per Leuenberger et al. (2014, p.316) are less based on development and more based on being environmentally sustainable. Qantas has always strived to operate sustainably, and this has been achieved through its improvement on environmental, economic and social performance with the intention of addressing long-standing business risks (Qantas Airways, 2014). Qantas also exploits opportunities while seeking to continue delivering returns that are financially sustainable to its shareholders. Basically, every business has a responsibility to incessantly decrease its environmental footprint. So, Qantas takes this responsibility seriously. This is evidence by the fact that the airline has positioned its environmental sustainability at its business core so as to put programs that lessen the airline’s environmental impact into practice and bring efficiencies in all its operations. Through its environment policy, the airline have been working proactively in creating as well as maintaining systems, which can assist in managing and identifying substantial environmental risk and impacts. Qantas is as well integrating such environmental considerations into functional activities; this, reducing waste and enhancing its resource efficiency. Corporate managers according to de Lange et al. (2012, p.151) are turning out to be more aware of the significance to expand their goals, further than the outmoded financial expectations. Qantas has not been legally sustainable; this is evidenced by 2011 drama when the entire Qantas fleet was grounded by Alan Joyce, Qantas CEO. As a result, 108 aircrafts were grounded, travel plans for more than 50,000 people were tumbledown and reputation of the Qantas was left in tatters. Mr Joyce argument for grounding Qantas was to save Qantas, but the same year industrial action was taken by workers unions against airliner (Ubc.ca, 2012). Qantas plans to restructure and outsource its operations to Asia would have made 1000 employees jobless. In this case, the unions were unhappy and the need for job security instigated industrial action against Qantas as well as intense strikes (Ubc.ca, 2012). In this case, two ethical issues arise; first is Mr Joyce improper decision to ground Qantas operations and second issue unjustifiable actions and demands of the workers’ union. Trends in the industry Current trends in hospitality and tourism include; Globalization, whereby people these days travel more freely than before across the globe. Safety and security; the security concern in the hospitality/ tourism and aviation industry has considerably increased because of numerous terrorist attacks globally, and due to tourists’ abductions and attacks. Services have improved considering that as market consumption and global competition change in the growing service sector, an important role is played by quality in both retaining as well as attracting customers (Kapiki, 2012, p.2). Technology is another trend, which is a steering force of change presented and continues to present opportunities for better integration and efficiencies of guest services. Demographic changes have also impacted tourism and aviation industry in equal measure. Population is progressively growing and lots of retired persons are spending their money and time to use hospitality services and travel across the globe. The future trends in hospitality industry will include more eco-lodgings, development of multipurpose facilities, and more boutique hotels (Kapiki, 2012, p.8). Sustainable tourism will continue growing in the future, since most people will turn out to be more responsible with reference to sustainability. The increased tourist across the globe will directly impact Qantas since low-cost carriers will also increase and new players will start dominating Australia air travel. Contemporary issues and Future challenges There are numerous contemporary issues that are negatively impacting tourism industry and aviation sector. The first issue is coping with the climate change and global warming: bearing in mind that tourism is an economic sector that extremely sensitive to climate. Tourism is closely connected to climate and the environment (Ghimire, 2012). So, on the one hand, it is highly affected by climate change and variability, and on the other hand, it is contributes to climate change through greenhouse gases emissions. Given that 5% precent of global greenhouse gases emissions are contributed by tourism through air travel. Fig 3: Widening gap in Air Transport Efficiency (ATAG, 2013) Financial Crisis is another issue facing hospitality/tourism industry considering that contemporary businesses are facing a lot of crises: governability crisis, fuel price crises (see figure 4), power crisis, and more others that are heightened by the global economic crisis. Another issue is enhancing competitiveness: competitiveness in hospitality and tourism has turned out to be amongst the noticeable issues in the current globalized World (Ghimire, 2012). Concentrating on innovation and creativity in the nature of tourism is problematic bearing in mind that tourism industry must compete with the fresh type of competitors as well as new services and products so as to meet the new preferences and tastes of the customers. The hospitality industry will in the future experience human resource and labour challenges, which will include the shrinking or compression of the workforce, workers and trade union issues as well as the intensifying benefits and healthcare costs (Nehta, 2012). Moreover, alternative ownership will in the future offer hotel developers with challenges, especially by considerably increasing their financial exposure in projects’ development. Fig $: Qantas Cost Structure and Total Expenditure (source: Qantas) Conclusion In conclusion, it has been evidenced that tourism and aviation sector plays a crucial role in supporting sustainable growth of the economy. Qantas is an important tourism component in Australia and globally, offering the important connection between the areas generating tourists as well as destinations. Evidently, Qantas is driving social and economic progress in Australia. Moreover, it is connecting cultures, countries, and people; it offers access to tourism markets; and generates trade. Tourism on the other hand, is generating a real sense of identity as well as pride for Australians. Through tourism, Australians are given the opportunity to showcase the different attributes of their culture, history, and ways of life. References Ahmed, M., 2014. Qantas positioning with individual/household and business customers…: World traffic growth forecast by Airbus Industries. [Online] Available at: https://www.academia.edu/8031005/Qantas_positioning_with_individual_household_and_business_customers_World_traffic_growth_forecast_by_Airbus_Industries [Accessed 27 January 2015]. ATAG, 2013. Tourism : Aviation: Benefits Beyond Borders. [Online] Available at: http://aviationbenefits.org/media/26786/ATAG__AviationBenefits2014_FULL_LowRes.pdf [Accessed 27 January 2015]. Corrie, K., Stoeckl, N. & Chaiechi, T., 2013. Tourism and economic growth in Australia: an empirical investigation of causal links. Tourism Economics, vol. 19, no. 6, pp.1317-44. de Lange, D.E., Busch, T. & Delgado-Ceballos, J., 2012. Sustaining Sustainability in Organizations. Journal of Business Ethics, vol. 110, no. 2, pp.151 - 156. Dobruszkes, F. & Mondou, V., 2013. Aviation liberalization as a means to promote international tourism: The EU–Morocco case. Journal of air transport management, vol. 29, pp. 23 - 34. Gaggero, A.A. & Piga, C.A., 2011. Airline market power and intertemporal price dispersion. The journal of industrial economics, vol. 59, no. 4, pp.552 - 577. Ghimire, R.P., 2012. Contemporary Issues of Tourism Development in Nepal. [Online] Available at: https://www.academia.edu/3888183/Contemporary_Issues_of_Tourism_Development_in_Nepal [Accessed 27 May 2015]. Graham, A., Papatheodoro, A. & Forsyth, P., 2010. Aviation and Tourism: Implications for Leisure Travel. Farnham, Surrey: Ashgate Publishing. Kapiki, S.T., 2012. Current and Future Trends in Tourism and Hospitality: The Case of Greece. International Journal of Economic Practices and Theories, vol. 2, no. 1, pp.1-12. Leuenberger, D.Z., Bartle, J.R. & Chen, C., 2014. Sustainability and Transportation. Public Works Management & Policy, vol. 19, no. 4, pp.316–21. Nehta, V.K., 2012. Hospitality management is both a field of work and a field of study. [Online] Available at: http://www.slideshare.net/speak2vinod/hospitality-management-is-both-a-field-of-work-and-a-field-of-study [Accessed 27 January 2015]. OECD, 2008. Tourism in OECD Countries 2008 Trends and Policies: Trends and Policies. Paris: OECD Publishing. Qantas Airways, 2014. Sustainability. [Online] Available at: http://www.qantas.com.au/travel/airlines/sustainability/global/en [Accessed 27 January 2015]. Qantas, 2013. Our Company. [Online] Available at: http://www.qantas.com.au/travel/airlines/company/global/en [Accessed 27 January 2015]. Sutherland, J., 2012. Job attribute preferences: who prefers what? Employee relations, 34(2), pp.193 - 221. Ubc.ca, 2012. Qantas brought down by its workers unions. [Online] Available at: http://blogs.ubc.ca/rup02/2012/09/12/qantas-brought-down-by-its-workers-unions/ [Accessed 27 January 2015]. Appendices Asia-Pacific Aviation Analysis (ATAG, 2013) Read More