Etihad Airways Business Model - Case Study Example

Name Instructor Course Date Etihad Airways business model Actors Local authorities Supplies Customers Partners Colleagues Potential customers Resources Intellectual Human Financial20 Board of directors Etihad Airways Business Model Infrastructures Airplanes Partner airlines Buildings Transaction informational flows Modify a reservation Book a flight Book a vacation Manage bookings Actors: they represent the role of persons while interacting with the business. Etihad has the following business actors: Local authorities Supplies Customers Partners Colleagues Potential customers These actors exhibit cognitive characteristics that help model something outside the business. For instance, customers through word of mouth and recommendations, help market Etihad to others. The role of actors is, however, not static. In addition, actors interact with the business differently, with each actor having a distinct role to the business. Local authorities provide regulations for which the company must adhere to when operating in the industry. Suppliers, on the other hand, are responsible for providing Etihad with supplies such as airplanes, engines, and other products and services that the airline requires. Resources Resources are the most important assets required to make the Etihad’s business model to work. Key resources include intellectual, financial, physical, and human resources. Etihad Airways depends more on human resources for business excellence. Etihad Airways owns key resources while rarely outsource its resources. Intellectual resources at Etihad include proprietary knowledge, partnerships, copyrights, patents, and customer databases. Infrastructure Infrastructure for the business includes physical assets such as the airplanes, point of sale systems, vehicles, distribution networks, and buildings for which Etihad Airlines operate. Transaction informational flows Data processing at Etihad takes place within the jurisdiction of the company’s transactional team. The company ensures fair and discrete exchange of information since customers often upload personal information. Etihad Airways has the following transaction informational flows: Modify a reservation: customers have the privilege to modify a reservation after they have placed a reservation. This feature allows customers to be certain about the reservation they have placed. While this transactional feature may involve chargebacks or refunds (Etihad Airways) Book a flight: the company facilitates access to wide network of destination with easy clicks. Customers can customize their flight as well as pay efficiently and quickly through options such as eWallet, credit cards, and real-time bank transfers. Nonetheless, customers can only book a maximum of nine guests in a single transaction. Book a vacation: The Company’s website offers consumers an opportunity to book for a vacation from the convenience of their homes. Etihad Airways offers a range of vacation destination and vacation assistance information, thereby making it possible for customers to make informed decisions. Manage booking: when clients make bookings, they may have a variety of tours and travels they want to do. The company’s website facilitates clients to manage their bookings online, thereby adjusting them to best fit. Etihad Airways unification business operating model Etihad’s organizational units are tightly integrated around some standardized set of processes. This, in turn, helps create business autonomy allowing the business to maximize on efficiencies and customer services through integrating as well as pushing variability out of the business (Alhadeff). The above unification model for Etihad Airlines reflects that the company operates under highly centralized management environment, engages in process standardization, and the company leverages on economies of scale. Etihad has large IT systems used to manage wide array of functions, including financial management, customer relationship, and human resources among other core functions. In addition, Etihad strives to keep variation between business units at a minimum in a bid to promote cohesion of units. Under the unification model, process standardization and process integration for the business are high. This means that Etihad utilizes economies of scale by introducing existing products and services in new markets. In addition, Etihad Airlines capitalizes on growing product line. Owing to its large capital investment, the company can opt to acquire competitors consequently lowering competition. Etihad’s Digital capabilities and leadership as digital masters Etihad’s digital and leadership capabilities can be classified as digital masters. This is because the airline has strong overarching digital vision as well as strong governance. An assessment of the company reveals that Etihad Airline seeks to become a world leader in flight management and reservation by using world’s most sophisticated tools, and indication of strong digital vision (Malik). Etihad’s vision reads “to reflect best Arabian hospitality as well as enhance” the prestige of Abu Dhabi. Etihad also exhibits good governance as it has a strict code of conduct enforced at various levels. Etihad has adopted the use of credit cards for customers to pay online. Moreover, it is recommendable for the company to cultivate in strong digital culture. This means investing heavily in developing system infrastructure. Strong digital culture at Etihad Airlines is exhibited by the use of sophisticated technology in the company’s website whereby customers can book their flights and destination using a secure channel (Malik). The advantage of having a strong digital culture is that the company develops ability to realize customers’ demands for personalized goods. This, in turn, increases efficiency of processes within the company. Etihad understands that digital is not technology challenge rather it is a transformational opportunity. Because of this understanding, Etihad strives to use digital to be better rather than being early adopters. Etihad introduced a bottom-up digital transformation, making the company to have digital capabilities. Digital capacity under digital masters is less important than leadership capacity. According to Westerman, great digital leadership implies developing a compelling transformative digital vision. At Etihad, the company crafted a vision and engaged the right people in order to build momentum for which the company would grow. Once the company had the vision, the next step was strong governance that saw the company stand strong to date. Major components of a “playbook” in relation to being digital masters Major components of a playbook At Etihad, the major components of a playbook include products and services, teams, and industry. The purpose of the playbook is to enable the marketing and sales teams to influence the roles of individuals in the company. Components of the playbook include: Products and services: the products and services’ section is the most important because it offers customers the opportunity to partake in development of products. The product section of the playbook provides a wide range of market needs. Segment guidelines: the company has market segment that separates the internal activity of the company and responsibility of each member. Expectation: expectation provides the guiding principles that propel us towards a common goal. At Etihad, the expectation takes the form of helping workers succeed and maintaining consistent communication. Works Cited Alhadeff J. “Data flows and business models: distributing information flows and business functions” 2014 Oracle Etihad Airways “Corporate profile” 2016 [Online] Available from http://www.etihad.com/en-ke/about-us/corporate-profile/ Malik Nick “SOA in the Unification model” 2007. [Online] available from https://blogs.msdn.microsoft.com/nickmalik/2007/10/27/soa-in-the-unification-model/ Read More