Implementation and Monitoring of Change in Etihad Airways - Case Study Example

Name Professor Course Due date Etihad Airways Etihad Airways was established in July 2003 as an established United Arab Emirates flag carrier by Royal Decree. It commenced its commercial operations on November 2003 and is now the fastest growing airline in commercial aviation. The airline announced its largest order of aircraft in the history of commercial history in 2008 at Farnborough Air-show of up to 205 aircraft. It operates cargo and passenger services to 85 destinations throughout the world from Abu Dhabi home base as of January 2012 (Etihad Airways, 2012). It carried 8.3 million passengers in 2011 which was a 17% increase from previous years which delivered revenues of US$ 4.1 billion and US$ 14 million net profits. The seat factor increased by 3.8% to 80.7 %in the 2011 third quarter which is the highest quarter since it commenced its operations (ArabianBusiness.com. 2011). This report discusses identification, implementation and monitoring of change in Etihad Airways. The contemporary airline industry is very competitive and it becomes essential for the organization to provide to its customers and owners a consistent quality and value. Thus, quality continuous improvement will be essential in order to put behind the ineffective old approaches and develop better and more effective approaches that will improve relationship with customers as well as owners and employees. Quality and continuous improvement is very essential in this organization because as a service industry, it requires to make rapid changes in order to remain competitive in the service industry. This means that the organization will not wait for anything wrong to occur in order to take action, but it will investigate any difference as well as potential ways that are more effective for solving issues and going to the next step using the best technology. This requires constant input by workers in everyday running of the business (Anderson, Banker, & Ravindran, 91-92). With constant input by the workforce, the employees are more encourage in their work and they develop better ways of improving performance. Thus, the organization becomes highly adaptable. This means that the organization will already be used to making various changes which makes it effective when there are sudden revolutions. With a continual improvement of quality of services provided by the organization, the expenses with be gradually lowered in the long term. The business may find itself spending more in the short term during the investigation as well as the implementation of changes. But such actions will later be useful in improving efficiency leading to faster processes, customization option for the customers and various effective that will save money in the business and increase its profitability. Thus, quality improvement will end up having a substantial effect especially in the bottom lines where the business is concerned about (Hamilton, & Asundi, 830-833). There are various factors that may require changes in the organization. Such factors include cost-effectiveness, speed, and risks. Cost-effectiveness Every year the organization makes efforts in planning of organizational operations. More scheduled flights usually undergo changes after the first publication. This may be due to cancellations, delays, changes in aircrafts, diversions or introduction of additional flights. There are also issues such as damaging of aircraft on the ground which may not occur frequently but may lead to disruptions that are very costly such as costs of recovery and compensations. Such causes are indirect and if not well managed, they may be even greater than direct costs. In addition, there is usually no control over various factors such as weather and unpredictable market changes. Every change in operation will affect various elements of system resources as well as their costs and revenues. This means that if the management does not have the ability to understand or forecast and also make decisions of frequency of such occurrence, these things that may end up being unavoidable. Thus, this will lead to incurring of more expenses (Cotteleer & Bendoly, 643). Speed The pace in which the airline industry is changing especially the IT sector is growing at a faster rate. Due to technology, the modern technology requirements are becoming far more complex and are larger when compared to some years ago. One of the biggest developments is introduction of internet into the services in the airline industry. This has brought new ways in which the customers are interacting with this sector which has led to high volume of transactions as well as higher demands on the sectors (Hamilton, & Asundi, 835) Risks With the changing environment especially in the matters of safety, there is a need to ensure that there is adoption of tighter standards of security in the sector. Such incidences include the trauma that was caused by previous terrorist attacks where the contemporary organizations must prove their efficiency to provide tighter security to their customers. Other issues that need to be reduced in order to gain the confidence and trust of the customers include operational disruptions as well as inadequate resources (Cotteleer & Bendoly, 647). Recommendations Cost-effectiveness There are very few managers that with knowledge of the overall operation and cost efficiency that are involved in decision making process. This means that the operational change is not widely spread in the system in order to control the occurrence of such unavoidable situations within the organization. This calls for more training on operational users in order to yield more significant cost savings (Anderson, Banker, & Ravindran, 93). Speed There are changes that are taking more time through documentation of requirements, engagement of the third parties as well as testing new functions. This is as a result of partial implementation of Agresso system. By fully implementing it, some of changes that many take days will be implemented in very short times. In addition, the operators will best understand this business leafing to simplification and provision of significant opportunities for reduction of costs as well as improving the convenience of passengers (Anderson, Banker, & Ravindran, 94). Risks Using Agresso system in assessment of operational disruption and delays will be minimized when such changes are made right in the graphical user interface. In addition, there will be elimination of paper work across every department to electronic work which will improve the confidence and trust thus reducing issues on security such as terrorism (Cotteleer & Bendoly, 650). With the Agresso system and full understanding and commitment in regard to its operations, the problem of planning of resource will be solved. This will lead to reduction of risks, complexity and effort accompanied by saving of substantial capital. Objectives Training the employees on applicability of agresso system in quarterly basis in order to reduce both direct and indirect losses Assessment of efficiency of implementation of a transparent agresso system on monthly basis Making every system of management of safety electronic in a period of six months Action plan Training Establish a team consisting of all levels of management which would review all the Agression system initiatives that are relevant in reduction of losses. The team develops an implementation plan that is detailed Implementation of the plan in specific key area with a specific time frame. Agresso system Continue with efforts of enhancing the implementation of the procedures of aggression system Conduction of quarterly audit program to ensure that best practices of the system are implemented Risks Identify suitable qualified inspectors to assess that implementation of safety management system Develop an electronic system for safety management and prevention of operational disruption Launch a program to address the compliance as well as the effectiveness of the system Monitoring on achievement of training will be goal-based. This will be done by evaluating the extent in which the programs on training are achieving the predetermined objectives on monthly basis. Such questions on evaluation involve: What is the current status of the progress of the program in achievement of the objectives? Which goals have we achieved according to the implementation plan? Are there adequate resources for the personnel to enhance the achievement of the goals? Implications of change The implementation of change may lead to various financial effects in the business. First, implementation of any change within the organization may incur more costs where the organization will initially feel the effect of increasing costs. After the implementation of change, the costs will gradually decrease in the long run where the organization will be relived financially due to decreased costs as well as increasing effectiveness of the change. Secondly, based on the previous system, complete adoption of the new system would be less costly since costs of operations will be concentrated in the electronic system. This means that the manual operations will be reduced and in turn, the costs will be reduced (Hamilton, & Asundi, 841) People may be affected positively and negatively. Positively, everyone is at the verge of adopting any upcoming technology and implementation of such changes is an advancement of technology. In addition, the changes will improve the relationship between employees and management through contribution of their decisions in the implementation teams. Thus, everyone owns the change. Negatively, due to change of technology and operations, some may be exposed to loss of their previous understandable favorite positions to new ones (Almutairi, 1264). One of the main barriers in implementation of change is the coordination of the implementation team due to incorporation of different levels in management. Some of the members may feel that their ideas are not accepted due to the lower levels of management or non-management conditions. Such barrier is overcome by ensuring frequency in feedback on all members and allowing voting to determine the strength of the idea (Almutairi, 1271). Communication and implementation of change Communication is very vital in implementation of any change in organization. Everyone in the department is expected to know the change from the upper management to other employees. Communication will begin from the upper levels then to the employees through teams where everyone will be able to participate fully in understanding and implementation of change. Communicating will achieve two goals. First, the employees will be informed clearly about the importance of the change and their new tasks in implementation of change. Second, by communicating, one will create a community in within the business which will work together to make change successful (De Ridder, 43). Once the change has been implemented, the teams will occasionally be asked on the progress and commitment to the change while ensuring that feedback is obtained every time. This will always remind them of the change and they will be interested in making it better. Teams will be involved in improving change through asking their opinions and discussing on the progress of change where everyone will own the process of improvement. The improvement activities will be evaluated preparation of questionnaires to the employees where they will be asked to rate the progress and effectiveness of change (Meyer, 92). Work cited Almutairi, H. “Information system and productivity in Kuwaiti Public Organisations: looking inside the black box,” International Journal of Public administration, 30 (2007): 1263-1290. Anderson, M, Banker, R., & Ravindran, S. “The new productivity paradox,” Communications of the ACM, 46.3, (2003): 91-94 ArabianBusiness.com. Abu Dhabi's Etihad Airways Q3 revenues up 39% - Transport. 2011. Accessed on 24 September 2012, http://www.arabianbusiness.com/abu-dhabi-s-etihad-airways-q3-revenues-up-39--423634.html Cotteleer, M. & Bendoly, E. “oder lead-time improvement following enterprise information technology implementation: an empirical study,” MIS Quarterly, 30.3, (2006): 643-660. De Ridder, J. “Organization communication and supportive employees”, Human resource management journal, 13.4 (2003): 29-50 Etihad Airways . Etihad Airways in Brief. June 2012. Accessed on 24 September 2012, http://www.etihadairways.com/sites/Etihad/Etihad%20Images/Resources/EY-Factsheet.pdf. Hamilton, L. & Asundi, R. “Technology usage and innovation: its effect on the profitability of SMEs,” Management research news, 31.11 (2008): 830- 845 Meyer, J., P., & Allen, N.J. Commitment in the workplace: theory, research and application, Sage publishers, Thousand Oaks: CA. 1997 Read More