Management Information Systems of Virgin Australia - Assignment Example

Management Information Systems Report Name : Registration number : Course Name : Program : Submission Date : Overview Virgin Australia is the second largest airline services firm in Australia and the largest by fleet size. Founded in 2000 as Virgin Blue, the company has grown from two aircrafts operating on a single route to serving 29 cities in Australia with 106 aircrafts and having three hubs in Brisbane, Melbourne, and Sydney. Virgin Blue was rebranded in 2011 to Virgin Australia with the entry of a new CEO, John Borghetti. Virgin Australia is a branch of the vast Virgin Group holdings, although its operations are to a very great extent autonomous. The company is listed in the Australian market with the first IPO having been in 2005. Air New Zealand enjoys 23% of the shareholding with Virgin Group holding 25% of the shares (Virgin Australia Airlines, 2012). The firm has over the years entered into codeshare agreements with a substantial number of firms in the airline industry such as Etihad Airways, Air New Zealand and Delta Airlines among others. Virgin Australia offers a wide variety of airline services from business class flight services to economy class flight services. In addition to flight services, the company also provides hotel and catering services in the Virgin Australia Lounge. Its headquarters are situated in Virgin Village in Bowen Hills, Brisbane. The company has three international subsidiaries: V Australia operating in Abu Dhabi and Los Angeles, Pacific Blue (rebranded as Virgin Australia) operating in New Zealand, Indonesia and South Pacific and Polynesian Blue (rebranded as Virgin Samoa) operating in Samoa in conjunction with the Samoan government (Virgin Australia Airlines, 2012). Under domestic and short-haul international operations, Virgin Australia offers the following cabin options: business class, premium economy and economy. Under international long-haul operations, the company offers international business class, international economy class and international premium economy class. It has integrated its services into an online forum where clients can subscribe for membership through logging into a passenger’s velocity frequent flyer account. Explain how Organization’s achieved business success through the use of information, information technology, and people Information, information technology and people are indispensable for business success. Virgin Australia has reaped success from using information garnered from all areas of operations to create a competitive advantage to their airline products. Through conversion of data information collected through the velocity frequent flyer accounts to meaningful information, the company has achieved tremendous success by structuring services according to market trends. The aircraft used by the company, for example, is regularly appraised and aligned with the trends in the market. Sharing of common information among all tiers of the company has enabled the firm to be more effective and efficient. Complaints by clients to the customer support department are disseminated to all departments in the firm such as a cabin crew which ensures that customer service quality meets customer expectations (Carr, 2004). The rebranding to Virgin Australia from Virgin Blue in 2011 was based on information collected from the market concerning the marketability of the brand name. Since the firm was undergoing transition including management (entry of John Borghetti as new CEO) and unveiling of business-class seats and new crew uniforms, market research conducted found out that a change in brand name would provide the much needed impetus to success of the process. The current success of the firm since rebranding is a clear indicator of how instrumental information can be in propelling business success. Persons, both employees and customers have been and remain to be an invaluable asset to Virgin Australia. After the rebranding in 2011, the success of the new strategy for the company was entirely dependent on the implementation team. The new CEO’s (John Borghetti) experience and enthusiasm acquired from his previous position in Qantas, a competitor to Virgin Australia came in handy to propel the success of the implementation process. In addition, the support and willingness of the crew and other staff to drive the strategic change in 2011 had a priceless contribution to the success realized from the process. John Borghetti is quoted to say that at least 50% of the strategic changes came from the staff and crew. Also, the continued and constant support from customers of Virgin Australia has been a major contributor to the success of the business. The company enjoys a wide and steady customer base who has been marketing agents for the services offered by the company (Sutherland & Morieux, 2011). Virgin Australia provides the best customer services to all clients. Its employees are smart, equipped with all necessary skills and supportive, experts to connect customers to their services and ensure that this becomes an integral part of their life. Virgin Australia knows that an organization without a customer base is unable to succeed and as such it puts more emphasis on customer satisfaction. The company uses information from customers’ suggestions and comments concerning their products to develop new products and services. The company has also integrated information technology into the entire process of customer service. Information technology has enabled the managers of the company to be more competent in the business function and the organization of the departments to be more effective. It controls the use of computers and computer software in the entire service business. The dedicated IT team in the organization has rendered themselves to delivering an adept and spot-on IT base for the company. From the passenger's velocity frequent flyer accounts for members to the customer-friendly website maintained by the company constitute a very key contributor to the wholesome success of the business in terms of service quality and customer satisfaction. The IT-based forums created in the flight services process by the company provide an indispensable source of much-needed information from clients and would-be customers. Describe the types of information staff/employees at an organization store or require Virgin Australia staff and employees store and require four types of information namely, descriptive information, diagnostic information, predictive information and prescriptive information. Descriptive information gives the managers of the company the “what is” condition of the business. It gives a description of the state of the business at any specified point in time. Virgin Australia uses this type of information to identify many problems. Staff and employees of the company store this type of information in the form of financial results, test results, product marketing, and financial results among others. Diagnostic information communicates the “what is wrong” condition to Virgin Australia management. It measures the disparity between the “what is” and “what ought to be” conditions. It is used to define problems that develop in the business process. It provides answers to common management problems in the company such as the desired level of production and the return on investment. This type of information is obtained from descriptive information in Virgin Australia such as financial and production records. The management of the company has developed norms and standards that help them to identify the “what is wrong” condition of Virgin Australia. Such standards include the projected number of passengers per year and the projected return on investment in a new flight route or a new flight package. Thirdly, staff keeps and requires predictive information about the dealings of the company. This type of information communicates the “what if” condition to the managers of Virgin Australia. It is usually generated through analyzing possible future events and has an exceeding value with desirable outcomes. Virgin Australia's CEO, John Borghetti has specialized in obtaining, storing and use of this type of information, a thrift that has had a great impact on the success of the company. Predictive information has helped the company to reduce risks and uncertainty associated with prices, business climate, technology and relationships with customers and other players in the flight services industry. It has been used in the formulation of production plans by the company and the evaluation of related financial impacts. This type of information is obtained from simulation models, budgeting techniques and other relevant tools used to evaluate expected changes in the business. Lastly, the “what should be done” question for Virgin Australia is answered by prescriptive information synthesized and stored by the management staff. This type of information is rather internally instigated as opposed to the other types that obtain their bearing from the external environment of Virgin Australia. This type of information is informed by the goals and values of the management of the company. The desired strategic change in 2011 was guided by the goals of the firm. The implementation of the strategic plan, which involves making a substantial number of investment decisions, is also dependent on the goals and values of the management of Virgin Australia (Savolainen, 1999). Evaluate how organization can gain business intelligence through the implementation of a customer relationship management system Customer relationship management (CRM) constitutes all interactions between a business and its customers. It helps the management to manage the business and relationships providing invaluable benefits to the business such as decreasing costs and increasing revenues. Virgin Australia has invested in CRM system with cloud, big data, social, mobile, and internet of things drivers. However, there still exists much room for improvement in the integration of the CRM system in the services process. Through ensuring success in the implementation of a CRM system, Virgin Australia can gain business intelligence in the following ways. First, the CRM system would help the firm to acquire customers. Data collected through the CRM system would enable Virgin Australia to correctly identify the target audience and help to focus marketing efforts that would in turn reduce the cost of customer acquisition. Also, it would improve customer satisfaction. CRM increases the visibility of the customers that would help to forecast sales and analyze customer service satisfaction. In addition, CRM system provides the users with the capacity to instantly check the order histories of the customers that would help the company to assess flight patterns and identify new opportunities (Peelen, 2005). Since CRM reports email marketing actions, the company can immediately identify hot prospects and route this information to the sales team for further action. Also, mobile and remote staff works efficiently with dependable access to all the customer and activity information they need via their mobile device. Vital business processes are allied in one system. CRM adjusts to manage various items like contracts, products, events, projects, applications & property in addition to sales and services process and customer services. Furthermore, CRM minimizes customer churn since users can access all the relationship detail they require through manifold channels to engage with clients and supply great service (Peelen, 2005). Formulate a strategy for how organization can use efficiency IT metrics to improve its business. The first efficiency IT metric is the alignment of the IT investment to business strategy. The preliminary stage in IT investment involves the management ensuring that the investment is in line with the business strategy. The strategic change in 2011 for Virgin Australia involved drawing a detailed strategic plan which outlined the various areas of interest that needed address, among them IT investment. Aligning investment in IT to the strategy of the business ensures that the firm can deliver sustained business value.it is necessary, therefore, to draw the IT and business strategy simultaneously (McWhirter & Gaughan, 2012).  Cumulative business value of IT investment is a second metric to consider. It involves sorting the projects in the IT investment portfolio by their net present value in descending order. Thirdly, the managers of Virgin Australia need to consider the IT spend ratio which involves determining the cost of new investment versus maintenance cost. Business success is highest when the cost of maintenance is minimized. Critical business service availability which focuses on the satisfaction of the customers with the services provided by the IT is the fourth metric to consider in the strategy. Virgin Atlantic would use customer satisfaction survey results and IT performance against service-level agreements to ensure that it obtains the desired business success from IT investment (McWhirter & Gaughan, 2012).  Summary Management Information System is a vital, indispensable integral part in modern business. It is especially an invaluable asset for airline services firms such as Virgin Australia mainly due to the lengthy and complex process involved in the service delivery. A successfully implemented MIS provides the managers of the firm with accurate, timely and organized information that helps them and other users in decision-making, supervising activities, solving problems and tracking progress. Virgin Australia has integrated MIS with the transaction processing system. It has, therefore, realized great business success as a result of the benefits that come with MIS. However, there still exists much room for improvement in the management and hence productivity of the MIS. REFERENCES Carr, N. G. (2004). Does IT matter?: Information technology and the corrosion of competitive advantage. Boston: Harvard Business School Press. McWhirter, K., & Gaughan, T. (2012). The definitive guide to IT service metrics. Cambridgeshire, Ely, U.K: IT Governance Publishing. Peelen, E. (2005). Customer relationship management. Harlow, England: FT Prentice Hall. Savolainen, V. (1999). Perspectives of information systems. New York: Springer. Sutherland, E., & Morieux, Y. (2011). Business strategy and information technology. London: Routledge. Virgin Australia Airlines. (2012). Virgin Australia voyeur. Eveleigh, N.S.W: Pacific Plus Company Pty. Limited - a Pacific Magazines Company. Read More