Strategic Information System Planning in UAE Organisation - Assignment Example

Audit on an Organisation of Your Choice Table of Contents Introduction 3 Situation Analysis 3 Organisational Goal 4 Competitors Analysis 5 Internal Strengths and Weaknesses 6 Strengths 6 Weaknesses 7 Marketing Objectives 7 Marketing Activities and 7P’s 8 Conclusion 11 References 12 Introduction Organisational audit is divided into two parts, ‘Internal Factor Evaluation’ and ‘External Factor Evaluation’. Every company can enhance their performance as well as effectiveness through the implementation of organisational and environmental audit. It is also an important aspect for strategic planning as it helps companies to react accordingly based on the external environment. In this context, it can be stated that audit is vital to ensure the long-term success for any industry. Success of aviation industry depends on several factors the keywords being quality and safety. With the help of audit, Aviation Company can implement a proper strategy of safety management to ensure safety of passengers. It encourages cooperation based partnership, which is actually helpful for analysing requirements and developing long term strategy for quality management. With regard to the process of audit, Air Arabia can identify various positive attributes (Alzaman, & Chikhalsouk, 2013). Through this audit report, Air Arabia’s situation analysis with the help of its goal, vision, competitor analysis can be comprehended along with determining the proper concept of marketing segmentation, target orientation and successful positioning, marketing objectives of aviation and how it affects firm strategy. A brief analysis of marketing mix in airline industry of Middle-East is also evaluated in the report. Situation Analysis Success of every organisation depends on its activities therefore, it is vital for the managers to collect data and analyse the environment to gain better idea about its future actions. It is vital to understand the goal of an organisation for its sustainability. Organisational Goal Air Arabia’s vision is “to be one of the World’s leading budget airlines” with the help of operational excellence, profit margin, reputation and innovation (Air Arabia Annual Report, 2013). The company has a strong mission statement to revolutionise the business with the help of innovative ideas such as offering outstanding value for money and consistent operation. For achieving the mission, Air Arabia has set some goals, to expand its business with profitability. However, in order to attain its goals Air Arabia will offer low cost facilities, control costs ruthlessly, build motivated multifunctional terms and demonstrate operational standards (Air Arabia Annual Report, 2013). In this context, the company needs to achieve its mission and vision and earn profitability. Middle East area is regarded as the most vibrant region in the airline industry. It has the strongest economy thus supports growth and expansion with regard to fleet and new route. Middle East is the fastest growing region with passenger growth, Revenue Passenger Kilometre (RPK) and Available Seat Kilometre (ASK). They are improving their passenger load factor, though it is still lower than other developed regions. For improving the situation and future success Air Arabia have to create an audit report for analysing the market segmentation, company’s present condition, competitors’ motive, target orientation and positioning. In this context, Air Arabia has created an ‘Internal Control Department’, which carries out procedures, conditions along with administrative laws and its practical implementation in the company’s operation for profitability and sustainability (El-Quqa & et. al., 2008). For the sustainability of an organisation, it is crucial to have a proper knowledge regarding its competitors and its market share for easy penetration in the market. In this context, a competitor analysis has been conducted below. Competitors Analysis Threat of New competitors: Threat from competitor is high as Middle-East has various other airlines in terms of market area, such as Etihad, Gulf Air and Emirates. Therefore, it is vital for Air Arabia to strategies policies through proper audit in order to gain better market share. Threat of Substitute Products: The substitute threat is moderate for Air Arabia. Other airlines such as Etihad have a mission to be profitable and effectual business for maximum load factors, minimum transition time with increase client’s service. This can be a threat for the company. Threat of Competitive Rivalry: The Etihad Airlines is also planning for expansion of their aircraft range, as it would like to provide service in countries of Europe and other destinations. This leads to threat for Air Arabia to a considerable extent. . The advanced features provided by competitors such as Etihad Airlines providing 24 hours service line for customers and it also provides temporary hotel accommodation for the passengers in case of flight cancellation or delayed. The bargaining power of customers: Air Arabia has a cost service programme, which is fixed. Due to customer’s reaction the company must have create the variation in travelling cost (Zawya, 2007). The bargaining power of customers is moderate as they have the option to change their preferences from one to another. Internal Strengths and Weaknesses The success of organisation depends on several aspects major being the analyses of both internal and external environment. Strengths First Mover Advantage: Air Arabia has power of effectual business with the help of maximum load factors in minimum transit time. Maximum loads are problem factor, it is a problematic situation for other airlines but Air Arabia has a solution of it. Time is important for every business, Air Arabia is able to minimise the transition time than other airlines. Strategic Relationship with Sharjah Govt.: The Sharjah Airport authority has effectively initiated growth plans for sustainability of Air Arabia in respect to its expansion of route. In addition, other joint ventures are, Information Systems Associates, Alpha Flight Services, HAECO Sharjah Aircraft Engg. Co. These types of cooperation-based partnership are always helpful for the sustainability of Aviation Company. Air Arabia leads a bold step in strategic relationship. This can be regarded as strength for the company for its long-term sustainability. Low cost structure: Air Arabia provides a very cheap cost service, which is very effectual to all low and medium earning customers. In all over the world main portion of consumer are middle class people (medium earning people), Air Arabia strategically grab the opportunity to reach this low and medium earning people and this should be the turning point of business. Experienced Management Team: It has its own experienced management and internally developed IT system, the Air Arabia’s management team have to monitor trends and responds efficiently and quickly while at the same time offering terms that facilitate decision making and along with lean management structure, airport availability, company –wide low cost mentality. This also should be sustainable for long-term business sustainability (Albadri & Abdallah, 2010). Weaknesses Overdependence on Sharjah Hub: Air Arabia’s main business allotted with the help of Sharjah Airport and its surroundings, it may cause of overdependence. Cooperation and partnership is always good for business but totally, dependent on partner’s cooperation for business is literally harmful for Aviation business. Limited Capacity: Air Arabia’s planes have limited area to seating arrangements. They are planning to increases the number of flights but another important issue is that, capacity of individual flights. Hub Location: Air Arabia is mainly Dubai based airline, so it is helpful for local people. However, it would be difficult to travel for other people of all over the Middle East. Therefore, the hub location is a little problematic for business sustainability (Zawya, 2007). Marketing Objectives Air Arabia’s implements SMART framework for the market objectives to be successful. SMART framework contain with, specific, measurable, assignable, realistic, time-related. In case of Air Arabia target market are customers and its specific goal is to set objectives as per the needs. In this context, Air Arabia have remained loyal to their low cost philosophy and continued to drive their operational costs lower. Therefore, it is quite clear that Air Arabia targets low and medium earning customers. The objective is to specifically focus on customer interaction area, introducing new programmes, launching new services like, state-of-the-art website for online interaction. Measurements should work here as improvements based on first objective. First, the target would be fixed, then second objective is measurement, after measurement of the criteria, assignment should be done. In the case of Air Arabia management and operation continued with route expansion, regularising flight and market share, invests on fleet growth and maintenance with efficient engines. After completing the first three objectives, the result should be realistic and time-related also. Air Arabia would work with last two points as introducing new operating hubs like, Sharjah, Casablanca, and Alexandria. In the aviation industry in Middle East, almost all are luxury flights, but Air Arabia is the cheapest one. It has 5 times more aircraft than other and more capacity too (Hanlon, 2014). Marketing Activities and 7P’s Marketing mix is a basic instinct of an organisation that describes the objective of its services particularly and effectively to a target customer group. It is also referred as 7P’s of marketing, which is product, promotion, price, place, physical evidence, people, process, which is also called as ‘extended marketing mix’ of an organisation. 7P’s are the same for every organisation but the contents are changing with industry. The aviation industry’s 7P’s are as follow: Product a. Quality b. Image c. Features d. Customer Services Promotion a. Sales Promotion b. Direct marketing Price a. Positioning b. Discounts c. Value added services Place a. Sales support channel b. Segmentation channels People a. Marketing Activities b. Customer Contacts Process a. Customer Focus b. IT supports c. Research and Development Physical Evidence a. Packaging b. Online Services These are the basic points of 7P’s of an aviation industry. Description of extended marketing mix of Air Arabia as follow: Product: Air Arabia is a brand name and provides better services to people. Design and quality of service are better as like any leading airlines of Middle East. It not only devoted to providing affordable flights but also dedicated to help less fortunate people and taking responsibility of their social needs. Promotion: It promotes the airlines using advertisement and publicity. Price: Air Arabia is the low cost effective brand with good facility for customers. Place: Air Arabia using hubs like Dubai, Sharjah, Casablanca, along with Alexandria and other also. People: Target people of Air Arabia are mainly low and medium earning consumers, it provides low cost services to people. Process: Air Arabia introduces new operating hubs as well as enhances their routes, they try to reach each and every untouchable area over the glove and increasing the flight frequency in between old routes. Physical Evidence: Air Arabia has successfully created its goodwill and brand image over the Middle East’s people. It has identified all the problematic area of Middle East’s market and its critical issues as well as opportunities. Strategic acquisition would also help to build a good market value and shares also (Alzaman, & Chikhalsouk, 2013). Conclusion Air Arabia growth will affect demographic as well as economic area of Middle East. This airline serves better services targeting segment of people with low and medium income levels, fleet expansion, improve engines, more aircrafts than previous years, and more hubs to link more and more areas, creating new business opportunities mainly in European market. Air Arabia is recognised locally as well as internationally for its strong performance and community efforts. It is already named “Low cost carrier of the year”. Middle East has enormous opportunities to grow as a leading business zone, Air Arabia is one of the ways to reach to peak, and this airline is on its right way. Air Arabia is trying to achieve its mission of being the best. References Albadri, F. & Abdallah, S., 2010. Strategic Information System Planning in UAE organisation: SISP Approaches Classification. Achademiaedu. [Online] Available at: http://www.academia.edu/643603/STRATEGIC_INFORMATION_SYSTEMS_PLANNING_IN_UAE_ORGANIZATION_SISP_APPROACHES_CLASSIFICATION [Accessed March 29, 2015]. Alzaman, C. & Chikhalsouk, M., 2013. Comprehensive Strategy Analysis for a Leading Firm in the UAE Precision Tooling Industry. Business & Financial Affairs, Vol.2, Iss.1, pp 2-7. El-Quqa, O. M. & et. al., 2008. Middle East Aviation Industry. UAE Global Research, pp. 1-40. Hanlon, A., 2014. How to use the 7Ps of the Marketing Mix. Smart Insights. [Online] Available at: http://www.smartinsights.com/digital-marketing-strategy/online-marketing-mix/how-to-use-the-7ps-marketing-mix/ [Accessed March 29, 2015]. Zawya, 2007. Air Arabia. EFG-Hermes. [Online] Available at: http://ae.zawya.com/researchreports/efg/20070701_efg_110604.pdf [Accessed March 29, 2015]. Read More