The Airline Giant Airblue - Research Paper Example

AirBlue: An Analysis Contents Executive Summary 3 Essay 4 Recommendations 7 Conclusions 8 Bibliography 9 ExecutiveSummary This essay takes the airline giant, Airblue into consideration and looks at its operations through many perspectives. It goes at lengths to discuss about the various facts that affect the costs of such an operation, for e.g. the cost of meal on board etc. Further on it also discusses about matters that affect the provision of such an operation including the quality of service provided by the airliner and the speed with which such a service is made available to people. Dependability is also one of the major factors affecting the operations of an airline and we have discussed here how the ability to deliver products and services on times is important to the proper conduct of an entity’s business. The final factor that needs to be bought to one’s attention is flexibility which can be defined as the ability to support a change in business. If a company is not able to control these five operational performance objectives then clearly it won’t be an easy job for it to thrive in this already competitive industry. This essay discusses all these factors in relation to Airblue and gives a clear application of the five operational performance objectives to its business. I chose AirBlue for this assignment in view of the fact that it is one of the most renowned names when it comes to the airline industry and because I felt I would easily be able to explain the effect of these factors on its operations with sufficient detail. Essay Airblue was launched in 2004 when the local market started witnessing an increased demand for high quality travel. The company’s ownership includes a group of top class investors with Mr. Tariq Chaudhary having a majority stake alongside holding the position of CEO and Chairman of the Board of Airblue. The company is registered as a private company and has its registered office in the famous towers of Islamabad Stock Exchange. The airliner has also successfully been able to obtain the IATA and ICAO airline designations. Currently it has a fleet of 14 Airbus A319 and A321 planes. Ever since its launch, the airliner has continually stretched out its operations and fleet in line with an ever escalating demand for the high quality flights it provides. Although initially it served only to customers travelling within Pakistan, the company has now expanded its operations by offering international flights to Manchester, Dubai, Abu Dhabi, Sharjah, Oman and Muscat. According to many market analysts, the focal reason for the airline’s success has been its provision for high quality travel at an economical rate. The airline has taken a lot of steps to bring down its operational costs and hence maximize its profits. As a result all business class seats have been converted into economy class following the low demand for such seats. All domestic flights are now only offered in economy class. According to an estimate, removal of one business class frees up enough space for installation of two economy class seats. Consequently, one doesn’t get to see empty seats on an Airblue flight anymore! One more measure towards scaling down its cost was the introduction of plastic cups and plates for in-flight refreshments. Earlier on the airline served refreshments in crockery made up of chinaware, which comparatively had a much higher cost. Alongside this the company now offers refreshments like sandwiches and biscuits abandoning its earlier practice of providing a 2 course meal which has brought down its expenditure on food by a good fifty percent. The company also offers huge discounts to its online customers who prefer to book their flights way ahead of time. Up to ninety percent discount is given to customers who book their seats a month ahead of the scheduled time! This marketing strategy has proved to be a huge success and is mainly exploited by students and families to plan their vacations ahead of time. Airblue is also the first airline to introduce the online ticketing mechanism in Pakistan. E-ticketing, as we call it has also reduced the company’s operational costs significantly. Now customers get their tickets online, get it printed themselves as compared to the previous norm in Pakistan where airline companies provided a 3 page cheque book like ticket to customers. Now that this ticket no longer needs to be printed, a majority of company’s work is being done in a paperless environment and this saves a lot of cost! Quality is one thing Airblue has never compromised on! As per customer reviews it’s the best airline as far as domestic travel in the country. One customer who travelled to Karachi went on to say, “Great flight on a very good airline, highly recommended especially for domestic travel, as the airline has cheaper fares then the rest - with some flights offering a 25% discount, and 50% off inaugural flights to new destinations for a month” Airblue is known to provide full value for money services. From check in at the airport to the time a person reaches his destination, the airliner makes sure it provides top notch quality to those who have elected to travel with it. The airline has its separate staff and ticketing counters at all major airports of Pakistan. It has its separate boarding counters inside the airport thus making it much easier for customers to get done with their boarding without any hassle and delay. In line with its industrial image for providing high end services, the company has announced an agreement with OnAir. As per this agreement, the company will provide Airblue with on-flight voice and data services. Upon completion of this project Airblue will become the first Pakistani airliner to provide such services. The company also has its own premium lounge at Karachi’s Jinnah Terminal Airport called the Blue Lounge. This lounge is accessible to the airliner’s business class travelers, credit card holders and other dignitaries. Customers having access to the Blue Lounge are provided with magazines, newspapers, internet services, television, massage chairs and a restaurant. Features like this add a lot to a company’s image and promote its name a provider of high quality services. Speed is of utmost important to the airline industry as a lot of people pay extra money to reach their destinations on time. If we talk in terms of speed, then for an airliner speed could be divided into two dimensions. First would be the time between which a customer requests a booking and getting his seat booked. The second one would be the time between which a customer starts his journey and ultimately reaches his destination. Airblue’s track record has also shown that its flights are usually on time and very rarely does it happen that its flights get delayed, except for bad weather conditions of course! In assessing any company, one of the main features that should be taken into consideration is how much a person can depend on the services provided by the company, i.e. dependability factor. Dependability can be defined as delivering, or making available, products or services when they were promised to the customer. In considering whether Airblue is a dependable carrier or not we need to answer two main questions. Firstly, does it stick to its flight schedule or deviates. Secondly we’d want to know if there are constant availability of seats for the customers who have booked them i.e. actually passengers are waited for before standby tickets being allotted to walk in customers. Answer to the first question has already been mentioned above when we were talking about the speed factor. As far as the second question is concerned, as per Civil Aviation Standard Operating Procedures (SOPs), airlines are authorized to sell standby tickets only when the customers who have booked their do not show up at least thirty minutes before the flight time. My personal experience with this airline has proven that they’re pretty dependable as even though once I’d reached the boarding queue just 25 minutes into take off, still they let me board and told me booking customers are their first priority even if it costs them their standby customers! Airliners also need to be flexible in their operations or they’ll be losing out to other competitors in the industry. Flexibility can be defined as the degree to which an operation’s process can change what it does, how it is doing it or when it is doing it. Airliners would be flexible if for example they identify the routes where flights are required and they launch flights, or take notice of places where planes are flying with less customers and taking action to consider whether such a route should be continued or discontinued in the face of consumer demand. Airblue’s flexibility can be judged from the fact that it discontinued its flights to Nawabshah when it realized that it hardly had any customers for this route. Its flexibility is also evident from the fact that when it realized that people demanded its flight more as compared to other local operators, it expanded its operation by increasing it fleet size along with increasing the times an airliner flew per day, hence serving more customers in a day. Airblue is also flexible in terms of technology. In the past only newspapers and magazines were offered to customers on board. However when some other flights started providing TV services, Airblue came out with Ipad for its customers. Customers can now order the Ipad for their in-flight entertainment needs by paying a little extra amount at the time of booking their flight. Recommendations AirBlue is providing a top notch service in its line of business. However, the following recommendations, if implemented, would further help the airline to expand its business and achieve the five operations performance objectives more successfully: Meals should not be included in the ticket price. The low cost would attract additional customers to consider AirBlue as an affordable flying option A pay as you go system should be implemented. Customers requiring drinks or food on board should be provided so in return for extra sum of money every time they make an order. Customer’s feedback should be obtained by the company. Passengers should be given a pen and a paper during the flight and asked for their comments, suggestions and feedback. High quality standards could be maintained this way if the company takes the information obtained and applies it towards the improvement of its operations. Customers, being one of the major stakeholders, should be included in the decision making process of the entity. They should be asked if they would want to see AirBlue making flights to new locations. Decisions to start a new line should then be made by looking at the customer’s responses. This would make the company flexible enough to react to the customer’s demand. Frequent flyers should be given access to the Blue Lounge along with complementary gifts to make sure they always fly with us. This would increase a customer’s dependability on the company’s policy to treat its customers well. Moreover, it’ll create a sort of brand loyalty towards the company. A team of experts should be hired whose job should be to analyze issues faced by other airlines and make sure that the same problems are not faced by AirBlue. This will ensure high quality of service towards its clients. The online booking system should be redesigned and a specialized section should be made for those customers who travel regularly. This will save much time for the regular passengers every time they make an airline booking. Conclusions Airblue is without doubt a market leader in its field of operations. My research has let me to conclude that the airliner has successfully been able to achieve the five operations performance objectives. It has been able to keep it costs low along side providing a high quality of services. The airliner can be deemed to be dependable as it does all what it should to make sure it provides all what it promises for, e.g. flights on time, proper service etc. The flexibility objective has also been achieved since AirBlue makes its decisions in line with the customer’s demand. AirBlue is a perfect example of an organization that has been able to manage low costs, provide high quality, is very dependable and responds to consumer demands very flexibly. Throughout the years it has continued to expand and it has successfully been able to exploit all the possible opportunities that it has come through. If the company continues to strive for excellence they way it is, it won’t be long until we see AirBlue reaching global standards. Companies like these don’t take long until they get globally recognized! Bibliography Airblue 2010 Airlines established in 2003: Etihad Airways, Adam Air, Tiger Airways, Jetstar Airways, Airblue, Air Norway, Kingfisher Red, Air Southwest, Wizz Air, Maxjet Airways, Thomas Cook Airlines, Song, Thai Airasia, Nok Air, Hooters Air, Rwandair, Starflyer, Air Madrid, Ted, Astar Air Cargo, Niki, Pacific Blue Airlines, Kam Air. (2010). Memphis, Tenn: Books LLC. Schmitz, S. (January 01, 2006). AIRBLUE -- A NEW HIGH FLYER FROM PAKISTAN - Sebastian Schmitz discovers that airblue has expanded rapidly and is now planning the launch of its first long-haul destinations to the UK. Air International, 70, 1, 56. Pakistans Air Blue orders eight Airbus A320 aircraft. Stefania Bianchi. 2007. Read More