Impact of Technology on Business - Qantas Airline - Case Study Example

Impact of Technology on Business: A case of Qantas Airline Student’s Name Institutional Affiliation Course Name & Number Date of Submission Executive Summary The world has experienced rapid technological developments in the recent past. These technologies have had a huge impact on businesses. The airline industry, in particular has been greatly impacted by technology. This report has presented how technology has impacted the operation of Qantas Airline, which is one of Australia’s largest airline by highlighting the positive and risks of technology on the company. The report has also discussed how the airline uses technology to increase its efficiency, performance and competitiveness. Despite the benefits of technology on the company, it is suggested that the company ensure that its IT is continually maintained and monitored to prevent breach that might compromise its IT infrastructure. Table of Contents Executive Summary 2 Table of Contents 3 Introduction 4 Impact of Technology of Qantas 4 Risks Associated with Technology 7 Technology Maintenance and Monitoring 7 Conclusion 8 References 9 Introduction There is no doubt that there has been a dramatic shift in the manner in which traditional businesses operate and interact with customers over the last century. This dramatic shift has been triggered by the technological developments that have happened over the last century that include the emergence of proliferation of the Internet and mobile technologies among other technological developments (McIvor et al. 2003, p. 31). These technological developments impact almost every aspect of business operations and are felt by large and small businesses alike (Retail Technology 2014). Today, no company can compete effectively without keeping up with the technological trends in the market. Studies show that technology is a critical source of competitive advantage for firms regardless of the industry. The airline industry is among the industries that have been impacted greatly by the technological developments of the 21st century and beyond. This report analyzes the impact of technology on business with a focus on Qantas Airline. Impact of Technology of Qantas Qantas is Australia’s largest carrier airline founded in 1920 in Mascot, where its headquarters are based. The airline operates both passenger and cargo services in Australian and internationally. Currently, Qantas controls about 65% of the domestic market share (Carty 2014). The company also operates the largest number of fleets numbering more than 118. Presently, Qantas flies to more than 85 destinations and is still in the process of expanding its market reach as part of its strategy to conquer the market and increase its market share and competitiveness. In 2015, the airline posted revenue totaling A$15.8 billion and operating income of A$975 million despite the growing competition in the airline industry. Like other players in the airline industry, Qantas is among the airlines whose activities and practices have been greatly impacted by the technological developments of the recent past. The Internet technology is one of the technological developments that have greatly impacted the business practices of the airline (Smith 2015). The impact of the Internet technology on Qantas has particularly been felt in the area of ticketing services. Before the emergence of the Internet technology in the 1950s, Qantas airline tickets were sold at its offices in which passengers had to travel to its designated ticket agents in various towns and cities to book for a flight, which required the physical presence of the passenger. However, this has since changed due to technological advancements that have seen the airline industry players’ move towards the adoption online ticketing services (Smith 2015). Qantas is among the airlines that offer online ticketing services. This means that a passenger who would wish to travel by Qantas do not necessarily have to move to Qantas offices or agents to buy a ticket. Instead, passengers can now buy flight tickets directly from Qantas official website. The Internet technology has also given rise to the emergence of social networking tools that are having a huge impact on Qantas. In the last few year, the world has witnessed rapid proliferation of social media cites, such as Facebook, Twitter, LinkedIn, Instagram, YouTube and WhatsApp among others that people use for interaction purposes (Smith 2015). However, Qantas use these social media sites not only as platforms for engaging with customers, but also for marketing its products and services. Unlike in the past, where Qantas depended heavily on television and print media for promotion, currently, the company has invested heavily on various social media sites that gives it the opportunity to interact and respond to customer issues and complements real time (Retail Technology 2014). Through such interactions, Qantas gets to understand the needs of its customers and how they would want to be served by the company. Social media has proved valuable for the airline considering that it also provides the most cost effective way of reaching out to customers in the market. As competition gets stiffer in the Australian airline industry, Qantas has had to find ways of improving its competitive advantage. To achieve this, the company has had to adopt new technologies to give it an edge over rivals by using technology to understand the experiences and the needs of its customers. In the olden days, Qantas used to depend on direct field surveys that involved sending its sales and marketing team in the field to get the views and opinions of potential customers about the products and services they receive (McIvor et al. 2003, p. 34). However, this has since changed at Qantas thanks to the technological developments. Just recently, Qantas built an application on Amazon cloud that enables the airline to capture the feelings of customers, especially the unhappy customers (Retail Technology 2014). The information gathered about the feelings of customers using this cloud technology is used by Qantas to improve the quality of customer service. The management of the company reveals that the company has been able to preempt customer grievances with the help of this cloud technology, thereby resolving them even before they can emerge. Technology has also impacted Qantas by enabling the airline to increase efficiency and productivity. In the past, Qantas used to rely on manual ways of doing things, such as accounting work, payroll system and book keeping. The manual systems were not only time consuming, but was also prone to many errors and manipulation. However, with the technological developments such as the emergence of computers and accounting software, Qantas has been able to automate is back office functions such as book keeping, payroll and accounting (McIvor et al. 2003, p. 39). Since the company automated its back office, the airline has not only recorded increased efficient and productivity, but also accuracy with which these functions are performed, effectively resulting in cost reduction. Besides, the safety of its back office functions have improved significantly since the airline automated its back office functions. Unlike paperwork that were prone to whether changes and damage by fire, automated information of the airline have been backed up and this ensures that no information is lost even in the events of accidental fires or sabotage. Fuel efficiency has been an issue of concern to Qantas for a long time. Presently, more than 95% of Qantas emissions are generated from the use of jet fuel (Qantas 2016). However, technology has had a positive impact on Qantas by enabling the airline to not only improve the efficiency of its aircrafts, but also seeks to help the airline achieve its 2020 fuel reduction target of 1.5% every year. All these have been enabled using big data. According to Qantas (2016) report, big data has helped the airline reduce aircraft fuel use. Accordingly, this has not only helped reduce the cost of operation, but also helped the firm improve its fuel efficiency. Additionally, new communication technologies, such as mobile phones, tablets, iPhones, iPads and video conferencing technologies have also had a great impact on how Qantas communicate with its stakeholders, including customers, suppliers, employees and investors. Unlike in the past, where Qantas had to type and send letters to its stakeholders, which took long to reach the recipient, modern technologies, such as mobile phones, tablets, iPad and ipods allows Qantas to communicate with its stakeholders instantly and get feedback either immediately or after some few minutes in case of text messages. Besides, Qantas sometime use video conferencing technologies to hold meetings with its staff from across the 85 plus destinations (Retail Technology 2014). In fact, with these technologies, Qantas managers are now able to conduct business from any part of the world without necessarily having to be in office (Qantas 2016). Technology also impacting the hiring practices of Qantas. Technology impacts Qantas operations by enabling the company to outsource its maintenance work (Carty, 2014). Outsourcing is one of the areas, where technology has had a huge impact on the airline industry as most industry players are in the race to cut cost by outsourcing some of their labor. Risks Associated with Technology Although technology has had many beneficial effects on Qantas operations, technology has also posed a number of threats to the sustainability of the airline. The first major threat of technology is that it has resulted in a situation where Qantas has had to invest more on training of its employees to ensure that they become conversant with the technological trends in the market. According to Qantas, the airline spends hundreds of dollars on training its employees (Smith 2004, p. 292). Besides the high cost of training, implementing technologies that keeps changing in the airline industry has proven costly to Qantas that has had to spend a lot of money on the implementation process. Qantas also faces IT risks, in particular data breach. Despite the many beneficial effects of technology, research indicates that IT infrastructure of most organizations is exposed to data breach by hackers. In the recent years, many companies have had their IT infrastructure maliciously intruded into and data compromised, which puts companies at risk of losing vital customer information (Retail Technology 2014). Qantas also cite data break as a major risk that it is exposed to today as it has been a target of cyber criminals in the recent times. Other threats that Qantas is exposed to as a result of technology include malware attacks, phishing and virus attacks among others. Technology Maintenance and Monitoring Technology maintenance and monitoring is an important undertaking in any company today. Maintaining and monitoring IT ensures that there is no breach of the IT infrastructure since if IT is not protected and effectively maintained, cyber criminals can compromise the system, resulting in the loss of vital information of the company and customers. To maintain the integrity of its IT, Qantas apply various maintenance and monitoring procedures. As part of its maintenance of the IT system, Qantas has ensured that its IT infrastructure is protected by anti-virus that is installed in all its computer system. At the same time, the airline ensures that the IT system is protected with strong passwords to prevent unauthorized entry into its IT infrastructure (Smith 2004, p. 292). Additionally, Qantas has ensured that there is a strong backup system in place to ensure that no data is lost in the event of emergencies, such as fire outbreak. Other than protecting the IT infrastructure, Qantas ensures that the integrity of its IT is maintained through constant security monitoring that involves monitoring the security hardware, backup monitoring, automated system IT monitoring and security patch management. Conclusion The technological developments of the recent century has caused dramatic shift in the way companies operate. Today, no company can compete effectively without keeping trend with the latest technological developments. Qantas is an example of a company in the airline industry whose activities have been greatly impacted by technologies, such as the Internet, social media, and big data among other technologies. The technologies have helped improve efficiency , productivity and enhanced the speed with which services are delivered to customers. However, Qantas also faces a number of threats emanating from technology that includes hacking. However, the company needs to keep with the technological developments to help enhance its competitiveness in the industry. References Carty, S 2014, What is happening at Qantas? Union claims outsourcing is hurting safety after six groundings but the airline says its maintenance standards are high, viewed 10 January 2017 http://www.dailymail.co.uk/news/article-2869524/What-s-happening-Qantas-Union-claims-national-carrier-s-outsourcing-maintenance-work-overseas-affecting-safety-Qantas-planes.html McIvor, R., O'Reilly, D., & Ponsonby, S 2003, “The impact of Internet technologies on the airline industry: current strategies and future developments,” Wiley Online Library, vol. 12, no. 1, pp. 31–47 Smith, A.D. (2004). Information exchanges associated with Internet travel marketplaces. Online Information Review, vol. 28, no. 4, pp. 292-300. Smith, P 2015, Qantas invests in new technology to maximise its ticket prices, viewed 10 January 2017 http://www.afr.com/technology/qantas-invests-in-new-technology-to-maximise-its-ticket-prices-20150416-1mmm0h Qantas 2016, Reducing fuel emissions, viewed 10 January 2017 http://www.qantas.com/travel/airlines/reducing-fuel-emissions/global/en Retail Technology 2014, Technology impacting sustainability at Qantas, viewed 10 January 2017 http://www.retailtechnology.co.uk/news/5549/technology-impacting-sustainability-at-qantas/ , Read More