Emirates Airline - Case Study Example

Project: Emirates Airline Emirates Airline Introduction Emirates is an airline company whose headquarters are present in Dubai and itwas established by the government of the United Arab Emirates (UAE) in the year 1985. The main role of this company is to provide people with commercial air transportation service. Emirates is considered to be the biggest airline service in the UAE and operates approximately 3,400 flights every week. It is also considered as the fastest expanding international airline on a global scale. Emirates is considered as the national airline of UAE. (Clark, 2012). Emirates has risen to the stage of success because of the ability that it has to link what their customers want with the services being provided. Certain other factors also influence the success of Emirates such as trade and politics, diversity, sustainability etc. Emirates airlines functions in six continents and has a team of 75,000 members which are comprised of over 16 nationalities. The company is on a streak of gaining profits as it recently achieved profit in a financial year for 26th consecutive years (Emirates, 2015). Views Emirates has successfully played its role in dealing with the public international aviation policy and hence has created a strong influence on the aviation industry. Emirates holds certain views and pays great attention to competition, liberalization and financial interventions by the government which is considered to be for the benefit of the customers. The business model that is being implemented in the organization will help create an open global economy which is essential in maintaining freedom of trade, growth of economy and enhanced chances of employment in the country (Emirates, 2015). Vision, Mission, Values Goal statement – ‘To reach on top by excelling at what we do’ Mission statement – ‘We exist to deliver the world’s best in-flight experience’ Vision statement – ‘To make civil aviation safe, leading and sustainable’ Emirates vision is based on the building and maintenance of their position as the market leaders and to see beyond the norms into the extraordinary. The leadership of the company is always engrossed in making intelligent decisions along with innovation. The company strives on maintaining the high standards of the business. The company fulfills its duties and responsibilities that it had towards the society. Emirates mission is to achieve and maintain the growth at 20% in the upcoming years. Goals and Objectives The basic goal of Emirates airline is quality and not quantity and it has been this since it started it operation in 1985 (Emirates, 2015). The objectives which facilitate in achieving the goals include retaining and improving the frequent passenger’s market share who travel in business class, to increase the market share, to achieve the return on investment of the company by tapping the low cost carriers market and also the promotion of Dubai’s tourist inflow and hence resulting in an increase in the tourism activities and making people aware of Dubai. Strategic Emphasis Strategy has also played an important role in the success of a business and similar is the case with Emirates airline whose outstanding performance is also due to correctly formulated strategies and then the implementation of these strategies. One of the most important strategy of Emirates airline is its’s operational or corporate strategy which is also known as high quality provider strategy. It is due to this strategy that Emirates has a fleet of new airlines which ensures the safety of its passengers. Another strategy of Emirates is operational or corporate strategy which focuses on being the first one for the introduction of new product. Due to this strategy, Emirates pioneers the rest of its competitors because it always ahead with innovation and new ideas. Emirates always has something new in its system whether it be the entertainment systems, the seats, private class suites, smart landing services, smart runways and the use of cell phones on board. Emirates was the first one to introduce the seat back screens and is also the first one to introduce the personal entertainment system. The third operational strategy which is being implemented by Emirates is known as best customer service provider. With the help of this strategy, Emirates provides its passenger with easy, convenient and quick services on land. Then the initiation of smart landing, smarter runways, and automatic check ins are also an example of the strategy of becoming highly automated. Emirates also focuses on its growth strategy in order to improve the products and services being provided to its passenger, it helps in improving the experience from boarding to departure. Emirates also focuses on being different from the rest and this is known as differentiation strategy. This helps Emirates penetrate in the market and the development of the market and the product itself. Related diversification allows the customers to invest in the sub branches which includes all the linked industries such as aviation engineering, air catering etc (Nataraja & Al‐Aali, 2011). Organization’s Analysis of External Environment Political Forces – Political scenario of the country is favorable for the business. The agreement between various countries has opened up various opportunities for the organization and increased opportunity of trade. Economic forces – The economy of UAE is growing at a steady state and the average income of a household is also increasing which means that the people can easily afford to travel by air. The regional governments are also trying their best to formulate economic policies which are suitable for the growth of the airline industry. Social forces - Emirates is located in a region where the workers rarely ask for more compensation and the labors come from a multiple cultures and even countries. However, there is a significant difference in the labor cost of UAE and other western world countries and there are also chances of improvement in the human resources area. Technological force – Emirates is quite ahead of its game technology wise and this technology is used quite frequently on a daily basis. Emirates operates a global technology platform that is available in 14 languages and allows payments to be made in 42 currencies. Legal Forces – Alterations in economic policy has allowed the airline industry to participate in competition without paying heed to the governmental interference because the region has less legal obligations and hence this has helped Emirates achieved the status that it is at right now. Environmental forces – Emirates has various strategies that are built to protect the environment from pollution and also believes in preservation of natural resources. For this purpose Emirates has designed various environmental projects for the last 20 years (Nataraja & Al‐Aali, 2011). Industry Analysis The international airline industry is included in the list of the industries that provide to millions of customers all over the world. The airline industry itself is a driving force of the economic world due to its operations and the influence that is has on the other relevant industries like manufacturing and tourism. In today’s world, the worldwide airline industry is made up of over 2000 airline. Airline industry is responsible for affecting the employing rate of a country, profit, net worth and has a direct effect on the airplane manufacturing industry, airports and the tourism industry and also on any other industry that depends on air travel for the expansion of its business. The airline industry also faces many challenges which can only be dealt with by increasing the safety and security of the passengers and this expansion requires a great deal of investment. The airline industry has grown even more after the airline deregulation and the prevalence if government assistance and stable profits (Web.mit.edu, 2015). Competitors Emirates list of competitors include the regional airline companies such as Qatar airways, Oman air, Gulf air and other international companies of Europe, Australian and Asia. Among these Air France, British airways, Lufthansa and Qantas are of greater importance since they allow the passenger to avoid the conventional airports such as the London Heathrow airport, Frankfurt airports, making them utilize the Dubai airport instead. Growth of the regional airline companies such as Etihad and Qatar airways due to competitive marketing strategies make them a double threat for Emirates. However, these competitors particularly find it difficult to cope with the advancement in competitiveness that Emirates has against them (Nataraja & Al‐Aali, 2011) Organizations Distinctive Advantage Emirates is located in Dubai city which gives it the advantage of location as the city is known for its increase in demand for both passenger and cargo service. Dubai also serves as the connecting point between Asia, Europe and Africa. Emirates has a strong decision making ability which helps to overcome problems in a unique way. Emirates also has a strong brand reputation and also a good number of loyal customers, this is all due to the level of comfort, entertainment being provided by the airline to its passengers. Emirates is also known for its consistent growth rate in the face of the economic failure that almost every other airline is going through. It is located in a country which has no tax limitations and hence the employees of the airline also get tremendous advantages (HubPages, 2015). Threats The two major threats for the company are the competition with the domestic airlines and the presence of budget airlines. Increased competition due to the presence of various other airlines poses a risk for Emirates for example; Etihad provides similar facilities to its passengers along with competitive pricing strategy. Budget airlines are those that provide the passenger with cheaper airfare but at the cost of quality. An example of such an airline is Arabian airlines whose foundation lies in Sharjah and the airfare is almost half to that of the Emirates airfare (HubPages, 2015) Innovative Strategies to Advance the Organizations Mission The airline has a multicultural cabin crew which helps in communicating with passengers all over the world making the journey easier for many who do not speak in fluent English language. Emirates also provides Iftar boxes at the boarding gates for those who are fasting during the month of Ramadan so that they may practice their religion freely. It as in March 2008, that Emirates allowed GSM users to use their cell phones for sending text messages and making calls to their relatives. Emirates is also planning on initiating in flight Wi-Fi services for its passengers. Emirates has also enhanced the entertainment being offered to the passenger on flights. Emirates in collaboration with Microsoft also created an entertainment zone at Dubai international airport which is equipped with Xbox, Microsoft surface tablets etc. Emirates also allows the cabin crew members to access the Knowledge based inflight service with the help of which the cabin crew members can lodge complaints, know about the passengers preference and also make the passenger pay for upgrades made at the last moment. The most creative initiative taken by Emirates was to ask the artists to submit their art pieces which were published on the membership cards of the passengers who were on the frequent flyer list (airlinetrends.com, 2015). Marketing Strategies Emirates airline has reduced its price in order to penetrate into the market so that the company can maintain its current status. By the help of market development strategy, Emirates has expanded its services to various other countries such as China. By implementing Product development strategy, the company keeps its airline updates with the latest technology and services such as its recent first class private lounges re high quality private suites that add into the luxury and comfort of the travelers and this comes completely equipped with its own minibar, cabinets, desk etc. Marketing Mix Product – various services are provided to the customers such as holiday packages, hotel services etc. Price – Price varies according to season, class and also to the destination to where the customer is flying to. Place – Main destination is Dubai and hence Dubai serves as the epicenter of most of the routes. About 3000 flights operate from Dubai. Promotion – Emirates involves in promoting its services through a number of advertisement campaigns (Marketingmixx.com, 2015). Marketing Campaigns An example of the marketing campaigns include ‘hello tomorrow’ campaign which brings people closer, links and promotes them to make a positive contribution to the society (Marketingmixx.com, 2015). In order to compete with Air France, Emirate has initiated direct flight service from Lyon to Dubai whereas if one travels through Air France they get a stopover in Paris, and these tickets are more expensive as compared to Emirates direct flight (Jammoul, 2015) Consolidated Financial Statement Breakeven Analysis References Clark, T. (2012). Speech to the International Aviation Club, pp. September, 13 2012. Emirates,. (2015). Our Company | About Emirates | Emirates. Retrieved 17 June 2015, from http://www.emirates.com/english/about/index.aspx#2308794 Emirates,. (2015). The Emirates Story | About Emirates | Emirates. Retrieved 18 June 2015, from http://www.emirates.com/english/about/the_emirates_story.aspx Nataraja, S., & Al‐Aali, A. (2011). The exceptional performance strategies of Emirate Airlines. Competitiveness Review, 21(5), 471-486. doi:10.1108/10595421111171966 Web.mit.edu,. (2015). Global Airline Industry Program. Retrieved 18 June 2015, from http://web.mit.edu/airlines/analysis/analysis_airline_industry.html HubPages,. (2015). Emirates Airlines of Dubai. Retrieved 18 June 2015, from http://samthomasuae.hubpages.com/hub/EmiratesAirlines airlinetrends.com,. (2015). 11 innovative airlines. Retrieved 18 June 2015, from http://www.airlinetrends.com/wp-content/uploads/2011/01/Innovative_Airlines_2011-airlinetrends.pdf Marketingmixx.com,. (2015). Marketing Plan of Emirates Airline | Marketing Mixx. Retrieved 18 June 2015, from http://marketingmixx.com/marketing-plan-2/341-marketing-plan-of-emirates-airline.html Jammoul, A. (2015). Emirates Airlines Strategy. Academia.edu. Retrieved 18 June 2015, from http://www.academia.edu/5494792/Emirates_Airlines_Strategy Read More