Baldrige Award Criteria Analysis - Assignment Example

? Baldrige Award Criteria Analysis on Airbus Baldrige Award Criteria Analysis on Airbus I. Company Profile – Airbus The origin of Airbus is traced in 1967 when three professionals from the European nations joined together to incorporate the Airbus programme with the launching, two years later, of the A300, known as the “world’s first twin-engine widebody passenger jet” (Airbus: Early days, 2011, par. 2). In contemporary times, the Airbus is acknowledged to be owned by “EADS, a global leader in aerospace, defence and related services. This group – which is comprised of Astrium, Cassidian and Eurocopter, in addition to Airbus – has a presence on every continent, and employs a total workforce of more than 119,000” (Airbus: Company, 2011, par. 5). The global presence of Airbus encompasses strategic locations in Europe, the Americas, Asia Pacific, Africa and the Middle East servicing more than fifty percent of commercial and military transport aircraft orders all over the world. 1. Leadership Heading the EADS consortium is Thomas Enders, the President and CEO of Airbus since 2007 (Airbus: Management, 2011, par. 1). Together with eight members of the executive committee, Enders has been committed to practicing its core tenets, focusing on enjoining other members of the management team and various personnel of the organization to “generate customer value, act with courage in all situations, practice teamwork and global integration, face reality and act with integrity, drive innovation and deliver reliably, and develop oneself and others” (Airbus: Company culture, 2011, par. 4). As a global organization entrenched in diverse geographical locations, managing and leading more than 50,000 employees from different cultures is a tremendous challenge. It takes innate skills, knowledge, abilities and genuine interest on the endeavor to steer the organization into weathering the changes in the external environment. As revealed, the organization has employed a unified management and leadership strategy to ensure that standards are imposed and adhered to in all locations where Airbus operates. The following crucial elements of the strategy align leadership policies and practices at Airbus, to wit: (1) leading by example; (2) equipped to perform, and (3) management expertise (Airbus: Management, 2011, pars. 5 – 7). By manifesting leadership through exemplifying the role of models in leading, each and every personnel are encouraged to embody the standards of excellence expected from everyone. The qualifications and competencies of each manager and leader are consistent with the demands of their jobs. There is continuous training and development to ensure that expertise is honed through time. Finally, programs are set to further develop and train global managers to be experts in technical and managerial skills. Aside from taking pride in incorporating cultural diversity in global operations, Airbus’ leadership is likewise committed to social responsibility through active support and development of various stakeholders. Employees, particularly, are given priority in terms of personal and professional development, affiliations with community programs through their Corporate Foundation, establishing strong partnerships with various suppliers, being actively involved in charitable endeavors, and ensuring the protection and safety of the environment (Airbus: Corporate Social Responsibility, 2011). In its official website, Airbus boasts of indicating that “as a responsible corporate citizen and industry leader, Airbus’ day-to-day operations are guided by a strong commitment to the highest ethical standards – ensuring integrity, transparency and professionalism across its operation” (ibid, par. 1). 2. Strategic Planning The process of strategic planning necessitates the identification of opportunities and risks in an organization’s external environment. As Lynch & Williamson (2006) averred, “strategic planning is long range in perspective and should be comprehensive in breadth of scope” (Lynch & Williamson, 2006, 132). Strategic planning, as a process, is constantly evolving. It should continuously determine and take into account the periodic change of organizational objectives, the acquisition and use of resources required for their attainment, the changes in the environment and the establishment of the basic policies which guide the goal-oriented activities of the organization. In the case of Airbus, the current news and events that highlight the organization’s future global strategies come as a result of the forecast revealed by the Airbus’ Global Market Forecast for 2010-2029, which indicate that “almost 26,000 new passenger jetliners and freighters will be needed to meet the rising demand for flight services” (Airbus: News, 2010, par. 1). In response, Airbus is preparing for increases in projected volume of production in terms of financial resources, manpower, and technology and equipment; as well as an identification of the market where these demands are foreseen. As revealed, “leading the charge are emerging economies such as India, whose passenger traffic growth of 9.2 per cent is the fastest of any major market. Overall, the greatest demand for new passenger aircraft and freighters will be from the Asia-Pacific region – which is to carry one-third of all passenger traffic by 2029, overtaking the United States and Europe for the top spot globally” (ibid, par. 5). Further, the organizations’ engineers and aircraft design specialists envision new designs which would improve efficiency of commercial and military aircrafts. As proffered in the report, “Airbus is anticipating this need with its family of modern aircraft, which includes the world’s largest jetliner – the A380 – and the next-generation A350 XWB widebody. For the single-aisle marketplace, Airbus is offering its A320neo – a fuel-efficient engine option for Airbus’ best-selling A319, A320 and A321 – which allows customers to choose between CFM International’s LEAP-X and the PurePower PW1100G from Pratt & Whitney” (ibid, par. 7). The strategic plans were validated by Van Loon (2010) as he averred, “Airbus is making quite a buzz with their new concept airliner. There is no name yet for the jet, which reportedly is an engineering marvel, offering “ultra long and slim wings, semi-embedded engines, a U-shaped tail and light-weight ‘intelligent’ body [...] The result: lower fuel burn, a significant cut in emissions, less noise and greater comfort” (Van Loon, 2010, par. 3). The strategy development and implementation focuses on these plans as demands increase in identified locations, particularly in the Asia-Pacific region. 3. Customer and Market Focus A quick rundown of the list of customer of Airbus would reveal a total of 191 operators and customers from various countries worldwide, attesting to the high standards of quality of the organization’s products. In a report published in 2004, Careless emphasized Airbus’ customer service strategy that acknowledged the importance of the impact of customer satisfaction to the organization’s level of productivity. Prior to 2004, Airbus centered on its manufacturing and selling points of their aircraft, aside from service, which was identified as secondary for the organization (Careless, 2004). However, the change in strategy was deemed a crucial factor in contributing to the missions of the organization, to wit: “safety, customer satisfaction, and contribution to airlines' profitability. In other words, satisfaction at the bottom line and not only in operations. As an Airbus spokesman put it, "customer service is not a deal maker but it can be a deal breaker."” (Careless, 2004, par. 6). The organization’s portal for customer service indicates adherence to the commitment to provide ultimate satisfaction to their customers in terms of: “maintenance and engineering, materials and logistics, training, products, cabin, and electronics and software products” (Airbus: Customer Service, 2011). Management ensures that assistance is accorded in maintenance of purchased aircrafts at the most cost-effective means. Crucial spare parts and required services could be availed at various geographic locations globally. Appropriate training facilities are strategically located to hone skills and competencies of operators’ personnel including “pilots, flight attendants, maintenance staff and performance engineers, using innovative courseware, top level instructors and the most advanced training technologies available” (Airbus: Training, 2011, par. 1). By according customers with a 24/7 support in terms of products, service and support needs, Airbus has consistently delivered exemplary service which ensures that customer satisfaction is not only met, but surpassed. 4. Measurement, Analysis and Knowledge Management One of the remarkable traits manifested by Airbus’ management team is its proactive stance in evaluating the global environment. As indicated in their Global Market Forecast for the projected 20-year period commencing 2010 up to 2029, “the company anticipates a 4.8 per cent annual increase in overall world passenger traffic” (Airbus: Global Market Forecast, 2011, par. 1).   Given the projected increase in demand, Airbus has identified plans and prospects to address the anticipated rise by focusing on the following factors: “fleet growth, aircraft size, emerging markets, innovation and the reduction of its environmental impact” (Airbus: Global Market Forecast, 2011, par. 2). The report highlighted relevant forecasts for the 20-year period with revenue growth indicated as increasing by as much as 153% and projected new aircraft deliveries of as much as 25,850 units for the period. GMF 2010 key numbers and 20-year change World fleet forecast 2009 2029 % change RPK (trillion) 4.76 12.03 153% Passenger aircraft 14,240 29,050 104% New passenger aircraft deliveries - 24,980 - Dedicated freighters 1,550 3,350 +116% New freighter aircraft deliveries - 870 - Total new aircraft deliveries 25,850 Market value of $3.2 trillion Source: Airbus, GMF 2010, p. 2   Airbus has identified the main factors contributing to the projected growth in global passenger traffic within the 20-year projected period as: “(1) replacement of aircraft in service in mature markets; (2) dynamic growth in emerging markets; (3) continued growth of LCCs, especially in Asia; (4) greater and continued market liberalization; and (4) traffic growth on the existing route network where it is more efficient to add capacity than frequency” (Leahy, 2011, p. 13). Even the details of the types of aircraft identified to be delivered and comprising the projected market value of $3.2 trillion were broken down as: 17,870 single-aisle aircraft, 6,240 twin-aisle aircraft, and 1,740 very large aircraft (ibid, p. 17). To deliver the expected increase in demand, Airbus would be focusing on the following strategy: “the right technology at the right time – with new-generation aircraft like the A380 and A350XWB, along with Airbus’ A320neo engine option, leading the way” (Airbus: Global, 2011, par. 7). The keen, detailed and comprehensive ability of the management team enables Airbus to design the appropriate strategy needed to achieve anticipated increases in demands to answer the needs of its global clientele. 5. Human Resource Focus Mark Stewart, the Human Resources Director and Country Manager of Airbus, recognizes the value and role that human resources management plays in the organization. Stewart emphasized that “human Resources has a key role to play in helping transform and shape the future strategic direction of our business both locally and transnationally. To do so, we need to recruit high potential graduates who are innovative, proactive and able to be team players in multi-national teams. Above all else, we need individuals who act with integrity, understand what it means to be customer focused and have the ability to deliver reliably” (Stewart, n.d., par. 1). The driving factors acknowledged by Airbus as instrumental to the success and efficiency by which the organization is able to operate globally are the following: “mastering and supporting the engagement and motivation of employees, adding measurable value to the business by anticipating, understanding and developing the company’s core key skills, developing strong common simple processes and ensuring change is managed effectively” (Human Resources, n.d. par. 6). Managing human resources at Airbus incorporates policies of encouraging diversity “and values the special experience and expertise that come from more than 80 nationalities represented among its 52,000 employees” (Airbus: People & Culture, 2011, par. 1). Career paths and growth follow each employee through training and development programs, rewards and recognition of valuable contribution and outstanding performance, and adhering to the highest standards of benefits accorded to global employees. The discourse on human resources indicate that “Deploying the Airbus resource strategy through a number of policies and processes including employment marketing, education liaison, recruitment, Apprentice and DEG programmes, training and learning solutions and competence management” (Human Resources, n.d., p. 2). 6. Process Management The portal for IT Business Edge (2011) revealed that “business process management forces discipline and alignment on business and IT. Though it initially dealt with automating mechanical processes, it has come to include human processes. With the latest available data, managers can monitor the business and make decisions in real time. Bringing together various types of information - on customers, business rules, policies, services, competitors  - it lessens the risk that anything is lost in translation between business-speak and IT-speak and puts focus on the core business” (IT, 2011, par. 1). In Airbus, the value of ensuring that process management is in place is crucial due to the nature of the product and service that the organization delivers. Hall (2010), for example, reported that Airbus recently entered into an agreement with Tego, Inc. “to provide RFID chips that the airplane maker will use on parts for its A350 jet, due to enter service next year. Tego put the value of the contract at at least $5 million. Airbus plans to tag about 3,000 parts per plane, according to RFID Journal. The tags aren't just for tracking inventory, though. The 8 kilobyte tags can store information and should help the company  -- and buyers -- improve processes such as maintenance and airport logistics” (Hall, 2010, pars. 1 & 2). Further, a review and evaluation of their process management system paved the way for the utilization of the “SAP Solution Manager (that) addresses our entire infrastructure management needs, reduces risk, lowers the cost of ownership, and speeds the return on investment for our online buying solution,” says Guillaume Legros, project leader at Airbus France SAS” (SAP, 2005, p. 1). According to the report, the solutions accorded Airbus with the following key benefits crucial to ensure the safe and secure operations and management of the entire system: (1) integrated, continuous business process and system management from a single console; (2) automated alerts for early warning of problems, enabling correction before they impact users; (3) ability to detect errors in less than 2 minutes, instead of 30; (4) improved ability to escalate problems (up to 10 times faster) and resolve issues (40% faster); and (5) 20% reduction in malfunctions reported by users” (ibid, p.1). Since customers of Airbus rely and depend entirely on the process management of Airbus which should be foolproof and totally secure, the implementation of the strategy ensured that high quality products and services are delivered consistently, through maintenance of a proactive approach in process management. 7. Business Results The achievement of the goals and objectives of Airbus are determined in part, by the results of the financial and business outputs reported in the Flight International (2010) where financial highlights were revealed: “Airbus's 122 commercial deliveries generated revenues of just under €6 billion - an increase of 9.5%. Consolidated revenues at Airbus, including its military division, amounted to €6.26 billion with earnings of €7 million” (Flight International, 2010, par. 1). As of December 2010, the total number of orders indicated in the Airbus portal is 9,874 of which 6,459 were delivered and 6,146 currently in operation (Airbus, 2011). As of January 2011, recent new orders from customers indicate the optimistic future as Airbus endeavors to meet the increase in demand: “India's largest low-cost carrier, IndiGo has signed a Memorandum of Understanding for 180 eco-efficient Airbus A320 aircraft of which 150 will be A320neo’s and 30 will be A320s. It is the largest single firm order number for large jets in commercial aviation history, and also makes IndiGo a launch customer for the A320neo” (Airbus: News & Events, 2011, par. 1). With bright prospects and rise in demand for overall world passenger traffic, as indicated in Airbus’ Global Market Report, the financial success of the organization in the aircraft manufacturing industry is entrenched. Identification and assessment of the seven criteria using Baldrige framework emphasized the reasons for Airbus’ competitive advantage and success as one of the world’s leaders in aircraft manufacturing. References Airbus. (2011). Company. Retrieved 12 January 2011. < http://www.airbus.com/company/> --------. (2011). Corporate Social Responsibility. Retrieved 12 January 2011. < http://www.airbus.com/company/corporate-social-responsability/> --------. (2011). Customer Service. Retrieved 12 January 2011. --------. (2011). Global Market Forecast. Retrieved 13 January 2011. < http://www.airbus.com/en/corporate/gmf2009/> --------. (2011). Early Days. Retrieved 12 January 2011. < http://www.airbus.com/company/history/the-narrative/early-days/> --------. (2011). Management and Leadership. 12 January 2011. < http://www.airbus.com/work/why-join-airbus/training-and-development/management-and-leadership/> --------. (2011). Management Overview. Retrieved 12 January 2011. < http://www.airbus.com/index.php?id=4411> --------. (2011). News & Events. Retrieved 12 January 2011. --------. (2011). People & Culture. Retrieved 13 January 2011. -------. (2011). Training. Retrieved 12 January 2011. Careless, J. (2004). Airbus's New Support Strategy Values Customer Service. Retrieved 12 January 2011. Flight International. (2010). EADS hopeful A380 could break even in 2015. Retrieved 13 January 2011. Hall, S. (2010). Airbus Contracts for High-Memory RFID Chip. Retrieved 13 January 2011. < http://www.itbusinessedge.com/cm/community/news/inf/blog/airbus-contracts-for-high-memory-rfid-chips/?cs=38819> Human Resources. (n.d.) Retrieved 13 January 2011. IT Business Edge. (2011). Business Process Management. Retrieved 13 January 2011. < http://www.itbusinessedge.com/topics/show.aspx?t=482> Leahy, J. (2011). Airbus Global Market Forecast 2010 – 2029. Retrieved 13 January 2011. Lynch, R.M. & Williamson, R.W. (2006). Accounting for Management. McGraw Hill, Inc. New York. Stewart, M. (n.d.). Human Resources. Retrieved 13 January 2011. Van Loon, B. (2010). Airbus Reveals Concept Plane, Plans for the Future of Air Travel. Retrieved 12 January 2011. < http://www.nileguide.com/blog/2010/07/20/airbus-reveals-concept-plane-plans-for-the-future-of-air-travel/> Read More