To what extent are either models mechanistic vs. organic? Why? Airline companies have used the diversification strategy to enhance their profits when compared with their competitors. However, it is important to select the most appropriate business model. Functional structure model compels the heads of departments to obtain permission of the CEO before taking important decisions, thereby affecting the profitability of the organization.
Barros and Wanke (2015) stress that load factors influence the decision made by airlines in choosing the operating aircraft for a specific route. Consequently, passenger load factor is considered as one important determinant of the airline profitability. It simply assesses the airline’s capability to sell available seats to the market. Moreover, studies also shows that passenger load factor and yields are interrelated with each other. In one of the few studies conducted by Tesfay’s (2016), analysis shows that high load factors are often associated with low passenger yields.
Accordingly, clients will be availed to possess the capacity to select to agilely arrange their time with Cathay Pacific Airways at all levels arranging from provincial to global. On the other hand, as an aircraft corporation, it has a weak bargain power counteracting its supplier, from the previous analysis, most of its suppliers, in fact, are in a monopoly or oligopoly market, according to the demonstrated Porter’s five forces
The terrorist attacks in September 11, 2001 severely shook the political stability of the US resulting in a catastrophic downfall in business activities and dramatic reduction in air travel. In the aftermath of the severe liquidity crisis, the US Congress passed the Air Safety and System Stabilization Act, resulting in the 1st government bailout of the twenty first century. More than 150,000 employees were out of work and losses of more than US 31 billion ( Banber, G.J, 2009 ). Source : IATA ( ii )
Southwest airline company case study CORPORATE STRATEGY Southwest sets up the greater part of its methodologies in that business. It demonstrates its low costs (packs fly free! ), accentuation on workers, and its separation (notwithstanding going so far as to get out different aircrafts for charging things expenses). This kind of crusade separates the organization from contenders and makes potential clients mindful of Southwest 's one of a kind approaches. The fourth key technique is Southwest 's attention on its future.
Boeing must use the globalization effect to its advantage by spreading risks associated with production within its partners. For that the company had ti take risks but it did benefit them. • Boeing should know which part it should manufacture on its own and which parts it wants to subcontract. The parts with sensitive characteristics should be built
Case Study: HR Problems at Jet Airways: Coping With Turbulent Times in the Indian Aviation Industry By SHI HAN Introduction The case is about the retrenchment drama that unfolded in one of India’s leading aviation companies, Jet Airways (India) Limited (Jet), in late 2008. After showing the door to more than 1000 employees in a bid to streamline its operations, Jet was faced with immense criticism and opposition by various organization and political parties. Jet’s chairman Naresh Goyal (Goyal) reinstated the employees a day later saying that he was not aware of these sackings. The Indian aviation industry was going through a tough phase and experts felt that it was in the interest of the company to research employee Issue 1 Analysis the HR problems faced by Jet Airways in 2008. Issue 2 Discuss various concepts related to hiring, firing and compensation management.
They have to obey to regulations. For instance, with the airlines alliances and commercial cooperation agreement allow others to reach any hub. For instance nation such as UAE, US and Netherland have open skies agreements with other nations permitting unrestricted access to their markets by any foreign carrier. Power of Suppliers With the available information, there is a less bargaining power of suppliers though there are two main suppliers as Boeing and Airbus. Because there are very few aircraft range and Emirate had requested the design modification requirement and placed a massive order.
Such as aircraft supplier, namely Airbus and Boeing have the most bargain power. AirAsia now has switched the aircraft from Boeing to Airbus, but if AirAsia wants to switch back to Boeing, it will require hight cost to train the staff. From MIS perspective, many airlines nowadays have already provided the same reservation system as AirAsia (online booking), which is a threat for AirAsia if does not make any improvements. But still, customer can print boarding pass directly from websites and also show the barcode by phone while check-in which are only AirAsia doing, will be a plus point in customer’s perspective. V. ONLINE RESERVATION