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Strategic Management of Emirates Airline

Abstract

This Project includes three parts. The first part is strategic planning of Emirates flight. The second part discusses the kind of decisions which are made in different levels of Emirates and explain the information systems used in these levels. The last part highlights the moral issues involved in the organization's functions.

Part 1: Strategic Planning

The reason for this part is to consider the overall tactical management process and think about what is happening in the surroundings in order to judge how those taking place may affect the business. In addition there is a concern of organization's strengths and weaknesses and the opportunities and snacks that has significant impact on the organization process.

Company overview

Emirates is a nationwide flight of Dubai in the Middle East. Emirates flees to over 100 vacation spots in 60 countries about the world from Dubai International Airport with a fleet of 137 aeroplanes. Emirates Air lines has been been around for 25 years. Although Emirates is a flight, over one ten years it has become one of the very most respected brands on earth. The key of their success is using new technology and information systems in their business functions. (Emirates group, 2010)

Company's mission:

Generally, Emirates' progress hasn't been less than 20 per cent yearly, and the flight has saved an annual revenue in annually since its third in operation. Their effort is to keep their explosive expansion and improve the percentage of this growth.

Mission assertion analysis

This analysis will help organization to reveal goals, goals and plans for achieving them which are important for the permanent survival on the market.

In any organizations, professionals need to target their work and resources on long-term, standard objectives, and provides a basis for short-term, specific aims in order to achieve their mission declaration. (Robson 1997)

General goals:

As brought up in mission assertion, Emirates is trying to boost the percentages of their twelve-monthly benefits.

Emirates taken 21. 2 million passengers and 1. 3 million tonnes of cargo through the past years (Total annual report, 2010), and they need to transport hundreds of thousands more across an evergrowing network of international areas if they want to increase their income. Therefore their target is to provide the best service in the industry to be able to have more people and cargo.

Specific Goals:

Currently, Emirates' flights account for almost 40 per cent of all air travel moves in and out of Dubai AIRPORT TERMINAL, and their primary goal is to increase this market-share to 70 % by end of 2010 without diminishing the reputation for quality.

Moreover, they want to add 18 new passenger aircraft to their fleet, increase seats capacity by 14 %. They also intend to increase frequencies on many existing routes as well as widening cargo capacity by 17 %. These specific targets are all to compliment the general goal which mentioned previously.

Environmental analysis

The organization's environment can be an important indicate be considered by managers because environmental factors can significantly effect organizational operations. Good managers should be aware with their organization's environment and know how any changes may have an impact on the organization and their organization's available resources. (Robson 1997)

Remote environment

Remote environment research lists all those occasions, issues and facts which will influence the company performance, but over that they have little affect and those facts are usually uncontrollable.

Nature of the environment

The United Arab Emirates (UAE) gets the seventh most significant proven oil, based on the Oil and Gas Journal in January 2009. As a result of this geography, United Arab Emirates has wealthy natural resources and high amount of natural sources of fuel. The option of large amount of gasoline in UAE helps Emirates to provide gas for its aircrafts easier than its air travel companies. (Business media, 2007)

Political challenges

One of the reason why that got significant effect on Emirates was experiencing a downturn of the competitors due to Gulf Battle. Gulf Battle was a warfare which occurred in the Persian Gulf between 2 August 1990 and 28 Feb 1991. Because of this political war, Emirates was the only air travel to fly within the last ten times of the battle. (Press, 2001)

Economies

Dubai International Airport's Terminal 3 was built solely for the utilization of Emirates at a price of $4. 5 billion. Terminal 3 is the greatest building in the world by living area. The influence of the environment is that many people may want to use this flight in order to go to the largest building on earth even though they have got other choice of airlines. (Caswell, 2008)

Industrial environment

United Arab Emirates (Dubai), that was a fishing town at the southern end of the Arabian Gulf, is continuing to grow to become one of the leading trade center of the center East. Large number of businesses and investments are running within. This affects Emirates Airline deeply because many people start approaching to Dubai from oversee and also many people need to flight abroad. Emirates, by providing good airline services, is one of the high demanded airline in this country.

SWOT analysis

SWOT examination is a basic tool for analyzing the organization's position. SWOT research addresses organizations strengths, weaknesses, opportunities and dangers.

A SWOT evaluation defines the relationship between the inner and external appraisals in tactical analysis. It really is an exercise in identification and research. Analysing the key factors of the environment and the fundamental internal strengths and weakness of the business will help determine the strategies appropriate to the firms. (Robson, 1997)

Strength:

Strengths are the positive interior factors that add value to the business.

New business idea:

One of the facts that makes organizations more powerful is when they create a new business idea. In 2005, Emirates started out traveling non-stop to New York. This occurred when only Delta Air Lines had the same service. Therefore Emirates began to give a service that was not provided by so many airlines, and this helps them in increasing the number of their customers

Reputation:

Another interior factor that makes the business strong is having good reputation among customers. For instance:

In 2009, Emirates was voted the fifth best air travel on earth by research consultancy organization Skytrax.

*Skytrax is a United Kingdom-based consultancy, the public face of Inflight Research Services

Competitive gain:

Emirates has triumphed in some competitive advantages which made the corporation as one of the good airlines. To answer this question that how Emirates is able to preserve its competitive position in the industry, considering how good Emirates is offering its products may be the answer. Product in Emirates is the services that airline offers for its customers such as airfare, food.

Flight

Emirates's offering is divided into three main lines; The First Class seat, the Business class seating and the Market class. In every three classes passenger are provided by high quality and comfortable seating, in-seat laptop power-outlets, and an ICE system on the LCD screen. Business and firs course have significantly more facilities include rub function, privacy partition, winged headrest with six-way activity, two individual reading lighting and an overhead light per couch, in-seat power supply, over 600 stations of entertainment on ICE.

Emirates was the first flight on the planet to introduce a personal entertainment system on a commercial aircraft which was reasonable for them to gain completive advantages.

Weaknesses:

These will be the negative inside factor that damages values of company or put the business in risk.

Actually it is difficult to state what exactly are the weaknesses Emirates, because Emirates is recognized as one of the very most respectable travel brands across the world. However there are still some weaknesses that Emirates need to boost. I can say that one of the Emirates' weaknesses is having expensive solution price especially for the business enterprise and high grade. Emirates began to lose some of its customer when Qatar Airline offered the same airline flight with cheaper seat tickets.

Opportunities:

Opportunities are exterior positive factors that symbolize the reason behind an organization to can be found and develop.

One of the opportunities that can truly add value to the company is having associates, agencies or distribution. Emirates has 6 subsidiaries and its own father or mother company(Emirates Group). These subsidiaries that happen to be operating separately can give Emirates benefits.

  • Emirates SkyCargo
  • Skywards
  • Emirates Standard Store
  • EmQuest
  • Emirates Aviation College
  • Emirates Engineering

Threats:

Threats are exterior negative factors which could place the business mission or procedure vulnerable.

Market demand

In the commercial air line industry, unfilled seats on a regularly scheduled trip represents a danger cost to the operator. Although Emirates try to provide best services for the holidaymakers, it is not possible all the seats get complete during all the flights.

Competitor intentions

Another threat that could be danger for Emirates is it's competitive on the market. While Emirates has one of the very most modern fleets on the market, and has service levels make other airlines to emulate, and start using the same strategy that Emirates is using.

(Williamson et al. 2004)

Part 2: Information system Analysis

There are four managerial levels in virtually any business that are in charge of organization's programs and decisions; proper, tactical, knowledge and procedure levels. Within this section, first the sort of decisions that manufactured in each level is discussed. Later, the info systems which are being used to help the professionals to help make the right decision in that level of company are listed. (Laudon, 2001)

Strategic Level

Decisions in proper level:

In tactical level senior professionals need to develop their skill of earning the best decision possible. This type of decision usually concerns about basic direction, permanent goals. These decisions will be the least structured nonetheless they might have significant impact on the future of the organization.

One kind of decisions that is manufactured in the proper level is planning for gaining long term advantage, which is the Emirates' target. This sort of decision could require managers to add new destination in their airline flight schedules.

Another long-term decision in Emirates is buying new air planes (Airbus 380). Buying a new plane is a strategic decision because administrator should consider this decision is it going to benefit them in future or not.

Information systems in strategic level:

Executive Support System ("ESS") is the sort of information system which is utilized in tactical level to be able to help older managers make strategic decisions.

A brought up, making profit is one of the Emirates' goals. Income Planning System could help the organization to get this aim. Income planning system packages a profit focus on for the approaching period. It is just like a summarized version of estimated income affirmation. It starts with a forecast of expected sales and desired percentage for gross revenue keeping because the market conditions.

Another information system used in Emirates is Facilities Location system which helps manager access to external information decide where you can find new facilities. This type of system will help in gathering, studying and summering the key internal and external information used in the business enterprise.

Tactical Level

Decisions in tactical level:

Decisions in tactical level support the strategic decisions. They have a tendency to be medium range, medium value, with moderate repercussions. The info used to drive this type of decision is usually found in summaries of boring deals e. g. sales purchases from another level or classification. (Laudon, 2001)

For example in Emirates one of the key strategic decisions is to improve the profit of the entire year. Therefore the tactical decisions which are made by middle level managers would be how middle process may help this decision to reach your goals. The data used to operate a vehicle this kind of decision is usually found in summaries of boring orders e. g. sales requests from the next level or classification.

Decision about deciding ticket prices or producing a low priced ticket, or offering some seasonal promotion to be able to entice more customers are those kind of decisions which are created in tactical level. Another tactical decision in Emirates could be determining optimal booking insurance plan for multiple fare classes.

Information systems in tactical level:

Management information system ("MIS") and Decision-support system ("DSS") are two important information systems which support motion level. Management Information System mainly concerns with internal resources of information and usually takes data from the Deal Processing Systems and summaries it into a series of management records. (Laudon, 2001)

Budgeting System which used to prepare short term budgets can be an example of this kind of system. All of the Emirate's annual reports are given by such system and they will be used by the middle professionals.

Another system which can be used in Emirates is Costs Evaluation System which is perfect for determining solution prices and deals.

Decision-support system ("DSS") is also one of quite systems specifically to help management make decisions in situations where there is uncertainty about the possible benefits of these decisions. This system helps in gathering relevant information and analyzes the options and alternatives. Then your system provides spreadsheet and directories to build "what-if" models, and offer professionals with the best decision to choose. (Robson 1997)

A exemplory case of DSS in Emirate is Settlement Analysis System. This technique provides a detailed overview of the organization expenditure, monitor pay, earnings and benefits for the supervisor and they are in a position to plan.

Knowledge Level:

Decisions in knowledge level:

The decisions in this level are made by engineering and designer. This type of decisions involve creating new investment, developing new career pathways and figuring out new markets. The information which is necessary for this level is structured inner knowledge such as research studies, product-oriented marketing metrical and techniques and methods. (Robson 1997)

Information systems in knowledge level:

Knowledge Management systems are being used in knowledge level. The aim of theses system is to take documents with knowledge inserted in them, such as memos, records, presentations, articles and store them in a repository where they can be retrieved easily. Types of such system are:

Competitive Intelligent System which works based on a detailed business model that identifies what information it should collect.

Market Evaluation System which gives tools for analysis of financial market segments using technical research.

Operational Level

Decisions in operational level

Operational decisions are every day decisions and used to support tactical decisions. Within the functional level the daily need are reviewed to make your choice. Thus, the functional decision is highly set up and their impact is immediate, short term, short range. The info used to operate a vehicle this decision type is usually recommended or defined in the strategies and rules of the business. (Laudon, 2001)

Information systems in operational level:

An Operational Information System is a class of information system which provide information bottom part for your day to day operation of the airline. In this technique the info about lights, individuals, crew, situational, and environment gather. A few of these flows are taken by additional information such as traveler scheduling via the internet and form the travel agencies.

Transaction Processing System is one of the current systems in airlines companies to aid of deal and analytical control on newly received functional information. This system includes source attention, event derivation, and the ability to provide primary view or says of functional data to applications, where subsequently received events update these view.

Order Processing System is another system which can be used in operational level and keeps track of daily requests and transfer.

Part3: Ethical issues

There is no doubt that with help of IT and Information Systems human being activities will be done better and effective. However some concerns have been increased in use of IS/IT that could make those to be unethical.

Ethical issues in utilization of IT

One of the primary concerns about the info technology is Internet. Internet has been modified the way people used to reside. Nowadays people shop through internet, buy ticket online, communicate with friends, family, college in the other part of the word, and that means traditional business such as travel agents have lost their customers to the new rival which called internet.

The other point of view of using internet is internet offences (hacking into data, falsification of data). Internet has shattered all the restrictions of personal securities. That might be a huge damage for a firm if their private data be stolen.

Ethical issue in utilization of IS

Developments of information systems also entail ethical things to consider in how information is used.

As described information systems provides information to professionals in firm to make plan and decision. The question is that "Do managers make legal decisions?"

On the other palm information systems are about gathering information, analysing data. The moral issue of this fact is that, will be the information accumulated in honest way.

Geographic Information System is a good example for show the unethical aspect of usage Information Systems.

American satellites orbit the planet earth, checking for various varieties of data, which can then be utilized in a GIS. Analysis of resulting data tells analysts a good deal about, for occasion, natural resources located in other countries.

The problem is that poorer countries, with no money to send up their own satellites, claim that the U. S. is taking information from them without any type of payment.

Conclusion

What is most concern in decision making not only is "Is this the right decision" but is "Is this decision the best decision". Professionals will usually need to access to the useful information in order to make the best decision.

An organization must have several types of information systems working at exactly the same time. The success of an organization which includes information system in every the departments such as Funding and Accounting, Sales and Marketing, Manufacturing and Recruiting department is assured.

Here are two more info systems that I believe can help Emirates to obtain better services:

In a business like Emirates which includes 6 subsidiaries, Partner Marriage Management (PRM) is a system for improving communication between Emirates and their route partners.

Another recommended system for Emirates is Customer Relationship Management (CRM) to help them stay near existing customers. Skyward is the famous Customer relationship Management system for Emirates. Taking into consideration the strong competition nowadays, they need to enhance their CRM performance to be able to improve the number of faithful customers. Resources:

  1. Business reports, March 08, 2007, Robust progress poses threat of inflation to high-flying Dubai [Accessed on Feb. 2010].
  2. Emirates group, 2010 < Offered by http://www. emirates. com/english/about/the_emirates_story. aspx> [Seen on Feb. 2010].
  3. Press J, 2001, International Directory of Company Histories, < Available at http://www. fundinguniverse. com/company-histories/The-Emirates-Group-Company-History. html> [Seen on Feb. 2010].
  4. Laudon J, Laudon K. C, 2007, Management Information Systems - Handling the digital firm, 9th Model, PEARSON Prentice Hall.
  5. Oleason V. Schwan K, Eisenhauer G, Plale B et al. Information System-An example form Airline Industry- Article-, college or university of processing Georgia Institute of Technology.
  6. Report by Symbol Caswell, 13/10/2008, Dubai's Terminal 3 starts, [Seen on Feb. 2010].
  7. Robson W. 1997, Strategic Management and Information Systems - A built-in strategy- 2th Edition, Pearson Education Small, THE UK.
  8. Williamson D. Jenkins W. Coole P. Moreton M, 2004, Strategic Management and Business Examination, 1th Edition, Elsevier Butterworth-Heinemann.
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