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Nobody Can Imagine The Life Without An Aviation Industry

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Question:

Nobody Can How Imagine the Life without an Aviation Industry?

 

Answer:

Introduction

Nobody can imagine the life without an aviation industry because the industry offers huge benefits and fast services for many industries. The airline industry is also creating new global economy thus justifying the significance of the industry in supporting globalization and internationalization objectives for many companies worldwide (Alcacer & Clayton, 2014). With this need and expectations, the aircraft manufacturers and suppliers have been exposed to an immense pressure. This has compelled them to increase their innovations, inventions, and investment to meet the expectations of the partners. Emirate Airlines is a leading company in the industry that is based in Dubai. Since its inception in 1985, the airline company has opted for an aggressive business strategy to commercialize its air transport services (Euromonitor, 2014). Based on the case, the company faces various strategic issues that threaten its growth potential and market position.

About The Company

Overview

Emirates Airlines is a Dubai government company founded in 1985. The organization began operations with flights to Karachi, Mumbai, and Delhi. Currently, the airline is the Emirates Groups’ subsidiary that is headquartered in Dubai (Alcacer & Clayton, 2014). Even in the recent recession, the company hardly experienced the economic turmoil because of its indisputable marketing efforts and promotion of Dubai as the leading destination for tourism (Euromonitor, 2014). Since it began the business operations, the Dubai-based airline company has gained competitive advantage and position in the global market. Emirates remains committed to realizing its mission by offering the best quality services to all its customers on its routes (Lovelock, Patterson, & Wirtz, 2011).

Values

Emirates Airline has set its battlefield and has set the best resources to emerging the winner in the airline industry. The company also values the communities and environment that it serves because these stakeholders have played an essential role in defining and shaping its future (Hubbard, Rice, & Galvin, 2014). The company remains committed to quality that has made the airline the leading companies in the industry thus rivalling its counterparts in New York and London. Emirates Airline cares about ethics, environment, community, stakeholders, and employees.

Mission

 “To exist to deliver the world’s best in-flight experience” (Emirates Australia, 2014).

Organizational Analysis

Principles

The Emirates experience focuses on customers and other its stakeholders. In fact, the company understands that the clients value the final output, but the business considers the way these stakeholders are treated, especially during the delivery of services because this significantly influences their value and satisfaction perceptions (Alcacer & Clayton, 2014). It stands for comfort, exceptional service, and convenience in defining the experience of customers. The company also stands for a high-quality service delivery through innovative strategies as explained by The Emirates Group (2014)

Strategy

Since its inception, the airline is tipped for significant growth in the market. It has become among the leading airline companies in the world (Emirates Australia, 2014). Based on the case study, the organization has been operating through three leading strategies including differentiation strategy, focus strategy, and cost leadership strategy (McDonald, DeChernatony, & Harris, 2011). For this company to remain relevant to the cost leadership strategy, it has made the workforce comparable to other low-budget airlines thus helping it minimize the costs thus increase its profits and revenues (Alcacer & Clayton, 2014). The company further passes the benefits to the passengers through low-cost flights thus affirming the customer loyalty.

Differentiation strategy has also seen the airline diversify its operations and services to meet the expectations of customers as discussed by McDonald et al. (2011). Finally, the focus strategy has allowed the group to operate an Emirates Executive that focuses on the corporate and private charters (Emirates Australia, 2014). It has even introduced an Airbus A319 jet that has the smallest capacity. This special plane has a private dining area, lounges, suites, showers, and bathrooms. To serve different market segments, the company has divided its classes into three including the economy class, business class, and first class (Alcacer & Clayton, 2014).

Performance

 

Financial Performance

Despite a challenging environment, the company posted an improved profitability in 2016. In the financial year 2015/2016, it reported $1.9 billion in net profit that reflected a 56 percent increase from the previous financial year (Kerr, 2016). However, it recorded a drop in revenue by four percent due to strengthening of the dollar. The company’s profitability improved because of its continued efforts to increase its performance and innovation. The return on assets ratio stood at 1.56 in 2016 and the return on equity was 12.71 percent (Moningstar, 2017). These values indicate that the company’s future is bright because it can overcome the competitive pressures to beat its competitors.

Market Share

Emirates Airline is an incomparable to other players in the region. It has become the largest carrier in the region can outwit it. According to Critchlow (2015), the UAE government has made the company a real player in the aviation industry, especially regarding the international passages. Based on profitability, the company has made $517 million of profit thus affirming its ability to generate enough money that none of its rivals can generate (Critchlow, 2015). Relating to the international passenger traffic, Emirates has beaten other players.

 

References

Alcacer, J. & Clayton, J. (2014, Jan 29). Emirates Airline: Connecting the Unconnected. Boston, MA: Harvard Business School.

Critchlow, A. (2015, Mar 21) Gulf Airlines are winning the Battle for the Skies. The Telegraph. Retrieved 7 May 2017. <https://www.telegraph.co.uk/finance/newsbysector/transport/11487567/Gulf-airlines-are-winning-the-battle-for-the-skies.html>

Emirates Australia. (2014). The Emirates Experience. Retrieved 1 May 2017, from <https://www.emirates.com/au/english/flying/index.aspx>

Euromonitor. (2014). Emirates Airlines in Travel and Tourism. Retrieved 30 April 2017, from <https://www.euromonitor.com/emirates-airlines-in-travel-and-tourism/report>

Hubbard, G., Rice, J., & Galvin, P. (2014). Strategic Management. Sydney: Pearson Australia.

Kerr, S. (2016, May 10). Emirates Airline Reports Record Annual Profit. Finacial Times. <https://www.ft.com/content/b2c45cd2-16ba-11e6-9d98-00386a18e39d>

Lovelock, C.H, Patterson, P.G., & Wirtz, J. (2011). Service Marketing, 5th Ed. Frenchs Forest: Pearson Australia.

McDonald, M., DeChernatony, L., & Harris, F. (2011). Corporate Marketing and Service Brands. European Journal of Marketing, 35(3/4), 335-352.

Morningstar. (2017). Emirates NBD PJSC. Retrieved 7 May 2017, from https://financials.morningstar.com/ratios/r.html?t=EMIRATESNBD

The Emirates Group. (2014). Our Brands. Retrieved 1 May 2017, from <https://www.theemiratesgroup.com/english/our-brands/our-brands.aspx
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