emirates case study strategic management
– Rival Companies are major threats and the increased unhealthy competition in the Middle East Market, particularly in United Arab Emirates may significantly affect the Emirates Airlines’ business It is possible to differentiate various Airline Companies through providing the modern and latest services such as the big comfortable seats, new e-ticketing system, and advanced aircraft. Also, while the United Arabs Emirates is by no means a region frequented by the extremist terrorist groups, Emirates Airline Company serves many nations, which have been marked as potential threats to security concerns by the administration of Trump (Alkhalisi, 2017). Since the operational costs related Is significant, Ye. Lim Meng Sheng CEB140063 2017). Available at: http://marketrealist.com/2014/09/why-social-and-demographic-factors-influence-air-travel-demand/ [Accessed 27 Dec. 2017]. Emirates cuts US flights, blames Trump travel ban. Also, it has enough airlines as well as pilots and can maintain the time of flight accurately. Emirates Airline consists of three types of First Class Chairs, that is, the horizontal bed “Sky Cruiser” seat, the full suite with doors, and “Sleeper” seats. In fact, since induction, the company did not experience any significant air travel accident, and there were no injuries or loss of life. His image has an excellent contribution towards the success of the airline. Vision and Value Analysis: The first step of strategic marketing is to analyze the mission statement of the organization for analyzing the purpose of existence of the company. For instance, Sheikh Ahmed is both a rare and valuable resources. Procurement Ideas are decided against at a low level without reaching the top. ... Social forces A well-designed strategic management system could fall short if necessary attention is not given to personnel affairs in an organization. (2015). The company’s flight operations could be disrupted both in the middle east and in other nations of the world. The Emirate Airline run its flights to many of the emerging countries of the world such as Iraq, Africa, and South-East Asia regions. PART IV- Emirates Airline Main Issues And Challenges In fact, the profit plunged 82% to $340 Million for the 2016/2017 financial year as the Emirates Airline faces severe economic as well as political headwinds after the duration of untrammeled growth. Here, strengths denote the core competencies that provide the company with some benefits in achieving these conditions. Trained staff fro different nationalities to offer best level of service, Yes. However, some adjustments in its business environment like rising competition form the long-haul low-cost airline’s services are suitable for the expectation of Millennial travelers and of course builds substantial opportunities. 3 However, the Emirates Airlines, as well as other aircraft, manufactures remain under a firm pressure toward the utilization of all the available technology, with the aim of reducing their overall fuel consumption (Phys.org, 2017). This company is also facing the challenge of price difference since many Airline Services traveling to and from Dubai offer significantly low prices. 7 While using the Jay Barney’s VRIO Framework, it is possible to understand better the competitive advantage of Emirate Airlines as well as the reasons that are behind its success (Australia., 2016). The strategy is a long-term planning that is aimed at achieving the objective of the business through the arrangements of the resources of organization within a challenging environment. The SFA Framework According to Emirates Airlines President, Sheikh Ahmed Bun Saeed, the airline will be hurt by the United Kingdom’s vote to exit in the EU, new US policies on air travel, terror attacks in Europe, Devaluation of Currency and the high cost of oil as well as sluggish gas industry. The Emirates Airline Company is one of the famous employers in its home region, having over 62, 000 workers currently. Therefore, the Millennial travelers are accompanied by diverse expectations from the predecessor generations. Suppliers have a significant effect on any industry through their capabilities to increase the prices and of course, to reduce the entire quality of the purchased services and goods. “A stable and strong leadership team, ambitious yet calculated decision making and ground breaking ideas all contribute to the development of great companies.” In fact, these have played a significant role in the establishment and growth of Emirates Airlines, and it’s clear that business ethics, as well as customer focus, are the core foundations in which the overall success of the airlines have been developed. Emirates Airline picks their clients appropriately and maintains their flight schedules. They include the Airbus and Boeing. Temporary Competitive Advantage Other support systems for the firm’s infrastructure include the partnership with the government and the developed tax-free environment. Table 1.0: Emirates Airline Partial SWOT Analysis, – The brand new Emirates Airline fleet can be used to expand their services as well as improve the overall confidence of customers in the Airline, – Emirates have more international Air Travel Destinations, which are famous amongst their customers, – Continuously increasing costs of fuel have some severe impacts on the margins, – Joint ventures/partnership and alliances with most popular international players in the industry can provide more business opportunities to Emirates’ Airlines, -Changing Government Policies as well as regulation, – Emirates has its own Aviation Institute, which provides constant workforce to the company. 3 Reuters. Reuters. 6. The airline’s vice-chairman has more than 50 years of experience in the sector. Emirates Airline uses many other strategies and plans to develop their businesses which include the strategy for development and motivation of their workers. Furthermore, the advanced technology of e-ticketing provided customers with the chances and flexibility to search for a lot of airline services companies, which offer better as well as cheaper costs and services. Emirates is differentiated from other airline companies by being the legacy airline where advanced technology, ancillary services, and staff skills are the core drivers of the success. To get the Emirates Airline Strategic Options, The Ansoff’s Directional Matrix can be applied as a strategic point, which is responsible for identifying all the choices that are available. https://www.slideshare.net/yeapszuhui/strategic-managementemirates-airline In the Airline Sector, the competition is significantly high, especially between the companies, since there exists a variety of airline companies, which offers the best aircraft as well as services to their esteemed customers. The Three Generic Strategies, which were identified by Michael Porter, include the differentiation, cost leadership, and focus. By because this company has never suffered any shortage of resources to develop, the attempt of launching a subsidiary airline that is cost-effective or a low-cost business model may be an incredible opportunity that worth exploring. – Joint ventures/partnership and alliances with most popular international players in the industry can provide more business opportunities to Emirates’ Airlines Supply Chain Management and Competitive Strategy Background of the Company. (2016). References; According to research on the past years, Emirates Airline has never enjoyed any favorable relationship with the American and European Airlines. Experience Children’s Museum Business Operations Analysis. However, in many nations, railroads, and trains are not available, such as in the United Arabs Emirates. Capital Requirements: An enormous amount of budget is needed for starting a new airline company to offer the services to the customers and also, to buy aircraft. The core concept or intention of the value chain is that in any action taken by the company, it is supposed to add value or think about outsourcing it to another business which can do it in the same manner or add more value compared to the first company. The United Arabs Emirates economy’s development and growth have been one of the top economy that is fueled by the oil industry of the nation. Emirates flew its first flights out of Dubai on 25th October 1985. Capabilities The Emirates Airline houses its technology research center. – The brand new Emirates Airline fleet can be used to expand their services as well as improve the overall confidence of customers in the Airline 2017). 2017). Therefore, depending on their long-time experience in the market, their existing companies’ experience curve is high. Since the company is targeting huge fans of various sports, Emirates Airlines has benefited from the strategic alliance with. The Airline is one part of, Capital Requirements: An enormous amount of budget is needed for starting a new airline company to offer the services to the customers and also, to buy aircraft. The first portion of the study provides a brief overview about Emirates Airlines Company followed by a state of affairs analysis that includes the internal and external analysis. Yeap Szu Hui CEB130067 Clipping is a handy way to collect important slides you want to go back to later. An Analysis of the Comprehensive Implementation of Strategic Plans in Emerging Economies: The United Arab Emirates as a Case Study January 2016 European Management Review 13(2) The strategic location of Dubai is a great resource that can never be imitated easily. The developing global security considerations, as well as the recent terror attacks conducted in Europe and other other nations in the world, can significantly reduce the overall demand for air travel. The case will critically analyze the risk management framework of the banks and the risks that bank typically faces. This is because Dubai acts as the Business Capital of the Middle East. The main advancements in the aviation technology that is affecting the fuel efficiency aren’t expected. It was established by Dubai government. Here, strengths denote the core competencies that provide the company with some benefits in achieving these conditions. Make Your Digital Connection: From Digital Strategy to Airline Strategy. However, on the international level, most people typically use airplanes to move more comfortable and faster. In cases of the regional airline services, this threat may be higher as many people can drive their personal vehicles or just use railroads as a way to travel within the same region. Emirates says airlines impacted by external threats such as Ebola. Marketing Penetration (Improving In-flight Services) In any Airline business, the safety of the flight is imperative. [online] Available at: http://uk.reuters.com/article/uk-emirates-airlines-results-idUKKCN0IW11K20141112 [Accessed 27 Dec. 2017]. Question: Case 34 – Emirates Airline EMIRATES AIRLINE* Emirates Airline Was One Of The Three Middle East Car- Riers That Were Singled Out By The Largest U.S. Airlines In A Report That Was Released On March 5, 2015. The aviation education, which is the airline’s arm of the business, is a crucial and fundamental strategy to the success of the company. This is because there are many passengers, over 1.8 Billion Annually. Brand Name and Customer Loyalty: Most of the existing airline companies have already established and built a strong and excellent position in the current market, a strategy that assists them to compete against the threats of new entrants. Table 1.1: Representation of Emirates’ VRIO Framework – Continuously increasing costs of fuel have some severe impacts on the margins [online] Forbes.com. Focus depends on the preference or choice of narrow competitive scope within the industry (Upham, 2015). IATA (2014). Therefore, the bargaining power of the suppliers is very high, since those who are limited suppliers have the control over the market due to the tremendous demand for their products. The company’s assets are valued to be over $ 60 billion, an investment that makes it feature among the companies with large land ventures in Abu Dhabi. Emirates Airline is supposed to strictly spread from the current objectives of marketing to get the low-cost airline market share. Emiratesnbd.com. Also, it has enough airlines as well as pilots and can maintain the time of flight accurately. This is because they may provide better quality services, cost-efficient, and better products. Protectionism Won’t Work Against New Competition. This enhances the overall Emirates Airlines Services. On the 2005/2006 financial year, Emirates Airline carried approximately one million tonnes of cargo and 14.5 million passengers. The aviation industry suffers from a range of political and economic obstacles and challenges today, and much attention should be paid to the strategy followed by Emirates to compete in the market. This is through the improved travel demands (Malek, 2016). 2017). [online] Available at: http://www.reuters.com/article/airlines-iata-idUSL8N18R23U [Accessed 27 Dec. 2017]. The process of recruitment is done via campus placements, specifically from their institute, Emirate Aviation College. It is the leading international carrier of Dubai, with a politically stable region and has a strategic location, mainly for transit passengers. In fact, Emirates Airline can expand under its fifth freedom rights in the United Kingdom, mainly linking the European cities with several destinations, which are currently under-served by the local airline services. This case is useful for undergraduate and postgraduate level students majoring in international business management and/or strategic management. Economist.com. Table 1.1: Representation of Emirates’ VRIO Framework. Emirates Airline has a significant Cost per Seat Kilometer (CASK) advantage compared with other European legacy groups, and these include the carriers that have been hardest hit by the Gulf carrier competition (Reuters. Emirates Airlines has gathered all its aircraft plus other required tools and equipment in fastest possible time. The previous population had a high reliance on the preferences and advanced technology for convenience at the most affordable rate in the market (Cederholm, 2014). [online] Available at: http://www.arabianbusiness.com/emirates-mulls-fifth-freedom-flights-from-europe-mexico-us-631288.html [Accessed 27 Dec. 2017]. However, the European full-service airline’s companies have been interrogating the feasibility of establishing a low-cost long-haul subsidiary, which will benefit from the massive potential market (Fehrm, 2016). 4 This is achieved through the protectionist policies and rules enacted and implemented, although few people on the involved airlines may openly admit that this accusations for the alleged subsidies as well as the lobbying to renegotiate Open Sky Agreements, together with the Gulf Airline services are done as part of the protectionism policies (Flottau, 2015). Due to the adapted services for customers, the company is exceptional Emirates has the largest fleet of aircraft related to any other company and reaches many regions around the world, Yes. Therefore, being one of the largest Airline in the World, Emirates is the most successful fleet, especially in maintaining the safety of the flight. [online] Available at: https://www.emirates.com/english/destinations_offers/route_maps/route_map.aspx [Accessed 27 Dec. 2017]. These are illegal practices in Europe and America (Flightglobal.com, 2014). This Assignment includes three parts. The core of Emirates network strategy and Dubai hub were also discussed, in addition to Emirates’ view on alliances and strategic partnerships. Strategic Management – BUS 799-G01 Case Study # 5 1 Keith Newsome new1788@calu.edu 724.272.5846 Strategic Management BUS799 – Case Study 20: The Emirates Group A. Emirates mulls fifth freedom flights from Europe to Mexico, US. Strategic Option 2 Labor or human capital is also a limited resource. Occasionally. (2014). [online] Available at: https://centreforaviation.com/insights/analysis/emirates-airline-turns-30-just-as-it-has-changed-the-world-now-emirates-faces-its-own-changes-245140 [Accessed 27 Dec. 2017]. According to the revenue, it is on the seventh largest airline in the world. Emirate Airline was recently named one of the fastest growing airlines and of course, the 5th most profitable airline all over the world. The overall global challenges, which are responsible for undermining the entire ambitious fleets, together with the airline expansions plans due to the competition on every airline for long-haul custom, have combined with the sluggish hit of the regional economy by a slump in the prices of oil. All Emirates flight routes | Destinations | Emirates. Introduction. Emirates Airlines have been providing excellent services through the utilization of various Airline types. Parasie, N. (2016). In this case, Emirates Airline has expert engineers, cabin crew, flight deck crew, personnel, Airline maintenance, aircraft controllers. 2 In the airline sector, such a threat is low because the level of entry barriers is high. According to research on the past years, Emirates Airline has never enjoyed any favorable relationship with the American and European Airlines. It is meant to fulfill the needs of the competitive market and also, the satisfaction of the expectations of all stakeholders. – Innovation and new talents Personally, I would consider the Dubai’s strategic location as rare resources that typically offer the company with an incredible demand for its service. (2015). Accordingly, such carriers do not have a potent threat to the airline sector, because they aren’t used for long distances journey by many nations. Diplomacy In Action. Air travel demand slows as airlines confront security, fragile economies. On the other hand, it also reduces the entire demand for the premium travel to some regions such as Dubai and the Gulf Region (Kamel, 2017). These primary activities of the business produced a smooth operation for the Emirates Airlines’ success and became the pioneer airline service to offer some personal entertainment system on the commercial airplanes after providing the initial Seatback Commercial Monitor of the world in 1992. Recently, the Emirate Airline published its first full-year profit report on the decline for the five years as an erosion in the travel demands, which delivered one of the Dubai “most challenging year to date” carrier. 1. Table 1.2: Representation of Emirates’ SFA Framework [online] Marketrealist.com. The lower price of fuel and gas has assisted the Emirates to lower the operating costs. International Air Travel IT Development Appraisal of The Resource & Competencies Advanced Technology Applied In this case, each organization or business under the Emirates group has the responsibility of establishing or producing a market specific function or services. Available at: https://www.forbes.com/sites/dominicdudley/2016/11/11/is-the-emirates-airline-growth-story-at-an-end/#71fb9ff966d6 [Accessed 27 Dec. 2017]. Furthermore, they have a program for rewards, which enhances the overall performance of their staffs (Emirates Group, n.d.). From this analysis, various implications require Emirates Airline to respond to some changes in the attempt of changing the context such as technological, political, and the current economic downturn. This brand and image realization generated from the business segment renders it a valuable strategy. Criteria Inbound logistics Furthermore, Emirates Airline is highly threatened by the introduction of long-haul low-cost airline services including the Norwegian Air, Wow Air, and AirAsia X, which are meant to increase the overall competition rate on the long-haul routes (Fehrm, 2016). – Emirates has its own Aviation Institute, which provides constant workforce to the company According to the international Airport Association (IATA), it is indicated that back in 2006, Emirate Airline was ranked one of the best among the top ten best airlines in the world. Chuah Pui Ling CEB140028 The leading airline, Dubai International Airport, has the private Emirates Terminal 3. Emirates Airline uses many other strategies and plans to develop their businesses which include the strategy for development and motivation of their workers. However, the Emirates Airlines’ efficient management is successfully operating the fleet, such that it has become an exemplary airline in the aviation sector. Emirates Airlines also plans to raise its long-haul flight services in diverse international destinations. Therefore, being one of the largest Airline in the World, Emirates is the most successful fleet, especially in maintaining the safety of the flight. In fact, the fleet of their airlines is obtained via the top airline manufacturers, Boeing and Airbus. However, according to the recent research, the current investment in other sectors including commerce and trade, which attempt to make the United Arabs Emirate an attractive destination for most investors to start their businesses indirectly benefiting the Emirates Airline in the area (U.S Department of State. In fact, the profit plunged 82% to $340 Million for the 2016/2017 financial year as the Emirates Airline faces severe economic as well as political headwinds after the duration of untrammeled growth. PEAKWORK CASE STUDY: EMIRATES Leading airline Emirates boosts leisure travel sales - Peakwork Flight Player connects Emirates to worldwide Player Hub Network BACKGROUND Emirates launched operations in 1985 with just two aircraft. The risks that are posed by the substitutes differ, mainly from one region to the other and the international airlines. Kamel, M. (2017). By now, it’s the Asian nations where the long-haul low-cost airline services are enjoying a rapid development and growth. Therefore, it is crystal clear to conclude that this sector is profitable, having less competition and threats for any new entrant company or substitutes. Cost leadership needs a tight set of interrelated tactics that involve the aggressive construction of efficient-scale facilities, fixed costs and overhead control, vigorous pursuit of cost reductions from experience, avoidance of marginal customer accounts, and the cost minimization in every activity in the firm’s value chain. Reuters UK. For instance, American Airlines. 4 ways climate change could ground the airline industry. Competitive Advantage Outbound Logistics Emirates’ Value Chain Analysis Possible if any rival enter in alliance with other airlines, where they will achieve low-operational costs and more services Available at: http://money.cnn.com/2017/04/19/news/economy/emirates-us-flights-trump// [Accessed 27 Dec. 2017]. In this case, each organization or business under the Emirates group has the responsibility of establishing or producing a market specific function or services. The partnership and collaboration of all the branches of Emirates Airline have achieved most of the cost-cutting and raised the efficiency of the service. Available at: https://www.ft.com/content/c274e63e-580c-11e3-82fc-00144feabdc0 [Accessed 27 Dec. 2017]. Personally, I would consider the Dubai’s strategic location as rare resources that typically offer the company with an incredible demand for its service. For example, most businesses try as much as possible to expand their market shares through providing perfect prices, customer services, and some exclusive promotions. The competitive advantages are the position that the company’s signature occupies, especially against its rivals. [online] Available at: https://www.forbes.com/sites/greatspeculations/2016/08/30/what-are-the-factors-behind-soaring-air-travel-growth/#39912672258d [Accessed 27 Dec. 2017]. Sustainability The Emirate Airline procures its resources from various sources outside and within the Emirates Group. Since the company is targeting huge fans of various sports Emirates have positioned as most favoured when it comes to airline services and therefore uses value-based positioningstrategies. The primary purposes of this is to make various attempts toward limiting the access to the Gulf Carriers, to their respective home markets. Therefore, the power of the purchasers in this industry is powerful. The Emirates Airline is an international air travel service and the revenues are collected in the multiple currencies. (2017). Threat Those aircraft were purposely applied until the Emirate started taking their delivery of a fleet of the newly advanced Airbus A300-600R as well as the Airbus A3100-300 wide-body aircraft. Strong brand awareness via sponsorship on games and sports, caring for their workers and stakeholders, and communities together with the environment served by Emirates Airlines, have also played a significant part since it was launched and will continue to signify success of its future (Nataraja, and Al-Aali, 2011). A single Boeing 737-300 and Airbus A300 were leased form the Pakistan International Airline (PIA), and most of the PIA employees were also hired at the same time by the Emirates. Furthermore, Emirates Airline is highly threatened by the introduction of long-haul low-cost airline services including the Norwegian Air, Wow Air, and AirAsia X, which are meant to increase the overall competition rate on the long-haul routes (Fehrm, 2016). Focus depends on the preference or choice of narrow competitive scope within the industry (Upham, 2015). Also, the premium class private suite is fully outfitted with personal storage, desk, individual mini bar, and coat cabinet. The airline industry comprises of few suppliers all over the world. The company also consider its employees as the core values and provides a myriad of advantages, regarding the non-cash and cash components to its workers. As Dubai is the hub for all international air travelers, this is an excellent time to improve the new services to offer to the top business executives. All these Porter’s Five Forces of Competition favors the Airline Industry. [online] The National. On the other hand, exploring different regions’ route pairs, with a primary purpose of exploiting the Fifth Freedom Rights may be an excellent opportunity to use a significant amount of aircraft, primarily to be delivered to the Emirates Airline in the next five years. As Dubai is the hub for all international air travelers, this is an excellent time to improve the new services to offer to the top business executives. The company also has the core resources in the form of active management team including the CEO/chairman, Ahmed Bin Saeed Makhtoum. Available at: http://www.atag.org/facts-and-figures.html [Accessed 27 Dec. 2017]. (2017). Furthermore, the advanced technology of e-ticketing provided customers with the chances and flexibility to search for a lot of airline services companies, which offer better as well as cheaper costs and services. Emirates Airline is supposed to improve the maintenance process, efficient and effective flight schedules and perfect utilization of the company resources such as aircraft. It may be divided into two parts; Competencies and Resources. A Comparative Study Between A’saffa Foods (SAOG) in... McKinsey 7S Model Factor Analysis of Amazon Inc. In fact, the airline companies in this countries accuse Emirates Airline of attaining the government subsidies, which in turn provide Emirates with an unfavorable competition benefit. This is because they may provide better quality services, cost-efficient, and better products. At the period of intense competition which refers to the maturity stage if the Airline industry, every Airline Company such as Emirates should approach offensive and also apply offensive strategies after in details review of the internal as well as the external environment and all factors that directly influence the position of the company (CAPA., 2015). This will enable the company to develop some small hubs outside Dubai as well as deploy modern aircraft (ArabianBusiness.com., 2016).