Services

Introduction

A service is anything done to us. Services are not things and are intangible. They cannot be seen stored or held as, for example, entertainment services, listening to orchestra playing or withdrawing money from a bank. Quality, on the other hand, can be defined in several ways: as a philosophical, technical, and user-based approach. While the philosophical approach will be discussed more scrupulously in the next section, the latter two are elaborated here. The technical approach considers quality from an absolute and objective perspective. This approach is concerned with the level at which a product complies with its technical quality. Since this approach focuses on what is readily measurable, it is used to describe the quality of the goods produced in large quantities. In a user-based approach, where the user determines the quality of the product, the quality is subjective and depends on the perceptions of the user or a customer. In this case, it is appropriate to measure the quality of a service delivery as to how the customer will take.

Philosophical approach

According to Oliver (1997), this perspective maintains that quality is synonymous with the ability of becoming useful. Under this approach, an individual knows quality when they see it, but cannot define it. Service Quality exists only in the customer’s mind and can be defined as the expectation of the customer towards a service. It can also be defined as the level at which a company achieves the following:

• Reliability: how helpful the company is in providing a service when needed by its customers.
• Responsiveness: how quickly the company serves its customers and their needs.
• Understanding the customers: the level at which the company identifies its customers.
• Security: the surety that the customer resources and information is not taken in an unfair manner.
• Communication: how messages and information are well translated to its customers.
• Courtesy: how considerate the organization is towards its customers.
• Access: the ease at which the organization and the customers reach each other when needed.
• Competence: how the organization well understands its services or products and interpret to its customers.

Emirates Airlines quality service

Emirates Airlines Company was established in Dubai in 1985 and initially possessed only two aircrafts. Since then, Emirates has grown into a large company with 83 aircrafts flying to 88 destinations in 55 countries across the world. Their cabin crew is represented by 95 nationalities. The country has become the largest buyer of super jumbo airbuses. The company’s mission is to offer a high quality service and to be the best airline on all its routes. It offers personal entertainment systems in all its classes and online booking service that enables customers to search and choose seats online. Therefore, Emirates is categorized as customer oriented and innovative in giving advanced services to its customers. It has achieved 280 international awards such as CAPA award by the Centre for Asia Pacific Aviation in 2005 (Bamber, 2009).

Industry profile in its environment

Emirates Airline Company has been able to display a positive environment in terms of differences in their culture. It has been able to boost the sharing of a common goal among its employees, hence making its team to work effectively and efficiently. Thus, they work together to maintain their competitive advantage. The actions of the airline are more coordinated since they work together. Both employees and the managers within the organizational culture involve themselves jointly in ensuring the firm’s service quality at each and every level. Improved services will help in promoting customers’ satisfaction that creates a positive effect which similar to a chain reaction. The organizational culture has a positive impact on the behavior of the organization making teams work more efficiently (Nussbaum & Sen, 1993).

External Environment

Airline industry is growing fast, and is considered to be the most competitive in the world as it leads to the world tourism and investment. It is trusted as one of the best and fastest expanding industry with a GDP of 2.4 high. However, this environment is affected by both political and trade factors as well as economic growth. Increase in oil prices is one of the economic factors affecting the industry that occasionally reduces the profitability of the entire airline. Terrorist attacks are an example of political factors affecting passengers. To survive in an economical and unstable political situation and succeed in the industry, the airline modified its strategies and services (Oxford Business Group, 2008).

The airline is facing strong competition in its external environment. These include:

• New entrants: The challenges that should be considered are the brand name of the company and the capital requirements.
• Bargaining power of suppliers: The ability of suppliers to raise or reduce prices of goods and services affect the industry. The power of the supplier is high since the company only has only airbus and Boeing.
• Bargaining power of buyers: Bargain for more services or high quality by buyers affects the industry through the power to bring down prices.
• Rivalry among other firms: As there are a number of airlines providing best services and aircrafts to passengers, the rivalry is high. The key competitors of the industry are British Airways, Qatar Airways, American and Singapore Airlines.

Internal Environment

The company’s internal environment can be analyzed using SWOT analysis

The company’s strengths

• The company offers self check-in services at Dubai Airports.
• Offers long haul flights to from US to Dubai.
• It is the first in the Arab World offering online booking services.
• The Airline, also called Arab Air Carriers Organization promotes safety standards among the Arab Air.
• Offer training services to other airlines in the Middle East.
• Own a frequent Flyer program known as Skywards Miles.
• Provide employees with rewards, training and performance programs hence improving loyalty of its employees.

Weaknesses

• Does not have a hub in the capital of the UAE.
• The airline is not registered as member of any global alliance.
• Incurs huge costs in buying its aircrafts and implementation of new technologies.
• Its tickets prices are high as compared to other flights.

Opportunities

• There will be a greater investment in the UAE government for developing main airports in Abu Dhabi.
• The UAE income per capita is growing.
• The population of the UAE and the world is growing.
• Internet users in the UAE and the world is expected to increase
• Increased annual number of UAE tourists.

Threats

• Passengers have a strong power hence can be a threat to the industry.
• The possibility of spread of diseases such as bird flu affects airlines.
• Rise of low cost airlines and new entrants into the market.
• If the oil prices remain high, there is a possibility of the airline losing.
• Operational costs can go high due to increase of fuel prices.
• Hackers can abuse the e-ticketing system hence damaging the company’s database.
• Terrorism activities have recently increased in the Middle East.

Emirates Competitive Landscape Advantages

Emirates Airlines were the first to serve an e-ticketing system in the Middle East. To become competitive among its rivals, the airline adopted differentiation generic strategy by offering the highest quality services in the market in order to differentiate itself from its competitors. It offers other airline companies the training courses by using modern machines (Thinking Made Easy). This has helped the company to gain advantage in the competitive market following its focus on new segments in the market. Such changes have made the company a leader in the industry by improving its awareness both regionally and internationally, thus, increasing profits and demand. The company aims at providing its customers with safe, dependable and most friendly transport along with reliable services by making their flights more special and memorable to their clients. The convenience, safety and comfort are the concern of the industry as they provide quality service for its customers. In addition, the company’s marketing approach and strategies are perceived to be designed to meet the customer’s needs, as the management has been able to serve various customers including special customers. This has enabled the company to stay committed by improving its operations. They have been able to benefit from improved demand among customers and a better market share (Mauch, 2010).

The company has had an opportunity to widen its market that has given it the strength to diversify its customer management approaches. Such approach allowed the company to gain a better experience in dealing with needs and demands of its customers globally.

How Emirates can improve its quality of services

Emirates Airlines can improve its quality of services through having a strong brand name, differentiation, alliances, and relations with the supplier. Establishing a base of loyal customers and acquiring a strong brand name is the primary airline’s concern. This will allow customers to stick with the strong brand name of the company, hence ignoring other competitors. Offering flyer mile to win a free ticket as done by other companies is one of the techniques employed by some airlines in an effort to win and retain customers (Zeithaml, 2009). Differentiation can be done in various ways including providing the company with the latest technology like introducing new and wide seats as well as e-ticketing technology that can help in bringing a difference between the company and other competitors.

Linking networks will help companies share resources, thus, increasing the number of routes, developing better services, and providing a large base of customers. In addition, forming alliances will lead to cutting down on operational costs and sharing experience. Having a long-term relation with the supplier will put the company on a safer side even if there was a future pricing strategy change since they entered into an agreement.

PEST Analysis

Political factors

Instability in the political climate of a country such as terrorism and wars may affect business between Middle East Airlines and the world at large by causing a difficulty in having relations with international airlines including America Airlines (Hernon & Altman, 2010).

Economic factors

Having modern and up to date airports enhanced with the modern technologies to meet the needs of customers is one of the factors leading to the success of a company. An example is the UAE, which has developed airports in Dubai and Abu Dhabi, and is now boasting of making seventy-one billion in the coming twenty years. Building alliances can be one way of improving economy and cutting down on the dependence on oil revenues by going for other sectors like tourism.

Social factors

Profits of the airline companies will go high as the number of expatriates increases, since the expatriates need to go back to their homelands. Increasing number of educated people and the increasing population of the world are examples of social factors. In addition, some killer diseases affect population in many countries. This causes a negative impact to the airline industry as it reduces the level of population (Hernon & Altman, 1996).

Technological factors

For the Emirates Airlines to remain at the top of the Arab internet market and to get a competitive advantage, the company should provide online services. There is an increasing rate of internet usage in the world and the UAE internet accounts would likely grow to more than one million. New technologies could have both negative and positive impacts on the airline industry. For instance, e-booking technology makes reservations efficient and eliminates such expenses as printing of tickets. Conferencing technology has reduced the number of customers and business travelers led by a reduction in face-to-face business connections.

Proposed suggestions to improving quality service delivery

There is a serious competition between firms as the airline is in a mature stage. Each firm, aside from analyzing internal and external factors affecting its position, also employs offensive strategies. Emirates Airlines Company should consider the following proposals.

As the costs of operations increase due to high investments by the company in Emirates aircraft and services, investments and the increase in fuel prices, the company should reduce costs by making improvements in its operations. It should maintain high utilization of its aircrafts and become effective in its flight scheduling. Costs could also be brought down by investing the technology in channels of distribution to reduce the cost of labor. Installing self-service kiosks in Emirates Airline destination is also recommended (Oleson, Hagan & Demoss, 2009).

The company should not lower its fares in response to low cost airlines threats, but instead should offer new low cost brand as subsidiary group-serving customers of low cost airlines. This will help in expanding the market share of the company. In an effort to improve services to its customers, the company should carry out an investigation of technology by signing an e-business contract that offers technology solutions to airlines.  Since the number of internet users is increasing, the company should come up with an E-CRM strategy as its new technology.

The industry should expand its routes on a global scale since there are key routes in the world that the company has not explored such as Canada. This can be useful, since tourism is growing in the UAE. In solving the problem of rising low cost airlines, the company should become a global airline in order to increase destinations hence providing options to its customers (Schneider, 2004).

In conclusion, the company should analyze both external and internal factors and competitors, and come up with new strategies in order to stay competitive. The company can also foster its performance by creating and sustaining a successful service suggestion program. Having this culture requires a good and constant flow of ideas in order to improve and sustain a better external and internal service.

The best practices that could lead to effective suggestion programs could be setting up categories for employees to think with greater focus; having bright ideas for services; and, improving customer service, bringing back lost customers, and boosting sales. The company is also supposed to employ better ways of making it easy for employees to submit their suggestions. For example, setting up a blog with examples of preferred suggestions or publicizing a telephone number. In encouraging its employees to have a better contribution of ideas, the company should quickly respond to the ideas proposed. Having an appealing name to the suggestion program can be a reasonable step for the company in encouraging its employees to participate in giving their suggestions.

Good ideas lead to more and better ones. The company should receive and publicize the ideas they get from their employees and give responses, since every response could lead to new solutions. This can help in boosting efforts of creating a change in the organization. Nothing will ever make employees or customers feel greater than seeing that their own efforts come to life by implementing those great suggestions. In doing so, the company will ensure continued support for its organizational culture change that is aimed towards its services. The company should also reward its suppliers and customers along with its employees and encouraging them to participate in the program. In order to inspire a strong organizational culture change, managers should be examples of acceptable and quality services at a time of change. A good service leader is one who gets to the frontline to serve where he or she can, especially when the staff is overloaded.