Purpose of the Project
Operations management is the field of management that is about supervising and controlling the designing and production processes in order to attain maximum efficiency in production of good and service offerings. In the service organization, it is very important to manage all the operations effectively, specifically in the case of an airline company (Noorderhaven, Koen, and Sorge, 2015). Qantas is not different from other airline companies while mentioning about the operation management. This organization is making different efforts to manage and control its processes. The below report is focused on discussion different aspects of operations management in context of Qantas. It describes the current performance of this airline’s business. It includes business layout, location and information flow system at Qantas airlines. Moreover, there is the discussion about the supply chain strategy and different quality aspects of chosen service company. At the end, some suggestions are provided for managing the operational aspects of Qantas Airline. These recommendations can be used by this organization to maintain service quality standards and provide satisfactory services.
Qantas Airways is the largest airline by fleet size, international destinations and international flights. It is a flag carrier of Australia and it is popular as 3rd oldest airline all over the world after Avianca and KLM. It is founded in the year 1920 and it started international flights in May 1935. Since its establishment in 1920, the company has given significant efforts to be the largest airline in the world and these efforts have resulted into brand image of becoming the strongest brand of Australian airline industry. It has been popular and successful in instituting itself as safer airline of the country via attaining operational effectiveness (Qantas, 2018). In order to enhance its operational efficiency, the company is adopting excellence in maintenance and engineering.
The major service operations of Qantas are the airline business that includes offering travelling services to the travellers who are flying from one place to another. It operates its business under two different brand names i.e. Jetstar and Qantas and it runs across Australia and foreign countries as well. About Qantas, it can be stated that it is a successful brand in Australian airline sector. This is based in Sydney suburb of Mascot with its primary hub at Sydney Airport. There are many subsidiary airlines which run to regional centers and on different trunk ways sin Australia under QantasLink brand name. One of its subsidiaries i.e. Jetconnect offers airline services between New Zealand and Australia and it is flying under Qantas brand (Qantas, 2018). Moreover, this company owns Jetstar airline that is popular as low-cost airline which provides both domestic services within New Zealand and Australia and international services from Australia (Qantas Airlines, 2018). This brand has a huge contribution to the overall growth and success of Qantas on international level.
By analyzing its financials, it can be stated that performance of existing business operations is very good. It can be said that it is leading both Australian and world airline industry. With the assistance of its hard efforts and innovative techniques, Qantas is able to possess 65 percent share in local market. Currently, its flights carry approximately 14.9% of total passengers who travel both outside and inside Australia. It manages a combined fleet of Boeing aircraft and Airbus. Qantas is a single airline all over the world that owns a fleet that is made up by Boeing 747s in the year 1980. In 2008, it was changed with Airbus 380. This company has attained huge growth in terms of financials with the passage of time. It can be noted that this company will improve its capacity by 1.5% to 2% in Coming June month (Qantas Group, 2018).
Overview of Qantas Airways
In the year 2017, the company is able to generate the revenues of $16.1 billion. With the help of significant revenues and profits, it flies to around 40 nations with over 850 international flights every week. The operations of Qantas are not practiced on the basis of commercial decisions so it should consider the industry and regulatory frameworks. Still, aviation is one of the highly regulated sectors all over the world. It indicates that the performance of Qantas’s existing operations and processes is very good that assists it to gain competitive advantage against competitors like United Airlines, Air India, British Airways, Emirates and Air New Zealand etc.
In the area of operations management, there are some specific strategies such as layout strategy, location and information flow. These strategies assist an organization in managing the operations and increasing customer base. As Qantas is operating its business as one of the most popular airlines all over the world so it has managed its layout, location and information flow effectively (Albers, et al, 2017).
Business layout of an organization is a vital component of overall operations of a business in the terms of fulfilling the requirements of employees and maximizing the production effectiveness. Companies develop layout for ensuring the smoother work flow, information and material in an operation system. In order to develop efficient operations of an airline company, it is important to develop effective layout. At Qantas Airline, facilities and layout are important in attaining effective utilization of equipment and workers. Top management of Qantas has various options to select from it comes to design their facility layouts. In the context of this company, the layout can be defined in context of design of flights. In this, the company has used different types of layouts like business class, first class, economy class and premium economy class. First class is provided on one Boeing 747-400 and all 12 Airbus A380s. This layout offers 14 separate suites in 1-1-1 layout. Moreover, business class is provided on all the Qantas core passenger aircraft. It is available on Boeing 787, Boeing 747, the A330-300 and Airbus A380. Economy class is also available on mainline aircraft of Qantas. In this, layouts are 3-3 on 737 and 2-4-2 on A330. In between cabins, there are 4 self-service snack bars (Qantas Group, 2018). This is one of the most significant parts of Qantas’s operations strategy as its seat capacity and facilities attract more passengers.
Moreover, location is another operations strategy that enables most of the Australian and world population to approach and use the airline services of Qantas. Under this strategy, the major objective of Qantas is to establish in different locations for maximum market reach. This is one of the biggest airlines that serve foreign destinations and so it has a great presence. It has established various avenues for ticketing facilities. Its tickets are available at owned outlets of Qantas where its agents assist the passengers to select best and affordable flights and offers. Additionally, its bookings can be made on internet through different portals. This location strategy of company enables it to provide services on less maintenance cost and more approach to the targeted markets (Lewis and Slack, 2014). The head office of Qantas is located in Sydney; however it has universal brand presence in all the nations and prime cities.
Performance of Existing Business Operations
In addition to above processes and operations, Qantas Airline has created an information flow process that includes different steps. In its operations, the information flows effectively so that they can provide their travelling services to customers (Robson, 2015). The below-given diagram includes the information flow at Qantas Airline:
(Source: Zhou, et al, 2014)
The above diagram shows that there are different departments which flow the information from one to another. These departments are such as ticket booking, airline crew, check-in desk and catering department. The process starts with the passengers when they book the tickets of Qantas flights. It helps the organization to exchange the information with each other. It allows Qantas to provide airline services effectively so that they can satisfy their needs and expectations towards flight services (Francis, Humphreys and Aicken, 2017).
Supply chain strategy is a vital component of operation management process that includes the movement of products and services from the suppliers and distributors. Qantas is creating and implementing effective supply chain strategy which helps the company to avail the raw materials from suppliers and provide services to passengers. Like other airlines, Qantas has a supply chain system that is dependent on various economic drivers like international travel to Australia, domestic tourist visitor nights, household income, aircraft kilometers flown, price of crude oil and consumer sentiment level (Jacobs, Chase and Lummus, 2014). The major supplier industries of Qantas are catering services, airport repair and manufacturing services, petroleum product, air transport company etc. Moreover, demand sectors are like Rail, mining, Finance, Postal, Sea and Air forwarding and courier services. It consists of all the combined activities and processes that bring the services to market and make satisfied customers.
This company has divided its supply chain strategy in two categories i.e. inbound supply chain and outbound supply chain. At Qantas, inbound supply chain includes passenger service system, route selection, fuel, yield management system, crew scheduling, flight scheduling system and facilities planning (Bazargan, 2016). These processes are performed at this airline company before the travellers shift to the middle operations phase. Moreover, outbound supply chain consists of flight connections, baggage system, hotel reservation and rental car system.
In its inbound supply chain, Qantas has worked in different and effective ways:
- It has its website that provides the facility to passengers to book their flight tickets and other services.
- Fuel is one of the most required raw materials that work as biggest economic driver in Qantas supply chain process. Ticket prices are decided on the basis of fuel prices that impacts the customer demand (Qantas Airlines, 2018).
- This organization is using Amadeus Software system to maintain the crew and flight scheduling.
- It gives its passengers different options to make payment like credit cards, debit cards, BPAY, POli Payment.
- Primarily, if the people are not sure of their exact day of travel, they can book their seats by paying a token amount of $25 for local flights. Other companies do not provide this facility (Cook and Billig, 2017).
In this way, Qantas is managing its service offering operations by using effective supply chain strategy.
In order to retain existing customers and to create new ones, it is very important for an organization to follow quality management aspects. In the case of Qantas, the major components of quality management are management commitment, customer satisfaction, process improvement, sustainable enhancement and employee participation. The company proposes to maximize the service quality within different constraints like price limits and costs. Different aspects of quality are stated below:
At Qantas, quality control is utilized by looking at and supervising all the parts of plane after flights. For example, this airline conducts quality inspections for their plan if they get information about the plans in other fleets globally and resolve the issues. Under this, the company also maintains the food standards and improving the services when needed to stay competitive among other players (Qantas Airlines, 2018).
Operations Management Strategies
Qantas Airline conducts various operational tests to ensure the safety of materials used in its flights. It is done by testing a sample of products to forecast the liability of others. This company has already passed the International Air Transport Association, IOSA Registration and Operational Safety Audit (Wu, 2016).
As a form of quality improvements, Qantas uses external catering and food businesses to offer food and beverages to the passengers in flights. They have started to replace the in-flight screen that only shows TV and limited shows and movies. It has saved very much space and reduced the financial investment in this area. This amount can be invested in quality improvement areas. Additionally, it continuously purchases new planes like currently Boeing 787 Dreamliner is launched to Qantas fleets.
In this way, Qantas Airlines is managing the quality of its operations by using different procedures and techniques which enable it to retain the passengers for longer time (Zhou, et al, 2014).
The above report shows that Qantas is very much focused on managing its operations and processes. It is using different operational strategies so that they can provide their services smoothly. Apart from above aspects, there are some suggested alternatives, which are stated below:
Value stream mapping is a technique that assists to see and know about the flow of information and material as a product makes its way via a value stream. The chosen company i.e. Qantas Airways can utilize this technique to use its workforce and resources in more effective way. It can support the organization to enhance its supply chain and logistics process (Bromiley and Rau, 2016).
Moreover, it can be suggested that this company can enhance the employee participation so that they can assist the company in effective and smoother flow of operations. There should be an efficient information flow through which top managers can take the feedback of employees related to its airline services (Sarina and Wright, 2015). There should be improvement in the internal communication process. In order to increase employee participation, Qantas can offer some incentives and monetary benefits to its employees.
It is one of the best ways to enhance the operations of Qantas Airlines. This company has many aircraft maintenance facilities all over Australia and in foreign nations. It is affecting the quality of its services. So, it should enhance its aircraft holding capacity at maintenance centers in Australia (Kleymann and Seristö, 2017). Australian staff will give it more trusted and certified services than outsourced services.
By using above suggested aspects, Qantas can manage and control its processes and operations more effectively.
In the above paragraph, the newly suggested aspects are such as value streaming technique, employee participation and stop using outsourced services. After their implementation, the company can use various practices and strategies which can help it to improve its overall operations. In order to increase the employee participation, the organization should conduct training and development programs so that they can provide the services effectively. Moreover, it should provide more authority to the staff so that they can participate in decision making process. As stated above, employee engagement is very important for better performance of Qantas operations. In service industry, it plays a vital role so Qantas needs to make more focus on it. If the company cannot eliminate outsourcing from its operations then it should outsource the aircraft maintenance from cheaper countries like Singapore. It will reduce the operational costs of the company (Shaw, 2016). By using value stream mapping, the company will be able to reduce the wastage from its supply chain and service delivery process. These improvements in existing operations will help Qantas Airways to upgrade its processes and operations.
Conclusion
In the limelight of above discussion, it can be stated that as a service organization, Qantas Airline is successfully managing its operations so that it can meet effective service encounter. The company is using different operation management techniques. The above report includes layout and location strategies used by this company. Quality of operations is managed by focusing on different aspects like quality control, quality assurance and quality improvement. There are some suggestions which are provided for enhancing the operations and processes of Qantas Airlines.
References
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