Why Emirate Airline is Successful (Research Paper Sample)

Emirates Airlines Name: Institutional Affiliation: Emirates Airlines Question 1: Analyzing why Emirate Airlines is successful The competitive advantage enjoyed by Emirate Airlines in the aviation industry is attributable to its business model, its partnership with the government, technological adaptability, and its ability to differentiate its products from those of its competitors. Unlike other companies that focus on the transatlantic bases model, the airline adopted the multipolar model to take advantage of the opportunities that defined the emerging and underserved markets rather than restricting itself to Dubai with the aim of investing in them (Alcacer &Clayton, 2013). Serving the underserved markets such as Pakistan, Sri Lanka, and Colombo gave the company the chance to lock these markets and take advantage of their subsequent growth. Dubai’s government has also played a significant role in enhancing the success of Emirates Airline. For instance, the government has channeled adequate resources to enhance the development of the Dubai tourism base while at the same time establishing it as both a logistics and travel hub (Alcacer &Clayton, 2013). The government has also made strategic investments in high-profile projects and critical infrastructure to enhance the smooth operation of the company (Alcacer &Clayton, 2013). The government is also working in collaboration with the hospitality industry with the sole purpose of creating a powerful pull of leisure and business tourists. Also crucial is that the Dubai government has attracted an influx of tourists to Dubai city by removing a majority of requirements for individuals seeking a visa in addition to supporting a wide range of marketing campaigns. The government’s efforts in 2012 resulted in a total of $ 10.4 billion receipts being purchased by tourists, and the Emirates airline was used by visitors to arrive and depart from the country (Alcacer &Clayton, 2013). The Investment Corporation of Dubai (ICD), which is a government’s holding company and the Emirates Group sole shareholder, has improved the cooperation between the Emirates Airline, the Airport, and the City to enhance the company access to emerging destinations (Alcacer &Clayton, 2013). The partnership has led to both the company and the government investing in new terminals to cater for the rapid growth of the company. The bilateral Air Service Agreements governs the global aviation as agreed by the nation states in the 1944 Chicago Convention. Even though some nations including the Netherlands, the US, and the UAE exhibit open skies treaties with other countries to allow foreign careers free entry to their markets, a significant number of nations still regulate the degree of their market access by foreign carriers. However, this was not the case with the Emirates Airline because it gained support from the UAE in its endeavor to access new markets. The UAE government negotiated with the foreign nations, especially those that the Airline aimed to expand, to enhance its access of the new markets (Alcacer &Clayton, 2013). Emirates Airline also differentiates itself from other competitors in the market by offering premium experience in terms of the services offered (Alcacer &Clayton, 2013). Such a strategy allows the company to enhance its value and build customer loyalty. For this reason, the company avoids direct rivalry with low-cost carriers in the industry. Some of the notable premium experience offered by the company includes modern facilities, duty-free retail shopping, and lounges for first-class and business customers. The loungers promote access to a wide range of services including luxury spas, full-service walk-up bar, and luxury layouts (Alcacer &Clayton, 2013). The company utilizes the available technology in the market to design its customer relation management tool known as “Paradise” to further enhance the experience of its target market (Alcacer &Clayton, 2013). Cabin crew members make use of the tool to note the tastes and preferences of frequent fliers so that the company can individualize their experience. Question 2: Discussing the Role of Dubai in Emirates Airlines Success using the Location Strategy Framework The success and the financial health of any company greatly depend on its location. Therefore, choosing a wrong location exhibits detrimental impact on the operations of a company due to lack of access to adequate materials, competent human resources, transportation network and customers (Owen & Daskin, 1998). Accordingly, organizations often utilize the location strategy framework to identify strategic locations, especially those that are in line with their objectives and needs in addition to enhancing their competitive advantage in their respective industries. Arguably, in choosing a location, companies are always in pursuit of settings that will not only minimize their risks and operational costs but also maximize their opportunity. They also consider other factors such as required assistance from the government, infrastructure requirements, regulatory concerns, market factors, competitive factors, facility requirements, and recruit-ability (Alcácer et al., 2017). Labor requirements and the proximity of the location to key clients or partners are crucial elements (Alcácer et al., 2017). Emirate Airline chose Dubai as its strategic location because it was compatible with its corporate strategy. Role of Dubai in the Success of Emirate Airlines Dubai is a hub city that is strategically positioned on the Arabian Peninsula. Therefore, it acts as a global transit route connecting various locations including Africa, Asia, Oceania, and Europe. In addition, it has minimal aviation traffic due to its relative distance from the European airspace that is already congested (Alcacer &Clayton, 2013). This makes it easier for the company to operate its flight on a 24-hour-basis. The city’s excellent weather conditions, even though with occasional heat and fogs, ensures that there is no interruption in airport operations due to snow storms and rain, which are factors that often contribute to delays in the American and European airspaces (Alcacer &Clayton, 2013). The location is also strategically placed to its key customers. The case study points out that about 40% of Emirates key customers terminates or originates their flights in this destination (Alcacer &Clayton, 2013). The government is also playing a crucial role in supporting tourism activities in Dubai. For instance, the government is making strategic investments in critical projects and infrastructure with the aim of making Dubai a logistics and travel hub. The government has also made it easier for tourist to access Dubai by removing a significant number of visa requirements along with supporting market campaigns that promote Dubai as a perfect tourist destination. Therefore, it is undeniable that Emirates Airlines gains from the status of Dubai as a transit hub. The city on long haul routes connects East and the West with passengers making stops at Dubai. The city’s image is also mirrored in the airline operations leading to a powerful brand image. Question 3: A SWOT Analysis of Emirates’ Dubai-based hub-and-spoke Model The configuration network of many airlines has been greatly affected due to the deregulation of the aviation market (Cento, 2009). Such a move has forced many carriers to have their network structures reorganized into hub-and-spoke system from point-to-point system. The hub-and-spoke system synchronizes flights and requires airline companies to maintain distinct types of aircrafts to meet the needs of different routes (Cento, 2009). This makes hub-and-spoke model to be quite expensive compared to point-to-point system which is easily structured. Accordingly, airline companies are attempting to identify market structures that reduce their operating costs by creating alliances (Cento, 2009). The partnerships try to connect their route networks to enhance their global connectivity (Cento, 2009). The following is a detailed SWOT analysis of the Emirates’ Dubai-based hub-and-spoke model. Strengths -Dubai government as its enthusiastic partner- The airline in conjunction with the government work closely together to improve the cooperation between the airline, the airport, and Dubai city - Adequate financing: The coordination between the government and the airline has resulted in the channeling of adequate resources to construct new terminals to reflect the company’s rapid growth. -High volume of transit customers: There is an increase in the number of passengers deplaning from points west and boarding east-bound flights which has increased the airline growth in new markets., Weaknesses -Difficulties in constructing flight scheduling and flight mix because of its complicated and dynamic nature -Limited number of runways coupled with tight scheduling can result in delays lasting for a couple of hours due to the addition of flights to Japan, China, and Africa. - Opportunities -Increase in opportunities in the underserved markets: These markets have large clientele base with minimal flying options and the model can help the airline lock these markets and take advantage of the expected growth. -Declining dominance of legacy European carriers: Emirate airlines can make use of its strategic location to increase its market share and service offerings on the main routes that were operated by the European carriers, as well as, take advantage of increase in passenger traffic in Africa and Asia. Threats -Fluctuating fuel prices which might cause the company to close down ...