PROJECT ON: SINGAPORE AIRLINES Introduction: Singapore Airlines Limited (Singapore Airlines) is a Singapore based airline company, engaged in providing airline operations, airport terminal services and engineering services. It provides both passenger as well as cargo and mail air transportation services to its customers worldwide. The company operates its business through three reportable segments, namely, airline operations, airport terminal and food operations, and engineering services.
Some of the major subsidiaries of the company include Singapore Airport Terminal Services Limited (SATS), Singapore Airlines Cargo Pvt Limited, SIA Engineering Company Limited, and Silk Air (Singapore) Private Limited. As on 31, March 2009, the company had a fleet of 175 aircraft, of which 111 were in service and the rest were awaiting delivery to customer airlines. In fiscal 2008-09, Singapore Airlines operated 103 aircraft with an average age of 74 months. It carried more than 18,293 passengers in 2009 to nearly 66 destinations across the globe. It operates in East Asia, Europe, South-West Pacific, America, West Asia and Africa.
The company is headquartered in Singapore. [pic] We have chosen the Singapore airline in Asian context, “Singapore Airlines has evolved into one of the most respected travel brands around the world. They have one of the world’s youngest fleet in the air, a network spanning five continents, and the Singapore girl as their symbol of quality customer care and service”. SHORT TERM AND LONG TERM GOALS: An organization’s current customs, transitions and general way of doing things are largely due to what it has done before and the degree of success it has had with those endeavors.
The short term and long term plans of an organization is usually reflected by the vision or mission of the organization’s founder. SIA Engineering Company is engaged in providing aviation-engineering services of the highest quality, at competitive prices for customers and a profit to the Company. Singapore Airlines has a responsibility not only to be an excellent company, but also to be an excellent citizen of the world by enhancing the lives of the people we touch.
With that aim in mind, we have made many commitments to the arts and education, to our communities, and the health and welfare of our country’s citizens, and those in countries we fly to. With this goal in mind, we’ve also made a strong commitment to preserving the environment – and our world for future generations. Organizational structure: An organizational structure consists of activities such as task allocation, coordination and supervision, which is directed towards the achievement of organizational aims, can also be considered as the viewing glass or perspective through which individuals see their organization and its environment.
An organization can be structured in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as the branch, department, workgroup and individual. Singapore airlines have a board of directors. Mr. Choon Phong Goh is the CEO of the company. There is a chairman of the board of directors, Ching Yen Lee.
Executive vice president of human resource and planning, executive vice-president of marketing and regions, executive vice president of operations and services, president and chief engineering officer of SIA engineering company ltd and senior vice president of Finance are under the supervision of Ching Yen Lee. The Cabin crew, Engineering, Flight Operations, Human resources and the Americas is under the Marketing and regions department. The South West pacific division, West Asia and Africa division, Europe division, North Asia, South Asia and the Airport Terminal Services are under the operations and services department.
Operations and planning, Commercial Technology, Corporate Services and Product & Services are under the Engineering department of Singapore Airlines Company. Modern organizations like the Singapore Airlines Group need a structure that enables people to work and deal with one another in a coordinated and co-operative way as they work towards the goals of the business. In order to provide the type of service that customers want, airlines need to be flexible. They must allow employees scope to make decisions that take into account changing circumstances in a variety of environments.
It is mainly for this reason that Singapore Airlines gives considerable autonomy to each part of the organization. Decentralizing a business: There are many issues associated with decentralizing a business that the Singapore airlines follow. These include: •Maintaining lines of communication The structure of Singapore Airlines continues to provide information for employees so that, even though they work for just one unit, they know how other parts of the enterprise are working to serve the customer. •Staff motivation The structure provides job satisfaction and is capable of motivating all employees, whatever their job is. Achieving Goals Employees of Singapore Airlines know the goals set for them. •Thinking globally whilst acting locally Employees of Singapore Airlines respond positively to local needs whilst remaining conscious of the global nature and standard requirements of the Group’s activity. In developing its organizational structure, Singapore Airlines has put these considerations at the forefront of it’s thinking, placing an emphasis on empowering individuals to make decisions. This enables employees to make decisions that allow them to respond to changing conditions more effectively.
The organizational structure of a company shows the relationships and relative ranks of its parts and positions/jobs. It shows the managers and sub-workers who make up an organization. As a global business with operations in more than 80 countries, Singapore Airlines has also divided up the overseas business by geographical area. For each region, it has created a senior vice president with authority for that region. Being organized geographically makes Singapore Airlines easier to: •Respond quickly to local issues and problems •Build up knowledge of specific markets Tailor its strategies to local conditions, laws and customs. Within this structure, general managers for each country have the independence to make their own decisions, allowing the organization to respond more quickly and appropriately to market conditions. Singapore Airlines have a flat structure, i. e. an organizational structure that provides a wide span of control within only a few layers of organizational hierarchy. There are few levels of authority within the hierarchy. By creating a flatter organizational structure, it was possible to push autonomy downwards.
This creates a more dynamic and flexible business that empowers people to make decisions in response to customer needs and to changes in the business environment. This in turn leads to job enrichment; all jobs at all levels are made worthwhile and more satisfying. A key problem that can result from organizing by function is that people become compartmentalized. They come to know one part of the business well, but have no experience of the business as a whole. This may limit not only their understanding of it but also their empathy towards it.
To avoid this, Singapore Airlines has a policy of moving key staff around, using a process of job rotation. This process has provided managers with cross-functional expertise and a better knowledge of the business as a whole. [pic] Organizational culture: Organizational culture is a system of shared meaning and beliefs held by organizational members that determines, in large degree, how employees act. In every organization, there are values, symbols, rituals, myths and practices that have evolved over time. These shared values and experiences determine, in large degree, what employees perceive and how they respond to their world.
The purpose of the culture is to understand how organizations function and gives meaning to the organizations way of doing things. Culture helps to foster internal integration, bring employees from all levels of the organization much closer together, increases moral, and enhances their performance. Just as personality shapes an individual, organizational culture shapes its members and defines what the organization is willing to do. The goal of the organization should not only emphasize on being profitable but also to ensure that its members are working in a healthy organizational culture. [pic]
There are seven dimensions that capture the essence of an organization. Singapore airlines focus mainly on people orientation. Core values of Singapore Airlines Pursuit of Excellence: Singapore Airlines strive for the highest professional standards in our work and aim to be the best in everything we do. Safety: Singapore Airlines regard safety as an essential part of all our operations. They maintain their equipment and adopt practices that promote the safety of their customers and staff. Customer First: Their customers are foremost in their minds all the time. They go the extra mile to exceed their expectations.
Concern for Staff: They value their staff and care for their well-being. They treat them with respect and dignity and seek to provide the staff with appropriate training and development so that they can lead fulfilling careers. Integrity: They strive for fairness in all their business and working relationships. Teamwork: Singapore Airlines work with pride as a worldwide team to achieve success together. Constantly staying at the leading edge of aircraft technology, their people are distinguished by a continuous strive for excellence and a high adaptability to changes. Singapore airlines have a strong culture.
Here the staff responds to stimulus because of their alignment to organizational values. Singapore Airlines has a Group magazine ‘Outlook’ that helps to bring all employees together by providing information upon a range of common issues, including promotions and service anniversaries. Wherever they work, every employee within the Group is united in a number of other ways, through the Singapore Airlines song, through wearing similar, but defining, uniforms and through sharing a common business culture, philosophy and goals. There is profit sharing, through bonuses and share options.
This gives staff a further incentive to ensure that the business as a whole is profitable. SWOT Analysis: Strengths • Singapore Airlines is eminent worldwide for its excellent service quality, unmatched environment, clean and sanitized food and unparalleled security. • It is a well renowned brand name in tourism and industry. • Singapore Airlines stands as the sturdy airlines of Asia and is influential from the very beginning. It lies as the chief brand name in comparison to other aspirant and recognized brands. It is matchless in its dedicated leader ship, legitimate quality, paramount technology and brand strategy (Leong, 2007). One of the very striking figures of Singapore Airlines is its attractive Singapore girl. The Singapore girl strategy has really worked out and has become a victorious brand icon with a fabled status and aura around her. These girls are quite known for their generosity and Asian values like compassion, affection, kindness, gracefulness and tranquility (Matthew, (2007). • Singapore Airlines is inimitable in providing lavish and entertaining flight full of luxurious like open non-alcoholic and alcoholic beverages, sizzling meals, warm perfumed towels, personal pursuits, video on demand and many more. It is the “world’s most admired airline” and is also ranked as 5 star airline by SKYTRAX in addition to this it has also won many other awards. • As far as its technology is concerned it maintains the youngest fleet of all foremost airways because of its stern policy of replacing older aircrafts for latest, improved models but stood first in the delivery of latest aircrafts like Boeing 777, Boeing 747 jumbo jets etc. • It stood first to soar Airbus Super jumbo A-380 IN 2006 and is also known for its sub-branded aircrafts like 777 jubilee and 747 mega top. It flies to sixty one destinations in thirty five countries including two longest non- stop commercial flights from Singapore to New York and Los Angeles. • It has diversified in related industry and sectors comprised of thirty two subsidiaries and two joint ventures. Weaknesses • It is too expensive to travel that middle class people can just dream of traveling via Singapore airlines. • As it is well renowned in the world for its first class services and sky touching fares customers naturally develop a very high expectation level and therefore very minor fault could blemish its reputation easily. Few customers report boorish attitude of air stewards and stewardesses. • Huge decline in the financial performance in year 2010 as compared to year 2010. • The relation between labor union and management has been not good at times due to cut in wages and downsizing in bad economic conditions. Opportunities • Singapore airlines offer the most inclusive and meticulous training programs for its cabin and flight crew to ensure brand experience and aptness. “Innovation” is an important trait of Singapore Airlines and it believes that it is a short lived character which lives before any other Airline adopt it, after some other Airline adopt it, it no more remains innovative. Therefore it keeps on introducing novel features and considers innovation as an integral part of its strategy, this differentiate it from other Airways and will lead it on the road to success. • It has vigilantly developed a financial plus rigid cost in order to support their brand name to overcome the competition on costs. . • It can increase revenue by increasing the total number of destinations and fleet size.
Threats • Due to immensity of its amenities and superb cabin service, Singapore airlines invite ahead of competitors whose number is increasing step by step. Some of its brawny challengers are Northwest, United and Japan Airlines (Heraclius, 2006). • Rapid growth of low cost airways in the recent past is a major shakeout for expensive, premium airlines. Singapore airlines should also go for low cost flights to remain first in the competition but not on the compensation of its innovative, luxurious brand name as it could affect its repute. • Increasing price of oil may result in high cost per passenger. Threat of security will always remain with the airlines industry after the incident of 9/11. The Singapore airlines have to always keep the security factor in mind because it was hijacked back in 1991. • High use of technology such as video conferencing for meetings reduces the frequency of visits of business officials for meetings Pest (Political, Economical, Social & Technological): A PEST analysis is an analysis of the external macro-environment that affects a number of vital variables that are likely to influence the organization’s supply and demand levels and its costs.
P. E. S. T. is an acronym for the Political, Economic, Social, and Technological factors of the external macro-environment. Such external factors usually are beyond the firm’s control and sometimes present themselves as threats. For this reason, some say that “pest” is an appropriate term for these factors. The use PEST analysis can be seen effective for business and strategic planning, marketing planning, business and product development and research reports. Let us look at the PEST analysis of the Singapore Airlines:
Political: Political issue refers to government policy such as the degree of intervention in the economy, what goods and services do a government want to provide and to what extent does it believe in finance firms. Such as Singapore airlines has withdrawn its bid for a stake in Air India, dealing a heavy blow to the Indian government’s privatization programmed. This is a political barrier for Singapore Airlines. Again, the politics has become more stable among countries around the world. This gives Airline industry a chance to enter into a new market and secures Airline business.
However, this will increase considerably the competition that the monopoly will lose the benefit, for example, Singapore Airlines (SIA) can no longer be a sole airline in Singapore. Economical: Economical issues include interest rates, taxation changes, economic growth, inflation and exchange rates. The Singapore Airlines offer to buy a 24 percent stake in China Eastern Airlines for 7. 2 billion Hong Kong dollars (USS 923. 8 million) that appeared in trouble after a major shareholder criticized the deal as unfair.
In the recent years, there has been an economic fluctuation and increased oil price around the world. The airlines have faced the difficulty to predict the demand and cost. This pressures Singapore Airlines industry to become more intense. Social: The customers have become more sophisticated and demanded high value from airlines as they have many airline choices. This forces airlines to be aware of providing the best service at reasonable price. Additionally, there is an increasing trend of traveling and doing business abroad. This is a good sign for airline industry.
Technological: Technology, in recent years, has significantly improved and been continuously launched to the market. Airlines have to carefully choose the technology in order to create competitive advantage. Singapore Airlines is the first and only airline to install a productivity suite for the benefit of its passengers who can now continue to work after boarding the plane without having to power up their laptops. In addition they provide the world’s widest first and Business Class seats and a technologically advanced seat in Economy Class, which makes the competitive advantage for Singapore Airlines.
FINANCIAL TOUCH: [pic][pic][pic] Major Competitors: The major competitors of Singapore Airlines are Cathey Pacific Airways, Japan Airlines Corporation and Japan Airlines. Singapore airline has to concern about the competitors because airline industry is very competitive. This has already started with two national carriers, Air Canada and Garuda of Indonesia, seeking to curb Singapore Airline’s access to their home markets. Growth of global megacarriers, as U. S. and European airlines merge or form alliances to cut costs, will also intensify competition for Singapore Airlines.
They may have been the first off the blocks with the Airbus A380s a year ago, but these days, Singapore Airlines are facing some rather formidable opponents. Both Emirates and Qantas have recently also taken delivery of their first few A380s, and offer some fairly attractive features as well, especially in their business- and first-class cabins. However, Singapore Airlines are still confident that they have a lead over their competitors. After all, they now have six of the giant airplanes to themselves for over a year, while Qantas have only just got their hands on the supersized machines.
On top of that, the ‘roo-emblazoned carrier’s A380 services have only just started in October, with a route that takes them between Melbourne and Los Angeles. SIA is likely to start feeling the heat only in January, when Qantas start flying their A380s between Sydney and London via Singapore. [pic][pic][pic] Singapore Airlines Strategy: Singapore Airlines is one of the strongest brands in Asia. SIA is known as one of Airlines Company which has an excellent service to its passengers. In order to serve its passengers, SIA was intensifying to its service quality improvements. Singapore Girl wearing sarong kebaya as an icon of Singapore Airlines.
SIA did not compete on price but they preferred non price competition such as better service, more destinations, more frequent schedules and newer fleets. However price became a more important feature. With the existence of other competitors which have adopted low price strategy, then it became a threat to SIA. But in fact, against the competitors, in 2000 SIA has achieved remarkable profit. With its own strategy, Singapore Airlines has consistently been one of the most profitable airlines globally, and has always had the reputation of a trendsetter and industry challenger. To adept their strategy, basically it needs a relatively high cost.
Each brand benefit requires significant investment, careful management and detailed implementation programs to live up to the brand promise. Singapore Airlines Strategy has carefully built a financial and fixed cost infrastructure which allows them to continue investing to support the brand while challenging the competition on costs. A. Excellent Services SIA has planned to improve the three pillars that provide quality experience to the customers: PRE FLIGHT – IN FLIGHT – POST FLIGHT. The excellent service is to build an image or to build brand name the customer that SIA is the best brand in airlines industry.
Outstanding Service on the ground: They have an outstanding service on the ground, means it focusing on improving service at reservation, ticket offices and most importantly at each airport SIA flew to. Making positive customers’ perception of ground service is very important. Their commitment in service on the ground has been implemented already. For instance, since 2000 SIA use Abacus a computer reservation program with extended array of services including airline and hotel, reservation, ground arrangements and regional travel news.
Each airport unit was given standards in terms of punctuality, baggage handling, speed and friendliness of check-in, efficiency of seat assignment, number of compliments from customers and professionalism in handling delays. In Flight Service: Singapore Airline’s service in flight is no doubt one of the best services in airline industry. Singapore Girl wearing sarong kebaya as an icon of Singapore Airlines, as symbol of Asian charm, grace and hospitality. It combined the charm of traditional Asian wear with elegance of French haute couture.
Passengers are treated to excellent food, served with lots of smiles, warm towels, and attention to details. The airline provides all passengers, regardless of class, with cocktails, fine wines, and in-flight movies at no extra charge. In fact, SIA pioneered all these “frills”. SIA also use “the most modern fleet”, with a lot of facility to satisfy the passengers such as TV screens, video entertainment, and satellite–linked air to ground telephone service. With these all service, the passengers feel an amazing experience in flight with Singapore Airlines. B. Advanced Technology and Innovation Capabilities
SIA had a strong reputation for in-flight firsts. For example: the first airplane that uses sky telephone, the first that introduces personal entertainment system and video-on-demand. Introduce the suite (class beyond first (2007)). First airlines operate Boeing B777 and A380 air fleet etc. Singapore Airlines recognizes that each innovation has a relatively short life span. Once other airlines adopt it, it is no longer considered “innovative”. Therefore, the airline continues to invest heavily in R, innovation and technology as an integrated part of the business strategy to further differentiate itself.
On the technology side, Singapore Airlines still maintains the youngest fleet of aircraft amongst all major air carriers, and keeps to the stringent policy of replacing older aircrafts for newer, better models. The use of new technology, include the modern air fleet, because it can reduce the operations cost and maintenance cost of the fleet, it more efficient. In long term this will deliver remarkable thrift for performance finance of SIA. C. Human Resource Management The airline industry is a service industry.
Service is provided by people; hence the basis for differentiation in the airline industry is the way the company’s employees treat customers. Behind the excellent service, human resource management processes, a crucial aspect of any service business, where people, especially front-line staff, are a core part of the offering and the most visible element of the service. They manage their human resource with stringent selection and hiring of people, extensive training and retraining, formation of successful service delivery teams, empowerment of the front line, and staff motivation. D. Communicating the Message
Singapore Airlines has been as consistent in its communication vehicles as in its brand strategy. The primary message “Singapore Airlines – A Great Way to Fly” has been consistently conveyed in exclusive print media and also in selected TV-commercials of very high production value to underline the quality aspirations of brand. All communication messages are featured through the iconic Singapore Girl in different themes and settings. The Singapore Girl has contributed immensely to the success of Singapore Airlines’ brand strategy and its entire positioning around customer and service excellence. pic] Conclusion Singapore Airlines is one of the leading aviation companies of the world. It has evolved into one of the most respected travel brands around the world. They have one of the world’s youngest fleet in the air, a network spanning five continents as their symbol of their quality customer care and service. When it comes to air travel, nothing beats Singapore Airlines both in quality and service. Recommendation 1. Singapore Airlines needs to keep its superiority and stay on top of the competition in the international market, despite the bad times associated with the global economy. . Singapore Airlines needs to thoroughly understand the plans being pursued by the British Airways, Cathay Pacific and Virgin Atlantic in improving the comfort and quality of service it provides to its customers and needs to continue to differentiate itself by examining the strengths and weaknesses. 3. By dominating the global regions it will create a greater potential for foreign investments, allowing the Singapore airlines to sustain their quality efforts. 4. Singapore Airlines should remain competitive by providing better ervices and comforts to customers as in the long term the market will grow. Reference (pictures): • http://www. google. com/imgres? imgurl=http://coolintl. com/wp-content/uploads/2010/03/singapore4. jpg&imgrefurl=http://coolintl. com/customer-service-from-an-airline/&usg=__lb1k-zKyE0-Oj9BfgXBZotKFG2I=&h=431&w=298&sz=28&hl=en&start=3&zoom=1&tbnid=YB7pDalIvLSd7M:&tbnh=126&tbnw=87&ei=INukTemIIZHSsgba96T7Bg&prev=/images%3Fq%3Dsingapore%2Bairlines%26um%3D1%26hl%3Den%26client%3Dfirefox-a%26sa%3DG%26rls%3Dorg. mozilla:en-US:official%26biw%3D1366%26bih%3D552%26tbm%3Disch&um=1&itbs=1 http://www. google. com/imgres? imgurl=http://bestvacationdealstoday. com/wp-content/uploads/2010/04/SIA-girls. jpg&imgrefurl=http://bestvacationdealstoday. com/singapore-airlines-airfare-trends/&usg=__vk61SEELmNZWn3KFPUwLdKCkMgk=&h=430&w=298&sz=38&hl=en&start=15&zoom=1&tbnid=-NMJ7beMkE7X_M:&tbnh=126&tbnw=87&ei=INukTemIIZHSsgba96T7Bg&prev=/images%3Fq%3Dsingapore%2Bairlines%26um%3D1%26hl%3Den%26client%3Dfirefox-a%26sa%3DG%26rls%3Dorg. mozilla:en-US:official%26biw%3D1366%26bih%3D552%26tbm%3Disch&um=1&itbs=1 • http://www. google. com/imgres? imgurl=http://www. ideachampions. om/weblogs/2845853643-singapore-airlines-sq1-cabin-crew. jpg&imgrefurl=http://www. ideachampions. com/weblogs/archives/2010/12/post_63. shtml&usg=__URyV5MPnQu0ATU04cMb5bWC3W80=&h=333&w=500&sz=133&hl=en&start=2&zoom=1&tbnid=ra0eXUiDIzTZRM:&tbnh=87&tbnw=130&ei=OdukTZWED87Hswb20fmCBw&prev=/search%3Fq%3Dsingapore%2Bairlines%26um%3D1%26hl%3Den%26client%3Dfirefox-a%26sa%3DG%26rls%3Dorg. mozilla:en-US:official%26biw%3D1366%26bih%3D552%26tbm%3Disch0%2C304&um=1&itbs=1&biw=1366&bih=552 • http://www. google. com/imgres? imgurl=http://topnews. com. sg/images/singapore-ai