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1 – 10 of 278M.R. Pitt and A.W. Brown
As airports strive to attract new carriers, a new strategic direction is necessary to address the differing needs of the two main types of airline – network carriers and low‐cost…
Abstract
As airports strive to attract new carriers, a new strategic direction is necessary to address the differing needs of the two main types of airline – network carriers and low‐cost airlines. The problem for the airport’s manager is compounded by the different management styles and philosophies that operate within the carriers themselves, meaning that the requirements of each airline may be subtly, or even fundamentally, different from one which might be expected to be placed in the same category. For strategic reasons, the facilities manager must understand the fundamental differences that exist between the two types of carrier. Examines the strategic response of Dublin airport to the presence of the two types of carriers requiring different services, and the difficulties faced by airport managers in the provision of the differing levels of service required by different customers. Sets out the strategic differences and suggests the resultant implications for facilities requirements. Shows that, in most cases, the provision of differing levels of “side by side” service to airlines is not possible with the existing strategic direction and that new directions are needed to facilitate the long‐term expansion of air transport.
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The main purpose of this paper is to create a model, which specifies the determinants of the airline business. This sector is chosen, as the airline industry is not only…
Abstract
Purpose
The main purpose of this paper is to create a model, which specifies the determinants of the airline business. This sector is chosen, as the airline industry is not only influenced by national characteristics, but also characterized by international standards and internationalization processes.
Design/methodology/approach
In this paper, a systematic analysis of the research published over the past decades is carried out. This analysis incorporates the most acknowledged concepts and works in the field of airline management.
Findings
The main determinants of the airline business are identified as: national culture, airline alliances, the implementation of the low-fare business model, the influence of the state on business, and the impact of market liberalization. The modern airline industry can be partially seen as an embodiment of the neoliberal ideas of the 1990s.
Practical implications
The model may be used by academics and practitioners who work in the area of airline business management. Specifically in the case of a merger between two airlines, the model might serve as a useful tool to analyze potential synergies.
Originality/value
Although various research has been conducted on describing the way that airline business is done, little focus has been paid on the factors that actually determine and change it. This paper analyzes the unique industry variables by which the airline industry is driven and determined.
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No‐frills carriers have revolutionized Europe's aviation market and have changed the airline business in a dramatic way. Having entered most of the countries in Central Europe…
Abstract
Purpose
No‐frills carriers have revolutionized Europe's aviation market and have changed the airline business in a dramatic way. Having entered most of the countries in Central Europe, the wave has also reached the Baltics. The purpose of this paper is to reveal how a Scandinavian carrier entered the market with a subsidiary airline, by combining elements of low‐cost and traditional carriers.
Design/methodology/approach
The paper starts by giving a brief overview of the different airline operating philosophies. It is followed by an introduction into the Nordic airline market. The main focus will be on the operating strategy of Air Baltic and its relation towards the extension policy of Scandinavian Airlines.
Findings
The paper provides an independent and structured analysis about the strategy of Air Baltic. Theory was applied to determine how much the airline was influenced by the “low‐fare wave” of the aviation branch and its implications. The hybrid character of Air Baltic reflects the Central European/Baltic business environment.
Research limitations/implications
Research is partly limited to the information published by the airline itself. Because international aviation journals have not yet covered Air Baltic, newspapers and popular journals were used as a base of information. To fill this gap, two semi‐structured interviews with Air Baltic executives were carried out.
Practical implications
The study is a useful source of information for scientists and managers dealing with the airline industry or/and the Baltic Sea region. Lecturers might use the paper for case‐based courses.
Originality/value
This paper is one of the first comprehensive publications in the English language about Air Baltic and the Baltic aviation market.
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Southwest is the world’s fourth largest airline and has consistently been one of the most admired organisations in the USA. Its founder and Chairman Emeritus, Herb Kelleher…
Abstract
Purpose
Southwest is the world’s fourth largest airline and has consistently been one of the most admired organisations in the USA. Its founder and Chairman Emeritus, Herb Kelleher, attributes much of this success to the use of strategic principles. This gives a guiding framework for employees within the company but allows them leeway to make their own decisions. The result is greater employee engagement, a more efficient organisation that is adapting to the needs of its major stakeholders and greater customer satisfaction.
Design/methodology/approach
The article analysis of the use of the strategic principle methodology at Southwest Airlines. It focuses on the position of Southwest as “THE low fare” airline and the use of humour and different working practices within the airline.
Findings
The article shows that If this can be done in an industry as heavily regulated as aviation, it can be applied with the same success to many other business sectors and organisations.
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Ian Seymour Yeoman and Una McMahon-Beattie
The primary aim of revenue management (RM) is to sell the right product to the right customer at the right time for the right price. Ever since the deregulation of US airline…
Abstract
Purpose
The primary aim of revenue management (RM) is to sell the right product to the right customer at the right time for the right price. Ever since the deregulation of US airline industry, and the emergence of the internet as a distribution channel, RM has come of age. The purpose of this paper is to map out ten turning points in the evolution of Revenue Management taking an historical perspective.
Design/methodology/approach
The paper is a chronological account based upon published research and literature fundamentally drawn from the Journal of Revenue and Pricing Management.
Findings
The significance and success to RM is attributed to the following turning points: Littlewood’s rule, Expected Marginal Seat Revenue, deregulation of the US air industry, single leg to origin and destination RM, the use of family fares, technological advancement, low-cost carriers, dynamic pricing, consumer and price transparency and pricing capabilities in organizations.
Originality/value
The originality of the paper lies in identifying the core trends or turning points that have shaped the development of RM thus assisting futurists or forecasters to shape the future.
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Concentrates on US domestic carrier, Southwest Airlines, and how its discount air travel has allowed millions to fly where previously they could not afford to. Highlights, in a…
Abstract
Concentrates on US domestic carrier, Southwest Airlines, and how its discount air travel has allowed millions to fly where previously they could not afford to. Highlights, in a box, the company's mission statement. Looks at team spirit, culture, employee recruitment, publicity and competition. Acknowledges that low fares may get people on a plane, but by giving them what they want — a good‐humoured carrier taking them to their destinations, safely, on time and with their baggage — they will come back — and do.
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Airport strategic direction is usually linked to the changing nature of airlines and their evolving facilities requirements. In the US airports are predominantly publicly owned…
Abstract
Airport strategic direction is usually linked to the changing nature of airlines and their evolving facilities requirements. In the US airports are predominantly publicly owned giving rise to different organizational structures to those associated with many of the other countries, such as the UK, which are currently experiencing a change in the nature of airline products. This paper examines the different responses that are possible and not possible within the organisational structures of airports, focusing on some of the limitations of the current US and UK models of ownership and how these may impede economic growth. The paper ends with a look at the structural problems that arise in the management of air travel in the best interests of the traveller in the UK and how these problems might be resolved through alliances between the airlines and the airports.
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Donelda S. McKechnie, Jim Grant and Marios Katsioloudes
The purpose of this paper is to focus on the four strategy tools of positions and positioning: leader, challenger, follower and niche. It suggests that it is important for…
Abstract
Purpose
The purpose of this paper is to focus on the four strategy tools of positions and positioning: leader, challenger, follower and niche. It suggests that it is important for managers to understand where their business fits in the market, vis‐à‐vis the competition. Without this knowledge, it is difficult to identify a differential advantage that will give the necessary competitive edge to attract the target customer.
Design/methodology/approach
This paper reviews positioning using a back to basics explanation. A simply constructed matrix – represented by variables: company‐focused or competition‐focused and pushes the boundaries or stays within boundaries – illustrates business philosophy in the marketplace.
Findings
Airlines positioned in the United Arab Emirates (UAE) aviation industry exemplify a market environment with companies holding distinctive positions. Emirates Airline is the leader, Etihad Airways is the challenger, Gulf Air is the follower and Air Arabia is successfully established in the niche position. A summary explanation of business operations for each airline supports the discussion.
Practical implications
Marketing practice aligned with textbook theory is identified in the growth‐oriented UAE aviation industry. In real‐world terms, four airlines distinctively hold each of the four positions while a fifth airline is making inroads into the regional market and appears to be challenging the current challenger.
Originality/value
The strategy simply stated in this paper suggests that the market environment is dynamic and constant assessment is necessary. Managers seeking to maximize differential advantage vis‐à‐vis the competition should consider using more than one strategy tool particularly if it contributes to a manager's ability to understand the market environment.
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We are often told that before we can run we must learn to walk. That’s sound advice, particularly in business. But try telling it to David G. Neeleman, the 44‐year‐old CEO of US…
Abstract
We are often told that before we can run we must learn to walk. That’s sound advice, particularly in business. But try telling it to David G. Neeleman, the 44‐year‐old CEO of US budget airline JetBlue. The airline has enjoyed phenomenal success since its 2000 launch and now offers its passengers luxuries previously considered mutually exclusive to the payment of low fares.
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– This paper aims to explain how airlines in India and customers can both benefit by the unbundling of services.
Abstract
Purpose
This paper aims to explain how airlines in India and customers can both benefit by the unbundling of services.
Design/methodology/approach
The paper explores how a recent regulatory change allowing unbundled services will affect the airline industry in India. Using illustrations, it highlights the benefits to the airlines and to the customers. It recommends the strategies that airlines can follow.
Findings
Airlines in India can now offer unbundled services. However, regulatory authorities need to allow greater flexibility to airlines. Given more flexibility, airlines can design offerings that will improve their profitability while simultaneously benefiting customers.
Practical implications
The government needs to go beyond the current regulatory changes. Providing increased flexibility will benefit both airlines and customers. Airlines would need to understand customers more intimately, experiment in the market, lobby for flexibility and develop strategic agility to benefit from the changed regulations on unbundled services.
Social implications
It concedes that airlines can now design unbundled services such that only those customers who value a service get charged for the service. Those customers who do not need a service can get away by paying a lower fare. The government has taken the first steps in the right direction. Once it provides greater flexibility, the airlines in India can benefit significantly.
Originality/value
The paper considers the unique context of the airline industry in India where recent regulatory changes are likely to make the industry more dynamic and improve profitability of airlines. It provides insights in to the challenges faced under the current system and recommends strategies for the government and companies to follow.
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