Improving Business Procedures of Qatar Airways: A Management Consultancy Project

The project focuses on selecting an entity to give consultancy in improving their current business procedures. Qatar Airways has been chosen for this assignment as some of the business operations of the business are requires in eliminating from the firm to maintain the dignity of the business in the industry. The article discusses the weaknesses of Qatar Airways and suggests better ways for this entity to expand their target market by offering affordable pricing options as per the budgets of all the individuals.

MANAGEMENT
CONSULTANCY

Table of Content

BACKGROUND
The current project focuses on selecting an entity to give consultancy in improving
their current business procedures. A business function depicts the actual condition of the
business in front of all the internal as well as external users of an entity. The motive of the
business is to attract a large number of stakeholders to invest in the business to get the desired
return as compare to the other business located in a similar industry (Baruch and Gregoriou,
2017, January). Improvement is essential in an entity as this will identify all the potential and
weaknesses of the firm to beat all their competitors. Process improvement process act as a
checker to tests the compatibility of the business against all the users of the market. Image
and goodwill of the business concern will emerge in this process. The focus of the
corporation is to deliver quality oriented services to all the users exists in the external market
by ensuring the business survival for a longer period of time.
A Qatar airway has chosen for this assignment as some of the business operations of
the business are requires in eliminating from the firm to maintain the dignity of the business
in the industry (Gonenc and Scholtens, 2017). Qatar Airways had been enjoying tremendous
advantages from fuel prices till recently dip in margins where it had to undertake significant
services improvisations. With growing dominance of low-cost carriers, airlines as Qatar
needed to offer much greater comfort and convenience to customers to attract them. Case of
QA is complex hence has been analysed for understanding growing fear of losses that has led
to the Company devise strategies for sustainability. Aviation and hospitality industry is a
wide industry which includes a variety of firms offering the similar services as they all are
giving tough flights to each other. Various competitive factors use by all the rivals in the
market cover airfares, flexibility, schedule of the flight, airline services.
Qatar Airways is a fastest growing airline which maintains its dominance in the world
in offering quality oriented airline services to all their customers. It is government Owner
Company as the government of Qatar have major shares in this firm as they take all the major
decisions of this entity. Headquarter hub of this airways is Hamad International airport with a
fleet of over 180 aircrafts that give their services to over 150 destinations. An international
destination of this airline includes Africa, South Asia, Middle East, North America, South
America and Oceania (Böhm, Eggert and Thiesbrummel, 2017).
This airline has various subsidiaries which are interrelated with their main business of
airline business includes Qatar Airways cargo, The Qatar Aircraft catering company, Qatar
Airways Holidays, United Media International, Qatar duty-free, Qatar aviation services,
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Qatar Distribution company and Qatar executives. This shows that firm has adopted internal
expansion as all their businesses are complementary in nature as the main business of airlines
requires the services of all their subsidiaries (Gómez‐Bezares, Przychodzen and Przychodzen,
2017). This entity has worked on two important criteria’s such as cost and quality as their
motive is to reduce the overall costs by using the resources of their own which, in turn,
minimises the cost of food outsourcing.
A Qatar airway is a brand name which shows their expensive airline service that is
affordable only by rich people as the airline tickets are too high. The rationale behind
selecting this organization is to suggest better ways for this entity to expand their target
market by offering affordable pricing options as per the budgets of all the individuals.
Services of this entity are very high but airfare at the same time reducing middle and lower
class people who intend to use the services of this airline but they are not capable enough to
afford the flight tickets. Revising of pricing patterns of all the fight ticket is essential for the
business to get a large number of customers as against all the competitors operates in the
same market (Padachi, Ramsurrun and Ramen, 2017).
The mindset of users differs from one person to another as they want quality oriented
services in lower price which will consider by Qatar airways by identifying ways to cater the
needs and higher expectations of all the customers. This action of the corporation will boost
the financial performance of the concern as their revenues get increases due to increasing
number of customers added to the consumer list of the firm. During festive days, a price of
flight a ticket gets an increase which creates difficulty for the users to travel from one place
to another. This problem faced by all the people will transform into one of the biggest
opportunity by Qatar Airways to grab the attention of all the users who are in need of
travelling to various places to meet their families (Buckley and Tian, 2017).
Services offer by the airline differs from economy to first and business class
passengers as they pay to get luxurious services. Currently, Qatar Airways offer lounge
services for all the first and business class passengers to get relief from a long duration flight
at the airport itself. Extending this service for economy passengers will give the sustainable
competitive advantage to an entity as they target economy consumers of all their competitors.
Majority of customers of all the airlines are economy passengers as an individual migrate
from their native place to other countries for employment purpose due to lack of jobs there in
their own country (Ferri and Pedrini, 2017).
A Qatar airway has poor risks management approach as future uncertainty imposed on
an entity is not tracked by an enterprise (Brindley ed., 2017). The current strategy of this
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airline chooses reactive approach rather than a proactive approach which, in turn, increases
the burden on an entity. Reactive nature of strategy proves negative for the business in
accomplishing all the desired aim and the objectives within a stipulated time. It is not
beneficial for the business as this leads an entity towards the path of complexities imposed on
the business concern.
IMPROVEMENT OF BUSINESS PROCESS
A change plays an integral role in an entity as it consists dual advantages for the
business that identifies the weakness of the firm and also improves the overall performance of
the business enterprise (Cohen, Krishnamoorthy and Wright, 2017). Changes are part of the
business enterprise which will increase and boost the overall earnings of the firm in the
external environment. A change comes in two major forms such as internal change as well as
external change. Internal change is controllable as an enterprise owner intentionally made
changes into the organisation to overcome all the internal conflicts and problems. On contrary
to this, an external change takes place in an entity is generally non-controllable as this will
not in the hands of an individual (Hopkin, 2017). Such changes are an acquisition in the
business in which one strong entity acquires another business to compensate the losses and
debts of that firm.
Filling the weaknesses of an entity is beneficial for the business entity that helps in
increasing the overall returns in a particular time period. A motive of the business is to cater
the needs of all the users of the business whether internal or external customers. Employees
are internal users of the firm which provides their services for the betterment of the business
and external users are shareholders, investors who invest in the business to boost their
earnings (Rugman and Verbeke, 2017). A wealth of the business portrays its image in the
external entity to satisfy the higher expectations of the business entity.
A Qatar airline service reflects higher brand name which has the majority of
customers belongs to a rich and upper class of the society. Different approaches to market
segmentation will use by an entity to grab the attention of its majority of users. A target
audience is expanded to the middle class and lower class customers to show social equality to
get the response of all the society members of the entire world (Nan and Tanriverdi, 2017).
Consultation is essential for Qatar airlines to conduct swot analysis of their entire
business processes to boost its desired sales and the revenues by eliminating all the
weaknesses affecting the business of this airline. Consultants needed to explore more varied
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and complex possibilities that can create sustainability for the organisation as digital
marketing. Whole initiative has to be focussed on deriving synergies in complex industrial
structure for brand extension.
Basic weaknesses lie in the pricing strategies adopted by the firm is to target high-class
people as even the economy airfares of this airline is very high. Services offered by this
airline is amazing but they are also charging higher prices for the services they offer to all the
customers. It can say that quantity and quality of all the services of Qatar airline is positively
correlated with the prices of the flight tickets. Higher the price of the ticket, better will be the
services offer by an entity to please its customers. Extending this service to the middle class
and lower class people in the standard airfare will create additional opportunities for the firm
to survive for the longest time in the external market (Bakker, 2017). This action of the
business will attain all the competitive goals as compared to other rivals exists in the similar
market.
Cost-plus pricing technique is currently in use by Qatar airline as higher margin
includes in the airfares of different classes such as the economy, business and first class. Rich
class people prefer to travel first class ether business class as they can afford to pay the higher
prices of airfare but middle-class people do not afford to travel from one place to another
even by purchasing economy tickets of the flights. Other airlines such as jet airways, Ryan air
and British airways grabs most of the potential customers of this entity as Qatar Airways
airfares are so high which cannot affordable for normal people for travelling purpose.
Majority of the population of the developing countries like India is middle class and lower
class people who migrate from one place to another for employment purpose cannot afford to
purchase the tickets of Qatar Airways (Liu, J.,and et.al., 2017).
This problem can resolve by Qatar airways by launching new scheme through which
all the middle classes people and lower class people can purchase economy flights ticket to
explore the services of this airline. Different class and budgets tickets offer by this airline will
help Qatar airways in maintaining their dominance in the whole world by stealing the
attention of most of the customers in the entire world (Kırılmaz and Erol, 2017).
Completive advantage uses by this airline by decreasing all the charges for cancelling
the flights as every airline charges fees for cancelling the flights which steal the attention of
price-sensitive customers towards the business of Qatar Airways. There can be various
possible negative outcomes emerging from gong mass-market, primarily costs driven. While
retail strategy might sound attractive it involves spending large amounts of marketing
endeavours towards extension of brand name to reach out to customers. In mass-marketing
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while the brand might be perceived highly by some, it might be not considered in good frame
by others. This leads to complex and confused image regarding the brand. Hence, it is best to
target specific segments at a time and then devise strategies accordingly.
From a business perspective, Qatar Airways will launch a scheme under which all the
members who purchase the membership plan at a specific charge can avail the benefit of no
cancelling charges on the tickets for 1 year. In this way, the problem faced by a corporation
transforms into the biggest opportunities (Chen and et. al., 2017). This launching of
membership scheme plan is one of the important approaches of marketing that attracts
different customers’ to purchase this plan as costs associated with this plan is lower than
overall benefits an individual can avail by buying this particular plan.
Particulars Amount
Economy saver 2995 QAR
Economy Value 3215QAR
Economy Flexi 4315QAR
Business value 8415QAR
Business Flexi 9755QAR
Above mentioned pricing rates are for one way trip from Qatar to Singapore
destination. The airfare offers by an entity in 5 options whose rate is increasing from one
option to another (Chen, Ling and Giannakis, 2017). It is not affordable for an individual to
purchase the return ticket from Qatar to Singapore as economy saver option is of 5990QAR is
the very higher price for middle-class people. These rates are standard rates which slightly
decrease for other destinations ravels by an entity. These rates of flights a ticket is higher as
compared to other airlines services offer by other entity who located in the similar industry.
Revised pricing rates use by the airline to attract more customers towards their
business (McQuigg and et.al., 2017). Competitive and cost-plus pricing method will adopt by
an entity to grab the attention of most of its customers as their motive is to showcase the
skills of the firm in marketing its products. A rate of the flight's tickets of an entity is an
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important weapon to steal the attention of all their customers as advertising of the business is
not sufficient enough. Showing revised prices of all the airfares will catch the attention of the
users as most of the price sensitive is eager to grab the offer as compared to other firms
offering the similar kinds of services (Kamrani, Wali and Khattak, 2017).
Particulars One way Two way
Economy saver 500QAR 900QAR
Economy Value 800QAR 1500QAR
Economy Flexi 1200QAR 1800QAR
Business value 2500QAR 3000QAR
Business flexi 4000QAR 6000QAR
These revised prices will catch the interest of the majority of customers towards the
business of Qatar Airways as people think they can’t afford to travel in this airline. The
action of the firm will promoters social equality by catering the needs of all kinds of
customers whether middle class or higher and upper-class peoples who can afford the
services offered by an entity.
A proactive approach is requiring an entity to know the strategies of all the
competitors before crafting their own strategy. Novelty is required in every strategy develops
by Qatar Airways to catch the attention of customers as similar strategies of the firm will not
convert potential customers into the regular users of the business. Risks management
approach is nothing but identifying all the prospective risks that may incur in an entity in the
future (Qatar Airways reports profits up 21.7% in FY2017, 2017). Likelihood of all the risks
is identified to compare the capability of the business as compared with all the competitors.
The risks management approach will help in identifying all the technical as well as non-
technical problems faced by an entity in the future. Prices of the competitive airlines also
identify by the firm to set an appropriate price by considering all the factors.
INFORMATION SOURCE
Facts and figures about the prices of flights ticket are taken from the official website
of Qatar Airways airline that is facing the problem of the lower target market. Financial
performance of the firm will evaluate by analyzing the annual report of the business. Sales
and the revenue of the firm are increasing from one period to another as customer’s loyalty
generates higher earnings for the business concern. The motive of the business concern is to
cater a variety of needs and objectives of all the customers of the business concern. An entity
focuses on various aims and the objectives develop by the firm just to stay four longer time
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period in this entity. QA had been reporting profitability of 21.7% in FY2017 with
profitability figures being net profit QAR 1.97 billion. This profits had been significantly
higher to profits in FY2016 of QAR1.62 billion. Profit margins was 5% as compared to
previous year’s of 4.5%.
Particulars Old Revised
Change%
Economy saver 2995 QAR 500QAR
16.69%
Economy Value 3215QAR 800QAR
24.88%
Economy Flexi 4315QAR 1200QAR
27.81%
Business value 8415QAR 2500QAR
29.71%
Business Flexi 9755QAR 4000QAR
41.00%
Economy
saver Economy
Value Economy
Flexi Business
value Business
Flexi
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
Old
Revised
Change%
The column chart is visual presentation tool used by an entity to portray the performance of
the business in front of all the external market users. There is three variable shown in the
above chart includes old rate, revised rate and % change from old airfare to the revised
airfare. This figure shows that old rate is higher and revised Rate is lower which shows loss
of an entity. But at the same time, loss of an entity will transform into higher customers base
of the business. An entity tries to capture a large number of customers to beat all the
competitors giving a tough fight to an entity by offering the similar kinds of products.
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Percentage change increases from one share to another show the big step of the firm to
convince all the customers by offering similar services to all the economy as well as business
class passengers. QA had undergone significant losses in the pasts, but with implementation
of competitive strategies the Company had been rising in profitability figures. . Its financial
statements reveals rise in profitability with increase in operating costs. With its rising
profitability it also aims at purchasing 10% stake in American Airlines. The airline is
expected to be less bountiful considering the economic blockade instituted by Qatar’s Persian
Gulf neighbours.
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Online
Qatar Airways reports profits up 21.7% in FY2017, 2017. Available through:
<http://atwonline.com/airline-financials/qatar-airways-reports-profits-217-fy2017>
[Accessed on 1st December 2017].
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