MGMT20132 Report: Value Proposition Driven by SDGs for Airbus Company

This report formulates a value proposition for Airbus, focusing on sustainable development goals (SDGs). It provides an overview of Airbus, explains SDGs, and identifies specific goals relevant to Airbus's industry innovation. The report analyzes customer segmentation, strategic fit, competitive advantage, and technical/financial viability. It then proposes and evaluates a novel value proposition for Airbus, emphasizing safety and innovation. The analysis includes the application of various innovation tools and techniques like Value Proposition Canvas, Business Model Canvas, and customer persona creation. The report explores market segmentation, competitive advantages, and the customer decision-making unit, aiming to enhance Airbus's market position through a focus on safety and sustainable practices aligned with the UN's SDGs.

Running head: VALUE PROPOSITION DRIVEN BY SDGs
Report title: Value proposition driven by SDGs
Business name: Airbus
Unit number and name: MGMT20132 Innovation and Sustainable Business
Development
Assessment number:
Student’s name:
Student ID:

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VALUE PROPOSITION DRIVEN BY SDGs
Executive summary:
The following paper is an attempt to formulate a value proposition for an already established
business with reference to sustainable development goals. Industry innovation is driven by
the factors like SDGs and/or development of technology. This paper zeroes in on the
company “Airbus” and discusses the impact of sustainable development goals in its industry
innovation and implementing novel value proposition for the said organisation. The paper
will try to provide an account on the company overview following by the elucidation of the
concept of sustainable development goals. Further, it will try to identify the specific
sustainable development goals as associated with the industry innovation of Airbus and
critically analyse its impact in terms of customer segmentation, strategic fit, competitive
advantage and technical and financial viability. In conclusion, the discussion will try to
formulate a novel value proposition and evaluate it.

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VALUE PROPOSITION DRIVEN BY SDGs
Table of Contents
Introduction................................................................................................................................4
Airbus- An overview..................................................................................................................4
Sustainable Development Goals................................................................................................5
SDGs as the motivating factor in the organizational value........................................................7
Value Proposition for Airbus.....................................................................................................8
Background............................................................................................................................8
SDGs as the motivator of value proposition..........................................................................8
Value Proposition canvas.......................................................................................................9
Customer Profile................................................................................................................9
Tools and Techniques for Innovation..................................................................................10
Market Segmentation.......................................................................................................10
Creating Customer Persona..............................................................................................10
Quantifying the Value Proposition...................................................................................11
Charting Competitive Advantage.....................................................................................11
Determining the Customer’s Decision Making Unit (DMU)..........................................11
Setting up Pricing Framework.........................................................................................12
Designing a Business Model............................................................................................12
Developing a Product Plan...............................................................................................12
Conclusion................................................................................................................................12
References................................................................................................................................14
Appendix..................................................................................................................................16

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VALUE PROPOSITION DRIVEN BY SDGs
Tools and techniques............................................................................................................16
Mind Map.........................................................................................................................16
Business Model Canvas...................................................................................................16
Ideal Final Result.............................................................................................................17
Jobs to be done.................................................................................................................18
DMU Checklist................................................................................................................19
Weisboard’s Six-Box Model to determine competitive advantage..................................19
Phoenix Checklist.................................................................................................................20
“Generalizing the problem” technique.................................................................................20

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VALUE PROPOSITION DRIVEN BY SDGs
Introduction
Value proposition is an essential tool for a company or organization for gaining
competitive advantage. Value proposition is the assertion or declaration of a company in
terms of what unique feature they are offering to their customers. Value proposition indicates
their strength and uniqueness for which customers or market segment will choose the
company’s product or services. It portrays their terms of added benefit compared to the other
similar businesses, which will attract new customers to the business. (Payne, Frow & Eggert,
2017)
The following paper is an attempt to formulate a value proposition for an already
established business with reference to sustainable development goals. Industry innovation is
driven by the factors like SDGs and/or development of technology. This paper zeroes in on
the company “Airbus” and discusses the impact of sustainable development goals in its
industry innovation and implementing novel value proposition for the said organisation. The
paper will try to provide an account on the company overview following by the elucidation of
the concept of sustainable development goals. Further, it will try to identify the specific
sustainable development goals as associated with the industry innovation of Airbus and
critically analyse its impact in terms of customer segmentation, strategic fit, competitive
advantage and technical and financial viability. In conclusion, the discussion will try to
formulate a novel value proposition and evaluate it.
Airbus- An overview
Airbus is the second largest Aerospace and Defence Company as of 2018. Originated
in Netherlands, it has extended to Spain, Germany and France in trading share and

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consequently expanded into a global business, becoming a multinational organization. It
deals in civil and defence aircrafts and subsidiary design, parts and technology. (Airbus.com)
Airbus has its biggest manufacturing unit in Blagnac, France now. However, it also
has its manufacturing and production facilities in the United Kingdom, Spain, Germany and
China. Airbus is known to produce the first commercially viable digital fly-by-wire civil
airliner, the Airbus A320 as well as the world’s largest passenger airliner A380. It operates in
approximately in 180 locations and is connected with 12000 suppliers worldwide.
(Airbus.com)
Airbus has pledged to the “Fightpath 2050” the aviation industry initiative to comply
with the sustainable development goals as proposed by the United Nations General
Assembly. It has committed to work towards reducing noise, CO2 and NOx emission.
(Airbus.com)
Sustainable Development Goals
Sustainable Development Goals or SDGs are the United Nation’s call for action to
every organization and institution to ensure global prosperity, conservation of the
environment and natural resources. Also known as the global goals, SDGs are aimed at
ending poverty, world hunger and protecting flora and fauna along with enhancing the
standard of living in general (Brackley & York, 2019). The goals, as designed by the General
Assembly report are as following(UNDP, 2015):
GOAL 1: No Poverty
GOAL 2: Zero Hunger
GOAL 3: Good Health and Well-being
GOAL 4: Quality Education

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VALUE PROPOSITION DRIVEN BY SDGs
GOAL 5: Gender Equality
GOAL 6: Clean Water and Sanitation
GOAL 7: Affordable and Clean Energy
GOAL 8: Decent Work and Economic Growth
GOAL 9: Industry, Innovation and Infrastructure
GOAL 10: Reduced Inequality
GOAL 11: Sustainable Cities and Communities
GOAL 12: Responsible Consumption and Production
GOAL 13: Climate Action
GOAL 14: Life below Water
GOAL 15: Life on Land
GOAL 16: Peace and Justice Strong Institutions
GOAL 17: Partnerships to achieve the Goal
The construal of these goals are embedded in the success of the Millennium
Development Goals which focused on the aforementioned challenges. Additionally, SDGs
incorporate some new action plans regarding climate change, sustainable consumption,
innovation, economic inequality etc. These SDGs came into effect in January 2016, with an
estimated timeframe of 2030. All the 170 abiding and allying member nations of the United
Nations have complied and pledged to achieve all the goals by 2030 as well as work together
to achieve them (Scheyvens, Banks & Hughes, 2016). The United Nations on the other hand
facilitates the participating nations in integrating and collaborating among themselves in
working towards the SDGs. The UNGA also opines that achievement of the SDGs are

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dependent on the partnership and collaboration of all kinds of government organizations,
private sector, civil society and citizens. (UNDP, 2015)
SDGs as the motivating factor in the organizational value
The company affirms its compliance with social and environmental responsibility
through their vision and organizational values. The official announcement mentions that
instead of aiming all the 17 values or the 169 targets of SDGs, the company has undertaken
specific action plans in achieving effective milestones to end poverty, stop world hunger,
reducing environmental impact and promoting equality and economic prosperity. (Airbus.com,
2019)
Airbus was among the first aerospace and aircraft manufacturing companies to adopt
the SDGs and incorporate them into their core Corporate Social Responsibility policy. The
organization worked with the Air Transport Action Group (ATAG) to carry out surveys in the
Aerospace industry to figure out the high-priority areas that needed action in terms of
implementing the SDGs. Eventually, the organization identified that the goals such as decent
work and economic growth; industry, innovation and infrastructure; climate action and
sustainable cities and communities to be their prime focuses. (Airbus.com)
Further, the organization executed some internal research and concluded that the group of
people born between 1980 and 2000, also known as the Millennials will be instrumental in
achieving the goals as prescribed by the UN. Consequentially, Airbus has formed groups of
employees across all their branches to comprehend their views towards the global goals and
identify which of them the millennials think are the most significant to work upon. They
concluded that the millennials think that responsible consumption and production, affordable
and clean energy and partnership for the goals should be in the focus. Further, upon analysis,

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the organization has set several action plans to attain the targets. They can be listed as the
following. (Airbus.com)
1. Approach for responsible business
2. Minimising environmental impact
3. Operating responsibly
4. Innovating for sustainable business
5. Contributing to a safer and more prosperous world
6. Fostering quality education and inclusion
7. Reporting and performance data
Value Proposition for Airbus
Background
Airbus is one of the leading aerospace and airline organization manufacturing for both
civil and Defence aircrafts. However, any organization needs further expansion for
competitive advantage and market acquisition. In order to achieve that, the organization has
to come up with a novel value proposition that the target customers can relate with. Hence,
the organization can proceed with the proposition of safety in their further enhancement and
promotion.
SDGs as the motivator of value proposition
The organization can proceed with the Global goal of Industry, Innovation and
Infrastructure in adopting the marketing strategy of safety. The thumb rule of the aviation
industry is to ensure passenger safety. Hence, incorporating better innovations and
infrastructure will ensure the effectiveness of the claim of safety.

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Value Proposition canvas
Source: (Pokorna et al., 2015)
The major pointers for the Airbus’s value proposition can be described as the Canvas:
Customer Profile
1. Gains: Safety and mobility in air travel
2. Pains: Anticipation of accidents and technical malfunctioning leading to life-threat
3. Customer jobs: Personal and professional travel including tourism, educational and
occupational travel.
Value Map
1. Gain creators: Advanced technology to ensure passenger safety and reduced
environmental impact
2. Pain relievers: Expenditure of over 3 billion euros each year in R&D to promote
innovation and infrastructure
3. Products and services- Adopting innovations for entering Industry 4.0

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Tools and Techniques for Innovation
Market Segmentation
Airbus deals in both civil and defence aircrafts. Hence, the target market segmentation
for Airbus is quite extended. However, the end users are identified as the travellers who take
the airline travelling for personal and professional purposes. People fly from place to place
for visiting their families and friends, or to attend job related engagements or simply for
tourism purposes. The primary requisite for such travels is safety and fast conveyance.
Hence, providing them with safety and comfort amenities will increase their trust and
eventually impact their choice to engage with the product and services by the airlines they are
travelling with. This will in turn influence the airlines to choose Airbus products improved
with novel innovation and infrastructure.
Creating Customer Persona
Customer Profile: Claire Adams (Female, Age: 45)
Persona description: End user
Job profile: Architect in a leading US-based firm
Purpose of travel: i) Occupational - site visits, client meetings and project
supervision
ii) Personal- Visiting her children in their college campus, travelling to
places with historical and architectural significance.
Motivation: Prefers business class journeys for long flights, concerned about security
and safety, keen on engaging with products and services with eco-friendly outcomes
as well as brands with welfare-based image.

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Influences: Books travel tickets through online booking sites, uses internet and social
media to check reviews and feedbacks of airlines.
Customer persona analysis
Claire is a professional belonging to a high-income group who often takes
airline travelling for personal and occupational travelling. She often requires to take
up long journeys for which she prefers aircrafts with enhanced luxury amenities. Also,
as a mother she is concerned about the safety measures in airlines. She is also
influenced by reviews and feedbacks from other fliers in terms of choosing airlines.
Hence, to attract such a target end user, airlines can improve their service by
upgrading their aircrafts with added innovation and infrastructure.
Quantifying the Value Proposition
The proposed value for Airbus is safety and fast conveyance. Airbus can benefit from
the launch of RFID technology in terms of streamlining supply chain and manufacturing
operations. (Airbus.com)
Charting Competitive Advantage
This will reduce cost of manufacturing and enable the target clientele to acquire end
products with less price. Thus, this will benefit the company in acquiring new customers over
other aerospace manufacturing companies. (Osterwalder et al., 2014)
Determining the Customer’s Decision Making Unit (DMU)
To acquire a new customer, the organization has to identify the target customer
persona, both as end user and the purchasing client. For Airbus, the target clientele is the
operating airlines and the travellers are the end users. The end users influence the target
customer’s choice to purchase from the brand. Hence, to ensure customer conversion, Airbus

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has to promote its new innovation in the light of end user’s experience with the airline. (Aulet,
Ursache & Snyder, 2017)
Setting up Pricing Framework
The pricing framework will take into account the Cost of Customer Acquisition
(COCA) and Lifetime Value (LTV) of an estimated product. For Airbus, the airlines can be
converted into a long term customers. Airbus promotes itself as a global partner for inclusive
and sustainable innovation, which may attract the customers for creating a better brand image
for themselves. (Aulet, Ursache & Snyder, 2017)
Designing a Business Model
Determining the target customer profile and their DMU as well as setting a pricing
framework will help the brand design its business model. However, the business model is a
concrete and long-term pattern whereas the pricing framework is subject to change with
economic viability and market trends (Osterwalder & Pigneur, 2010). The business model
must focus the product innovation and infrastructure to promote it to the target clients. (Aulet,
Ursache & Snyder, 2017)
Developing a Product Plan
Airbus approaches innovation with a broader perspective of achieving future
prosperity instead of focusing just the target customer segmentation. It is investing
comprehensive amount in their independent self-funding R&D to develop fuel economy and
noise reduction. They are also developing electric and hybrid propulsion that will contribute
to a cleaner and quieter environment. Aligning with these innovation, the Industry 4.0
technology has to be promoted to feature safety infrastructure for the future products. This
will eventually appeal to the global clientele as the world is gradually leaning on sustainable
technology and innovation.

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Conclusion
Aviation industry is one of the core sectors that influence the end users’ personal life
and experience. It enables greater communication in less time, ensuring economic
opportunities and personal wellbeing. Hence, to acquire new clientele, the organization has to
influence the end users’ experience in choosing their products and services.
The primary value proposition of Airbus is their consistency in production features
and qualities. However, bringing in the safety perspective in the value proposition will
directly impact the end users’ experience. Also, sustainable innovation and infrastructure will
also ensure the compliance of sustainable development goals. Therefore, to conclude, the
value proposition for the organization will impact the customer acquisition if it can be aligned
with sustainable innovation and infrastructure.

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References
Aulet, B., Ursache, M., & Snyder, C. (2017). Disciplined entrepreneurship workbook (pp. 30-
35). Hoboken, New Jersey: John Wiley and Sons.
Payne, A., Frow, P., & Eggert, A. (2017). The customer value proposition: evolution,
development, and application in marketing. Journal of the Academy of Marketing
Science, 45(4), 467-489.
Pokorná, J., Pilař, L., Balcarová, T., & Sergeeva, I. (2015). Value Proposition Canvas:
Identification of Pains, Gains and Customer Jobs at Farmers' Markets. AGRIS on-line
Papers in Economics and Informatics, 7(665-2016-45080), 123-130.
Brackley, A., & York, B. (2019). What's next for sustanaible business? Retrieved
from https://trends.sustainability.com/
Osterwalder, A., & Pigneur, Y. (2010). Business model generation. Hoboken, New Jersey:
Wiley.
Osterwalder, A., Pigneur, Y., Bernarda, G., & Smith, A. (2014). Value proposition design.
Hoboken, New Jersey: Wiley.
Scheyvens, R., Banks, G., & Hughes, E. (2016). The private sector and the SDGs: The need
to move beyond ‘business as usual’. Sustainable Development, 24(6), 371-382.
Innovating for sustainable solutions. (2019). Retrieved 25 August 2019, from
https://www.airbus.com/company/responsibility-sustainability/innovating-for-sustainable-
solutions.html.html

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Sustainable Development Goals | UNDP. (2015). Retrieved 25 August 2019, from
https://www.undp.org/content/undp/en/home/sustainable-development-goals.html
We are Airbus. (2019). Retrieved 25 August 2019, from https://www.airbus.com/company/we-
are-airbus.html

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Appendix
Tools and techniques
Mind Map
Business Model Canvas

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Ideal Final Result

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Jobs to be done

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DMU Checklist
Weisboard’s Six-Box Model to determine competitive advantage

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VALUE PROPOSITION DRIVEN BY SDGs
Phoenix Checklist
“Generalizing the problem” technique