Air NZ Resource Integration Management Practices: A Detailed Report

This report provides a comprehensive analysis of Air New Zealand's resource integration management practices. It begins by defining integrated resource management and its importance in minimizing operational risks, particularly within the aviation industry. The report delves into Air NZ's specific resource integration practices, underpinned by theories such as effectuation and configuration, highlighting the importance of collaboration and efficient resource utilization. A review of operational problems, including passenger load and capacity issues, is presented alongside a VRIO analysis to assess Air NZ's competitive advantages. The study further examines the organization's internal processes, focusing on human resources, tangible assets, and intangible assets, as well as external factors through a PESTEL analysis. Key strategic concepts guiding resource integration, such as Total Quality Management and Lean Production systems, are identified and critically analyzed. The impact of strategic responses on Air NZ's operational objectives is evaluated, and a practical process for improving resource integration practices is developed. Finally, the report addresses the range of operational and financial risks and concludes with a cost-benefit analysis of the proposed improvements.

Running head: INTEGRATION MANAGEMENT PRACTICES
Integration management practices
Name of the Student
Name of the University
Author Note

1INTEGRATION MANAGEMENT PRACTICES
Table of Contents
1.0. Introduction.....................................................................................................................3
1.1. Purpose........................................................................................................................3
1.2. Scope...........................................................................................................................3
1.3. Limitations...................................................................................................................4
1.4. Company Background.................................................................................................4
2.0. Resource Integration.......................................................................................................5
2.1. Resource Integration Practices in Air NZ...................................................................5
2.2. Theoretical Approach..................................................................................................5
2.2.1. Effectuation..........................................................................................................5
2.2.2. Configuration.......................................................................................................6
2.2.3. Review of the Problems.......................................................................................6
2.2.4. VRIO Analysis.....................................................................................................7
3.0. Processes of the Organization.........................................................................................8
Internal Analysis....................................................................................................................8
Human resources................................................................................................................8
Tangible Resources..........................................................................................................10
Intangible assets...............................................................................................................11
External Analysis.................................................................................................................11
PESTEL Analysis.............................................................................................................11
4.0. Outline for General Principles Adopted by Air NZ........................................................0
5.0. Key Strategic Concepts for Resource Integration...........................................................0
Total Quality Management................................................................................................0

2INTEGRATION MANAGEMENT PRACTICES
6.0. Impact of the Strategic Response....................................................................................3
Lean Production systems....................................................................................................3
7.0. Application of the Systematic Integration of Resources.................................................4
8.0. Range of Operational and Financial Risk.......................................................................7
9.0. Conclusion.......................................................................................................................8
10.0. Cost benefit Analysis......................................................................................................9
REFERENCES.........................................................................................................................12
Appendix..................................................................................................................................14

3INTEGRATION MANAGEMENT PRACTICES
1.0. Introduction
Integrated resource management is the incorporation of the factors that will be
responsible for the development of the areas that will be helpful for the achievement of the
desired business outcomes with the efficient utilization of various resources. This is one of
the major activity that will be responsible for the development of the factors that are
associated with the minimization of the operational risks. This is one of the most significant
factor that contributes to the development of the activities such as sales and operations. One
of the most significant aspect of the integrated resource management is the utilization of the
resource that will be liable for the operations and other activities.
1.1. Purpose
The purpose of the study is to evaluate the areas of resource integration management
practices. The study will be discussing the various activities that will be responsible for the
influencing the planning policy. The study will also emphasize on the aspects of the
operational objectives along with the development of the factors that are associated with the
organization. The business and the operational settings will be also elaborated in the study.
For assessing the risks that are associated with the operations and the financials will be
evaluated in the study with the given scenarios.
1.2. Scope
The organization that has been considered for the study is Air NZ. Flying industry
being one of the most extensively dependent on the operations it is important for the study to
incorporate such stuff and it becomes important to critically analyze the resources and the
aspects that are related with the operational and financial risks. The two key risks in the
aviation industry are operational risks and financial risks. Thus, it becomes significantly
important to analyze the operational risks and the financial risks.

4INTEGRATION MANAGEMENT PRACTICES
1.3. Limitations
There are limitations associated with the study as the articles that will be providing
the key insights on the strategic concepts can be outdated. However, the study will be
focusing one the relevancy of the articles. The study is based on the secondary resources
which creates another limitation which is the biasness of the authors towards their study
which cannot be measured.
1.4. Company Background
Air NZ has been one of the major players in the aviation industry of New Zealand
(Airnewzealand.co.nz, 2019). This has been the flag carrier airline of New Zealand. This has
been one of the most influential company in the aviation industry. The current fleet size of
the company inclusive of the 64 carriers which does not include the subsidiaries. It was
founded in 1940 as the Tasman Empire Airways Limited but in 1965 the company became
Air New Zealand when the government of New Zealand bought 50% of the stake from the
Australia airline (Airnewzealand.co.nz, 2019). Currently the organization is being led by the
chief executive office named Christopher Luxon. The company is having a current total asset
of NZD 7,261 million with a revenue of NZD 5,231 million. The company is currently
having a strong financial structure. The company is currently operating with Airbus A320,
Airbus A320 Neo, Boeing 777 and Boeing 787 (Airnewzealand.co.nz, 2019). The company is
having subsidiaries such as Air Nelson and Mount Cook Airline (Airnewzealand.co.nz,
2019). This company is having a direct competition with the big companies like Qantas,
Etihad, Malaysian Airlines and many more.

5INTEGRATION MANAGEMENT PRACTICES
2.0. Resource Integration
2.1. Resource Integration Practices in Air NZ
Resource integration is one of the major contributor towards the development of the
key factors that will be responsible for the development of the key issues that are related to
the comprehensive planning process. These practices are comprised of the activities such as
planning, utilizing the resources, setting the objectives drawing the strategies for the efficient
utilization of resources. Current resource integration of resources are emphasizing of the
safety of the customers along with creating a frame work that will be liable for the change in
the sustainability. The process of integration is one of the major activity that requires
collaboration. This is one of the major contributors towards the development of the key areas
that will be impacting the operations. There are contributors towards the development of the
aspects that will be responsible for the integration of the resources. The theories tells about
the successful integration of the resources in inclusive of the effectuation theory and the
theory of configuration. These two theories are responsible for enlightening the key
organizational practices that are associated with the integration of the resources. Air NZ
being a part of a competitive environment of the aviation industry it becomes vital for the
organization to deal with effective integration of the resources (Airnewzealand.co.nz, 2019).
The theories that underpins contemporary resource integrations for the Air NZ is stated
below:
2.2. Theoretical Approach
2.2.1. Effectuation
Effectuation theory is one of the most important theory that states about the various
practices that any organization can be adopting the activities that will be liable for the
development of the efficient process (Arend, Sarooghi & Burkemper, 2015). The study states

6INTEGRATION MANAGEMENT PRACTICES
about the organizational behavior and its adversity (Berends et al., 2014). However, the study
is stating about one of the most important aspect that will be liable for the improvement of
the process which is the collaboration. The study states that collaboration among the various
processes can impact the organization and its processes that are associated with the
organization. Collaboration between the various processes in the organization can help in
better integration of the resources. This ensures the effectiveness among the various
processes while incorporating the aspects that are associated with the development of the key
factors that are associated with the organization. For Air NZ it is one of the important aspect
that will be liable for collaborating with the activities that are associated with the operations
of aviation. Adapting this practice will be helpful for the organization that can impact the
organization with integration of the resources with the efficiency.
2.2.2. Configuration
This is one of the theory that emphasizes on the practices that are associated with the
integration of the resources. This will be liable for the development of the aspects that are
related to the operational activities that will be helpful for the organization. This theory states
about the practices that will be helpful for the integration of the resources. The practices that
are being stated includes the efficient utilization of the resources in a more efficient way
along with the strategizing by considering the present environment of the organization. This
is one of the most significant approach towards the better integration resource management.
Air NZ being one of the giants in the aviation industry it is one of the important duty for the
organization to incorporate the measures that will be helpful for the organization to
incorporate and utilize the resources in an efficient manner. Integration of the resources is
one of the most important part for the organization.

7INTEGRATION MANAGEMENT PRACTICES
2.2.3. Review of the Problems
This part of the study will be consisting of the factors that will be responsible for the
assessing the problems that are associated with the resources integration management
practices of the Air NZ. This part of the study is one of the most crucial part for the
addressing the problem and reviewing the key factors that have caused such issues. The
practices of the integration of the resources are one of the major factor that contributes to the
development of the factors that is associated with resolving the issues associated with the
operations of the organization. The key operational problems that requires the integration of
the resources are inclusive of the flag operations and ground operations. Utilization for the
resource happens mostly in these two of the industries. Thus, it becomes vital to use the
practice of collaboration along with the efficient utilization of the resources. The problems
that are persisting among the operations of the aviation industry is inclusive of the activities
that are required to address. The problems are one of the major factor that will be
contributing towards the development of the key areas that will be liable organizational
development. The key problems were concerned with decrease in load of passengers which
led to the increase of capacity. The latter resulted to rise in costs, thus, a reduction in the net
profit was visible. The former is an operational risk while the latter is a financial risk.
2.2.4. VRIO Analysis
Value The resources are valuable. The company has been able to
incorporate numerous vehicles with ideas of innovation and fuel
sustainability. Thus, they ahead of the competitors.
Rareness They services offered are rare in the market. The airline
company incorporated in various services that helps them
differentiate from the competitors. They have made suitable
changes in accordance with needs of the customers. Example:

8INTEGRATION MANAGEMENT PRACTICES
Service of sky couch.
Imitability The branding and image of the company possess challenges to
the competitors. They are recognized as the national airline
company and thus cannot be easily imitated.
Organization Proper planning regarding the customer services, the human
resources, the tangible and intangible resources, along with
favorable organizational policies helps the company in
operating smoothly in the market.
3.0. Processes of the Organization
This part of the study will be assessing the attributes that are significantly influencing
the processes of the organization. The attributes such as the transformations in the different
sectors such as customer relationship, human resources, tangible and intangible resources.
Internal Analysis
Human resources
The most vital resources that the company can use for implementing better
relationships with customers is by incorporating values within their organisational
framework. In order to stay ahead of the competitors by gaining competitive advantage the
company has devised a vision statement. The strategic goals of the company is to abide by
the established vision statement as incorporating and abiding by the same would imply that
the organisation will be able to attract customers and increase their market share. “To
improve every steps of the consumer journey” has been realised and established as the vision
statement of Air NZ (Airnewzealand.co.nz, 2019). The vision statement of the company is a
perfect ground on which the goals of the company can be realised. This is further integrated

9INTEGRATION MANAGEMENT PRACTICES
to the internal aspects of the organisation. The latter have realised that improved culture
within the workplace would lead to better relations with the employee. Better relations with
the employee would result in the engagement of the employees with the organisation.
Employee engagement is said to increase the commitment of the employees towards the
organisation (Breevaart et al., 2014). Thus, buy securing the aforementioned factor, the
employees of the company and the company itself will be able to deliver better performances
to the customers of the organisation. The company has been able to implement a culture of
friendliness. Unlike most of the airline companies where utmost formality is maintained at all
cost, in Air NZ, the employee are given the freedom to interact with the customers as needed.
The management does rarely intervene in the service and that allows for a sense of authority
for the employees (Airnewzealand.co.nz, 2019). Thus the employees are able to informally
converse with the customers of the airlines company. Informal communication helps the
company to establish good relations with the customers. The customer service that is offered
at Air NZ is aligned perfectly to the Kiwi style of communication. People of New Zealand
believe in keeping communication direct and informal. This makes the communication in the
airline favourable for the customers and this has been recognised as one of the major
rationales behind the appreciation that the company has received from the consumers of the
country. The vision statement of the company has been realised by their belief in ‘welcome as
a friend’, were the personnel of the company in the flights and inside the air craft establish a
friendly atmosphere while dealing with the customers (Airnewzealand.co.nz, 2019). The
company has also established statements such as “can do” and “be yourself” that are aimed
towards the flexibility of the customer service and sustainability of the employees associated
to the organisation (Airnewzealand.co.nz, 2019). The company believes in establishment of a
customer centric approach by which they can position themselves favourably in the minds of
the customers.

10INTEGRATION MANAGEMENT PRACTICES
Moreover, it can be said that there vision is realised by the people of who are
employed in the airlines company. The human resources of any company can be identified as
one of their most crucial elements and valued assets. Thus careful scrutiny goes into selection
of the employees who share the same values as the employers. As mentioned above, the
employee engagement is a factors that is carefully monitored by the organisation. In order to
engage the employee, the HR policies ensure that flexibility is offered to the employees.
Good performances are rewarded properly and frequent favourable appraisals make Air NZ
employees engaged to the company. They have a dedicated awards ceremony that is known
as “We are Impressed”, were the employers and fellow employee nominate each other when
their feel that an employee has performed well or has achieved a feat that would favour the
company (Airnewzealand.co.nz, 2019). Policies such as the above, are some of the reasons
behind realisation of the company as one of the most attractive employers in New Zealand.
At Air NZ, people believe in the “nothing to hide” concept. The meaning behind
establishment of the statement is to determine the nature of the organisation culture that exist
within the company. Credits for the statement and the established culture, should go to the
HR management department of the airline company, as they have been able to implement
policies and schemes through which they can ensure that there is smooth flow of
communication between every functional department within the system. Establishment of a
smooth network of communication is can help in sustainability of the organisational views
and it also helps in maintaining favourable relationships with the employee and each
functional division (Granek et al., 2013). As a result the ideas of the top level management
and vision of the company is shared with the employees, who can then implement the same in
their work. The same is also reflected in their customer service where the employee provide
the customers with all the necessary information when asked. This helps in realisation of the
ultimate vision that has been devised by the top level management of the company.

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Tangible Resources
Tangible resources are resources that can physically be touched and that have physical
existence. Being a global company, operating throughout the globe, they employ a
considerable amount of resources that can be deemed to be tangible. Air NZ proudly boasts
some of the most fuel efficient vehicles in New Zealand and operate throughout the world by
using an estimated 105 aeroplanes throughout the globe (Airnewzealand.co.nz, 2019). In
order to maintain the airplanes and house the same they have hangars. The company has over
200 corporate outposts throughout the globe and are employ ground staff whose jobs are to
man loading wagons and pushback tugs (Airnewzealand.co.nz, 2019).
Intangible assets
The intangible assets of the company are realised in the form of Additions,
amortisations and transfers of internally and externally purchased software that were required
for the day to day operations within the organisation (Airnz.com, 2017). The total carrying
value for the year end of 2017, was ninety for million dollar worth of internally developed
software and five million dollar worth of eternally purchased software (Airnewzealand.co.nz,
2019). Capital work in progress amounted to twenty seven million dollars for the same year
along with one million dollar for other intangible expenses (Airnz.com, 2017). Apart from the
financial figures, one of the most crucial intangible resources of the company can be
identified as their goodwill. The company has been able to act through activities of that
promote sustainability of the environment by minimising wastage. Air NZ have been able to
implement innovation in their operations. It has been identified by the organisation that they
the cost of fuel associated with the operation of an airline company is one of the highest.
Thus, they have developed fuel efficient aircrafts which help in reduction of costs and also
help in cutting down the ticket prices. Thus, they have been able to incorporate and bolster

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their goodwill by contributing to environmental sustainability and corporate social
responsibility at the same time.
External Analysis
PESTEL Analysis

Running head: INTEGRATION MANAGEMENT PRACTICES
Political
 Corruption hinders
efficiency of the
sector.
 Importance has been
realized in the
sustainability of the
Transportation
sector
 Frequent political
intervention
 Employee welfare
policies and tax
regulations
 Violations to ethic
established by the
government are
voidable.
 Acts established
for the protection
of intellectual
properties.
Economic
 Stability of the
currency of New
Zealand.
 High rates of
inflation
 High rate of
unemployment and
income through
discretionary ways.
 Adept transport
sector
 Favorable
infrastructure.
 Stability of the
financial markets
 High rate of
economic growth
Social
 Hierarchical
structure of the
country.
 High rates of
literacy
 Favorable attitudes
towards, heath and
sustainability of the
environment.
 Multiculturalism
 Varied opinions
regarding
entrepreneurship.
 Friendly attitudes
and direct style of
communication.
Technological
 Constant
innovation
 Innovation from
the part of the
company
 Development of
cost efficient
services and
products
 The technical
expertise of the
people of the
country
 Changing rates of
technological
diffusion
Environment
 Dynamic weather
 Frequent change of
climatic conditions
as a result of the
environmental
depletion.
 Environmental
sustainability
regulations.
 Green initiatives and
initiatives towards
recycling.
 Assimilation of
endangered species.
 Use of renewable
forms of energy and
alternative sources
of energy.
 Control of
pollutants.
Legal
 Various laws against
discrimination.
 Protection of the
cultural values of
various ethnicities.
 Law for health and
safety protection
 Consumer
protection acts.
 Establishment and
emphasis on
antitrust laws.
 Presence of patents
and copyrights for
the protection of
intellectual
properties of people
and companies.

Running head: INTEGRATION MANAGEMENT PRACTICES
4.0. Outline for General Principles Adopted by Air NZ
Current practice of such resource integration is one of the most crucial factor to assess
the competitors. The current practices that are being adopted are mainly focused on the
aspects that are related to the safety of the customers and initiatives that are being taken for
the sustainability (Airnewzealand.co.nz, 2019). The current practices are viable and logical to
protect the customer and take the responsibility for the adoption of the aspects that are related
to the development of the key process that will be liable for the improvement of the key
processes that are being taken by the company. The principles are consisting of the activities
such as enterprise risk management services that are being monitored by the board. This
includes the operational as well as the financial risks (P-airnz.com, 2019). The competitors
such as Qantas follows a strict guideline for the monitoring of the risks that will impact the
operational and financial resources (Qantas.com.au, 2019).
5.0. Key Strategic Concepts for Resource Integration
Strategic concepts are one of the most significant contributors towards the
development of the activities that will be liable for the growth of the organization. This study
will be incorporating the aspects of the Total Quality Management. The concepts and the
application of the activities that will be responsible the smooth operations of the organization
such as risk management and capacity planning.
Total Quality Management
Total Quality Management is a process that is characterized by continuous elimination of
errors in the manufacturing (Goetsch & Davis, 2014). Production or service of an
organization. For the current scenario it is concerned with systematic elimination of
hindrance and negative utility that could be experience by the customer community. The

1INTEGRATION MANAGEMENT PRACTICES
ideas of Total Quality Management moves forward with the view that carrying out the
practice will speed up the process and operations of the functional units. This can be justified
as elimination of errors form the system would imply that the company will able to provide
efficient services to their customers and cater to employee welfare needs while carrying out
the same. The system of Total Quality Management is established since it helps the
management of the company to locate the incidences or point from which the hindrances are
generating. Thus they would be able to mitigate the issues associated to the detected points of
malfunction within the system. Mitigation of the problem would imply that the concerned
division within the company will be able to work more efficiently than would be possible if
the hindrance or error was present within the concerned division or functional wing. The
following are the principles that have been established the concept of total quality
management;
1. Customer orientation: The rationale behind the elimination of the errors from the
functioning is to raise the quality of the factors that are responsible the viability of the
service that the company provides to the customers. However, it can be stated that the
ultimate quality of the service is determined by the customers. The customers are the end
users thus they decide if a service is free of errors. Thus the efficacy of Total Quality
Management is determined by the end users of the services, that is the customers.
2. Involvement of the employees: It is a known fact that, apart from the customer
community, the employees are the most valued assets for a company. Same is applicable
for Air NZ as they have implemented policies in order to increase their levels of
commitment. Commitment can be achieved through engagement of the employees. The
collaboration of the former and the latter imply that the employee would be involved in
every activities of serving the customers. Furthermore, the policies that have been
established in the company, enable the employees to take charge of the operations in

2INTEGRATION MANAGEMENT PRACTICES
whatever department they are employed in. The achievement of the same leads to
achievement of favorable organizational culture, satisfied employees, satisfied employers
and most importantly satisfied customers.
3. Improvement: Improvement of organizational performance of the organization in terms
of profitability, employee welfare and effective management of relationship with the
customer community are the ultimate goals of a healthy organization (Valmohammadi &
Roshanzamir, 2015). Total Quality Management incorporate continuous improvement in
the management, the employees and the policies. The collaboration of the above
mentioned factors imply that the organization will be able to perform more effectively in
terms of what helps a company establish a position of competitive advantage in the
market. The culture of improvement can be achieved by incorporating and implementing
smooth hindrance free communication within the framework of an organization.
4. Effective communication: Effective communication is the key to establishment of proper
functioning of every functional division of and organization (Weller, Boyd & Cumin,
2014). The ultimate quality of realization of the managerial strategies is implemented by
the establishment of a framework of clutter free and smooth communication.
Communication of ideas of the board of directors enables the executives and other
managers to be aware of the goals of the board. Thus they can communicate the same
down the hierarchy of the organization. Communication of ideas enables the executive of
the organization delegate responsibilities effectively. Furthermore, the employees are also
educated properly regarding the ideas that that the management they would need to
implement in their activities to be aligned to the strategic goals of the organization.
Establishment of a communication network enables the organization to engage and satisfy
the employees, thus, reducing attrition and providing better services to the customer
community.

3INTEGRATION MANAGEMENT PRACTICES
6.0. Impact of the Strategic Response
Adoption of the new strategies does have an impact on the organization and it
becomes significant factor for its contribution towards influencing the organization. This is
one of the major contributor towards the development of the factors that will be liable for
effective operational activities. Thus, it becomes significantly important for measuring the
impact of the strategies that are being adopted in by the organization. The problems that have
been identified have been dealt by the airline company by a strategic response that is
characterized by the following:
Capacity plan: The capacity plan enables the organization to understand the
operational costs that are required to be incorporated in the needs of the company in
terms of capacity. The nature of capacity, the volume or weightage of the requirement
and the time frame within which the same was required was determined.
Product process: The process of delivering the actual service to the consumers was
determined by the strategic decisions that that was passed by the organization. The
strategies determined the processes that will be responsible for implementation of
total quality management and lean production management.
Service design: The framework of the service was also determined by the
implementation of the strategic impacts.
Lean Production systems
Lean production system is a process that is characterized by reduction of the waste that can
be associated to the production and manufacturing (Leite & Vieira, 2015). For the given case
scenario it implies, the hindrances and faults that can be located within the functional division
of any particular wing of the organization. It can be opined that the resources of an
organization should be effectively capitalized on and the wastage should be eliminated. The
elimination of the wastage would enable the company to utilize the same in the other wings

4INTEGRATION MANAGEMENT PRACTICES
of the organization where those resources would be values. Whether a resource is valuable or
a waste is determined by the end user or the customer. The services that are used by the
customers can be deemed to be effective and the ones that are hardly used or neglected by the
customers are deemed as wastage. It is the function of a lean production system to determine
the nature of the operations of organizations and eliminate the wastage or misallocation once
it has been located.
In order to attain efficiency of functioning of organizations, the following features must be
included within the lean manufacturing system;
1. Identification of value from the perspective of the customer: This would enable
companies to identify what service will be valued by the customers (So et al., 2013).
Thus, the company will be able to minimise and control the wastage of resources.
2. Creation of flow: Establishment of a flow of operation within the functional systems
would imply that the company would be able to delegate their efforts to the places that the
resources are necessary.
3. Value stream mapping: Controlling the value stream enables the organisation to identify
the value of a product or service during each phase of the product lifecycle or service
lifecycle (Tyagi et al., 2015). Identification of the value would enable the policy makers
to identify whether a particular product or service is suitable for the customers.
4. Continuous improvement: If the aforementioned factors are successfully implemented.
The organisation will be able establish a culture of continuous improvement in each
functional division. The employees would be successfully in performing according to the
goals of the management and this will result in achievement of appreciation form the
customer community.

5INTEGRATION MANAGEMENT PRACTICES
7.0. Application of the Systematic Integration of Resources
In order to operate smoothly and function efficiently as a system, an organisation needs to
ensure that they are able to integrate all the functional departs. Integration of all the activities
help organisations to speed up the overall processes within their organisation. Integration of
resources in an organisation is possible when an organisation abides by the principles
established in the lean in system. It is a system that is characterised by the type of thinking
that incorporates firm rules and processes within the organisational framework of
organisations. Even though there are various frameworks established in the lean in system, it
provides a considerable amount of flexibility and the structure of the same makes the
methodologies established in the system more disciplined and structured.
It can be said that if an organisation is perfectly aligned to lean in processes of management,
they are able to differentiate themselves from other companies. This is done to an extent
when the companies are able to ensure competitive advantage while operating in the market.
There are various functionalities and principles that are established in a lean in system.
Following are the guiding principles and essential factors that must be considered in order to
integrate the resources with the organisation effectively.
Optimisation: Optimisation incorporates, the visualisation of the vision of the organisation.
Optimisation is used for establishing a sole value system. It enables the organisation embody
the view of Air NZ in delivering the best possible services to the customers who opt to stick
to the services offered by the airlines company.
Base of Knowledge: The knowledge of a company regarding the market insights and the
consumer trends are tested by a lean system. This is evident in the case of the selected airline
company as they have showcased a great deal of competence in carrying out market research
that has enable the company to integrate policies of the welfare of the customers and the
sustainability of the organisation in the long run.

6INTEGRATION MANAGEMENT PRACTICES
Waste elimination: Systematic integration of resources is characterised by the integration of
systematic elimination of wastes. Wastes does not simply imply to the by-product that are
produced by the airline company. It implies that the company will be able to utilise and
reduce the wastage of the resources that would not be utilised productively by the company.
Waste elimination and integration is an integral component of lean in systems and must be
incorporated in the operations of a company that is aiming to reduce wastage and provide
efficient services to a consumers.
Fast processes: Systematic integration implies that the services that the company provides to
the customers will get speeded up. Speeding up of the service will result in acceptance from
the part of the consumers or customers of the company. The incidence of the latter ensure a
considerable portion of the market share as a result of the fast services. It involves placing the
correct resources at the correct places. Placing the right resources in the right places imply
that the customers will be able save time and will ultimately lead to customer satisfaction.
Furthermore, successful system integration incorporates, effective use and delegation of
personnel at the right places to reduce the clutter and hindrance in service. The absence of the
latter becomes favourable for the organisation and is responsible for inflicting smooth flow of
operations and functioning of the inter-related departments of the company.
Commitment and respect
By incorporating a considerable amount of lean in thinking, organisations can inflict
systematic thinking and integration of resources. Staying committed to the ultimate goals of
the company enables the managerial personnel to align their efforts directly with the expected
outcomes of the organisation. Other than gaining the state of profitability in the long run, it is
the aim of very company to gain support from their customers. Especially at Air NZ, it is the
aim of the company to develop a customer centric culture. They have been successful in
doing so by implementation of proper strategies and policies the enable the former in

7INTEGRATION MANAGEMENT PRACTICES
perfectly aligning and collaborating the efforts of the employee to help the customers of the
community in achieving satisfaction. The company has been able to develop committed
employees who have been engaged to the organisation as a result of the employee welfare
policies that are available within the perfectly framed structure of the company.
8.0. Range of Operational and Financial Risk
Risk are associated with every process of the organization and it is one of the most
important factor that contributes to the development of the aspects that are related with the
proper functioning of the organization. This part of the study will be concerned with the
assessment of the two key risks that are financial and operational risks. The range for the risk
will be discussed within the organization and that will be contributing towards the
development of the strategies that will be helpful to control such risks. Strategically control is
one of the main influencing factors that will be liable for the controlling the risks that are
associated with the operational aspects. However, financial risks also involves the external
environment for which the organizations need to analyze the risks and strategize in
accordance with such initiative.
One of the most important part for the aviation process is the capacity of the seat in
the route. This leads for the organization to monitor the passenger load factor that will be
helpful for the development of the key factor that will be liable for the efficiency of the
operations. This leads to the range for the operational risks that are depended on the
passenger load capacity as if it getting low then it impacts the efficiency of the process.
Passenger load capacity influences the efficiency of the operations by projecting efficient
capacity. The decrease in the passenger load capacity is a risk as it gets lower projecting the
increased redundancy in the operations. This is one of the most significant operational risk
with the worst possible scenario. This states about the failure in the efficient resource

8INTEGRATION MANAGEMENT PRACTICES
management failing to obtain lean process system. However mitigation of such risk can be
achieved by incorporating the lean process and efficient usage of the resources.
Another important risk is the financial risks that is associated with decline in the
passenger demand. This is one of the most significant impact on the financials of the Air NZ
as this enables the situation to be risky. Decrease in the passenger demand leads to a failure in
the various aspects of the organization. However, as the resources are being exploited the
financials show a downward trend in the net profit of the company. This is one of the most
significant aspect of the organization as it is the back bone of the organization. The decline in
the passenger can be a significantly influential risk for the company. For the mitigation of
such risk it is important to analyze the situation and utilize the funds in more efficient manner
but keeping the costs low and payback period below 1. The growth of the passengers can be a
challenge to determine the efficiency of the operations. As it serves to the inefficient usage of
the resources which in the case of Air NZ is bus.
9.0. Conclusion
Resource management is one of the most significant aspect that is associated with the
improved organizational function There are practices that are associated with management of
such activities. This being one of the most significant aspect for the organization it is one of
the most important part for the organization to follow the systematic resource integration.
This will be helpful for the lean process and a process that has minimized the waste. Air NZ
being such a big company it is one of the most important duties for them to do such activities
that will be liable for making the process lean. To summarize the study it can be said that
there are enough practices that can impact Air NZ in a more efficient way. However, it is one
of the most important duty for the organization to utilize the resources and help Air NZ to
identify the financial as well as operational risks along with mitigation of such risks by
incorporating best possible decision making process.

9INTEGRATION MANAGEMENT PRACTICES
10.0. Cost benefit Analysis
There are three scenarios for the analysis which are being stated below:
Scenario 1: Load Factor Decrease
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10379 0 5573 5573 0
Seat km available 12597 12752 155 15,553 15,999 446
Passenger load factor 82.39% 81.39% 0 35.83% 34.83% 0
Projection for 2018 0 0
Passengers carried 10840 10840 0 5837 5837 0
Seat km available 12597 12752 155 15,553 15,999 446
Passenger load factor 86.05% 85.01% 0 37.53% 36.48% 0
Projection for 2019 0 0
Passengers carried 11321 11321 0 6114 6114 0
Seat km 12597 12752 155 15,553 15,999 446
Passenger load factor 89.87% 88.78% 0 39.31% 38.21% 0
Revenue 2017 311.37 311.37 445.84 445.84
Cost 2017 125.97 127.52 311.06 319.99
Net Profit 185.40 183.85 134.78 125.85 320 310
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.54 0.54 0.74 0.79
Revenue 2018 325.19 325.19 466.97 466.97
Cost 2018 125.97 127.52 311.06 319.99
Net Profit 199.22 197.68 155.91 146.98 355.14 344.66
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.50 0.51 0.64 0.68
Revenue 2019 339.63 339.63 489.11 489.11
Cost 2019 125.97 127.52 311.06 319.99
Net Profit 213.66 212.12 178.05 169.12 391.71 381.23
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.47 0.47 0.56 0.59
The above data projects the importance of the load factor. Decrease in the load factor causes
the Air NZ for the underutilization of the resources. This impacts the operational process by
increasing the redundancies in the processes. The scenario projects that how important load
factor is for any of the organization. Decreasing the load factor by 1% has caused the
financials to obtain a loss.
Scenario 2: Passenger Decreases

10INTEGRATION MANAGEMENT PRACTICES
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10171 -208 5573 5462 -111
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 82.39% 80.74% 0 35.83% 35.12% 0
Projection for 2018 0 0
Passengers carried 10840 10623 -217 5837 5720 -117
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 86.05% 84.33% 0 37.53% 36.78% 0
Projection for 2019 0 0
Passengers carried 11321 11095 -226 6114 5992 -122
Seat km 12597 12597 0 15,553 15,553 0
Passenger load factor 89.87% 88.07% 0 39.31% 38.52% 0
Route Auckland-Tauranga Change Auckland-Cape Reinga Change Profit Total Change
Revenue 2017 311.37 305.14 445.84 436.92
Cost 2017 125.97 125.97 311.06 311.06
Net Profit 185.40 179.17 134.78 125.86 320 305
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.54 0.56 0.74 0.79
Revenue 2018 325.19 318.69 466.97 457.63
Cost 2018 125.97 125.97 311.06 311.06
Net Profit 199.22 192.72 155.91 146.57 355.14 339.29
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.50 0.52 0.64 0.68
Revenue 2019 339.63 332.84 489.11 479.33
Cost 2019 125.97 125.97 311.06 311.06
Net Profit 213.66 206.87 178.05 168.27 391.71 375.14
Average cost for new bus 100.00 101.00 100.00 101.00
Pay-back period 0.47 0.49 0.56 0.60
Decrease in the passengers is one of the worst possible scenarios. This impacts the company
significantly. This is one of the scenario where passenger is being lost by the company and
this directly impacted the financial numbers of the company. Decrease in passengers by 2%
has significantly impacted the company by reducing the load factor and the net profit of the
company.
Scenario 3: Feasibility for New Bus

11INTEGRATION MANAGEMENT PRACTICES
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10587 208 5573 5573 0
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 82.39% 84.04% 0 35.83% 35.83% 0
Projection for 2018 0 0
Passengers carried 10840 11057 217 5837 5837 0
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 86.05% 87.77% 0 37.53% 37.53% 0
Projection for 2019 0 0
Passengers carried 11321 11548 226 6114 6114 0
Seat km 12597 12597 0 15,553 15,553 0
Passenger load factor 89.87% 91.67% 0 39.31% 39.31% 0
Route Auckland-Tauranga Change Auckland-Cape Reinga Change Profit Total Change
Revenue 2017 311.37 317.60 445.84 445.84
Cost 2017 125.97 125.97 311.06 311.06
Net Profit 185.40 191.63 134.78 134.78 320 326
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.54 1.04 0.74 1.48
Revenue 2018 325.19 331.70 466.97 466.97
Cost 2018 125.97 125.97 311.06 311.06
Net Profit 199.22 205.73 155.91 155.91 355.14 361.64
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.50 0.97 0.64 1.28
Revenue 2019 339.63 346.43 489.11 489.11
Cost 2019 125.97 125.97 311.06 311.06
Net Profit 213.66 220.46 178.05 178.05 391.71 398.50
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.47 0.91 0.56 1.12
This is one of the interesting scenario. The feasibility of increasing the bus is one of the most
important decision of the organization. With the increase in the passenger it shows feasibility
by projecting the payback period of the cost of the new buses. This scenario shows that there
are extensively low performance even if passengers are increased by 2%. The payback period
goes more than one year even if one bus is being increased. However, from second year on
wards, Auckland-Tauranga route can take the new bus.

12INTEGRATION MANAGEMENT PRACTICES
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zealanders
Airnewzealand.co.nz. (2019). Sustainability & Corporate Responsibility | Air New Zealand.
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Airnewzealand.co.nz. (2019). Trade & Enterprise Development | Air New Zealand. Retrieved
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Airnz.com. (2019). Annual Financial Results [Ebook]. Air New Zealand Group. Retrieved
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Goetsch, D. L., & Davis, S. B. (2014). Quality management for organizational excellence.
Upper Saddle River, NJ: pearson.

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Granek, L., Krzyzanowska, M. K., Tozer, R., & Mazzotta, P. (2013). Oncologists' strategies
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Valmohammadi, C., & Roshanzamir, S. (2015). The guidelines of improvement: Relations
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barriers to effective teamwork in healthcare. Postgraduate medical journal, 90(1061),
149-154

14INTEGRATION MANAGEMENT PRACTICES
Appendix
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10587 208 5573 5573 0
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 82.39% 84.04% 0 35.83% 35.83% 0
Projection for 2018 0 0
Passengers carried 10840 11057 217 5837 5837 0
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 86.05% 87.77% 0 37.53% 37.53% 0
Projection for 2019 0 0
Passengers carried 11321 11548 226 6114 6114 0
Seat km 12597 12597 0 15,553 15,553 0
Passenger load factor 89.87% 91.67% 0 39.31% 39.31% 0
Route Auckland-Tauranga Change Auckland-Cape Reinga Change Profit Total Change
Revenue 2017 311.37 317.60 445.84 445.84
Cost 2017 125.97 125.97 311.06 311.06
Net Profit 185.40 191.63 134.78 134.78 320 326
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.54 1.04 0.74 1.48
Revenue 2018 325.19 331.70 466.97 466.97
Cost 2018 125.97 125.97 311.06 311.06
Net Profit 199.22 205.73 155.91 155.91 355.14 361.64
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.50 0.97 0.64 1.28
Revenue 2019 339.63 346.43 489.11 489.11
Cost 2019 125.97 125.97 311.06 311.06
Net Profit 213.66 220.46 178.05 178.05 391.71 398.50
Average cost for new bus 100.00 200.00 100.00 200.00
Pay-back period 0.47 0.91 0.56 1.12

15INTEGRATION MANAGEMENT PRACTICES
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10379 0 5573 5573 0
Seat km available 12597 12752 155 15,553 15,999 446
Passenger load factor 82.39% 81.39% 0 35.83% 34.83% 0
Projection for 2018 0 0
Passengers carried 10840 10840 0 5837 5837 0
Seat km available 12597 12752 155 15,553 15,999 446
Passenger load factor 86.05% 85.01% 0 37.53% 36.48% 0
Projection for 2019 0 0
Passengers carried 11321 11321 0 6114 6114 0
Seat km 12597 12752 155 15,553 15,999 446
Passenger load factor 89.87% 88.78% 0 39.31% 38.21% 0
Revenue 2017 311.37 311.37 445.84 445.84
Cost 2017 125.97 127.52 311.06 319.99
Net Profit 185.40 183.85 134.78 125.85 320 310
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.54 0.54 0.74 0.79
Revenue 2018 325.19 325.19 466.97 466.97
Cost 2018 125.97 127.52 311.06 319.99
Net Profit 199.22 197.68 155.91 146.98 355.14 344.66
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.50 0.51 0.64 0.68
Revenue 2019 339.63 339.63 489.11 489.11
Cost 2019 125.97 127.52 311.06 319.99
Net Profit 213.66 212.12 178.05 169.12 391.71 381.23
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.47 0.47 0.56 0.59
Route Auckland-Tauranga Change Change Auckland-Cape Reinga Change Change
Passengers carried 10379 10171 -208 5573 5462 -111
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 82.39% 80.74% 0 35.83% 35.12% 0
Projection for 2018 0 0
Passengers carried 10840 10623 -217 5837 5720 -117
Seat km available 12597 12597 0 15,553 15,553 0
Passenger load factor 86.05% 84.33% 0 37.53% 36.78% 0
Projection for 2019 0 0
Passengers carried 11321 11095 -226 6114 5992 -122
Seat km 12597 12597 0 15,553 15,553 0
Passenger load factor 89.87% 88.07% 0 39.31% 38.52% 0
Route Auckland-Tauranga Change Auckland-Cape Reinga Change Profit Total Change
Revenue 2017 311.37 305.14 445.84 436.92
Cost 2017 125.97 125.97 311.06 311.06
Net Profit 185.40 179.17 134.78 125.86 320 305
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.54 0.56 0.74 0.79
Revenue 2018 325.19 318.69 466.97 457.63
Cost 2018 125.97 125.97 311.06 311.06
Net Profit 199.22 192.72 155.91 146.57 355.14 339.29
Average cost for new bus 100.00 100.00 100.00 100.00
Pay-back period 0.50 0.52 0.64 0.68
Revenue 2019 339.63 332.84 489.11 479.33
Cost 2019 125.97 125.97 311.06 311.06
Net Profit 213.66 206.87 178.05 168.27 391.71 375.14
Average cost for new bus 100.00 101.00 100.00 101.00
Pay-back period 0.47 0.49 0.56 0.60