MPM701 Report: Analyzing Tulloch Air Business Process Management

This report analyzes the business operations of Tulloch Air, a regional airline, aiming to improve its financial performance through Business Process Management (BPM). The report begins with an executive summary outlining Tulloch Air's current business and expansion plans. It then defines BPM and its benefits, emphasizing its role in aligning business processes with strategy and improving efficiency. The report explores how BPM can enhance various airline departments and links BPM with business strategy, positioning, structure, and value propositions. A detailed value chain analysis, including Porter's model, identifies areas for improvement, particularly in inbound and outbound logistics, operations, and marketing. A 5-Why analysis pinpoints the root causes of customer complaints related to online booking, website outages, and inefficient processes. The report also uses SWOT analysis to identify capability and performance gaps. 'As-is' processes are examined, and a project scoping diagram highlights problems. The proposed solution involves business process architecture to improve efficiency, customer satisfaction, and overall financial health. The report provides a detailed overview of the current processes and suggests improvements through BPM implementation.

MPM701 – Business Process Management
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Executive summary
Tulloch Air is one of the leading Victorian regional airlines which provides freight and
passenger services to citizens in various regional areas such as Bendigo, Portland, Mildura,
Echuca, Albury, Sale and Lakes Entrance. Presently, the airline has planned to grow its
business operations in other regions of Australia such as Mount Gambier, Orange and
Toowoomba in order to attain competitive advantages and to increase its brand value. The
main purpose of this report is to review the existing business operations of the airline and to
propose a solution to the most urgent problem confronting the firm. This report covers how
Business Process Management can assist ‘Tulloch Air' organization to improve its financial
position. In this report, As-Is and To-Be processes have been discussed in detail with the help
of suitable diagrams. Along with this, this report outlines significant considerations which
could affect airline organization during the development and implementation of the proposed
solution.
BPM and Strategy
Business Process Management and how it can help ‘Tulloch Air’
Business Process Management can be defined as a discipline in operations management in
which professionals use new and innovative methods to identify, discover, measure, analyze,
automate, optimize and improve business processes (Brocke and Rosemann, 2015). BPM
provides an effective way to perform business operations, which will help ‘Tulloch Air’
organization to continuously drive performance improvements. It will enable Airline
organization to effectively align its business processes with its business strategy. Design,
modelling, monitoring, execution and optimization are the main stages of Business Process
Management Life Cycle which should be followed by the airline organization to overcome
existing business problems, increase customer satisfaction and stay competitive in the market.
However, ‘Tulloch Airline’ organization should adopt BPM to eradicate problems associated
with different airline departments like reservation, freight forwarding, catering, accounting,
scheduling, training, maintenance and finance and return the airline to profitability within 12
months.

Benefits of BPM
• Improved business agility – Tulloch Air organization can meet the demands of their
consumers by adopting BPM as its flexible design enables end users to bring desirable
organizational changes (BĂLĂNESCU, 2013).
• Increased efficiency – Currently, valuable time and money of the airline organization
has been wasted due to ineffective business operations. With the adoption of BPM,
the organization can perform its business operations like freight forwarding,
reservation, catering, scheduling, accounting etc. efficiently and smoothly.
• Increased visibility – Refined software programs have been used in BPM to
automate business processes. Tulloch Air organization can track and manage the
performance of each business process successfully by using these programs.
BPM and Business strategy
BPM should be properly linked with business strategy from internal and external perspectives
otherwise; it might be difficult for an airline organization to achieve organizational missions.
It focuses on organizational objectives and strategy, so it must be integrated with business
strategy. By implementing BPM, it would be easy for an organization to influence most of
the components of business strategy (BĂLĂNESCU, 2013).
Figure-1 Components of business strategy

BPM and Positioning
Through BPM, airline organization can achieve a reputable position in the business market by
providing better airline and freight services to their consumers.
BPM and structure
As per the given case study details, the organizational structure of ‘Tulloch Air’ is
inappropriate that might restrict it to achieve business goals. BPM will help the airline
organization to properly structure and organize its business tasks and human resources.
Hence, BPM and organizational structure are strongly linked with each other.
BPM and value propositions
BPM value proposition facilitates continuous improvements in business operations. By
following the value proposition of BPM, airline organization can process a number of
business operations with less effort and higher quality. To increase efficiency, effectiveness
and agility of business operations, business organizations should follow the value proposition
of business process management (Alzoubi, 2015).
How ‘Tulloch Air’ can improve its financial position by using BPM in
conjunction with value chains
‘Tulloch Air' organization has been performed various activities to design, market and deliver
its services to its valuable customers. The airline organization can improve its financial
position by performing its business operations efficiently and cheaply than its competitors.
The conjunction of the value chain and business process management could facilitate the
creation of an environment that will help the organization to attain competitive advantages
(Lincoln IV, 2018). In the following section, Porter's value chain analysis has been performed
to assess where improvements need to be made in the business operations of the airline
organization.

Figure-2 Porter’s value chain diagram
Primary activities
Primary activities Description
Inbound logistics Inbound logistics activities of the airline organization need to be improved
because some suppliers, particularly in the regional area occasionally deliver
a paper invoice to the representatives of the local airport which leads to delay
in request processing. As per the given case study details, travel agents are
also working as a supplier who helps passengers in tickets booking.
Passengers are unable to book tickets offline due to staffing issues at some
regional airports.
Operations ‘Tulloch Air’ organization performs various operations like reservation,
freight forwarding, catering, training and scheduling and maintenance on a
routine basis. Most of these operations are inefficient and inappropriate, that
is why, airline organization has been receiving a number of complaints from
customers due to incorrect fees debited from accounts, incorrect flights being
booked, flight delays, late arrivals at destinations, poor catering services etc.
However, the existing business process could not add value to the business.
Outbound logistics The outbound logistics activities of Airline organization do not add value in
business because of the number of disgruntled customers switching to
another airline provider due to the significant increase in delayed flights.
Sometimes, airline service staff members fail to deliver efficient services to

customers due to unavailability of information about the number of
passengers, freight loading, seating allocations etc.
Marketing and
sales
Presently, ‘Tulloch Air’ organization has been used ad-hoc advertising (like
print and radio) to promote its airline services. However, the distribution of
information about the promotions, timetable and relations with travel agents
outside the metropolitan area is highly challenging in ad-hoc advertising.
Table-1 primary activities
Support activities
Procurement Suppliers of goods and services have been requested for submitting
invoices directly to the head office of Tulloch Air in Melbourne. The
airline cash flow can be affected negatively as some of the suppliers
deliver paper invoices to representatives of local airports.
Technology Presently, ‘Tulloch Air’ organization has established its online presence
to encourage its passengers to book their tickets from anywhere and
anytime. Due to lack of confidence and awareness among passengers,
most of the people consult with travel agents to book their tickets which
adversely affect the financial position of the organization.
Human resource
management
It is difficult for airline organization to provide own flight training at the
workplace due to the small size of airports.
Firm infrastructure The existing firm infrastructure does not add value to the business as ROI
value has been reduced in the current scenario. Moreover, airline
organization has experienced low returns which negatively affect its
ability to maintain reliable and quality of airline services.
Problem analysis
Most urgent problem
After performing value chain analysis, it has been found that complaints from customers
related to incorrect fees being debited from accounts, major website outages and incorrect
flight booking are major problems which restrict ‘Tulloch Air’ organization to achieve its
business goals and objectives.

Identification of causes and consequences of the problem
5-Why technique has been used in order to identify causes and consequences of the selected
most urgent problem (Pelletier, 2014).
5-Why questions Causes (answer) Consequences
Why passengers, consult with
travel agents for booking their
tickets?
• Regional passengers
are unwilling to book
their tickets online
• Limited use of
online ticket
booking website
• Airline
organization is
required to pay
10% commission to
travel agents for
ticket booking
Why passengers do not prefer
online ticket booking website?
• Major website outages • Difficult for
passengers to book
their tickets
• Poor website
usability
experience
Why local travel agents cannot
fulfil all the requirements of
airline consumers?
• Due to unavailability
of limited staff at local
airports
• Passengers are
unable to avail
airline services
Why Tulloch Air does receive
complaints from passengers?
• Due to the inability of
local travel agents to
accurately manage
airline bookings.
• Sometimes
passengers miss
their flights due to
incorrect flight
booking
Why Tulloch Air organization
could not retain its customers?
• Due to the inefficient
and ineffective ticket
booking business
process
• Significant
decrease in total
customer count
Table-3 5-Why questions

Identification of the capabilities gap and the performance gap through gap
model
Business organizations use gap analysis techniques to compare their business’s actual
performance against the planned performance (Alotaibi and Liu, 2016). SWOT (Strength,
Weaknesses, Opportunities and Threats) analysis is an effective gap analysis technique which
has been used to identify the capability and performance gap.
Strengths
• Tulloch Air has been providing both
online and offline services to enable
customers to book their tickets as per
their needs.
• Travel agents help customers in ticket
booking (Kumar and M.S. Nain,
2011).
Weaknesses
• Ticket booking website outages
which might create cybersecurity
issues for end users.
• The number of customer complaints
regarding incorrect flight booking,
incorrect fees debiting etc. are
increasing at a rapid rate from the
past 12 months.
• There is a limited freight handling
arrangements in some regional
destinations which result in delivery
of wrong goods, flight delays,
damage of consignments etc.
• Information about freight loading,
seating allocation, number of
passengers, etc. is unavailable due to
poor communication between
different departments.
Opportunities
• To encourage passengers to utilize
online airline ticket booking facility
to eliminate the problem of the
commission, this is currently being
paid to travel agents by company.
• Emerging technologies like AI,
Threats
• Decrease brand reputation
• Decrease ROI value
• Total count of customers decreases

robotics, etc. can be adopted by the
airline organization to enhance the
efficiency of the ticket reservation
business process.
• $4,400,741 is the overall budget of
the airline organization to overcome
an existing business problem.
Table-4 SWOT analysis
‘As-is’ processes
Figure-3 As-is process
Steps by step description of current airline reservation process
Online airline reservation
1. First of all, passengers should open a ticket booking website of Tulloch Air
organization in order to book their tickets.

2. They have to enter their personal information, select airline service and make
payment to book their tickets (Mahmoodzadeh, Jalalinia and Nekui Yazdi, 2009).
Offline airline reservation
1. Passengers need to visit travel agent’s counters to book their tickets.
2. Travel agents enter personal information of passengers to book tickets as per their
requirements.
3. After successful booking of tickets, travel agents receive 10% commission from
Tulloch Air in return of ticket booking.
Project scoping diagram
A project scoping diagram is widely used to examine problems associated with a particular
process. In the following section, problems associated with project airline ticket booking
process have been examined with the help of a project scoping diagram (Turbit, 2019).
Figure-4 Project scoping diagram
Guides • Travel agents receive 10%
commission from Tulloch Air in

return of ticket booking after
successful booking of tickets
• Policies of Tulloch Air
Input • Personal details of customers
• Payment details
Enablers People • Travel agents
• Staff members of Tulloch Air
• Passengers
Technology • Online ticket booking website
Facilities • Both online and offline ticket
booking facilities are available for
passengers
Output • Payment receipt
• Flight booking details
• Complaints from customers
Table-5 IGEO diagram
Proposed solution
Business process architecture
Business process architecture can be defined as a hierarchical and visual model of processes
of a company. It is a powerful decision making and management tool which can be used by
‘Tulloch Air’ to improve its existing business processes. Senior management of the
organization can constantly focus on value delivery by developing and maintaining a BPA.
Moreover, the development of BPA will provide proven, effective and practical support to
Tulloch Air for the achievement of business performance goals.

Figure-5 Business process architecture for Tulloch Air
Proposed solution
It has been recommended to the CEO of Tulloch Air organization to adopt and implement AI
technology to overcome the identified capability and performance gap for delivering quality
customer services. AI technology based chatbots can be deployed by the airline organization
to attract number of passengers towards their services and provide virtual assistant to them
for airline reservation. Chatbot is a comprehensive solution that will allow the airline
organization to perform end to end tasks associated with the reservation process.