Innovation Management Report: Etihad Airlines Innovation Capabilities

This report provides a comprehensive analysis of innovation management within Etihad Airways, focusing on the airline's past, present, and future innovation activities and capabilities. The report begins with an executive summary and delves into the future of the airline industry, specifically...Read More

Running head: INNOVATION MANAGEMENT
Innovation Management
Name of the Student
Name of the University
Author note

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Executive Summary
The report has been capable of understanding the future innovation trends in the entire airline
industry of the United Arab Emirates market along with the Etihad Airlines in a successful
manner. From the different surveys and research, it has been made clear that the airline industry
is contributing to more than 2% in the carbon emissions and due to which it is impacting the
performance of the company negatively. In such scenarios, the sustainability related practices
along with usage of the artificial intelligence aspects are the effective aspects which need to be
implemented by the respective organization to improve their effectiveness and gain
competitiveness in the market in a successful manner.

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Table of Contents
Introduction, Purpose of the Report & Structure.............................................................................3
The Future of the Industry 2020 and Beyond..................................................................................3
The Organizations’ Innovation Requirements 2020 and Beyond....................................................5
Building the Future Innovation Capabilities for the Organization..................................................7
Conclusion.......................................................................................................................................8
References......................................................................................................................................10

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Introduction, Purpose of the Report & Structure
As commented by Wagner and Walton (2016), the creativity are the capability or act of
conceiving something original or unusual in nature. Innovation is the proper implementation of
the something new which will be beneficial in making the company or the entire industry highly
competitive in nature. The main aim and purpose of the report is to analyze and identify the
future of the Airlines Industry in 2020 and beyond. In addition, the innovation requirements of
the airlines industry in 2020 and beyond needs to be identified which will be capable of
providing a brief understanding on the capabilities which are needed to be built for the company
in the near future as well. The structure of the report includes the future of Airline industry 2020
and the innovation requirements along with capabilities for the company in the future.
The Future of the Industry 2020 and Beyond
As commented by Torija, Self and Flindell (2016), in the year 2020 and beyond, the
ultimate demand for the air transport is expected to increase to a high level by an average of
more than 4.3% per annum over the next twenty years. If the respective growth is being
achieved, by the year 2036, the air transport industry will be contributing 15.5 million direct jobs
and $1.5 trillion of the Gross Domestic Product to the entire world economy. In a survey of the
International Air Transport Association, it has been noted that the aviation sector of UAE would
be growing 170 percentages as the entire industry is capable of introducing the different kinds of
aspects such as becoming the significant player in bolstering the position of the country as the
international hub for the tourism along with business in a successful manner (Price et al. 2019).

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Figure 1: Analysis of the market Liberalization in UAE
(Source: Pfister 2017)
The past ten years have been capable of marking by the key milestones for the UAE
aviation in terms of the fast expansion of the network of airlines, crew, and infrastructure along
with presence in international market. In the future, the aviation industry in Middle East is about
to change as over the next decade, the industry is likely to see growth which would be massive in
nature (Pfister 2017). The Middle East remains fastest growing air transport market in the entire
world with their traffic expanding over 2019 at the rate of 12.7% in comparison to 2018. From
the respective trend, it has been analyzed that Etihad along with other airlines such as Emirates
Airlines are planning to expand their business operations in a much steady phase in the years to
come and maintain their effectiveness in a suitable manner.
As commented by Payán‐Sánchez et al. (2018), there are three major areas where in the
government can be promoting the aviation’s growth and bring more value to the UAE market of
aviation which are described as follows:

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Firstly, increasing the capacity of the airspace can be managed for easing the congestion
along with meeting the future demand in a successful manner. The governments in the respective
regions can be replacing the political fragmentation with the collaborative cross-border decision-
making which will be suitable for ensuring global competitiveness of the region’s hub and it is
not being affected (Mousavi and Bossink 2017).
Figure 2: Growth of Gulf Airlines
(Source: Klampfer, Haeusler and Naef 2017)
There should be continuation in leveraging the new technology along with process
innovation which will be enhancing the efficiency and the experience of the passengers. The
UAE market is considered to be the pioneer in utilizing the innovation for improving the
experience of the passengers. In the future or from 2020, the fast adoption of the new technology
along with initiatives can be helpful in integrating the aviation with the future modes of the

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transportation which will be capable of enhancing the competitiveness of the UAE aviation hub
in a successful manner (Klampfer, Haeusler and Naef 2017).
The Organizations’ Innovation Requirements 2020 and Beyond
In the future, there are few innovations which are needed to be implemented by Etihad
Airlines as to become highly effective among the different individuals and augment the airport
and airplane experience among the customers as well. Etihad Airways along with Elenium, the
provider of the automation technology solutions have been announcing the different kinds of
plans which help them in revolutionizing airport check-in experience and service for the
customers. In the entire world, wherein the air travel contributes to more than four to nine
percentages of the man-made greenhouse gases, it is highly essential for the companies to find
out the sustainable ways through which they can propel the people through air (Kim, Lee and
Ahn 2019).

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Figure 3: Sharing is Caring
(Source: The News Economy.com 2020)
The most exciting solution which can be implemented and adopted by Etihad Airlines in
the respective aspect is Electric-Powered Flight that will be able to see loud, gas-guzzling jet
engines replaced with the clean, quiet motors. The Photon Powered Planes such as Solar
Impulse Craft will be promising and it is the realistic remedy which is needed to be implemented
in the future. The process is quite complex and it requires proper planning and it should yield
working hybrid prototype by the year 2020. The usages of the smart materials are highly
effective in managing the growth of the company in an efficient manner with few adjustments in
the existing engines designs for making the scenario highly efficient in nature (The News
Economy.com 2020).

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As the new kinds of airplanes are rapidly emerging in the market, there is nothing to stop
innovation with such classic models as well. In the long run, the airplanes need to think of the
innovative solutions wherein they must be having the proper potential in cutting the consumption
of fuel, boosting the aerodynamics along with making the planes faster through giving them
stronger along with lighter bodywork (Khaleejtimes.com 2020). The green power and the smart
materials usage are the two main components which are needed to be implemented by Etihad
Airlines in the future and beyond as the world needs to be greener and it can be only done
through implementing such technological advancement in their setting for making the
effectiveness high and managing their growth in a strong manner. Etihad Airlines have been
trying really hard in introducing the in-flight applications for customers which is the other
technological advancement and it can be gained through the usage of the Artificial Intelligence
which will be effective in improving their performance.
Moreover, the idea generation for 2020 and beyond can be difficult to a certain extent as
there can be high level of uncertainty in the preferences of the different customers and the prices
of the fuel can be driving three major trends which includes financial restructuring, increased
level of competition along with industry related consolidation (IATA.org 2020). In such
scenario, Etihad Airlines need to understand and survey the different needs and requirements of
the different customers which will be providing them with the brief outline of the different kinds
of future trends which will be beneficial for them in managing their growth prospects in the
market and gain competitiveness in the market as well. In order to make the environment and
earth a better place and a pollution free place, airline companies such as Etihad Airlines or Qatar
airways need to take their companies to the next level which will be beneficial in managing their
effectiveness to a large extent as well.

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Building the Future Innovation Capabilities for the Organization
As commented by Hodgkinson and Johnston (2018), innovation is required to be
becoming the heart of the entire airline industry and strategy in the future for making their
business highly profitable. The structural technology change is the key element and aspect
which is needed to be implemented by the company such as Etihad Airways in case of
reservations as well as the flight operations system. The technology is being improved from last
few years to provide the customers with the seamless experience and enjoy the pleasant trip from
the time they check-in till they leave the flight. In such scenarios, virtual reality along with
immersive experiences can be true differentiator in the saturated airlines market which will be
capable of making the passengers feel delighted with their experience in travelling with Etihad
Airlines (Frediani et al. 2017).
In addition, the other future innovation capability for Etihad Airlines is the in-flight
connectivity related experience that can be provided to the different customers. Many of the
airline companies are trying hard for digitizing the in-flight experience as to stay relevant. In the
next few years, the technology will be highly more advanced that will be keeping a track on the
different approaches for staying ahead of the other competitors. The respective demand will be
driving real-step change in the terms of the quality of the connectivity on offer. For instance- In a
recent survey, it was being noticed that when the airline companies are planning to offer the
access to customers with the e-commerce websites, it means they are missing the opportunity to
work with the different retail giants such as Amazon or Alibaba (Forbes.com 2020). When there
will be in-flight connectivity, it can be considered to be the real opportunity for bumping in the
in-flight sales through launching the real-time offers along with initiatives to drive the
conversion.

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Sustainability is the other key innovative capability which is needed to be implemented
by Etihad Airlines as the year 2020; it has been the crucial year for the airlines industry to ramp
up in the different efforts related to sustainability. The companies such as Etihad Airlines need to
become the world’s first major commercial airlines, which will be operating with net-zero carbon
flights across the entire network and it will be effective in maintaining the sustainability related
practices in the entire environment as well. In addition, the in-flight airlines mainly rely on the
single usage plastics with 5 million tones of the cabin waste created in a single year (Forbes.com
2020). It alone can be impacting the surroundings and impact the growth of the company to a
large extent. In such scenarios, it becomes highly challenging for the companies to introduce
such aspects which will be beneficial in improving the effectiveness and maintain the decorum
which will be making the environment pollution-free as well.
Lastly, the other artificial intelligence aspect is the hearable, wearable along with voice
technology which can be implemented by Etihad Airlines. The respective device will be
beneficial and helpful for transmitting the different passengers feel highly rejuvenated. It is the
complete new initiative that will be beneficial in making the experiences of the customers
seamless as well as managing the growth of the company as a whole to improve their
effectiveness in the competitive business environment (Dziallas and Blind 2019). Therefore, as
the technology continues to mature, it will be without any doubt open new and exciting
opportunities for the different companies in strengthening the relationship between the
businesses as well as other customers to improve their effectiveness in a suitable manner in
comparison to the other competitor airline companies (Camacho et al. 2016).

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Conclusion
Therefore, from the analysis of the future of the airlines industry in 2020 and beyond
along with understanding the organization requirements of 2020 and beyond, it can be seen that
in the future, in order to make the environment highly sustainable in nature, there are few aspects
which are needed to be changed in order to improve the effectiveness in a suitable manner.
firstly, the sustainability is the key element that can be done through the green power wherein it
will be reducing the wastage of the different items and the plastic bags usage will be reduced. It
will be making the world a better place to live in and it can be done with the help of the smart
materials.
In addition, as the future is highly uncertain, in such scenarios, it is highly necessary for
the companies to understand the usage of the artificial intelligence for making themselves
effective and it will be improving their performance in the competitive business environment.
Lastly, it can be inferred that airline industry contributes to more than 2% of the carbon
emissions and in order to reduce the same, it is highly necessary to take care of the different
kinds of wastages in the flight for making the experience valuable for the customers.

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References
Camacho, T., Foth, M., Rakotonirainy, A., Rittenbruch, M. and Bunker, J., 2016. The role of
passenger-centric innovation in the future of public transport. Public Transport, 8(3), pp.453-
475.
Dziallas, M. and Blind, K., 2019. Innovation indicators throughout the innovation process: An
extensive literature analysis. Technovation, 80, pp.3-29.
Forbes.com 2020 Will the Future of Middle East Aviation be dictated by low cost carriers?
(Online) Retrieved from https://www.forbes.com/sites/dominicdudley/2019/12/16/future-of-
middle-east-air-travel/#967563027802 [Accessed on 12th April 2020]
Frediani, A., Cipolla, V., Binante, V., Abu Salem, K. and Maganzi, M., 2017, September.
Parsifal project: a breackthrough innovation in air transport. In XXIV AIDAA International
Conference.
Hodgkinson, D. and Johnston, R., 2018. Aviation law and drones: Unmanned aircraft and the
future of aviation. Routledge.
IATA.org 2020 Continued Prioritization of Aviation Essential to Supporting Jobs and GDP
Growth in UAE (Online) Retrieved from https://www.iata.org/en/pressroom/pr/2019-10-08-01/
[Accessed on 12th April 2020]

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Khaleejtimes.com 2020 UAE aviation set for exceptional growth (Online) Retrieved from
https://www.khaleejtimes.com/welcome-2020/uae-aviation-set-for-exceptional-growth
[Accessed on 12th April 2020]
Kim, Y., Lee, J. and Ahn, J., 2019. Innovation towards sustainable technologies: A socio-
technical perspective on accelerating transition to aviation biofuel. Technological Forecasting
and Social Change, 145, pp.317-329.
Klampfer, B., Haeusler, R. and Naef, W., 2017. CRM Behavior and Team Performance Under
High Workload: Outline and Implications of a Simulator Study'. Innovation and Consolidation in
Aviation.
Mousavi, S. and Bossink, B.A., 2017. Firms’ capabilities for sustainable innovation: The case of
biofuel for aviation. Journal of Cleaner Production, 167, pp.1263-1275.
Payán‐Sánchez, B., Plaza‐Úbeda, J.A., Pérez‐Valls, M. and Carmona‐Moreno, E., 2018. Social
embeddedness for sustainability in the aviation sector. Corporate Social Responsibility and
Environmental Management, 25(4), pp.537-553.
Pfister, P., 2017. Innovation and Consolidation in Aviation: Selected Contributions to the
Australian Aviation Psychology Symposium 2000. Routledge.
Price, G., Briceno, S.I., Pinon, O.J., Wang, J. and Waszak, M.R., 2019. Innovation and
Convergence-Divergence. In AIAA Aviation 2019 Forum (p. 2875).
The News Economy.com 2020 Top Five Aviation Innovations for the Future (Online) Retrieved
from https://www.theneweconomy.com/technology/top-five-aviation-innovations-for-the-future
[Accessed on 12th April 2020]

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Torija, A.J., Self, R.H. and Flindell, I.H., 2016. Evolution of noise metrics in future aviation
scenarios in the UK.
Wagner, S.M. and Walton, R.O., 2016. Additive manufacturing’s impact and future in the
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