Tourism Service Operations Management: Airline Business Analysis

This report provides a comprehensive analysis of service operation management within the airline industry, focusing on Singapore Airlines and Flybe. The report begins with an executive summary and introduction, then delves into employee performance and job satisfaction, evaluating corporate strategies, conducting a value chain analysis, and measuring service quality and customer satisfaction. Key concepts such as Herzberg’s two-factor theory and the SERVQUAL model are applied to assess employee motivation and service quality. The report also examines the service concepts of both airlines, their corporate strategies, and identifies areas for improvement. The analysis covers primary and secondary components of the value chain. The conclusion summarizes the findings and provides recommendations for enhancing service operations and customer satisfaction within the airline sector.

Running head: SERVICE OPERATION MANAGEMENT
Service Operation Management
Name of the Student:
Name of the University:
Author’s Note:

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Executive Summary
The main purpose of the assessment is to analyse the business of airline sector and how different
policies are set by such businesses. The airlines which are selected for this assessment are
Singapore Airlines and Flybe which operate in different regions and are considered to be one of
the significant airlines operating from global perspective. The analysis further shows the policies
which are adopted by both the airlines in order to keep the employees of the business satisfied
and also improve the quality of services which is provided to the clients. In addition to this, the
analysis is also conducted in the services which is offered by both the airlines and how satisfied
are the customers with such services. The assessment further goes on to provide a value chain
analysis of both airlines citing primary and secondary components of the Value Chain Analysis
model. The assessment would also be showing application of theories and models such as
Herzberg’s two factor theory, SERVQUAL Model and also value chain analysis. The assessment
also includes the areas where further scope of improvement is possible and also how satisfied are
the customers with the services which is provided to them.
Table of Contents

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Introduction......................................................................................................................................4
Discussion........................................................................................................................................5
Employee Performance and Job Satisfaction..............................................................................5
Evaluating the Corporate Strategy of Both the Companies.........................................................8
Value Chain Analysis................................................................................................................10
Measurement of Service Quality and Customer Satisfaction....................................................14
Conclusion.....................................................................................................................................17
Reference.......................................................................................................................................18

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Introduction
The main purpose of this assessment is to analyze the business operation process of
airline industry and also depicts the different strategies which is followed by such sectors. The
analysis and comparisons would be done on the basis of two companies which are Singapore
Airlines and Flybe. The assessment focuses on the business of travel and tourism business and
how such businesses follows strategies for ensuring the employees are satisfied with the
companies. In addition to this, the report would also be highlighting the business models which
is followed by such businesses. The assessment further conducts a value chain analysis for both
the companies and what activities are undertaken by businesses for creating values for its
customers. The assessment would then be suggesting some recommendation which can help the
companies to further improve the business structure effectively.
The companies which are considered for this assessment are engaged in airline business
and the same is closely related to tourism industry. Singapore Airlines is considered to be a flag
carrier for Singapore and is one of the most popular airlines operating in the country
(Singaporeair.com 2019). The airline is regarded to be one of the best airline in the world as of
2018 estimates. On the other hand, Flybe is a British based airline and the airline was previously
the largest independent regional airline operating in Europe (Flybe.com 2019). The report
considers the strategies which is followed both these airline businesses for satisfying the
employees and improving the quality of services as well as efficiency in organisational
operations.

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Discussion
Employee Performance and Job Satisfaction
The performance of an employee in a business closely related to the strategies which are
applied by business for ensuring that such areas are covered. Similarly, job satisfaction is also an
important factor as it is closely related to retention of employees of a business (Sarwar and
Abugre 2013). The airline industry makes it a priority to look after the needs of the passengers
and ensure that the customers are content with the services which is provided by the companies.
The Singapore Airlines and Flybe are fast growing airlines in the tourism sector. For
these airlines there is a desire to improve employee performance by attaining job satisfaction in
order to ensure that quality services are offered to customers. Similarly, Job satisfaction is an
important component which the management of the company needs to consider for the purpose
of retaining skilled employee and also for enhancing the profitability of the business.
Employee Performance
In the case of Singapore Airlines, the management of the company is dedicated towards
maintaining the influence of the business over the market and therefore expects their staff to give
their best efforts towards the goals and objectives which are set by the business. Another aspect
which a major requirement for the business is maintaining integrity in its operations which is
also expected from all staff members (Bogicevic et al. 2013). The management of the company
sets targets for the employees and on the basis of the targets sets, the performance of the business
is measured.

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In the case of Flybe, the management of the company recognizes that the profits of the
business are closely related with the performance of the employees and also with retention of key
employees in the business. The company has around 1700 staffs around Europe and the
management has set certain policies so that the employees are satisfied and can outperform
themselves. The company also sets targets for the employees and on the basis of the same
performance of the employees are measured. As per the estimate, the company won Most
Environmentally and Socially Responsible Budget Airline’ award which shows that the
employees of the business are working efficiently and also sustainably.
Job Satisfactions
The performance of the employee is closely related to the satisfaction associated with the
job profile. If an employee is satisfied with the environment and the work process, then the
employee would be motivated to contribute more towards the business which can enhance the
performance of the business as well as the employee (Zopiatis, Constanti and Theocharous
2014). As per the annual reports and corporate governance reports for both the companies, it is
clear that employees are motivated and encourage with perks and additional benefits which
definitely contributes to the performance of the employees significantly.
The management of both Singapore Airlines and Flybe needs to first identify the
contributing factors which affects the motivation level of employees and how the same lead to
job satisfaction (Pantouvakis and Bouranta 2013). The management of both the companies can
apply Herzberg’s Two-Way theory which effectively identifies factors which contribute to
employee satisfactions and better performance. As per the theory, there are two factors in a
business environment which can affect motivation in a work place and the factors are namely

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hygiene factors and motivating factors (Expert Program Management. 2019). Hygiene factors
does not directly affect the employee but the employee would not be able to work if such factors
are not present in a business. On the other hand, motivating factors have a direct impact on the
mindset of the employee and these factors push them to work harder.
Figure 1: Two Factor Model diagram
Source: (Expert Program Management. 2019)
The above figure shows some of the examples which a company can adopt for improving
the hygiene and motivating factors for an employee. The different examples which are shown
above are followed by most of the companies in order to keep the employees of the satisfied and
enhance the performance of the business. Therefore, following this model, the management of

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Singapore Airlines and Flybe needs to take the following steps for enhancing the motivation
level of the employees of the business.
 Eliminate Job Hygiene Stressors: The first step is identified whether the hygiene factors
are appropriate and ensure whether the same are not causing dissatisfaction among the
employees of the business (Osabiya 2015). The management can make amendment’s in
company’s policies and ensure that the working environment of the employees are
appropriate.
 Boasting Job Satisfaction: The next step which the management can take is to provide a
boost to motivational factors which can be done job enrichment, job enhancement and
empowering the employees (Hazra, Ghosh and Sengupta 2015). In addition to this, there
is also rewards and recognitions for employees for boasting their moral.
The above theory shows that the management of both the companies can apply such a theory
and boost the confidence of the employees so that they can perform even better.
Evaluating the Corporate Strategy of Both the Companies
As discussed in the above paragraph, the business is engaged in providing a service to the
passengers and the main revenue which is generated by the business is from such a source. As
per the financial highlights for the business of Singapore Airlines, the return which is provided to
the investors is shown to be significantly high which shows the performance of the business and
ability of the same to generate profits. In the case of Flybe, it is also noted that the revenue which
is generated by the business has enhanced.
Service Concept

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The Singapore and Flybe Airlines use a service concept that ensures that customers
receive high quality services. This is primarily because the quality of service impacts the overall
impression of customers towards airlines in terms of their superiority in the airline industry. In
the case of Singapore Airlines, the management follows the model which is directed to enhance
the revenue and profits of the business but at the same time also ensure that the customers are
satisfied with the services which is provided (David Mc 2013). In case of Flybe Airlines as well,
the focus of the management of the company is to ensure that customers are satisfied with the
services and also ensure that a level of quality is maintained at all times.
Service Concept Analysis for Singapore Airlines
The core business of Singapore airlines is to provide the best quality of services for the
customers and also ensure that the quality level is maintained by the business. The business is
regarded as one of the best in the world as per current estimates and this shows that the
management of the company is dedicated towards providing efficient services to the customers.
The business has different types of aircrafts and have destination in many countries which makes
it a perfect airline for foreign travel. In addition to this, the airline also provides domestic travel
services for its local customers (Bieger and Agosti 2017). The management of Singapore airlines
has developed a business model which aims at providing excellence in the services which is
provided by the airlines and also engage in innovation so that a competitive edge can be
developed against the competitors of the business. These can be regarded as the main reasons
due to which the business has been able to face tough competition in the market and still survive
as one of the top airlines in the country and world. It is also to be noted that the management of
Singapore airlines is also dedicated towards sustainability practices so as to ensure continue
survival and prosperity of the business.

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Service Concept Analysis for Flybe Airlines
The service which is provided by Flybe is quite similar and even identical to the services
which is provided by Singapore airlines. The core area of business for Flybe is to serve the
customers efficiently and ensure that all the customers are satisfied with the services which is
provided by the airlines (Holloway 2017). The management of Flybe prefers to promotes the
services which is provided by the business by offering more discounts and attractive offers to the
customers. It is one of the known packages of Flybe to be offer family discounts and special
coupons to families travelling under its banner so that it can build a customer base for itself. This
is also a technique for combating the competitors of the business and further enhancing the
profits of the airlines. The corporate strategy of Flybe focuses on structural efforts towards
product development and design. The company is also dedicated to sustainable practices and
innovation so that further improvement can be brought about in the business structure.
The Singapore Airlines and Flybe are service organisations whose primary object and
strategy is to attract customers by providing quality flight services (Albers et al. 2017). Both the
airlines are trying to reach out to as many customers as possible for the purpose of enhancing the
revenue of the business further. Therefore, it can be said that the service concept for both
Singapore Airlines and Flybe are identical in nature and therefore they can be treated as
competitors from global perspectives.
Value Chain Analysis
Value chain analysis can be regarded as one of the strategic management tool which
analysis the internal and external activities of a business which are intended towards creation of
value from such activities. The analysis is conducted in order to identify which activities of the

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business are valuable in nature in terms of the final product or service which is offered by the
business. This part considers the value which is generated by the business of Singapore Airlines
and Flybe for its customers. The use of Value Chain is a strategy used by airlines such as
Singapore Airlines and Flybe to ensure excellent services are delivered to customers. The value
chain analysis is conducted on the basis of primary activities and secondary activities of the
business. The primary activities are closely related to the services or product which is offered by
the business while the secondary activity are support activities which can help businesses with
their core activities.
Figure 2: Figure Showing Value Chain Analysis and its components
Source: (Jurevicius 2013)
The above figure effectively shows the components of value chain analysis and how the
same can have an impact on the overall value which is created by the business. The diagram
shows the different activities which needs to be undertaken by a business in order to create value

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for the customers (Jurevicius 2013). The discussion regarding the primary and secondary
activities of the business are discussed in the paragraph below
Primary Activities of Singapore Airlines and Flybe
The value chain analysis involves primary activities which are considered to be the main
activities which is undertaken by the business for creating value for the customers. As both the
companies are engaged in the same line of business therefore the activities of the business would
also be same considering the activities which are undertaken for creating value. The activities are
discussed below in details:
 Inbound Logistics: These airlines are associated with service industry and therefore are
involved in activities associated with inbound logistics such as receipt and storage of
products. The passengers are not the only one travelling and therefore the same also
needs to be taken care (Daft and Albers 2013). The inbound logistics deals with basis
materials which is required for the operations and in this case the passengers and the
luggage they bring into for the travel.
 Operations: The operations activities of the business include all those pre-check ups and
involves activities such as with, packaging, equipment assembly and maintenance. The
activities are conducted before the travelling begins for the passengers. In the case of
Fluybe however there is a problem with operations which mainly involves repairs and
maintenance which needs to be improved by the management of the company.
 Outbound logistics: The outbound logistics involves transferring the final product of the
business to the final consumers and in this case how the tickets are sold and how
customers are treated for their satisfaction is considered while considering creation of