As described by Michael Porter in his 1985 publication, the concept of value chain is an attempt to describe how a company builds value for its customers using a series of activities to achieve the service or product that successfully and effectively satisfies the customer needs. It rests upon the need to identify, select and analyze each organizational activity or task and assess the value or meaning it adds to the desired products and services (Malaval, Bénaroya & Aflalo, 2012). Consequently, the term ‘activities’ includes the organized systems and activities within the organization (Malaval, Bénaroya & Aflalo, 2012).
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Emirates Airlines is a member of the Emirates Group that consists of Dubai National Air Transport Association and transport related activities and a hotel group. The company is owned by the government of the Emirate of Dubai, a member of the 7-emirates that make up the UAE (Emirates Airlines, 2014). From its headquarters in Dubai, the company serves more than 140 cities in about 78 nations across the world’s six continents (Emirates Airlines, 2014). Currently, the company is among the first airline operators boasting of luxurious fleets such as the Boeing and Airbus and a number of routine wide-body fleets (Emirates Airlines, 2014). It has created value in its services due to the use of luxurious but at relatively lower prices compared to most other international companies.
Value Chain analysis of the Emirati Airlines’ Activities
The company has a number of activities related to inbound logistics. For instance, the exclusive Emirates Terminal 3 is an important facility in Dubai international airport built for the purpose of the company’s use. It was completed in October 2008 at a cost of about $4.5 billion, becoming the second largest building in the world in terms of floor space as it occupies more than 420 acres of land (Emirates Airlines, 2014). The capacity of the facility is estimated to exceed 43 million passengers per year. In addition, the company completed its new concourse 3 in 2013 meant to handle the large Airbus A380-800 flights (Emirates Airlines, 2014).
In addition, the company focuses on the management of yields and strives to reduce dependency on supplies. The Dubai international Airport, which is largely owned and controlled by the mother company, gives the company a competitive advantage over the regional and international competitors, especially because it has exclusive rights to use most of the facilities therein.
The company focuses on self operations in a number of areas in order to improve its knowledge of customer needs. The Emirates has developed a strong web-based service provision with an aim of ensuring that customers enjoy quick and efficient self-service in a number of activities. For instance, a number of tasks have been automated to allow self-service for the customers, including checking-in, service desk, longing and boarding, handling of baggage and pushback at the airport.
The Emirates SkyCargo and Emirates Executive are the company’s outbound services that contribute to the value creation in its services. Emirates SkyCargo serves as the company’s air freight division. Currently, the fleet is much larger and services about 10 exclusive destinations for cargo apart from those in the company’s network.
Marketing and sales
Emirates Airways uses its slogan “Fly Emirates” to develop an impression among the public that it is safe, fast and comfortable. Various advertisement programs are aired across the world through national, regional and international radio and television as well as the internet (Plunkett, 2008). In all the cities served, the company has embarked on intensive marketing strategies, including large advertisement billboards, mass media advertisement and other techniques. In addition, it takes safety issues seriously, and has never been affected by major incidents and accidents in its history. Moreover, the company has official sponsorship of leading athletic and sport organizations, especially in the European soccer leagues such as the English Premier League.
The achievement of international awards has earned the company a good reputation in terms of safety, growth and profitability, which creates value of its services. Moreover, it has an effective pricing strategy that allows it to set lower price tags on its services compared to most European and American airlines, especially because it uses its airport in Dubai for exchanges instead of the European airports such as Heathrow and Amsterdam for the America-bound flights (Wittmer, Bieger & Müller, 2011).
Emirates Airline creates value of its services through its service package that consists of Emirates Hotels and Resorts, Emirate Lounges, Sky Wards, ICE and 24 hours Prior Check-in Service.
Support services in Emirati Airlines
Government sponsorship is one of the most significant strategy that has added value to the company. The company was started by the government of the Dubai Emirate and supported by the federal government of the UAE as a strategic investment to attract investment in the country. The source of capital was provided by the government and so were the required infrastructure, including the international airport in Dubai. In addition, the company enjoys free tax offered by the Dubai international; Airport, which makes operations effective and less costly. Moreover, the company’s sponsorship by the government allowed it to enjoy standard aircraft, which has added value because it attracts a large number of customers.
Human Resource Management
The company runs the Emirates Aviation College, an affiliate that successfully and constantly supplies the airline with highly trained and dedicated employees. Over the years, the company has been providing its employees with rewards and recognizing them under a reward employee program. The aim is to enhance employee motivation while also focusing on their performance. In addition, employees are enticed under the accommodation and transport allowance programs.
Emirati Airlines has an in-house research center, an engineering center and a computer reservation system that promotes and enhances technological research and development to support its primary services. In addition, it has an in-flight system as well as a flight scheduling system.
The procurement system at the company consists catering service, fuel handling as well as stock control, food and drinks offered to customers at the airport as well as during the flights.
It is clear that Emirates Airlines is among the largest airlines companies in the modern world, despite having in operation for only three decades compared to most of its competitors that have been in the business several decades. It is worth noting that its achievements are based on its ability to create value of its services offered to the customers, thus satisfying and attracting a large pool of clients both locally and internationally. Its activities ensure that the company offers customer-oriented services in order to create value and meet the customer needs and demands in a highly profitable but risky and costly venture (Malaval, Bénaroya & Aflalo, 2012).
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Emirates Airlines. (2014). Our Destinations. Web.
Malaval, P., Bénaroya, C., & Aflalo, J. (2012). Aerospace Marketing Management: A Handbook for the Entire Value Chain. New York: Springer Science & Business Media. Web.
Plunkett, J. W. (2008). Plunkett’s Transportation, Supply Chain & Logistics Industry Almanac: The Only Comprehensive Guide to the Business of Transportation, Supply Chain and Logistics Management. New York: Plunkett Research. Web.
Wittmer, A., Bieger, T., & Müller, R. (2011). Aviation Systems: Management of the Integrated Aviation Value Chain. New York: Springer Science & Business Media. Web.