Resource Integration Management Practices In Air New Zealand: A Critical Evaluation

Researching and Identifying Resource Integration Management Practices within Air New Zealand

Purpose of the paper:

This particular paper has provided in-depth overview about integration management practices and its importance in business operations. Integration management is all about maintaining a proper harmony within team by monitoring and coordinating all functions of organizational activities. In order to run a team, the project manager is responsible to maintain integrity within team members so that projects can be delivered at proper time

Scope:

Maintaining harmonization within business operations is one of the most significant roles of business managers. Therefore, by implementing integration method, the business experts of Air New Zealand intend to keep a proper balance within business process. Being associated with airline industry the business experts have to be very much concerned in maintaining superior quality of services rather than focusing on products

Limitation:

The study is not devoid of some of its major limitations. Theories of integration management could have been evaluated in detail. In addition, the risk mitigation policy has not been discussed in detail.  

1. Resources & Transformation Process

Transformation process is an activity which maintains the entire inbound and outbound system in a proper and systematic way based on which the target customers can get the services within stipulated time. ACARE Strategic Research Agenda has quoted Air Transport is defined as “the movement of aircraft, of all types, and their passengers, through airports and sky, in a timely and economic manner, without undue constraints on their preferred flight trajectories (aircraft), journeys (passengers) or departure and arrival times”. The entire input and output transformation schedule of Air New Zealand is constituted with three major steps. The three steps involve flight schedule generation, aircraft schedule generation, planning and designing the operation, outbound the passengers towards proper destination. Flight schedule primarily covers a period of three to six months. Flight schedule is formed and designed in such a way that internal and external stakeholders do not have to face challenges in following the schedule. Aircraft schedule generation primarily follows two major steps, one is fuel calculation and the other is air traffic control requirements. Fuel calculation is made in order to ensure that aircraft can reach the stipulated destination within proper time. In order to mitigate the risk of midair collision, air traffic control has to be very much responsible.   

Planning and designing the operation is one of the most significant parts of transformation. It is however observed that before fixing the price of products the business experts have to set the target market first. The service providers should have multilingual flexibility with the help of which customers from different geographical boundaries and attitudes can be attracted in using the services. On the other hand, it has also been observed that Planning is one of the important components, which reflects the collaborative output of the personnel of Air New Zealand. Assemblage of the resource groups helps the top level managers to conduct audits and review of the practices (Albrecht et al., 2015).

Excavating goals and indicators is one of the other practices conducted by the practices, which Air New Zealand adopts for performing the resource integration management. Different level of management collaborate for translating the goals into the measurable indicators. This translation is effective in terms of setting the targets, which needs to be attained. Within this, special attention is given to the special warnings, which might alter the direction of flights. These are: sensitivity to ecological variability, variable weather conditions, understanding the approach of the decision maker among others. Brewster, (2017) feels that monitoring of these activities is vital for ensuring that efficiency is maintained in the business operations. As these activities are cost effective, stable relationship is maintained with the members of the trade union.

Evaluating Key Theories and Models of Contemporary Resource Integration Management Practices in Air New Zealand

Before making the outbound process systematically, the business experts have to monitor the entire operation properly. Monitoring is accounted as one of the other practices for integrated resource management in case of Air New Zealand. This includes inspection by the experts for the aircrafts in order to prevent the instances of defective aircrafts before the initiation of the flight services. Skilled and qualified experts are hired for conducting the inspections. After the inspections, reports are delivered to the higher authorities for acquiring additional resources, which are needed for repairing the damaged parts of the aircrafts. Mention can be made of Safety Management Systems, where the important practices are hazard identification through risk management. Reaching the passengers to proper destination within stipulated time is one of the important transformation process that Air New Zealand follows.   

1. Evaluation of the transformation process, comparing with the competitors

In order to implement the entire transformation process systematically the business experts of Air New Zealand has made in-depth trade off analysis. Trade-off analysis is one of the other practices within the integrated resource management. If theories are considered within the goals, then the management of Air New Zealand emerge successful in mapping large landscapes. This is additional assistance for planning in terms of implementing GPRS sensors in the remote areas. Mostly, it has been observed that there is a tendency to attain economic growth without the consideration of previous trade-off analysis. As a matter of specification, trade off analysis is assistance for Air New Zealand in terms of preparing land use strategies (Saebi and Foss, 2015). In order to make the entire operation process successfully the organization has used PDCA model. In the planning component, plans, business models and methodology reflects the approach of the personnel of Air New Zealand towards managing the business practices in an efficient and effective manner. In case of “doing”, the approach towards conducting the business is deployed through rational control in terms of improving the standards and quality of the flight operations. Here, Hubbard, Rice & Galvin, (2014), places focus on innovation breakthrough, where positive outcomes is yielded through strategic approach. Quality tests are conducted for reviewing the performance before launching them for the clients and the customers. These reviews are assistance in terms of undertaking appropriate actions like risk assessment.

1. Core-Services, Value-added services, trade-offs, performance objectives with polar diagram

Providing superior quality of services in affordable price range is the primary aim of this very specific study. The service providers are very much professionals with multi-lingual competency. Service users do not have to face immense challenges in dealing with the professionals. The food quality provided by Air New Zealand is very much superior as well as affordable. Among value added services, Air New Zealand provides translators to help those passengers who have language incompetency. As per cost effectiveness, Air New Zealand belongs to moderate phase where the passengers belong to average-income status. In this kind of situation, the number of target customers of Air New Zealand is high.

Polar diagram primarily identifies the position where the company belongs in current market scenario. In this business market scenario, it has been observed that Air New Zealand in compared to its competitors is very much cost effective, due to which the organization has to face challenges in creating market demand. In case of doing, scaling the activities helps the personnel of Air New Zealand to measure the effectiveness, appropriateness and feasibility. This aligns with the identified goal of achieving organizational excellence in terms of the business operations. Haksever & Render, (2018) opines that checking and acting are parts of evaluation. Here, reliability and validity is developed through the experiments and quality checks, which brings to the forefront the defects, which needs to be modified before fulfilling the needs, demands and requirements of the clients and the customers.

1. Competitive Advantages and Sustainability by using VRIO Analysis and Porters 5 Forces

Guiding Strategic Factors and Concepts affecting Resource Integration Practices in Air New Zealand

VRIO analysis:

• Value:

The value of products as well as services existed within organization is high in range. The passengers get additional benefits and facilities from the service providers. Employees always intend to show their sympathetic outlook towards those employees who have language barrier.  

• Rare:

Air New Zealand is in competitive conformity due to which resources are not rare but it extremely valuable. This output brings to the forefront the competencies of the professionals of Air New Zealand. These aspects indicate conflicts, which degrade the sanctity of the workplace (Cachon & Terwiesch, 2017). However, ethical code of conduct is implemented for enhancing the cultural diversity. Within the ethics, consideration of the interests of clients is essential in terms of averting the instances of customer and employee turnover.

• Costly to imitate:

Competitors’ resources are very much costly to imitate due to economic constraints. In this kind of situation, organizational experts have to face innumerable challenges in gaining competitive advantages.

• Organized to capture value:

If the resources are valuable, rare and not easy to imitate, the business experts do not have to face challenges in gaining market advantages. One of the major problems with business operation of Air New Zealand has been identified that service providers are not well accustomed with multi-lingual flexibility. In this kind of situation, the business experts based on major priority have decided to take immediate initiatives of providing effective communication with the customers based on which they do not have to face challenges in receiving effective services (Argyris, 2017). This particular implementation of policy is considered as one of the most effective strategic responses.   

Porter’s Five Forces:

Power of the suppliers	Power of the suppliers in the market of New Zealand is high. The number of raw material suppliers in New Zealand is few in number. As a result, airlines do not get immense opportunity in bargaining with the suppliers.
Power of the buyers	The number of airlines is not immense in New Zealand due to which buyers do not get enough scope of bargaining with the business experts. Therefore, Power of the buyers is low.
Competitors’ market threats	Competitors’ market threat in the market of New Zealand is high due to the establishment of some of recognizable airlines. Jetconnect, Qantas, Mount Cook Airlines are some of its major competitors.
Threats from the rivals	The competitors like Jetconnect, Qantas, Mount Cook Airlines are very much prominent as a competitors with the help of which the business experts have to face immense challenges in maintaining their business sustainability.
Threats from the substitutes	In comparisons to other transportation system like water, road or railway the passengers belonging to New Zealand like to make their journey by air. Therefore, threats from the substitute is very low.

1. Service/Product Design and Capacity Planning

In order to follow effective product or service design method Air New Zealand has followed the below framework.

Air New Zealand has designed their service plans by constituting several teams. The role of knowledge management support is to make in-depth research about the trend of current market, the needs and demands of customers and making future analysis of risk management strategies. By getting a proper direction from the top management, the employees associated with operations intend to make market orientation strategy by using advancement of technology. The role of new product development team is to render innovation within product development process so that customers’ desires can be fulfilled in the current market.

Strategic planning and management is one of the crucial processes in the workplace of Air New Zealand. Within this, preparation of the plans is most important, as it lays the proper foundation of the business operations. Adherence to the fundamental processes helps in the achievement of positive outcomes. Identification of mission, vision, values, benchmarks are important activities of the planning process. Briefing the employees about the goals and the means to reach that goal, reflects the straight forward approach regarding the execution of the business activities. Diversification in the thought processes is helpful in terms of achieving alternative solutions for the issues of poor quality flight services (Harvey, Heineke & Lewis, 2016).

Involving the employees in the presentation is assistance in terms of enhancing their communication skills. This enhancement upgrades the parameter of hospitality, enabling the scope and arena of the business. This can be related with the systems theory of Russel Acknoff, as it relates with the provision of technological training to the employees. This training is important in terms of making the employees aware of the efficient and effective means for bringing automation within the business operations.

1. Supply Chain Management & Total Quality Management

Analyzing the Impact of Strategic Response on Air New Zealand’s Operational Objectives

While maintaining an effective supply chain process the business experts have to focus on maintaining products to proper destinations. The entire chain management process of Air New Zealand is constituted with four major ways that are as follows:

• Inbound logistics:

Inbound logistics believe in receiving and maintaining the entire operation with systematic way. In case of making an effective flight schedule, the entire process is formed and designed in such a way that internal and external stakeholders do not have to face challenges in following the schedule. Aircraft schedule generation primarily follows two major steps, one is fuel calculation and the other is air traffic control requirements.

• Operations:

In the phase of operation the business experts have to executive the plan in such a way that passengers can be reached to their appropriate destinations. The service providers should have multilingual flexibility with the help of which customers from different geographical boundaries and attitudes can be attracted in using the services.

• Outbound logistic:

The entire procedure of departure to the estimated destination is one of the most effective parts of supply chain. Mention can be made of Safety Management Systems, where the important practices are hazard identification through risk management. Reaching the passengers to proper destination within stipulated time is one of the important transformation process that Air New Zealand follows.   

• Marketing and sales:

In order to grab the attention of customers from different geographical boundaries the business experts have to focus on selling and promoting the products and services by using the popularity of media vehicles. Social media , direct marketing, traditional media can be used in order to draw the attention of international customers.

• Services:

Providing superior quality of products in affordable price range is the primary target of the customers. In this kind of situation, the target customers in recent business scenario have been increased due to professional behaviour followed by the flight associates.

Total Quality management:

Total Quality Management is a customer focused process which primarily aims to improve entire business operations based on specific areas in quest of meeting customers’ needs and demands. The business managers while making TQM, tends to focus on some specific areas that needs to improve in order to grab the attention of international customers. The areas are as follows:

• To maintain organizational profitability and gaining international image and reputation
• To provide superior quality of products and services in order to increase the number of target customers
• To expand business by identifying and mitigating the risk factors faced by Air New Zealand

While rendering organizational innovation the business experts intend to set their priority one by one. Based on the priorities the business experts intend to organize and respond on their projects (Ptak & Schragenheim, 2016).  Air New Zealand has used technology as a driver of communicating people most effectively. Providing effective customer services is one of the significant responses and priorities of maintaining business sustainability in airline industry. Simplifying the flying experiences by using advancement of technology is one of the most effective ways of gathering customers’ feedback. Air New Zealand has implement advanced technology with big data in order to maintain customer data, product data and operation data.

After evaluating the impact of strategic response in organizational objectives, numerous eminent scholars have provided their own opinion. The author has stated that based on the organizational issues of Air New Zealand the business experts have identified the areas where they need to improve their business strategies for gaining customers’ attention (De Villiers, Rouse & Kerr, 2016).

Developing a Practicable Process to Improve Resource Integration Practices in Air New Zealand

Before identifying the risk factors, it can be sated that excavating goals and indicators is one of the other practices conducted by the practices, which Air New Zealand adopts for performing the resource integration management. Different level of management collaborate for translating the goals into the measurable indicators (Doh & Tashman, 2014). Mostly, it has been observed that there is a tendency to attain economic growth without the consideration of previous trade-off analysis. As a matter of specification, trade off analysis is assistance for Air New Zealand in terms of preparing land use strategies (Wright, Coff & Moliterno, 2014).

 However, in this study some of the most effective areas of risks have been identified which can damage organizational operations.

Identification of risks:

• Implementation of PDCA model may fail to overcome sudden organizational crisis. With the help of implementing this model, the business experts cannot implement any sudden organization policy. In order to overcome any risk factors alternative theories would have to be used with the help of which sudden crisis can be avoided(de Carvalho, Patah & de Souza Bido, 2015). On the other hand, Mary Parker Follett is effective enough to make direct decision on business, which ultimately helps the organization in overcoming unpredictable situations (Al-Haddad & Kotnour, 2015). Air New Zealand would be able to regain their fame and glory.
• The entire business operation is highly dependent on advanced technology with the help of which the employees can deliver the services within stipulated deadline(Patil & Kant, 2014). Air New Zealand has to face immense challenges in maintaining systematic flow of business if any kind of technological barriers occur. As a result, both the service providers and the service users get equally affected (Prakash & Barua, 2015). In order to run airline industry the accessibility of internet and service availability of big data is highly important (Meixell & Luoma, 2015). In this kind of situation, the entire business fails to run its systematic flow of work
• One of the most significant risk factors that the project managers of Air New Zealand would have to face is communication barrier. Project managers may have to face innumerable challenges in communicating with those stakeholders who belong to various cultural backgrounds(Fredendall & Hill, 2016). As a result, the team members fail to provide superior quality of services within stipulated time. On the other hand, lack of communication emerges immense cultural barriers among the people.

Risk mitigation strategy:

Risk management strategy implies the fact on how identified risk factors can be mitigated by implementing appropriate integration strategy. In order to overcome risk factors in using PCDA model alternative theories would have to be used with the help of which sudden crisis can be avoided. On the other hand, Mary Parker Follett is effective enough to make direct decision on business, which ultimately helps the organization in overcoming unpredictable situations (Collings, 2014). At the same time, the project managers need to grab multilingual flexibility with the help of which both the business experts would be able to interact with the people of different cultural backgrounds (Elgendy & Elragal, 2014). At the same time, employees need to attend effective training and development session based on which technological skills as well as competencies can be enhanced.

Here, risk assessment template/risk assessment matrix is relevant. This matrix is crucial in terms of measuring the intensity of the risks before proceeding to the solutions. As a matter of specification, the risks are classified into two categories: severity and likelihood. Instances like sudden weather changes are likely to occur, as it is a probability. Once the weather worsens, incapability to operate the flight correctly aggravates the complexities. This can even lead to loss of life and property. Further, the severity can be classified into insignificant, minor, moderate, critical and catastrophic. Negligence towards the flight defects is a risk. Taking the flight for operating is catastrophic, as it would lead to accidents leading to loss of the company property.

Cost benefit analysis primarily estimates on how cost can be invested for gaining organizational profit. This particular strategy evaluates the fact that business experts should invest money in those areas from where they can gain organizational profits (Wisner, Tan & Leong, 2014). As a result, both the customers and the service providers get equal benefits.

In this specific table, the study has identified some of the most specific areas where cost investment is needed. Based on the sales volume of Air New Zealand in last four years (approximately), the organization has invested cost on some of the specific areas. Four years of cost benefit analysis have decided where the organization is making profit or the organization is in loss which needs to be recovered in future.  

			Year 1	Year 2	Year 3	Year 4
	Gross revenue		$80,000	$81,600	$84,864	$89,956
	Cost of goods sold		$0	$0	$0	$0
	Gross margin		$80,000	$81,600	$84,864	$89,956
	Other revenue [source]		$0	$0	$0	$0
	Interest income		$0	$0	$0	$0
	Total revenue		$80,000	$81,600	$84,864	$89,956
Operating expenses
	Sales and marketing		$6,000	$6,120	$6,365	$6,747
	Payroll and payroll taxes		$50,000	$51,000	$53,040	$56,222
	Depreciation		$27,900	$28,458	$29,016	$29,574
	Maintenance, repair, and overhaul		$0	$0	$0	$0
	Total operating expenses		$83,900	$85,578	$88,421	$92,543
Operating income		($3,900)	($3,978)	($3,557)	($2,587)
	Interest expense on long-term debt		$0	$0	$0	$0
Operating income before other items		($3,900)	($3,978)	($3,557)	($2,587)
	Loss (gain) on sale of assets		$0	$0	$0	$0
	Other unusual expenses (income)		$0	$0	$0	$0
Earnings before taxes		($3,900)	($3,978)	($3,557)	($2,587)
Taxes on income	30%	$0	$0	$0	$0
Net income (loss)		($3,900)	($3,978)	($3,557)	($2,587)

From this very specific cost benefit analysis, it has been observed that Air New Zealand in last four years of financial journey has failed to reach the profit level. It ultimately influences on organizational profit. The organization did not gain benefits after investing money in some of the most specific areas. In first year, the organization gained revenue of $80,000. But, the entire operation cost was $83,900. Therefore, the company got $3,900 loss in first year. In second year the total revenue was $81, 6000. The total expense was $85,578. Therefore, $3,978 was loss which ultimately leaves negative impact on the overall organizational image. In third year, revenue was $84,864 and operation expense included $88,421. Therefore, the organization failed to gain benefit and it was amount of $3557 that the company got loss. In fourth year, revenue was $89956 and operation expense included $92543. The company got $2587 loss in fourth year This is one of the most significant reasons of implementing integration management policy within business operation of Air New Zealand. After evaluating the entire cost benefit strategy, it can be stated that Air New Zealand needs to improve their operation process and integrated management policy in order to gain benefits of invested operating cost.  

Cost/Benefit Analysis – New Airplanes vs Domestic Production Outsourcing

Conclusion: 

After evaluating the entire study, it can be concluded that maintaining harmonization within business operations is one of the most significant roles of business managers. Integration management is all about maintaining a proper harmony within team by monitoring and coordinating all functions of organizational activities. Air New Zealand is one of the most recognizable flag carrier airlines occupying prestigious place in the market of New Zealand. After the inspections, reports are send to the higher authorities for acquiring additional resources, which are needed for repairing the damaged parts of the aircrafts. This translation is effective in terms of setting the targets, which needs to be attained. Providing effective customer services is one of the significant responses and priorities of maintaining business sustainability in airline industry. Simplifying the flying experiences by using advancement of technology is one of the most effective ways of gathering customers’ feedback.

The study has evaluated that based on the organizational issues of Air New Zealand the business experts have identified the areas where they need to improve their business strategies for gaining customers’ attention. Based on these areas the business experts would like to implement new management policy and strategy.

On the other hand, business experts may have to face sudden organizational crisis with the help of which the organization has to make sudden decision and impose immediate action to overcome the situation. After evaluating the entire cost benefit strategy, it can be stated that Air New Zealand needs to improve their operation process and integrated management policy in order to gain benefits of invested operating cost. In order to overcome this kind of situation, the business experts need to render innovation strategy and policy with the help of which the business experts can regain their image and reputation. Some of the most effective areas of improvement has been critically analysed in this study by projecting the significance of the risk assessment. Utilization of risk assessment templates is effective in terms of gaining an insight into the extent to which the risks have been reduced.

The aspect of feedback is productive for Air New Zealand in terms of gaining an insight into the approach of the clients. Uploading the feedback forms on official website and social networking sites is fruitful for reaching to large number of audiences at a single time. This widens the scope and arena of the business operations. Within this, security policies are effective for maintaining the safety and privacy of the confidential data of the company. Even in case of the profile of the customers, security cookies are important in terms of averting the instances of cybercrimes. For this, the managers need to expose conscious approach towards the involvement of the customers on the social media.

Evaluation is necessary in terms of excavating the areas, which needs modifications. This is done through the consideration of checklists and templates, which enhances the awareness about the extent to which the benchmarks have been identified. Within this, the experts and inspectors, which results in quality controls and checks of the flight services, can make mention of the audits and reviews. Maintaining frequency in these reviews and audits helps in upgrading the standards and quality of the flight services. Effective communication in the supply chain process needs to be established with the higher authorities regarding the execution of risk management. This is in terms of completing the projects well in advanced with enough time of evaluations. The employees are to be trained about technologies, which would help in enhancing the sales revenue and profit margin. Social media marketing helps Air New Zealand to increase the trafficking of the audience towards the brand image. Uploading the news of special discounts, offers and schemes addresses the queries of the customers regarding the benefits and prospects of the flight services.

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