The hospitality industry, in general, is one of the most competitive ones. Globalization and liberalization of the economy have further brought this industry into a sharp focus. With more low-cost airlines coming into the field, benchmarking has become an integral part of the corporate strategy. Airlines companies are now having strategic tie-ups with catering companies, which in turn is providing newer dimensions to the successful business propositions. The fierce competition has made the customer the king, and now the customer is consistently on the lookout for the best available services at reasonable prices. Because of the availability of several alternatives to the customer, the airline industry is constantly on the lookout to implement strategies to please its customer.
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Research Questions and Objectives
The main intention of the study is to develop an understanding of the concepts of Inflight Catering in general and how the established theories and principles are applied to particular airlines. During the study, an effort will be made to observe the general working of some inflight caters in and their strategic relations with the airlines to seek answers to the following key objectives.
- To study and analyze the growth that the inflight catering industry has witnessed in recent years, particularly after the globalization forces started blooming. This includes an analysis of the prevailing competition and the Inflight catering scenario in the airline industry in general.
- How some of the inflight catering companies have been having been able to motivate their staff given shrinking profit margins in the industry.
- Once the business and travel opportunities grew the world over, so did the number of corporate travel and business-related conferences, which in turn generates more opportunities for travelers around the globe. For the inflight catering industry, this proved to be a windfall of opportunities.
- Prerequisite to a decent quality is the motivation of staff in delivering good quality, which necessitates respecting individuals and treating everyone, customers, and colleagues, with dignity. How the inflight catering industry has been able to adopt a balancing approach towards motivating the workforce.
- If possible, an effort would be made to establish a well-studied relationship between the traveling trends, the inflight catering industry, the airline industry, and the economies of nations. These effects have become of particular significance given the fast-spreading effects of globalization.
Scope and Context of the Research
The scope and context of this study will include;
- Analysis of some of the major inflight caterers in general and the Asia Pacific region in particular.
- Analysis of an overall picture of the inflight catering, particularly after the WTO regime and liberalization came into force.
- Growing curiosity about the Airlines industry and despite the shrinking margins, the interest of many multinational enterprises (MNEs) in going for the airlines business.
- In addition the market-driven global economy appears to be infatuated by the availability of a large number of consumers in countries like China and India and they are the hot destinations for investments. Many companies are lined up to catch hold of a percentage of the billion people. Does that have an impact on the catering business? The MNCs will initially invest in these economies on a smaller scale, but once they establish themselves, they are sure to upgrade their investments which are sure to translate into more business for the airline industry and the catering industry. Are there some projections towards such moves?
- Such a study proves to be of vital importance for a student like me in gaining an access to the real-life environment, after learning the strategies through the books. Such a study often proves to be quite crucial for the carrier of a student, as it helps in generating interest in him/ her towards a particular subject or field. This way the study could prove to be of vital importance for the student.
- Doing research can be intensely satisfying. It provides an opportunity to become an expert in your subject and this may be the start of your lifetime’s special interest. Knowing that you have contributed to your area is tremendously fulfilling, and many researchers find that publishing in journals read by their peers worldwide is a great pleasure.
Research approaches and methods radically influence research content and, consequently, the policies designed in response to that content. Research philosophy is a belief about how data about a phenomenon should be gathered, analyzed, and used. This thesis is a qualitative case study that focuses on an analysis of the inflight catering services prevailing in the hospitality industry in general and in the airline industry in particular. To carry out such a study in general we resort to two main approaches;
Deductive reasoning, which works from the more general to the more specific subjects. Sometimes this is informally called a “top-down” approach. In such an approach we take up the ‘theory’ and then try to apply it to the hypotheses that we intend to test. Gradually we narrow down to the testing of data and observations for their applicability to the theory/ theories to arrive at confirmation of its applicability or not.
The Inductive approach on the other hand begins with collecting data, specific observations, which then lead to broader generalization and theories. Such an approach is called as “bottom-up” approach. The patterns thus detected are formulated into tentative hypotheses and we can therefore arrive at some general conclusion about our subject. An effort would also be made to prepare a questionnaire and get it filled by the concerned research participants.
In this case, the study will be more of an inductive one as I’ll be observing the functioning of some of the inflight catering activities during some such travels During the process I’ll also be interacting with some inflight catering staff members of some airlines to solicit their views about the industry, their perception about the services, quality and the customers in general. No business or organization can transform itself, without approaching the existing as well as prospective customers. Intense marketing efforts have been one of the key elements of the success story of the hospitality industry. Efforts would therefore be made to study some such marketing strategies. For the companies to identify their sustainable competitive advantage, Michael Porter developed a generic value chain with inter-related activities which are common in many firms. Porter identifies primary and supports activities. Primary activities are the ones that generate a profit margin by adding value. These activities can be instrumental in providing a sustainable competitive advantage for the organization either collectively or individually. The catering industry requires a professional touch to come out with such activities at par with international standards. Porter’s value chain framework (1985) in general is accepted as the language for representing as well as analyzing the logic of firm-level value creation.
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The customer will prefer to deal with the company which values its association with the customer. This will help in retaining the customer base. And loyal customers happen to be good brand ambassadors for a company/ product, which will ultimately help the company in sustaining its competitive advantage.
The airline’s industry has been going undergoing a phase where it has to contend with not only the competition but the increasing threat of terrorism as well. Competition in the airline industry has intensified in recent years as a result of the combined effects of the entry of new low-cost airlines and some of the terrorist incidents of the recent past. The travel environment had to undergo adverse business impacts in the recent past brought about by fears of terrorism, the Iraq and Afghanistan wars, SARS, etc. The entry of low-cost competitors, coupled with the adverse operating environment, has forced the entire industry to adopt cost minimization strategies in response (Spiess and Waring, 2005). This has resulted in some of the airlines even restructuring their organizations and the related services to cut the costs. Cost-cutting exercises include outsourcing and off-shoring of some jobs as well. Therefore, an effort would be made during the study of some such phenomenon of the recent past.
- Secondary Sources: Such data can be collected from the existing literature, research reports, company leaflets, information brochure, etc. This section will focus on the literature review i.e. a careful examination of the literature pointing towards the answers to the research question. Literature or a body of literature is a collection of published research relevant to a research question. Economists, market analysts, financial consultants, investors, retailers, manufacturers, etc have also been watching and analyzing the inflight catering industry with interest and intent for quite some time now. Therefore, such studies will also be quite helpful in collecting data for this report.
- Primary Sources: Such data can be collected by interacting with the staff, management, customers, and other stakeholders in the catering business. By observing the working and the supply/ distribution chain also we can gather first-hand data. Observing the inflight catering in full flow means spending the time with them on board, which is indeed a costly proposition. But I’ll try to look out for an opportunity where I can go be on board, without spending a fortune. Taking a firsthand account report from some of the frequent travelers is another important option. It will be a little difficult to interact with the top management of the companies, but I will surely try to meet some of the seniors in the business.
- News reports in newspapers and current affairs magazines prove to be another source of data for the study. Since the subject is an emerging field in terms of innovation, technology as well as economics, therefore a lot of developmental news items are available in the public domain. Such reports provide the updated information and the latest policy initiatives about the catering industry in general and related to the inflight industry business in particular.
Efforts would be made to complete the different modules of the project leading to the completion of the project as per the following timeline (Note-These are completion dates).
- Submission of Proposal: December 5, 2007
- Interaction with the Tutor: December 9, 2007
- Inclusion of suggestions by the tutor: December 10, 2007
- Preparation of questionnaire: December 18, 2007
- Data gathering, Lit Review etc December 30, 2007
- Compiling the Modules January 10, 2008
- Review of all details and requirements January 18, 2008
- Submission of the Project January 25, 2008
- Business operations of some airlines companies, mainly through their websites
- Business operations of some inflight catering companies, through their websites and the partner airlines.
- Documents of government, particularly relating to aviation and hospitality businesses
- Independent research reports from marketing agencies and other companies.
- Spiess, Leslee and Waring, Peter (2005). Aesthetic labour, cost minimisation and the labour process in the Asia Pacific airline industry. Employee Relations; Volume: 27 Issue: 2.
- Porter, M. (1985). Competitive Advantage: Creating and Sustaining Superior Performance. Free Press, New York.