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Introduction of QHO532 Operations Management Assignment
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According to Homburg and Furst (2005), the airline industry is always considered and categorized as being the major “intangible services provider industry.” Operations management has had a huge impact on modern air transportation management. With the technological advancements, the airlines are engaging in utilizing various advanced techniques to optimize for development of the system of effective decision support (Koksalmis, 2019).
Background of British Airways
British Airways is an international airline that was established in 1974, and its headquarter is situated in London, England, located near the main hub at Heathrow Airport (Santiago and Horvitz, n.d.). Major subsidiaries of British Airways are British Airways CityFlyer which serves the people living in the United Kingdom and Continental Europe, and another subsidiary named as OpenSkies which serves the people to reach New York City and Paris.
Aims and Objectives
The aim and objectives of the report are to analyse the issues regarding the operations and the quality management that is being faced by British Airways and how the different theories of operation and quality management can be applied to improve the overall operation and quality management issues in the British Airways.
1. Evaluation of relevant Operations and Quality Management Theories
Operation management refers to the business administration that involves various practices that are accountable for creating the highest efficiency level possible in any business organization. It involves the conversion of materials and human resources into commodities and services efficiently to maximize business profitability (Kang et al., 2016). Operation management also includes the utilization of valuable resources such as technology, staff materials, and equipment. The managers that are responsible for operation management engage in the development, acquisition, and delivery of commodities to the customer as effectively and as efficiently as possible.
On the other hand, Operation Management is another important and critical aspect of the business organization, and maintaining the quality effectively aids the business organization in attracting more customers that are loyal and contribute to maximum profitability and efficiently compete in the market. Quality Management is not limited to the top management of the business organization, but it is also the accountability of the employees or the human workforce working (Ross, 2017). It makes sure that the business organization is keeping the customer satisfied in the process and finding the right rhythm in the market as well via market segmentation and targeting. There is equal importance for operation management as well as Quality management since both play a huge role in shaping the business organization in an effective manner and help in accomplishing the goals and objectives of the business organization, which varies for each business organization.
Followings are various relevant theories of operation and quality management in the case of the airline industry:
Demand Forecasting
This is one of the relevant operation management theories in the case of the airline industry. Demand Forecasting is mainly revolved around long-term as well as short-term decision-making via effective forecasting. This model helps in estimating the demand that is analyzed from the different factors that are considered, like whether the people will travel or not, whether the individual will use direct flights for travelling etc. (Hsiao and Hansen, 2011). There is a huge importance for making precise and accurate predictions for the airports as well as airlines.
The profitability of the airline industry can be hugely boosted by effective planning with the utilization of a “demand forecast”. Furthermore, the airline can create effective planning for generating profitability with effective forecasting of demand. With the help of effective operation management, it can be observed that there are two methods by which the high passenger density can be overcome in the case of the airline industry (Hess, 2007). One of the first is the airport expansion and the airport construction that can aid in balancing the demand as well as the supply. The second method is to increase and utilize the capacity via using effective pricing methods.
Fleet Assignments
Another theory of operation management that can be discussed is Fleet assignments which are also very relevant to the airline industry. The Fleet Assignment mainly involves dealing with the various assignments of the distinct type of aircraft to the “specified flights” on a chart as per the equipment, profitability, and capacity (Doži? et al., 2019). The decisions regarding the Fleet Assignment Problem get affected based on profitability, and it is also among the most critical components of the problems of scheduling of the airline companies.
Assignment of aircraft that has a smaller capacity might result in improper management of the demand. On the contrary, the assignment of an aircraft that has a larger capacity might result in seats remaining unsold. From the perspective of operation management, the Fleeting Assignment problem is among the critical problem because of many flights during the day and the “close relationship” of the many airline companies with other businesses (Koksalmis, 2019). As per the research from many studies, it can be observed that the Fleet Assignment problem can be divided into four components as Integrated FAP mode, dynamic FAP model, and these all are part of the operation management.
Six Sigma
Six sigma refers to the method that provides essential tools to improve the capabilities of the procedure of business. The variation between the increased performance and the decreased performance can aid in defecting the reduction as well as improving the profitability of the business organization in the process, the morale of the human resource, and the quality of commodities and services (Tay and Aw, 2021). Six Sigma also aids in streamlining the quality control for improving the current procedure, commodities, and services. This theory is mainly concentrated on maintaining the consistent quality of the commodities and services.
The six sigma is very important in the aviation industry as well since it involves managing the critical problems or conflicts regarding the safety of the passengers, cost savings techniques, and customer satisfaction. Six Sigma allows the employees or the workforce working in the aviation industry to contribute collaboratively to improve the quality (Caiado et al., 2018). Six Sigma is basically a toolbox that is filled with various practices that can aid in resolving the flaws of the process and ultimately engaging in improving performance.
Total Quality Management
Total Quality Management refers to the procedure of detecting as well as neutralizing the errors in terms of manufacturing, streamlining the supply chain management while also improving the overall experience of the customers and ensuring that the human workforce is getting effective training and development (Al-Serhan, 2019). Total Quality Management focuses on engaging all the parties in the procedure of production that are responsible for managing and shaping the overall quality of the final commodity or services. It was developed by William Deming, whose work influenced Japanese manufacturing in an effective manner. Total Quality Management is very similar to the process of Six Sigma but not completely the same.
Six Sigma focuses on reducing defects, and Total Quality Management concentrates on reducing errors by effectively maintaining the procedure standards as well as the internal guidelines. Just like other operational management theories, the TQM is also very important and crucial for the Aviation industry (Nagarajan, 2018). TQM aids the airlines’ services to concentrate on providing the quality and maintaining a quality human workforce that is trained while also utilizing the advanced technological tools for providing a convenient ride.
2. Recognised Issue in British Airways and Related Industry
British Airways used to be a favourite airline by the people, but currently, it is not among the favourite airline anymore. There are many issues that are being faced by British Airways, such as failure and difficulties in the IT department of British Airways (Cook and Long, 2021). This is one of the persistent issues that can be recognized affecting the various operation of the business. This IT outage and glitch also took place in the year 2016, and many people suffered from the delays internationally, the check-in system was completely glitched, and many people mentioned this issue on many popular social media platforms (The Associated Press, 2016).
This IT glitch and outage also took place again in the year 2019, in which the aeroplanes again got delayed, and a large number of passengers got stuck for almost 24 hours due to the computer glitch (Rizzo and 2019, 2019). The IT glitch and outage resulted in the cancellation of many flights, and pilots were forced to stop the journey. The same issue again arose in the year 2022, in which a large number of flights got cancelled and delayed because of an IT glitch which affected “London Heathrow” (Sillars, 2022). On 30th March, the British airways remained grounded for a few hours. Furthermore, in the month of February as well, an IT glitch and outage took place, and at that time, it was due to a cyber-attack (Vikram Philip, 2022).
This is one of the issues that need to be addressed and solved to be able to provide effective and efficient services to the customers for maximum profitability as well as employee productivity. This is also among the most commonly occurring problem in the aviation industry. British Airways experienced a power outage in the month of May 2017. British Airways failed in making a backup plan for itself, and as a result, it destroyed many systems; the carrier of the British Airways had to cancel around 726 flights, stranding more than 10000 individuals or passengers, and it cost the business about £80 million due to the outage and IT glitch (O’Neill and Skift, 2019). In addition to that, British Airways is not the only air service that faces this problem. Many other airlines and service providers faced this issue of technical glitches that resulted in many cancellations. As per the study of the United States, it can be discovered that every month on an average, the problem of IT glitches can be recognized becoming a major problem.
Other airlines, such as Southwest Airlines, were also got affected by the technology glitch in the year 2022. According to the statement of Southwest Airlines, the disruptions took place due to the “intermittent technology issues” (Tayeb, 2022). Southwest Airlines cancelled around 518 flights, and 1486 flights got delayed.
3. Challenges faced from the identified issue in British Airways 550
British Airways faced various challenges, as discussed above, and the long queues, delays and cancellations are among some of the major challenges due to the technical glitch and various cyber-crimes that affects the overall productivity and profitability of the business organization (Vikram Philip, 2022). Even though the servers went online but the problem still remained very relevant; the company even warned that there would be more technical disruption and people could face these problems again. This shows that the problem still has not been able to solve completely. At the time of the global outage and IT glitch, Online Check-In was completely affected and affected the flight departures (The Associated Press, 2016).
In the year 2017, The GMB union of British Airways blamed the decision to outsource the job of Information and Technology to India as one of the reasons behind the cancellation of many cancellations of flights (Deccan Chronicle, 2017). Another challenge that can be recognised from the issue of IT glitches and global technological outages is the frustrated passengers and the customers that got affected by the flight delays and cancellations. As discussed, there were more than 500 flights that got affected. Customers or the passengers were not able to check the flight status online and huge queues formed as a result. Some of the passengers that were affected and angry took the issue to social media.
Application of Operations and Quality Management Theories
3.1. Six Sigma
As discussed, Six Sigma is the method that is heavily engaged in providing necessary tools for improving the capabilities of the business process. The increased performance is a requirement for all the airways to gain maximum profitability and maximum productivity (Madhani, 2022). The aviation industry, including British Airways, includes a series of interlocking procedures, and each has its own challenges. Furthermore, the British airways focus on improving the passenger experience. One of the first stages in the six-sigma model is to engage in gathering the data to determine the areas that require improvement.
Furthermore, the employee time is valuable, and there is a requirement of staffing the right staff when providing services to the customer. The application of six sigma can aid in neutralizing as well as reducing delays, cancellations, duplications, etc. (Demir and Paksoy, 2021). As recognized in the above discussion, IT glitches, and outages are among the reasons that affect the customer experience. Check-In processes are some of the essential components of airports that can be recognized in the case of British Airways as well. As per Mckinsey, the standard time frames for checking-in passengers with the time spent on accomplishing the task varies by “as much as 50 per cent”.
3.2. Total Quality Management
Total Quality Management is also mentioned and discussed above; the total quality management and total quality management is very similar to six sigma since six sigma focuses on reducing defects and Total Quality Management concentrates on reducing errors by effectively maintaining the procedure standards as well as the internal guidelines (Sweis, Elhawa and Sweis, 2019). The information system is one of the effective tools of total quality management that aids in providing various services to the customers. It tracks and concentrates on the customer and also includes the human workforce for engaging in effective decision-making in British Airways. Furthermore, training and development are also among the effective components of Total Quality Management (Abbas and Kumari, 2021). By the effective and constant application of effective training and development for providing effective customer satisfaction. The success is heavily dependent on the consumers using the service. With effective training and development, the human resource workforce can increase their overall performance, profitability, and productivity since the employees and the human resource gets active and constant training and development to reskill as well as upskill in the process.
4. Conclusion, Improvement Options, and Recommendations
The IT glitch and the global outage is one of the critical problems that are required to be addressed and solved as effectively as possible to contribute to the success of the business organization. According to the expert, the technology system in the aviation industry is very similar to the system that is used in the areas such as Banking. Airlines have to rebook various flights, reroute the options and engage in finding the best fares to be charged in return for providing the travelling experience. British Airways must ensure the technology infrastructure is being maintained regularly, so the technology remains up-to-date, and it can be observed that the airline industry heavily relies on utilizing the complex systems of Information & Technology to provide a convenient experience to the customers or the passengers.
Another recommendation for the British Airways that can aid in addressing and minimizing the problem of IT glitches and global outages is to engage in regular as well as effective testing and maintenance of the complex technological system. However, regular testing of the complex technological tools can cost a heft amount of financial resources for upgrading as well as testing the system without affecting the regular business operation of British Airways.
References
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