Southwest Airline and Etihad Airways Companies Innovations

Introduction

In the world today, companies strive to maintain consumer base. Stiff competition, market liberalization, and continuous entry of new players in the market challenge the existing market commanders. This compels them to design new ways of management, develop better organizational structure, and create working cultures that ensure innovation, creativity, and employee development and retention. Since employees form the base of company success, several companies continue to engage in programs that ensure continuous employee motivation and retention.

Equitable rewards, structured and favorable salaries, employee training and instant applauses, coaching, team management, and viable leadership systems are some of the programs employees put in place to ensure adequate motivation and retention of employees (Nickerson, Yen, & Mahoney, 2012). The airline industry is not exempted in these competitive marketing modifications. This paper analyzes few structures set out by Southwest Airlines and Etihad Airways in innovation and creativity, employee motivation structures and the rewards that come with such structures. Similarly, the paper seeks to explore the roles of innovation as a factor in employee motivation, and, finally, develop recommendation for effective implementation of the innovative ideas.

Southwest Airlines

With a vision to “become the world’s most loved, most flown and most profitable airline” (Southwest Airlines Careers, 2014), Southwest Airlines sets out clear mission for employee motivation and retention. To the company, employee recruitment takes place based on quality and performance. Similarly, the company’s recruitment policy ensures take up of a diverse employee base since it provides equal opportunities to women, minority groups, qualified people with disabilities, and the covered veterans.

After recruitment, the employees enjoy a stable work environment with adequate training, learning, and development opportunities. Similarly, the company’s leadership structure encourages creativity and innovation at the workplace. This forms the prerequisite for improvement in service delivery and enjoyment of competitive edge over other players in the airline sector.

In their vision on employees, the company remains steadfast in providing all the employees with equal concern, respect, and caring attitude as they perform duties at various service points (Southwest Airlines Careers, 2014). Treatment of employees with such an attitude necessitates the multiplier effects in which employees extend care, love, and respect to the customers. Once the customers feel valued, they become loyal to the company leading to more profits.

Innovations at the Southwest Airlines

Low-cost airline model remains the greatest innovation set out in this international carrier. Based on a strategy to win the hearts of the customers as well as maintain a competitive advantage in the market, Southwest Airlines developed a low cost strategy that focused on low-ticket prices for customers, as well as augmented the use rate of the aircraft fleet to enhance growth and increase routes. Low cost passengers with insufficient abilities to use the First Class, enjoy ability services provided in the Premium Class.

This ticketing system aimed at consolidating the business travellers with frequent travels to destinations lying within nine hundred miles of each of other. In the growth perspective, the strategy seeks to capitalize on the maximum use of aircrafts based on efficient ground services, limited time in hauling stations, and high frequency routes between cities and secondary airports (Southwest Airlines Careers, 2014). Under such a circumstance, the planes stay longer in flights than on the ground. This utilization rate based on high volumes becomes very crucial in low cost airline’s strategy model, leading to increased earnings to the company.

Similarly, the innovation ensured simplified structures for efficient work delivery and customer service processes. Notably, lean and productive personnel are meant to check resource investment against returns earned. In the process sector, simplicity set in. For example, the company maximizes the use of Boeing 737 for most of the business services. This helps the company cut down on the overall production costs such as service fees charged for pilot trainings and re-training, spare part purchases, and aircraft maintenance. Such a strategy coupled with lean, innovative, and hardworking personnel help reduce production cost. In order to develop a lean productive workforce, Southwest Airlines developed a system of recruiting flexible and multi-skilled personnel (Southwest Airlines Careers, 2014). High rewards and employee compensations help the company retain a productive workforce.

Etihad Airways

Despite localizing, some of their employments opportunities to the nationals of United Arab Emirates only, this international carrier continue take strides in consolidation of market base amid stiff competition. Service delivery, customer care, and employee development, training and motivation represent some of the vital structures that Etihad Airways uses to create a competitive edge over other players in the airways industry.

Etihad Airways stands out as the leading carrier with utmost care and respect to the Arabian culture and hospitality. With a vision to deliver successful customer service based on a unique brand of modern Arabian hospitality, the company ensures recruitment, training, development, and retention of an employee base with adequate cultural diversity (Etihad Airways: Working at the World’s Leading Airline, 2014).

Such factors, coupled with commitment to employee rewards and motivation create a system within which creativity and innovation exists leading to goal and mission achievement. Organizational culture at the Etihad Airways ensures a friendly and transparent work environment leading to increased productivity. A workforce with diverse cultural backgrounds; objectivity and passion for aviation; and care and respect to customers enables Etihad Airways to earn customer loyalty thus increasing profit levels (Etihad Airways: Working at the World’s Leading Airline, 2014).

Innovations at Etihad Airways

Innovations require development of design principles, processes, and sustainable development methods for successful implementation. Etihad Airways, with the aim of developing a systematic innovative idea to enhance market compensation, developed a systematic system of employee recruitment, training, and retentions. Development of a wide range of up-to-date software solutions to increase service delivery through technology has been the main idea of the Etihad Airline.

Under this plan, the airline uses SAP ERP coupled with varied cloud-based products within its business functions in the human resource, finance, supply management, and business development (Etihad Airways: Working at the World’s Leading Airline, 2014). The SAP system seeks to grow the business base of the company through improvement of employee confidence and enhance customer service delivery.

Similarly, SAP employs the use of cloud systems for business solutions in major departments. Under the human resource segment, management and recruitment of workforce uses a talent base structure from success factors. SAP works further in developing the technology and communication goals of the Etihad Airways through opening up of centers of excellence in the United Arab Emirates, Europe, and India. Through such structures, Etihad Airways looks forward to improve business solution provisions, especially in the air travel (Etihad Airways: Working at the World’s Leading Airline, 2014).

Importance of Innovation in Company development

Innovations enable companies to respond to emerging market trends. Once a company conforms to the emerging market needs, it remains relatively relevant in production levels and competition. Since production and maintenance of consumer bases form the basis of company success, the Southwest Airline expects to register positive performance using its LCC model. Anticipation of future ideas and improvement of the current business ideas are the main points in innovation and creativity in production. Innovation and creativity helps companies stay ahead of competitors in the markets as dynamism in market structures keep changing (Carlopio, 2011).

Innovation helps companies develop unique selling points. In this aspect, the uniqueness in service provision has made the two airline firms operate in the crowded industry with the likes of Emirates Airline, Qatar Airways, and British Airways. To consumers, a company with creative and innovative employees represents producers of efficient and high quality products.

This implies that if companies use innovation and creativity properly, they stand good chances of earning commercial advantage over rivals in the production sector (Lyons, Jordan, Fass, & Swindler, 2011). As more innovation continues to set in the market, more consumers continue to go for the new trendy and classy products rather than the already existing cheap products- that would otherwise offer the same services (Dodgson & Gann, 2008).

Recommendations for Best Innovation Strategies

In order to come out with the best creative and innovative ideas, companies need adequate self-organization. Strategic imperatives such as transformation through employee base, process systems, and organization culture play a vital role in defining innovation strategies that a company employs. Identification of viable technological tools follows the strategic imperatives. Through such technologies, companies strive to improve enterprise productivity through reduction of complexity in production (Beyerlein & Beyerlein, 2006).

Efficient technological ideas in production enable ease of business growth. Taking an example of the Southwest Airlines, the rolling out of “low cost carrier” (LCC) model is a great move. However, for sustainability in the market, the company can put in place additional services for passengers to bring in more profit. In addition, the airline firm can alter the nature of the model to sustain and increase the customers’ need for continuous use of the services. The approach helps in eliminating monotony that may set in by instilling enthusiasm in customers.

In the current globalized market, using social media to communicate and collaborate with both employees and customers help companies partner and create ideas for new products and services. Organizations should tap into the global village systems to improve chances of developing new creative products. Likewise, as technological advancement continues to take place, it is vital for companies to appreciate and embrace a mobile workforce. Flexibility in work conditions ensures employees have ample time for collaboration and innovation (Nickerson et al., 2012). The use of the systematic systems at the Etihad Airways requires high-leveled security to prevent online risks like phishing, and hacking, which may expose employees and customers’ personal data to third parties.

Conclusion

In the production segment, copying and duplication seems normal. Finding product and service with similar characteristics from different producers seems normal in many settings. However, organizational branding calls for creative and innovative ideas. Organizations continue to recruit employee with the abilities to develop ideas over which they can own intellectual rights.

Duplication and copying will soon go out of the business environments. Innovation and creativity, therefore, seems to take up the important role of enabling companies develop original and unique ideas for products and services provision. The two parameters require well-coordinated efforts, just like in the cases of the Etihad Airways and Southwest Airlines, in order to enhance achievement of strategic goals and objectives from a sustainable perspective.

References

Beyerlein, M., & Beyerlein, S. (2006). Innovation through Collaboration. Bingley: Emerald Group Publishing Limited.

Carlopio, J. (2011). Development Strategy by Design: the Future of Strategy. New York: Palgrave Macmillan.

Dodgson, M., & Gann, D. (2008). The management of technological innovation: Strategy and practice. Oxford: Oxford University Press.

Etihad Airways: Working at the World’s Leading Airline. (2014). Web.

Lyons J.B., Jordan, J., Fass, P., & Swindler, S. (2011). Organizational Development Goes Digital: Applying Simulation to Organizational Change. Journal of Change Management, 11(2), 207-221.

Nickerson, J., Yen, C.J., & Mahoney, J.T. (2012). Exploring the Problem-Finding and Problem-Solving Approach for Designing Organizations. Academy Of Management Perspectives, 26(1), 52-72.

Southwest Airlines Careers. (2014). Web.