Abstract
As the airline industry becomes more and more competitive, Air carriers and other travel providers have been forced to recognize their high value customers and their contribution towards their success. This has been through processes that are focused towards the identification of high value customers, retaining of the existing customers and also developing the relationship that you enjoy with them. All this has been done in the name of Customer relationship management (Butler, 2002).
The goal of CRM is to introduce a personal touch to the customer rather than just offer the next application to serve its customers. It is through successful planning and implementation of the CRM solution that we will be able to appreciate its power in the retention of customers (Butler, 2002). This paper is going to demonstrate How CRM is going to assist airlines such as Emirates in Attracting and retaining new customers through CRM solutions.
Methodology
The solution has to address certain needs of the organization in question. This is done by conducting feasibility study. There are various feasibility studies such as, economic feasibility is to check the costs that will be associated with coming with the new system and whether it is going to bring any new revenue into the business. The cost of Implementing the new system is high hence we should be able to justify an increase in revenue that comes to the business through the new system. Also involved will be the intangible benefits such as improved customer satisfaction and better collection and storage of records ( Dyche, 2002). There is also the operational feasibility where the solution is supposed to be able to provide information to the organization. This information will be used in business intelligence and to be able to meet the needs of the organization. The operational feasibility tests whether the system will work when implemented. There is also the technical feasibility that needs to be carried out. This evaluates the technical requirements for the project. It evaluates whether the organization has the technical infrastructure that will be enough to implement the project (Dyche, 2002).
After the Feasibility study has been completed, the system is designed according to the requirements of the organization. This is done through a series of coding in order to customize the CRM software in accordance with the needs of the organization. This is done through taking of snap shots of the application (Dyche, 2002). The final stage of the CRM project is the testing of the solution. This is done to ensure that the solution is able to perform and come up with the desired results.
Business Environment Overview
The airline industry is very fragile and customer retention is the key to protecting one self from the shocks that accompany this sector. This problem was triggered after management realized that they are spending too much in terms of sales and marketing yet the returns did not match the spending. Another factor that aggravated the problem was the eroding market share that the airline faced from rival competition. A lot of time and effort was being used (Dellah, 2006).
The Company in question is Emirates airline, whose main undertaking is to ferry people and goods to their destinations. The airline is popularly known as Fly Emirates. The airline is the national carrier of Dubai and United Arab Emirates. The airline is busy as it has an average of 2200 flights per week that are boosted by a workforce of 40,000 employees.10,324 being the cabin crew and 2141 flight deck crew. Other people employed by the airline are the engineers working on the planes, they total about 1849 staff and 9,379 staff is categorized as other. Its main hub of operations is based in based at Dubai International airport, terminal 3. The airline flies to over 91 destinations across 6 continents. Ferrying of cargo is done by a subsidiary known as Emirates sky division (Dellah, 2006)
Brief History
The airline was first started in the mid 80’s and was born out of the need of persons in the Middle East wanting to fly in ad out of Dubai. The carrier at the time Gulf Air, was cutting back on the number of flights that were going to Dubai, this left many people stranded in Dubai contending with other modes of transport. It is this action by Gulf Air that resulted in the conception of Emirates Airline. The Dubai royal family financed its first aircrafts by providing the first two aircrafts. At the time the airline was to operate without Government subsidies. The airline was to operate from the profits that it acquired from its operations. Apart from start up capital that it acquired from the Government. The airline managed to grow on a yearly basis with the first year making a turnover of about 100 million dollars. Its operations were formerly based at Dubai International Airport but in 2008 it relocated its operations to Terminal 3 which exclusively serves both aircrafts and passengers of the airline. Emirates has managed to build a strong brand as it is known for its innovation as well as its quality of service that it offers to customers who fly in their aircrafts (Hanlon, 2001). Since inception the airline has undertaken major expansion in terms of both infrastructure and staff recruitment. It has also added the range of routes that the planes normally fly to (Dellah, 2006). This has assisted the airline in growing its revenue and brand name. All this has been done in an environment that is mixed with all sorts of challenges ranging from rise in fuel prices to meeting their cost efficiency targets (Beiske, 2007)
The airline currently uses many systems in order to support its operations, since the company is geographically spread; Problems such as distance, time and the ever present huge workforce are presenting problems to the system. Further more the systems in use are fast becoming too many hence requiring more training for the users who are going to use them. When it comes to sales and marketing software the business uses legacy systems that are independent with one another. This meant that contact of former and current customers are recorded in different database. When it came to tracking of costs, this was done in an up hazard way as each department had its own database of costs revenue earned and Marketing department had its own database of expense used in order to acquire a customer. This meant that there were inconsistencies with how money was being spent in the organization.
The new IT solution that we had in mind was to ensure that there was to offer convergence and visibility within the organization despite its size (Beiske, 2007)
Scope
The scope of this project is to identify a process within an Organization that needs to be made more efficient in energy spent and time used by man power. This will need us to use an I.T solution so as to cut back on time wasted in order to be more efficient.
Problem Definition
The Organization that we chose was Emirates airline. We found out that the Airline is always having problems in attracting new clients and winning them in the process. Apart from attracting new clients the airline needed to retain their current clients as well as to nurture them. The airline also needed to lure back former clients who had been taken away by rival competitors. All this was to be done at reduced expenses in both marketing cost and customer service. The productivity of the staff such as the booking agents needed to be boosted. This could only be done through using an I.T based solution. With rival airlines coming from both low cost carriers and mainstream airlines that flew long distance, the airline is to come up with a solution to this problem or else its market share in the aviation industry will most likely continue to be eroded as we have seen in the recent past. Emirates lack a well defined corporate data backbone and infrastructure that can allow a range of employees within the Airline to have information about the clients that fly with them. It is this lack of visibility that the solution will offer to eliminate.
Objectives
The objectives to be met by the solution to be provided is to ensure that all the people involved in the company, the processes and the technology used in the company are to work in synergy in order to increase and reinforce relationships. This will be done by implementing a customer relation management system, through this we will be able to ensure that productivity in sales will be higher in terms of the number of airline tickets we will be able to sell and enhanced customer service experience that our customers will be able to enjoy. This plan documents the actions &responsibilities needed for the improvement and staging of the customer relation software up to the beta stage. Information on the Maintenance of the system, its operation and deployment will be documented in a separate plan.
Analysis
Problem definition of current system
The airline is currently using customer focus groups, in order to get information from their clients about what they want changed, and what they would rather see changed within the airline. The people who contribute these views are mostly made up of their valued clients or clients who use their service more often. The information taken from them is recorded manually in client survey forms. The issue with this kind of technique is that the information collected is not visible to every one as the data is stored in form of hard copy and the marketing department does not benefit from much information as the information collected from the surveys become more and more repetitive. Furthermore, customer’s data are stored in different data bases. One instance is where the email requests and customer phone conversation records are stored in different locations. This makes customer follow up difficult. The airline has a call center to serve its customers, when a customer calls to make an inquiry, he or she is subjected to long repetitive questioning which would have been done earlier by another customer care representative. The airline being an International carrier makes analysis of the information difficult as data is scattered all around the globe.
Work System Analysis
Above is frame work model that can in order to organize the process that will be used in coming up a with a solution. As exhibited above the customer is the most important person tthat is supposed to benefit from the process that will be involved (Alter, 2002) :
- Customer. In the above Framework, the solution to be instituted are to assist the customer who may the customer in this case may Emirates Airlines Customer, The customer care staff serving the flying customers or any other person using our CRM solution.
- Product: This is the result that the process generates for the customer. In our case the CRM solution is meant to come up with information to assist in the fast processing of passengers and rewarding of the persons flying most frequently with the airline.
- Business process: The business process is the way our solution is going to be implemented from the analysis of needs to the acceptance stage. The CRM solution will have to undergo many stages before being accepted by management.
- Participants: The participants are the people who are to carry out and execute the process. In our case the online company will be in charge of tasks that will directly lead to the implementation of the project. We have coders who will be in charge of coding the CRM software application and its customization. We also have people in the tem that will be in charge of collecting information on the needs of the Emirates airlines as to what can be resolved using the CRM solution.
- Information: This is data that will be used by the participants of the project. The data comprises of the needs that the Airline need to see changed and the people who are going to be affected. Information such as the schedule are also important towards the success of the team.
- Technology: For this project the Management of Emirates Airlines will have to purchase more hardware and software for the completion of the CRM project. Hardware includes more Servers that will be used to run the CRM application together with storage of the database. We will also need the CRM software that will be contracted from the vendors, we will also need an expansion on the current network as the Solution will require a large amount of bandwidth.
- Infrastructure: This is the organization ability to sustain the technology needed to get the system live and going. In our case the infrastructure includes the network availability. Despite us talking about the network, this time we are talking about whether the speed of the network is sufficient to ensure that the information reaches the customer in time
- Context: This refers to whether the information provided by the system is able to address the needs of the organization. The CRM solution is meant to cover each and every facet of the organization.
PBSA
The purposed of the the solution is to provide world class Customer relation management tools that will present opportunities in multiple terms such that instead of just collecting information just for the purpose of the airline, the airline will also be to give back to its customers to reward loyalty. These incentives will be presented in terms of frequent flyer points or gifts. This will go along way in ensuring that the relationship between Emirates and its clients is strengthened (Swift, 2000).
Scope; any airline wants to build loyalty with its customers. Companies that are innovative in the world have taken time to make sure that they have invested enough resources in ensuring customer retention and building of brand through the customer is facilitated.
Work system definition: The objectives of the customer relation management software is to automate, the database records that are being collected by the cabin crew through customer surveys and customer phone conversations to make it easier for customer care representatives in Emirates call center and customer care staff who may be in direct contact with the customers in the airport. Currently the process for collecting customer contact and information such as Email is through hand written records which is a very manual process. Tracking of customer information is also difficult from the samples taken from them to inquiries made through phone calls.
After customer complaints about poor customer service they received from call center representatives, Emirates contracted an on line company to evaluate the potential of coming up with an automated system for the whole call center data collection and retrieval process. This pilot process was to evaluate the strengths and weakness of introducing customer relation management software. This pilot assessment will first start in the Call center that is located in Dubai. Major improvements to be adopted by the airline Customer care department were identified.
The experience that we had in evaluating the current system and coming up with a solution was relevant in providing a foundation in the specifications that were laid out in Emirate’s problem proposal. This was to be developed by the team who were to come up with the customer relation software.
The scope of the work to be done involves, the Customer relation management software to meet the specifications of the problems identified, this is to be delivered by the online company to Emirates under this Agreement. The Customer relation software comprises of custom client software and server end software that will both be implemented by the Online Company. Development of the Customer relation management system includes coming up with the application software, customizing it and documenting all the processes involved. The documentation will involve identification of the software requirements, software to run the system and final location of the staging area of the system. Tests are to be carried out before the system is to be adopted wholly by Emirates (Harvey, 2008)
The online Company’s responsibility within the scope of the Customer relation management software will include
- Management of the whole project including testing of the software.
- Monitoring of deliverables.
- The testing of the software solution. (The tests mentioned are unit testing, incorporation testing and final testing of the whole system)
- Provision of the source code for the system.
- Provision of documentation necessary for the running of the system.
- The preparation of manuals to be used by the instructors.
- Training. This will include training of trainers. This means that the online company will train staff of emirates airlines that will later pass that information t other staff within the Organization.
Tasks that will not be covered from the perspective of the online company include:
- The acquiring of hardware that will be used by the customer relations management software, this includes the servers, computers and other related hardware.
- Purchase of license
Proposed Emirates CRM Architecture
Below is a diagram highlighting the kind of a CRM solution that can be implemented for Emirates airline considering that it is an International airline. Advantages of such a system are the high quality of the results that can be achieved through such a solution. In the airline industry the turn around time is key for any airline to stay afloat. The CRM solution that we envisage will be able to reduce this time as many customers will be serviced at the airports with minimum delay (Alter, 2002). The solution has the advantage of offering comprehensive security as we don’t want a case where just anybody can hack into the system.
Solution
The ability to relay information about the travel outline in the different sectors within Emirates Airline is one critical factor in the development of customer satisfaction. Customer relation management software is important for Emirates airline. Although the implementation will not be easy, the fruits of the hard work will be seen through increased convergence of systems, improved customer feedback and loyalty.
Solution detail: Customer relation Management (CRM) software will include planning on the part of the airline and the creation of a schedule as the implementation takes place in phases(Alter, 2002). Training of staff will also be done as the users will need to familiarize themselves before it goes live. CRM Software will foster cooperation between departments such as sales and marketing, which will in turn lead to better results where collaboration is needed. In Emirates airlines, interdepartmental rivalry was noted as one of the major factors that hindered the improvement of customer satisfaction and their long term loyalty. CRM software has the capability of analyzing the data collected within the organization. Once the data has been collected, information from all departments can be analyzed using interwoven applications so as to come up with data that will be used for business intelligence. Examples of data that can be analyzed include the number of tickets that were sold in a week and what is the return rate per customer when it comes to flying with the Airline. How to reward frequent flyers with incentives will also be handled by the system.
Implementation strategy: Implementation of the CRM solution will happen in stages. First we will need to come up with a team that will be responsible in the analysis of company needs and come up with a feasible schedule that will be used to execute the project. There are many kinds of CRM systems, thus it will also be the responsibility of the team to come up with the appropriate software to be implemented. In our case the CRM should be address the needs currently facing the sales and marketing departments. Implementation of the CRM project will need a budget to be set out early so as to avoid mid project delays. Training of staff on how to use the system will lead to full utilization as many times, Companies have found themselves not utilizing the system fully because the Company staffs are not familiar with the working of the system. This brings out a frustrated Customer care manager who later disagrees with the IT manager as they both understand the missing link which was training (Alter,2002).
Information that is derived from using a CRM solution can be used to come up with strategies for the different departments in question. In our case, the biggest beneficiary of using the CRM solution will be the customers (Rigas, 2006). This is because customer care staff will be having all the information at the touch of a button. Hence the customer will be relayed with the right information in real time. The other beneficiary of the CRM solution will be the management of Emirates airlines as they will have enough business intelligence before making any decision in regards to price adjustment and incentives to be offered to its clients. For the business and the customer, the solution will provide a win-win situation as the customer will be rewarded with both information and incentives for flying i.e. frequent flyer miles or points. For the business, the solution will provide a stronger network with its customers in terms of loyalty from the flyers using the airline (Butler, 2001).
Solution Requirement
In order for the solution to be implemented, the airline needs to dedicate staff from IT department in order to assist staff in handling of the system. The staff will need to go for further training in regard to how to push the system to go live. Management should also participate in the training sessions as they will be able to assist in how to come up with suggestions on how the solution is to be implemented (Dyche,2006). Another reason why the management should be involved in the project is so as to report on whether the implementation of the whole solution is successful in accordance with the needs off the organization (Swift, 2000). Also the finance team should come up with budget allocation for the whole project as money should be set aside for the purchasing of the software which does not come cheap and also the purchase of the corresponding licenses. In terms of software requirements, w may need an operating system such as Windows XP/2003 enterprise. CRM solutions are offered by different vendors, the IT staff should come up with the best possible choice among the vendors as the needs of the organizations vary from one to another. When it comes to technical requirements, the airline will have to purchase a dedicated server that will be used to run the solution. This server will have to have the capability to run efficiently as downtime to such a solution can be disastrous to a company the size of Emirates airline. The IT infrastructure will have to be upgraded as the CRM solution will occupy for a large part of the bandwidth as the solution will run from virtually anywhere whether you are in the office or sitting at home. CRM solution runs on the internet hence there will be a need to upgrade network on the part of I.T department. (Dellah, 2006)
As said earlier there will be a need for a company wide training program. This will be conducted in house by the initial staff that will have been trained by the solution implementers. Training is required firstly to the customer care representatives as they are the ones who come face to face with the clients (Kumar, 2006). The representatives are the ones who act on the information by booking tickets or rewarding more loyalty points to the customer hence it is their duty to ensure that there are no lapses. The other people who are supposed to undergo training are the IT staff as they are the ones who will provide in house support in case problems occur and require urgent attention. The kind of training that they will undergo is different as they will need to have the complete knowledge as they will also be the “trainer of trainers.” Training of the IT department will be done during the implementation stage of the project while training of the customer care staff will be done during the final stages of the project(.Swift,2000)
List of Tasks to be done by the Members
The tasks to be done by members of the team include:
- Conduction of feasibility study to find out the requirements of the organization.
- System analysis and design
- Coding and implementation of the Customer relation management software
- Testing of the solution
All these tasks are to be done by every team member so that each gets a chance to experience and to learn every step of the way.
References
Alter, S.(2002). Information systems: a management perspective. San Diego, CA: Prentice Hall.
Beiske, B. (2007). Loyalty Management in the Airline Industry. Berlin: GRIN Verlag. Butler G. (2001). Handbook of airline strategy: public policy, regulatory issues, challenges, and solutions. New York: McGraw-Hill.
Dellah, R. ( 2006). Customer Relationship Management: Concepts & Cases. Bombay: PHI Learning Pvt. Ltd.
Dyche, J. (2002). The CRM handbook: a business guide to customer relationship management. New York: Addison-Wesley.
Hanlon, J. (2007). Global airlines: competition in a transnational industry. London: Oxford Publishers
Harvey, G. (2008). Management in the airline industry. London: Oxford Publishers.
Kumar, P. (2006). Customer Relationship Management :A Databased Approach. Bombay: Wiley India Pvt. Ltd.
Rigas, D. (2006). The airline business, New York: Routledge.
Swift, R. (2000). Accelerating customer relationships: using CRM and relationship technologies. New York: Prentice Hall.