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Aviation Value Chain Analysis

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1.1. The aviation value chain The value chain shown below describes all the activities involved in air travel. Airports serve as a gateway to aviation and hence are a key link in the air transport value chain. They play a vital role in facilitating tourism and business travel and global supply chains as well. For inbound travelers, an airport contributes to their first impression of a city or country, and for outbound travel, particularly on short-haul journeys, passengers may spend as much, or even more, time at the airport as they do in the air. Figure 5 Aviation value chain analysis 1.2. Airport Business Models A business model describes the rationale of how an organization creates, delivers, and captures value. It is critical that …show more content…

Competitiveness Airports operate in a highly competitive environment and therefore encourage developments which make the airport sector more responsive to the needs of their passenger and airline customers. Competition in the airline sector has been a driver of innovation and cost reduction and has delivered major benefits for consumers in terms of increased choice and value. Effective competition between airports is clearly something to be encouraged for the same reasons. “Within the aviation industry, MRO, ground handling, catering, CRS and freight forwarding created economic profits, but these were much more than offset by economic losses by airlines and airports. Airlines were responsible for the large USD17 billion of economic losses globally. The returns generated by airports are weighed down by the US, where airports are owned by local governments and funded by tax-efficient municipal bonds. They are not run to generate a return in their own right, but to bring wider economic benefits. Outside the US, airports generally produce higher returns, often aided by price regulation.” (CAPA, …show more content…

Competition situation Porter’s 5 forces model below describes the competition and the relationship among the different players. (IATA, Profitability and the air transport value chain, 2013) Figure 8 Porter’s five forces model for airports (IATA, Profitability and the air transport value chain, 2013) Market forces Some competition is emerging in the airports sector, largely for regional airports and for some transfer markets. There is little evidence that this is sufficient to constrain charges at large hub airports. Regulation Economic regulation needs to be independent of government and incentive-based. Where an airport has significant market power incentive-based regulation is the only price regulation that will deliver efficiency gains. Airports usually have high credit ratings and can bear risk more easily than airlines. Regulation should be designed to facilitate this. Standards Poor passenger experience with check-in and security processes is another factor leading to a commoditization of the airline product and a low customer willingness to pay. Standards being introduced and proposed by the fast travel and checkpoint of the future programs and others could play an important role in improving passenger experience and willingness to

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Airport Security When visiting an airport, we should be prepared to undergo an intense security check to assure we have a safe flight from start to finish. Transportation Security Officers are now more attentive during security checks. Traveling passengers are expected to respect and obey any instructions given by a Transportation Security Officers. Some people travel for business, others for pleasure, but no matter our purpose for traveling, we all have in common one thing, to have a safe flight. Following the terrorist act on 9/11 and the growing number of threats in aircraft during domestic flights, airport security in the United States are now stricter when checking passenger through security, which helps with the safety of traveling passengers

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Johnson & Johnson currently has a 10.4% market share of the Pharmaceutical Manufacturing industry. They have the second largest share of this industry, just behind Amgen at 10.9%. By looking at the revenue and operating income for Johnson & Johnson, we can see their margins and evaluate their performance. Johnson & Johnson’s operating profit margin improved from 2015 to 2016 but decreased significantly from 2016 to 2017. The operating profit margin for the company as a whole in 2016 was 28.72% and in 2017 it was 24.07% (Appendix A).

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As with value chain integration, companies in the industry have embraced a scattershot approach. Pearce & Doh offer a better approach: identify those opportunities where the core business activities and the scope of the company’s operations create genuine leverage to bring other stakeholders to the table, creating lasting beneficial change. Airline management, collaborating with their stakeholders, should work to identify the One Big Thing a airline could do that would make a lasting positive change, rather than focusing on multiple things at

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Question 2: To do a resource-based analysis of any organization, it needs to go through different steps, first identify the three categories of the resources , the tangible ,intangible, and the human resources , second identify the capacity of the organization to put its resources for a desired end and in good use, third to decide on suitable strategy for the organization we need to do SWOT analysis to determine the organization strength and weakness compared to the competitors, third what are the key successful factors of the organization that can be determine by identifying the customers of the organization and their needs, and what the organization will do to survive the competition ( Hall&Keynes,2015) also audit analysis to Ford resources , and value chain analysis to Ford activities . In the next section, there will a brief explanation about the steps mentioned above , followed by an application to each step to, Ford motor which was incorporated in Delawae in 1919, it is a global automotive industry leader in Dearborn and Michigan, distributed vehicles across six continents the core business of Ford , designing and manufacturing cars, marketing , financing and servicing a full line of Fords cars, trucks, SUVs, and electrified cars, and Lincoln luxury car (Ford annual report,2015). Resource-based view (RBV) is an essential theory for strategic managers , considering the organization resources the assets , capabilities organization

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