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Background

On the global competitive market, economic success of multinational enterprises (MNEs) heavily relies on their subsidiaries that are geographically dispersed being partially or fully owned subsidiaries, representative offices, regional offices, etc.  Looking at the expanding globalization on a largely competitive market, local responsiveness and dual imperatives of the global integration become more critical than ever for the growth and survival of MNEs (Barney, 1991, p. 111). The Emirates Airlines is among the fastest growing and expanding multinational enterprises in the world. The company forms a part of the Emirates Group that is based in Dubai. Founded in 1985, the Emirates Group is composed of the Emirates Airlines, Emirates Sky Cargo, and Emirates Holidays. Today the Emirate Group is a global corporation operating in 62 countries and over 100 destinations and adding new locations on average every month. Being one of the largest growing and expanding airlines, the Emirates Airlines has one of the youngest fleets in the sky and has been awarded over 300 awards for excellent performance worldwide. The Emirates Airlines operates a fleet of aircrafts to numerous destinations in Europe, Africa, the Middle East, the Far East, Australasia, North America, and in general every continent.

Introduction

Whenever organizations operate on the competitive market,they are bound to be under pressure to formulate and implement strategies that create or add value. The importance of the strategic management is also applicable to the general public as well as to non-profit sectors because they compete for resources, collaborate with private organizations, operate within quasi markets, and evaluate corporate policies. The success of such establishment strategies has essential impact on their capability to grow, survive, and prosper. Every executive, head of the department, or manager struggle to identify means that their companies can employ to acquire and maintain competitive advantage. A sustainable competitive advantage occurs when one firm implements a strategy that creates value in case other companies cannot duplicate the gains. Management of values means that the long term money generating capacity of the company is maximized. The easiest way to achieve this is through sales volume and prices while disposing of unnecessary assets, managing stock efficiently, and financing the business effectively through a necessary mix of capital (equity and debt). In any company, primary value-creating activities in the product or service creation include marketing and sales, inbound logistics, outbound logistics, operations, and service. In every activity, the company must add value or outsource a specific activity to another company that can do it better or even add more value. Business managers today are required to have the ability to make quick decisions in a rapidly changing world. They must make quick and right decision for their business to run effectively in a highly developing and competitive business environment. Decision making is one of many skills that a manager is required to have in order to run a company or institution. Others include ethical and/or spiritual orientation, communication skills, interpersonal skills, an ability to motivate workers, and most importantly, an analytical or problem solving ability. In order for sound decisions and correct management to be in place, critical thinking must be employed by all managers. In companies where there is a distinct lack of critical thinking, dysfunctional leadership is bound to arise. In the contemporary world, business realities have turned into global areas of rapid and quite unpredictable changes. It has led to an increase in the complexity of setbacks that institutions, managers, and employees deal with in the circumstances of this new generation. Advancements in technology have hugely impacted working practices and management styles. Study shows that more managers today rely on technological help in an effort to make right decisions that would either break or advance an institution. This paper is aimed at exploring the crucial skill of critical thinking among managers and top executive officers and at exploring how they propel companies through trending issues in the aviation industry.

Management

Beyond reasonable doubt, the new generation of managers has goals and priorities that are almost opposite to the ones of the majority of managers running institutions and companies today. To be able to accommodate these new generation managers, a work environment adjusted to their values and priorities has to be created. Recently, institutional strategies, basic company structures, products, and services have rapidly become outdated. New practices in the work place, for instance, virtual teams, video conferencing, and tele-work among other new technologies, have replaced old routines. It is evident that such developments occur at a rate that most managers and employees cannot cope with or adapt to. However, the new generation of managers easily adapts to these structural and technological advancements. To be an excellent manager, one must possess a variety of skills ranging from delegating and planning to communicating and motivating. Since the sets of skills are so diverse and extensive, managers are tempted to improve skills only in areas of management that they are comfortable with. Nevertheless, in order for the achievement to be successful in the long run, it is advisable to assess or evaluate skills in areas that do not belong to the one’s specialization. It is then mandatory for a manager to improve in all areas of management in order to increase efficiency. Managing any given organization, whether it is a financial institution, educational center, a discipline force, or a company, is a quite demanding job. Certain skills are necessary in order to accomplish the set targets. These skills are necessary for a manager to perform his duties better. Such skills are known as managerial skills. There are generally many types of management skills. However, this paper has highlighted 5 main skills, namely the following: Decision making skills; Communication skills; Leadership skills; Administrative skills; and Human relation skills. Management in the Emirates Airline can be claimed to be excellent because the team has seen the company through the rough times and emerged on the top.

External Environment

Major Trends, Opportunities, and Threats

The continued flow of success of the Emirates Airline has continually raised questions among the scholarly circles concerning the style of leadership, management, and strategic planning. These questions are an attempt to understand which way location, culture, and internal strategic decision-making contribute to the growth and success of the business. In the period when giant companies in the same field have announced losses, the Emirates Airlines continues to record profits having recently purchased 32 Airbuses and 380 super jumbo jets in the circumstances of the global financial crisis. Additionally, the company plans to hire additional two thousand cabin crew employees in order to support and accommodate operations and growth. With an addition of 14 new aircrafts, the total number of aircrafts of the Emirates Airlines now stands at 145. A question arises how the Emirates Airlines has managed to keep such good records over the years. A lot can be learnt from the business model employed by the airline company, its leadership style, and the support of the Dubai government. With the fast development and growth of the Emirates Airlines, other industries, competitors, and substitute industries are concerned about the repercussions of this tremendous success. There have been accusations of the Emirates Airlines receiving subsidies from the Dubai government and recruiting low-cost labor. Regardless of those matters of concern, the Emirates Airlines has a marketing strategy that is very strong and almost unmatched. This strategy has managed to create the significantly strong brand awareness worldwide. The Emirates Airlines sponsors a lot of fields including events, sports clubs, and students in the United Arab Emirates and all over the world while citing sponsorship as an important marketing strategy. New purchases and an exceptional geographic location are regarded to enable the company to grow and serve the main hubs of its competitors. The Emirates Airlines also has very cheap rates that are almost half of those offered by their competitors. Addition of fleet, assets, and employees would also make it quite hard for other competitors in the market to catch up with the Emirates Airlines. Conclusively, the above mentioned factors contribute to the Emirates Airline’s phenomenal expansion, but the success is unlikely without the stable governance of the company’s everyday running. The key of good results in the Emirates Airlines is the continuity of the management team.

The current external environment (societal one and industry) contains several trends that will most likely affect the Emirates Airlines. With the just concluded global financial crisis, sales and ultimately profits are expected to shoot downwards. Purchases and acquisition of new assets are quite expensive due to the recession and inflation. It will most likely negatively affect the Emirates Airlines. In the continuation of the current trend, future projections show globalization to be on the increase in the next few years. Predictions state that the aerospace industry will experience shortages in skilled personnel to service the industry in the next few years. It is mostly due to the developments in the aviation industry. Over the last few years, fleet sizes have increased on all scenes leading to the creation of new routes. Consequently, the volume of air traffic has increased tremendously and this trend is forecasted to go on for a couple more years. More frequent flights are on offer and the demand for trained workers is going to increase over the time. The largest suppliers of passenger aircrafts Boeing and Airbus forecast a tripling in the world’s airline traffic by 2020. The cargo is projected to grow by 6% while normal traffic grows by 5%. As seen earlier, it demands an increase in the skills training that is yet to materialize. It is attributed to the high cost of training that would force employees to pay for their own training. Another trend in the aviation industry is collaborations (Lynch, 2006, p. 70). Recently, the Emirates Airlines has entered a new global aviation partnership with the Australian airline giant Qantas. It is amidst major collaboration trends within the aviation industry where major airlines enter the partnerships and share benefits accruing from them. Another trending issue is maintenance of the airline fleets and overall operations. Certain unfortunate incidences in the past have caused tight control of the industry’s maintenance section. With new regulations, every aspect of the maintenance function needs control and recording. This information can pile up to levels where control and processing of the useful information become a challenge. The only way to overcome this obstacle is through the use of the new modern technology. The Emirates Airlines is exploring new ways of boosting productivity among the maintenance employees. Another emerging trend in the aviation industry is outsourcing. In order to increase productivity of assets and cut costs, the aviation industry has adopted outsourcing maintenance, overhaul, and repair. As development and growth expand, outsourcing will become common. As outsourcing becomes a popular strategy, only those activities that add value to the business will be kept internally while everything else will be shifted to different contractors. Outsourcing will reduce costs, thereby, saving a lot of money. However, outsourcing will present an opportunity to many start-up airlines since they do not require expertise of the fleet and aircraft maintenance. They also do not require a lot of capital since outsourcing will provide contract signing only with real experts. Terrorism, continued financial issues, war in the Arab nations, internal conflicts, unintended consequences of both good and bad intentions, power shifts, distribution of natural resources, and changes in the international political landscape are the trends that will one way or another affect the day-to-day running of aviation companies, particularly of the Emirates Airlines.

Threats versus Opportunities

In order to survive on the highly competitive market, the Emirates Airlines is in constant competition with other aviation companies. With almost all companies having a broad product range in segments, competition for dominance and service delivery is inevitable. The Emirates Airlines’ market strategy is a simple utilization of technological advances to gain the competitive advantage by increasing productivity on all levels and by offering special services. Such strong points as more aircrafts for ferrying passengers and cargo, more employees, an incredible geographical location, good partnerships, and training programs with a dire desire to dominate have given the Emirates Airlines an opportunity to soar higher than its competitors. They have also reduced the cost per seat, which then leads to the reduction of ticket costs and to more customers. With the improved quality of services, direct marketing strategies, and physical features, the Emirates Airlines remains a few steps ahead of its competitors, hence continuing to increase its productivity. However, the above mentioned opportunities, trends, and threats may have an impact on sales and the overall performance of the airline company. Threats from new entrants, an ever increasing power of buyers, inevitable power of the suppliers, threats from the already present substitutes and from other emerging alternatives, and competitive rivalry within the industry are among the threats the airline company needs to tackle. New entrants will reduce the demand for the company services in terms of transport. It is due to the reduction of ticket costs and other incentive activities that newbie companies possess. To tackle this, the Emirates Airlines tries to create a long lasting image that would be hard to erase in the aviation industry. The power of buyers and suppliers is another trending threat to the performance of the company (Wheelan and Hunger, 2008, p. 23). A mistake with the above mentioned sectors would have a negative impact on the company’s reputation, which will ultimately reduce the level of its performance. Another trending issue that poses a threat to the aviation industry as a whole is the threat of presence of substitutes and alternative means of travel. It has been quite a blow, especially where air accidents are experienced. It negatively affects the company as customers opt to use other means of transport that are deemed safer and cheaper, for example, road travel. Air accidents are rare. However, an accident involving any airline company negatively affects the rest of airlines and is a blow to the aviation industry. Terrorism is another worldwide trend that threatens to crash the aviation industry. With the terrorist attack on the world trade centre in New York on September 11th,2001, as a key reference, world airlines have become more aware of this threat than ever. If unchecked, the threat would destroy the industry as few people will be willing to use the air travel (Johnson et al., 2011, p. 193).

No matter how many hazards are threatening to take down the industry, several opportunities have risen and companies need to utilize this chance to increase productivity. With the internet connecting the whole world, the Emirates Airlines is expected to take advantage of this opportunity to expand their company in the rest of the world. Tours and travel have also risen over the past couple of years. It is a trend that is expected to prosper as the world has become interconnected like a global village. More people travel to various destinations in the world for various reasons. The number is projected to increase by an even larger margin due to the reduction of ticket prices and increased social interactions. Another opportunity that can be well utilized by the Emirates Airlines is never ending military advancements. New discoveries in the field result in a better delivery of services as planes and other commercial aircrafts are constantly improved. Another opportunity arising from worldwide trends is blooming partnerships between airline companies and other relevant companies in the field. Partnerships with other airline companies help to increase interactions. Consequently, the performance is enhanced. Additionally, partnerships with relevant companies, for instance, with those specialized in mechanics, maintenance, or fleet management, can bring benefits through the outsourcing that heavily emphasizes the addition of value. Taking advantage of such opportunities will ensure that the Emirates Airlines remains on top of the game as the world’s leading airline company. With the extensive expansion of the airline and establishment of sub stations all over the world, performance and position of the company in terms of dominance are expected to shoot upwards in the nearest future (Hitt et al., 2007, p. 98).

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