Service Operations Management of Easy Jet Airlines
Managing operations focuses on the efficient and effective execution of business operations with the main objectives of achieving customer satisfaction and optimal use of resources. Operations management is a necessity during service development and delivery since it fosters effective conversion of inputs to outputs in a manner that guarantees quality service delivery. Under the service concept, a service is considered as a set of explicit and implicit benefits, carried out by a supporting facility that makes use of facilitated benefits (Alamdari & Fagan 2005). Therefore, the service concept refers to the perceptions and anticipations of the service from the customers’ point of view. According to Johnston & Clark (2005), a service operation entails the conversion of inputs to the desired outputs.
An important outcome of the service operations concept is that it should result in high levels of customer satisfaction, which is attained through effective and efficient use of business resources. The main purpose of this paper is to evaluate how Easy Jet Airlines achieves high-level customer satisfaction and competitive advantage, basing on the aspects of service operations management such as service operations concept, the five competitive objectives, supply chain management, capacity management and corporate social responsibility. Service Operations Concept Easy Jet is a British airline and the largest in the UK in terms of the number of passengers, and both domestic and international operations (Jones 2005). The success of a firm in the service industry, especially the airline industry, depends on how customers, employees, and shareholders view the firm. This implies that it is a crucial mission of Easy Jet’s service management to define its services (Oded, Eitan & Naufel 2008). The service concept offers a framework, through which its customers and core shareholders can perceive its business proposition.
Easy Jet is based on low-cost and no-frill business model. The service concept of Easy Jet Airlines bases on the viewpoint that the demand for short-haul air transport services is price-elastic. This implies that if prices are reduced, the number of people flying will increase (Jones 2005). Conventionally, service concept of airline companies are based on the predisposition that airline traffic increases with the economy and that reducing the prices only serves to reduce the revenue. Easy Jet has disapproved this business model. Under this analysis, the service concept of Easy Jet involves using the internet to cut distribution costs; point-to-point (short haul) flight services; lack of additional services on board; use of modern and standardized fleet, and maximum use of substantial business assets.
Easy Jet has a business objective of offering safe, good value and short haul flight services, which is reflected in its service concept model (Curtin 2012). Easy Jet is a no-frills airline, and uses this service concept to make sure that it offers low-cost flight services. This business model is consistent with the view that demand for point-to-point flight services is price-elastic (Weatherford & Pfeifer 1994). This has been achieved, using two approaches in terms of the size of the market served and the range of services offered. Easy Jet has a narrow range of services, when compared with other airline companies that serve international and European states routes. Easy Jet focuses on meeting the demands of the European transport market in relation to short haul services (Emerald Group Publishing Limited 2002).
The notable business advantage, associated with a focused service, is that the company concentrates on a core area of flight operations. In addition, the short haul service lasts for shorter durations, which eliminates the need to offer frills on-board. The no-frills service concept reduces operational costs and results in significant savings in terms of human and financial resources that can be channelled to other core areas of flight operations like safety and performance (Sull 1999). Overall, the no-frills service concept results in low-cost carrier services and increases profitability for Easy Jet. This is because there is a less expectation gap from its customers and the actual services, offered by the company.
Easy Jet uses the internet to lower operational costs and increase convenience for its customers, when using its services. Approximately 90 percent of its bookings are done online; the company also aims at responding to most of its customer service requests through the internet. This helps to reduce running costs, enhancing business efficiency and value for its services. The use of modern and standardized fleet means that Easy Jet operates one type of aircraft fleet, which is Airbus A319-100 (Jones 2005). This has an added advantage because uniformity serves to enhance the effectiveness and efficiency of training, maintaining and operating costs. This makes significant contributions towards the achievement of its business objective of operating at lower costs.
It is evident that the service concept model, adopted by Easy Jet, has made significant contributions towards its growth as evident in the following table 1 (Curtin 2012). Five Performance Objectives The five performance objectives include quality, speed, dependability, flexibility, and cost, which are all essential in increasing the competitiveness and profitability of Easy Jet. Quality, in the airline industry, implies that the service delivery should match the expectations of the customers. In the context of Easy Jet, quality service is enhanced through online booking and rapid turnaround times focus on punctuality and flight safety, using standardized fleets. All the above makes significant contributions towards quality service delivery by the firm.
Punctuality and e-ticketing serves to add value to the air transport services, offered by Easy Jet. Quality in service delivery by Easy Jet is also enhanced by the fact that it flies to primary airports in the regions that it operates. Easy Jet uses numerous convenience services to enhance quality, such as transferring to an earlier flight free of charge and one-way ticketing, which serves to increase convenience for its customers by increasing their flexibility to plan for their trips, when compared to round trip. Easy Jet has adopted a business model that embarks on improving the quality of customer service delivery (Johnston & Clark 2005). In the context of air transport services, speed simply means being fast, and involves punctuality and convenience of the services (Robinson 2009).
In order to achieve speed, Easy Jet focuses on punctuality and rapid turn-around times, which is attained through high frequency of flights between the main airports in Europe that are close to the major cities. Speed in its distribution channel is enhanced through online booking and response to customer requests, which saves time and resources, required for manual bookings (Slack 2003). Online ticketing minimizes the time a customer requires to book a flight by eliminating the long queues, associated with short haul air transport. Speed is also enhanced, using the Easy Jet plus Card, which serves to reduce the booking steps and enhance speedy boarding on each flight. Easy Jet enhances the speed of its operations using a point-to-point flight model instead of the conventional hub and spoke model, whereby passengers have to be transferred to another aircraft, while in transit (Morrison & Winston 2000).
Dependability implies being on time, implying that customers have a guarantee that the service will be delivered in a timely manner. Punctuality is a significant element of Easy Jet business model. Since airline industry requires integration with the hospitality industry, Easy Jet is expanding its business strategies to the hospitality industry as evident with its co-branding with First Choice Holidays to launch Easy Jet Hotels and offer package holidays. In addition, Easy Jet has reported minimal cases of flight cancellations and delays, which has increased its view of dependability among its customers (Preyas, Oded & Devavrat 2004). Flexibility refers to the ability of a firm to adapt its business strategies to meet the changing customer requirements. In the airline industry, flexibility involves the capacity to introduce new services, expand to the market, offer a wide range of services and adjust the number of customers that the airline serves (Johnston & Clark 2005).
Easy Jet has not done much to achieve flexibility since its strategy only focuses on the provision of low-cost carrier services with no frills. Easy Jet is yet to diversify its services and expand beyond the United Kingdom. The emphasis on area of flight operation inhibits the introduction of other flight services such as long haul flight services, provision of frills, and other additional service on board for a premium (Sull 1999). Easy Jet has reported a success in terms of cost objective. The company focuses on maximum usage of assets to enhance profitability, lack of frills to lower costs and online booking to reduce overhead costs. The business model, adopted by Easy Jet, focuses on operating at lower costs and ensuring resources are used optimally.
The use of modern and standardized fleet means that Easy Jet operates one type of aircraft fleet, which an added advantage because uniformity serves to enhance the effectiveness and efficiency of training, maintaining and operating costs (Wu & Blackhurst 2009). Supply Chain Management Supply Chain management is primarily concerned with the flow of business processes and information with the main objective of meeting customer requirements effectively. A smooth running of supply chain in the service industry requires good availability of information on cusstomers’ demand (Attorney 2006). An effective supply chain management results in higher levels of customer satisfaction, cost savings on distribution, vertical integration benefits and allows the firm to place more emphasis on core business functions. In addition, effective supply chain management helps in reducing inventory and administrative costs, and facilitates speedy a response to changes in the market. Easy Jet manages approximately 900 flights on a daily basis, which poses the need for an effective supply chain management to operate its business from 416 airports, located in Europe (Lewis 2003).
Booking is an essential element of Easy Jet supply chain management. The firm initially used telephone reservations and later adopted online booking to enhance convenience and reduce costs (Waters 1999). Easy Jet does not make use of travel agents since its business focus is to lower operational costs. The e-commerce website, used by Easy Jet, provides real-time booking for its customers. This business model has helped in reducing the call centre costs and improving the efficiency of the booking process in terms of time and steps needed for the process.
Online booking has increased the efficiency of supply chain management at Easy Jet, which is in line with its business goals and objectives (Rae 2001). This is increasingly reducing the firm’s reliance on the airport facilities to aid the execution of some of its business functions such as booking and communication with the customers during cases of flight cancellations and delays. Capacity Management Capacity management at Easy Jet places emphasis on utmost usage of resources to facilitate the achievement of business objectives that are in line with reducing operational costs and increasing profitability. Capacity management aims at matching demand and supply in order to eliminate instances, associated with idle and over capacity. In addition, maximum capacity in services imposes significant challenges in implementing flexibility, as evident in the case of Easy Jet (Calder 2006). For instance, Easy Jet makes maximum use of space in the aircraft to increase the number of passengers that the aircraft can carry.
This is crucial towards the achievement of profitability but imposes significant limitations on flexibility of business level strategies such as diversification. Its capacity management involves not offering additional services on board as a strategy for cost cutting (Sadler 2007). The key area of focus is maximum aircraft utilization, high frequency of flights and quick turnaround times, and reducing the operating costs. Therefore, capacity management at Easy Jet makes use of Level Capacity, since it embarks on the maximum utilization of its resources (Pate & Beaumont 2006). Easy Jet has a capacity that is usually greater than the demand, resulting in sufficient demand that can be used to match its capacity. This also offers a cushion for absorbing demand uncertainties.
Easy Jet embarks on a demand management strategy that involves low cost pricing, advertising and online visibility to influence the demand to match its capacity (Pilikinton & Meredith 2009). Corporate Social Responsibility (CSR)CSR involves combining corporate self-regulation with the firm’s business model in order to ensure that the business processes and operations comply with legal requirements, international standards and ethical considerations. CSR denotes the responsibility that a firm has over its actions to the community, environment and its stakeholders. In relation to CSR, Easy Jet has a commitment towards environmental responsibility by ensuring that its business operations and processes are optimally efficient, while on air and ground. Easy Jet has a goal of finding ways to reduce its impact on the environment in terms of noise, greenhouse emissions, waste and particulate emissions. During 2006, Easy Jet ensured that its fleet complied with the international noise standards.
In relation to wastes and emission, Easy Jet is aiming at adopting more efficient business operations, as evident in its EcoJet Program, which aims at developing craft engines that are more fuel-efficient. Easy Jet has also implemented a policy to ensure that its fleet uses the latest technology. Easy Jet has a commitment towards its shareholders by embracing equality and diversity, training and development, employee information and consultation, rewarding and recognition of staff, health and safety and charitable donations. In addition, Easy Jet has a commitment towards ensuring that its corporate behaviour matches the highest standards. Conclusion This paper has evaluated how Easy Jet Airlines achieves high-level customer satisfaction and competitive advantage, basing on the aspects of service operations management such as service operations concept, the five competitive objectives, supply chain management, capacity management and corporate social responsibility.
It has been established that service concept of Easy Jet involves using the internet to cut distribution costs; point-to-point (short haul) flight services; lack of additional services on board; use of modern and standardized fleet, and maximum use of substantial business assets. It has also been established that Easy Jet performs well on the five performance objectives except flexibility. With regard to capacity management, the capacity of Easy Jet is usually greater than the demand, resulting in sufficient demand that can be used to match its capacity. This also offers a cushion for absorbing demand uncertainties.