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Business Management Planning of Emirates Airways and Sabic Petroleum Company

Organization Selected : Emirates Airways and Sabic a petroleum company
Question :

This assessment will cover certain questions which are like:

  1. What are the effective strategies for management planning.
  2. Give the ideas and the techniques for management growth band planning.
Answer :

INTRODUCTION

Management planning is a process of monitoring the organization goal and makes a plan to achieve it. Management planning helps the company to utilize their resources to its fullest. Effectual plan can help the company to make more revenues and brand equity. The future plan should be realistic and attainable as fictitious plan can harm the companies in a negative way. In this report two companies are taken into consideration i.e., Emirates airways and Sabic a petroleum company. These companies should use management planning to expand their business and improves their performance thus increase in profitability of the company. Main purpose behind conducting this report is to analyse goals which have been attained by companies. In this report, different ways, methods and sources are used to analyse the purpose about achieving goals.

Subject

EMIRATES AIRWAYS

Emirates is an airline company which is owned by The Emirates Group headquarters in Dubai, United Arab Emirates. It is the largest airline company in middle east and operates in more than 140 cities in 81 countries in six continents. Emirates airways is one of the largest airlines in the world as it operates 3600 flights per week from their hub i.e., Dubai International Airport (Goetsch and Davis, 2014). Emirates is one of the top company in context of revenue and passenger kms. With the help of management planning Emirates airways has set their goals and purpose of existence and try to achieve it within the set deadlines. Goals which have or have not been achieved by Emirates airways are describe below,

Increase profit up to 30% in 1 year

In 2016-17 Company profit was AED 1.3 billion and in the next year they have achieved a growth of 124% and recorded AED 2.8 billion as profit. Emirates started their operation in many new cities through which customer base increased gradually thus increase in profit. Apart from that they have started using Lean management due to which their operating cost decreases to a certain level. Emirates airways have save their big amount of money with the help of management planning as the employees working in the company is according to their pre set strategies. Consequently due to the local company of the UAE, there is a relaxation of tax as in 2016-17 airlines brings more than 250000 Australian visitors in Dubai.

Biggest plane in the world by capacity

Emirates airways have started their business in 1985 and after 20 years they have achieved the target of flying the biggest plane in the world. It was done by using latest technology and increasing the size of the wingspan in the Airbus A380 apart from that it have 4 powerful engines that helps them to provide a smooth flight to the customer. Consequently unique feature of Airbus is Auto throttle and the yoke moves which different this plane from other plane in the world (Austin and Pinkleton, 2015). Other than Airbus Boeing 777 is also one of the biggest and largest plain in the world.

Total passenger and cargo capacity increases

In 2016-17 Emirates total capacity was 60 billion but in the next year they have crossed the 61 billion mark. This was done due to the innovative approaches used by the Emirates like  reducing the prices by 7% thus helping the company to allure the potential customers. Company has regularly try innovative styles like coupons, lucky draw, premium service, free tickets so to attract the customers. Emirates airways has improve their cargo business as improvement in supply chain management and logistics so to improve the customer experiences (Yeomans and Huang, 2015). Company has also increased their frequency of flights in those countries who were giving more business in Cargo to increase their profit and numbers of supplies.

Increase the revenue by 12%          

The main target of Emirates airline is to increase their revenue so that profit could improve. In 2016-17 their revenue was USD 23.2 billion dollar and in the next year they have achieved their target by generating USD 25.2 billion dollar. The main reason behind their success was high investment in the marketing activities like advertisement, hoardings, sponsorships etc. Emirates airways has invested in sponsorships as they sponsor Cricket Australia, pro arch tournament etc. Besides this the name of the company is also features in the shirts of the umpire in Cricket. Airways could use their cargo space while fitting the customer baggages thus charging them extra and helping the company to increase their profit for a certain level (Schönsleben, 2016).

Failure:

Reduce Operating cost by 3%

Emirates wants to increase their profits by reducing operating cost. Total operating cost in increased by 7% in 2017-18 year. The main reason behind this failure is fuel cost. Total fuel cost in 2016-17 is 25% of operating cost and in next year it is 28%. Cost of fuel is increasing gradually thus increase in operating cost. Emirates airways can decrease their operating cost by flying single aircraft thus reduce in the cost of spare parts, training and development to the employees etc. Company should focus on high passenger route so that operating cost will be cover up by increasing the profits (Kerzner and Kerzner, 2017). Airways should introduce extra premium seats so that more profit would be earn from them.

Buying new aircraft to acquire more customers and cities

Acquiring more customer leads to increase in profits and revenue of the Emirates Airlines. In 2016-17, Emirates have acquired 35 aircraft so that more customer would be allure. But in the next year they have only 17 aircraft. The main reason behind the degrade in performance is currency value and its fluctuation. Fluctuation in the currency of dollars and euro is to main factor of inflation due which Emirates does not invest much in their technology. Company has also started to lease their aircraft to other company so  to improve the customer base and brand equity in the competitive market. Emirates Airlines strategy is to invest more on buying the aircraft so that they can create their positive brand image in the mind of their customer besides this expand their business to reduce the business risk ratio. Apart from that their plan is to make their planes efficient so that they wont harm the environment and attract more investors (Aher, Adinarayana and Gorantiwar, 2014).

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SABIC PETROLEUM COMPANY

Sabic is the largest public sector company in the middle east. It was founded in 1976 and headquarters in Riyadh, Saudi Arabia. Sabic petroleum company deals in chemical like it is the second largest company which produces ethylene glycol and third largest manufacturer of polyethylene. In 2014. Sabic was ranked fourth by Fortune Global 500 in chemical companies. With the help of management planning Sabic petroleum company has made goals and objectives for their company which they have to attain it under the deadline. Goals have or have not been accomplished by the company is described below,

  • Decreasing in greenhouse gas emission intensity

Environment is the main concern of all the companies in this sector and to save the society and environment Sabic has improved their carbon dioxide plan. Due to which carbon emission reduced to 1.23 megajoule from 1.24 megajoule. Apart from that out of 11 asset of Sabic, company has applied for seven high selectivity catalyst. It reduces the carbon emission thus doing their part in saving the environment.

  • Improve in environment, health,safety and security rate by 10%

Protecting the environment, health, safety and security (EHSS) is the main focus of the company and stakeholders. Everyone wants to save the environment where they are living. Sabic has done their part in an excellent way. Sabic main motive is to promote a culture and climate where everyone wants to attain the EHSS goal. Sabic has recorded the 21% decrease in EHSS rate in 2017-18 as compare to 2016-17 EHSS rate. Apart from that Sabic has launched 46 competency development program which helps the company to reduce their safety incidents. Moreover after the inquiries of 12669 customers, Sabic has improved their process to save the environments (Gallego-Ayala and Juízo, 2014). 

  • Contribution in welfare

Company should give to their society as it somehow help the Sabic to improve their goodwill in front of customers and government. If the company is contributing in the welfare of the society than more customer are interested in investing in the company. Sabic has invested 57.5 millions dollars in 2017-18 in the welfare of society and environment as compare to 46.4 millions dollar in 2016-17.

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Failures

  • Increase number of women in workplace by 10 % 

Middle east is a place where men don't like to work with women. Sabic has introduced new HR model in which they would motivate the other qualified women to work with them. Apart from that they have start investing strategic workforce planning through which proper number of females should be recruited so to decrease the gender gap in the company. After doing all this in 2017-18 percentage of women working the Sabic has reduced from 7.7% to 7.2%. Sabic should give motivation through giving bonus, incentives etc so that women will attract to that.

  • Increase in patent portfolio by 5%

Launching a new and unique product is hard for the company. Sabic has achieved 12191 patent in the 2016-17 year and has the target of increase of patent in 10%. Patent can be use to gain the competitive advantage over a period of time as they can not copy their products thus gives the time to create sustainable competitive advantage. Consequently Sabic can earn more by selling the permit to others to use their product and can collect royalties from them. But due to the poor management and old technology Sabic has only attain 11534 patent in 2017-18. The main reason was organizational changes and business priorities due to which Portfolio sustainability assessment is also shift for 2018-19 (Grady, 2016). 

  • Reduce complaints in the workplace:

Healthy working environment motivates the employees to work harder and give their performance at its best. Complaints in the workforce increase from 94 to 114 in a year. Proper training and development sessions, workshops, seminar should be given by the Sabic so to reduce the complaints in the workplace (Warner, Bach  and Hickey, 2014). Sabic should make their environment working friendly as motivated employees will give their best performance thus affects the profitability of the Sabic.

CONCLUSION

Management planning is the important factor in the success of the organization as it helps the company to make competitive strategies. Apart from that it also helps in workforce planning, expansion of business, improvement in performance of the company etc. Consequently  it minimizes the uncertainties of the future, improves employees morale to its fullest and help in attain the economies of the company. Company should invest in the welfare of the society as it improve the goodwill of the company in front of their customers, stakeholders and government.

Moreover company should spend in improving  environment, health,safety and security as employees are asset for the company as due to their skills and capabilities company increase their profits. Company should try to reduce the gender gap in the workplace as it will help them to create a friendly working environment in the company.

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