Executive Summary Report: Corporate Governance and Social Responsibility


 


The international organization to focus on corporate governance and social responsibility will be the Qantas Airlines


 



 


Qantas Information


Qantas is widely regarded as the world’s leading long distance airline and one of the strongest brands in Australia. Qantas continues to provide outstanding service to its customers and is at the forefront of the international civil aviation industry. The future holds many challenges for Qantas maintaining safe operations and world class product standards while building a viable and competitive position long term for the airline. Qantas continues to grow both in aircraft and numbers of flights the sophistication of its operations began to outstrip the manual, labor-intensive processes it used to schedule and plan its flight crew resources. Like most airlines, Qantas use a system of seniority and merit to enable flight crews to bid for routes and promotions, planning its resource requirements two to three years in advance (Crawford, 2006).


PESTLE Analysis


For political sense, airline industry wherein Qantas belong integrates strategic sector that plays a fundamental role in the globalization of other industries since it promotes tourism, world trade, foreign investment and, therefore, leads to economic growth, Qantas airlines within the industry operate in a highly dynamic environment where various legal, social, technological and economic forces interact with each other, thus influencing their decisions and actions, in Australia and operating Qantas has been recently added to the market and has prevailed over several challenges and obstacles over the years and has emerged triumphant.


For economic sense, the airline can face severe financial distress due to oil crisis, recessions and terrorist attacks, Qantas continues to grow and prosper. The main attraction of Qantas is their reasonable tickets. In regards to the rise of competition delivered to airlines operating, the survival of Qantas applies more assess to the competitive environment and identify key factors that may influence its actions (Porter 1998, p.45). 


For social sense, there has been timing of Virgin Blue’s entry into the Australian domestic airline market was fortunate as it was able to fill the gap created by the failure of Ansett in September, 2001. It was at this time that Qantas dominated the market share and saw Virgin Blue as a threat, grow rapidly to become Australia’s second domestic carrier, rather than just a cut-price alternative to the established players. It also gave them access to terminal space without which growth would have been significantly limited.


In technology domain, positive energy towards Qantas strategic assimilation identifies success of its governance and CSR, the safety and security is Qantas priority wherein Civil Aviation Department regulations and standards covers operation, maintenance, equipment, move for the effort to have better compete with up-and-coming low-fare carriers which have been undercutting Qantas sales through more simplified routes and pricing structures.


Legal ways at Qantas there enjoys regulatory approval for expansion of its code sharing agreement with other airlines and has also expressed an interest in leveling up its competitors considering the sale of its majority stake in the struggling airline increase. There is a need for Qantas to strengthen whatever opportunity that can be found in airline industry through engaging into established process of valuing its marketing strategies and a detailed planning structure helping promote better strategic moves and be able to provide good customer services to the customers like by having discounted flights and value promotion to keep the competitive advantage at stable mode within its competitors and will need to focus more on the core competencies that allow those low cost airlines to practically and wisely design suitable airline operations within the bracket of their marketing network services in a market standard-based perspective.


For environmental, Qantas Airlines long-term strategy is to improve its profitability to create substantial shareholder value and to maintain its position and to continue to grow and diversify the business into new markets nationally and internationally, maintaining a flexible and diversified network, maintaining current alliances and seeking mutually beneficial relationships with other quality airlines, improving the profitability of the business organization, maintaining financial strength, high level of success as well as investing in product and customer service initiatives in order to avoid failures.


Strategic issues and Discussions


Strategic issues of airline management might arise such as in terms of operations and performance at Qantas from wherein corporate governance and social responsibilities will assume flight and destination issues deemed at Qantas and the issues of leadership and stakeholder partnership could place an effect reality into the airline business, upon avoiding issues from the dynamic environment, there is critical need for Qantas business to continually assess resources as needed to accomplish airlines business strategy well available into the organization. (Prahalad, 1990) The Qantas strategy provides for the maximization of human capital, reduction of wasted and inefficient labor and other financial investment, eventually to maximize profitability. (Barton, Bradshaw, Brunschwiler and Bull-Larsen, 1994) It is desirable to have objectives that are clear and measurable, it is important to let the Qantas employee determine when they are clear enough for them to pursue. Asking for complete clarity when people are still digesting what is possible hinders rather than gains com­mitment, give Qantas team the time to think things through can sometimes help them see the opportunities. Qantas has undergone considerable restructuring for many years now, have become opportunistic seekers within the airlines business and its market stance. Thus, Qantas business competitors has led to increased competitiveness and in a way accelerated the trend of strategic business as characterized by the desire to belong to global network process with the tendency to strive for global presence and the airline carries passengers on extended flights from Australia to other destinations. In many ways strategic activity of Qantas is following better methods which reflect decisions regarding the product/service provision of routes, seat allocation and types, in-flight and ground-based services, the price structure, distribution channels and promotional activity. The business environment at Qantas is becoming competitive as the international market is expanding and airlines are returning to profit (Betts, 1994; Skapinker, 1995). Then, competition still proceeds in an environmental context where access to routes and free market solutions are constrained with emphasis on the cost basis of prices and the airlines’ product mix (Driver, 1999). In addition, there can be constructive process of change, the CSR application does have organization effect on the part of leaders chosen as the change can assume aspects towards confidence, knowledge being perceived, the optimistic inculcation of theories deemed for explaining CSR ways into the organization as well as enough respect and admiration on leadership competencies found in complete assimilating of CSR resources along with leadership dominance (Sankar, 2003; Lord and Brown, 2004).


“CSR is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large” (Moir, 2001, p. 18) and that Qantas Airlines must be aware of. Qantas social Responsibility assumes empowerment in such resources and diverse roles to make known of the business practices and principles. Aside, recognizing the organization’s corporate governance as there will be influence over strategies used by the airline business operation and growth stance. Thus, the strategic management of Qantas will be entitled to some issues that must be handled by the management and executive board wherein the business relates to passenger/customer satisfaction and it is essential for Qantas to attempt to understand and deal with governance and CSR connection. The importance of strategies and its concepts will imply that airline leaders can act more socially responsible without using too much expenditure into the Qantas assets and funding. The social responsibility amiably determines strategic issues upon mapping business impact and leadership effects within the realm of certain economic as well as environment emergence, from within there outcomes into socially responsible decision patterns (Master and Heresniak, 2002). Governance and CSR value at Qantas have demonstrated attention towards continuous improvement of business, allowing operations to embrace change in its management and the formation of various leadership styles into leadership success, airlines will utilizes more governance stature and CSR ways (Gunther, 2005; Pant and Lachman, 1998; Agle et al., 1999).  


 


Conclusion


In conclusion, for Qantas Airlines, having good substance of governance and social responsibility are a must and serve ideal requirement for success in business operations, so leadership qualities are important to consider in choosing of ideal leader for the organization, as there includes the following points:


-      Providing effective purpose based on corporate governance and social responsibility applications


-      Articulating Qantas change vision that challenges powerful CSR formation and governance structure 


-      Showing strategic business determination upon achieving change and decision pathways


Although there is emphasis to service, quality and customer issues, it is surprising that the approach of certain Qantas in their value chain involves destination networking and fierce competition is vital and can affect the future of Qantas operation business in general. The sustainability of the value chain depends on effectiveness of the process within value chain and the process needs to be managed and measured well. Thus, effective governance pursue Qantas profit and engage airlines in social responsibility having in precise investment, Qantas team is being driven by ample sales and profits and from having good strategic issues handling and resolution to challenges at large, maximizing strategic change and functionality modification. 


 


Contribution


My contribution into the topic is being a researcher, collating and understanding information and knowledge presented by secondary sources from within the Qantas resource and several proponents comprising of academic articles and journals wherein CSR and governance at Qantas airlines are deemed applied and executed to from this report in organized manner. Doing research is one integral approach that implies clear connectivity of the issues and how it adds positive assimilation to concepts and theories and upon understanding Qantas environment centered analysis, PESTLE in particular. 


 


References


Agle, B.R., Mitchell, R.K. and Sonnenfeld, J.A. 1999. ‘Who matters to CEOs? An investigation of stakeholder attributes and salience, corporate performance, and CEO values’, Academy of Management Journal 42 (1): 507–525


Barton, C., Bradshaw, L., Brunschwiler, R. Bull-Larsen, T. 1994. Is There a Future for Europe’s Airlines. The McKinsey Quarterly, Issue 4 p29


 


Betts, P. 1994. A slow flight back into profit – the pain for airlines is by no means over, Financial Times


Crawford, M. 2006, Finance apps streamlined – A report – Qantas


Driver, J.C. 1999. Airline marketing in regulatory context”, Journal of Marketing Practice: Applied Marketing Science, Vol. 5 No.6


 


Gunther, M. 2005. ‘Cops of the global village’, Fortune 151: 158–166


 


Lord, R.G. and Brown, D.J. 2004. Leadership Processes and Follower Self-Identity, Lawrence Erlbaum Associates: Mahwah, NJ.


 


Master, M. and E. J. Heresniak: 2002, ‘Ethics at Work: The Disconnect in Ethics Training’, Across the Board 39(5), 51–52.


 


Moir, L. 2001, What do we mean by Corporate Social Responsibility?, Corporate Governance 1, 2  MCB University Press pp. 16-22


 


Pant, P.N. and Lachman, R. 1998. ‘Value incongruity and strategic choice’, Journal of Management Studies 35(2): 195–212.


 


Prahalad, C.K. 1990. The Core Competence of the Corporation. Harvard Business Review.


Porter, M 1998, Competitive Advantage: Creating and Sustaining Superior Performance, Free Press, Texas


 


Sankar, Y. 2003. ‘Character not charisma is the critical measure of leadership excellence’, The Journal of Leadership and Organizational Studies 9(4): 45–55.


 


Skapinker, M. 1995. Business travel: no escape from the dreariness, Financial Times, pp.12


 


Qantas Website – Qantas Info, http://www.qantas.com.au


 


 


 


 


 



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