Introduction
The global air transport industry provides services to every corner of the globe and is a major economic force generating a multibillion dollar industry, both in terms of its own operations and its impacts on related industries such as aircraft manufacturing and tourism. Global cities, regions and emerging destinations are experiencing a phenomenal growth in aviation expansion and connectivity.
Despite the rapid growth of airlines and the aviation industry, the sector remains vulnerable. This is due to the low profit margins that govern operations, and the unforeseen circumstances, such as security concerns and climate change, that can have a dramatic effect on their business.
The aim of this unit is to give students an insight and
understanding into the complexities of the industry and multi-dimensional areas
of managing and running a commercial airline. It covers a range of operational
and strategic management techniques used by airlines to increase their revenue,
maintain sustainable growth and manage a myriad of challenges and issues that
currently face the sector.
Learning Outcomes
By the end of this unit students will be able to:
- Examine the complexities and nature of integrated airline operations
- Investigate the commercial management of an airline and the main routes of income and revenue
- Evaluate the key issues and challenges of safety management that affect airline operations
- Analyse how air transport operators minimise economic and environmental impacts to meet sustainable business growth and objectives.
Essential content
LO1 Examine the complexities and nature of integrated airline operations
Different functional areas:
The roles and responsibilities of different functional areas of airline operations: commercial, operations, crew, catering, finance, ground operations and maintenance
Business to Business (B2B) and Business to Consumer (B2C) operations
The value and utilisation of both hard and soft skills in achieving and managing operational objectives
The differences between sales distribution channels and marketing strategies for scheduled and non-scheduled carriers
Interrelationships between the functional areas:
The links and interrelationships between different functional departments to achieve overall business objectives
Issues of conflict between departments e.g. commercial versus operations, operations versus maintenance
The airline programme plan and International Air Transport Association IATA slot co-ordination
Air broker/Private Charter operations:
The value of an air broker in securing an alternative supply of aircraft
The importance of client relationship management and business development in securing a repeat customer base
B2B versus B2C operations
LO2 Investigate the commercial management of an airline and the main routes of income and revenue
Costs of operations:
Direct costs of operations e.g. costs of fuel, crew, maintenance, on-board catering, passenger services, sales distribution costs and depreciation
Revenue versus direct costs of operations
Economic
effects on costs of operations: routes, frequency, traffic, fares
Revenue management:
Yield management – capacity and load factors Profit margins and realistic revenue targets
Pricing strategies and the differences between scheduled and non-scheduled carriers
Forecasting and cost analysis
Financial implications of aircraft performance management
LO3 Evaluate the key issues and challenges of safety management that affect airline operations
Issues and challenges:
The importance of awareness and continual monitoring of environmental, economic and political threats
The relevant international and national regulations for airline and passenger safety management
Conflicts of interest between commercial business objectives and operational constraints
Crisis management:
Contingency planning for aircraft emergency and emergency procedures Emergency plans and the co-ordination of emergency services
LO4 Analyse how air transport operators minimise economic and environmental impacts to meet sustainable business growth and objectives
Economic and environmental impacts of aircraft operations:
Positive and negative impacts of aircraft operations
Sustainable management:
Sustainable management approaches/initiatives e.g. carbon footprint offsetting, biodegradable fuels, new fuel aircraft design
Sustainable
management plans and use of indicators to monitor sustainability
Learning Outcomes and Assessment Criteria
| Pass | Merit | Distinction |
| LO1 Examine the complexities and nature of integrated airline operations | ||
| P1 Investigate the different functional departments of airline operations P2 Explore the relationship between functional departments and how they link to organisational objectives and structure from both B2B and B2C perspectives | M1 Analyse the complexities of airline operations, structures and interrelationships in fulfilling organisational objectives | D1 Critically analyse the complexities of airline operations from both a B2B and B2C perspective |
| LO2 Investigate the commercial management of an airline and the main routes of income and revenue | D2 Critically analyse different revenue management techniques and make justified recommendations on how a commercial airline can improve sales and profits to meet overall business objectives | |
| P3 Discuss the main income streams for generating revenue of a commercial airline P4 Investigate the different management techniques and strategies applied for maximising sales and profit to generate revenue | M2 Analyse how the principles of yield management, aircraft utilisation and pricing strategies adopted by a commercial airline maximise sales and profits to meet overall business objectives | |
| LO3 Evaluate the key issues and challenges of safety management that affect airline operations | ||
| P5 Conduct a PESTLE analysis of the macro environment to assess the key issues, threats and challenges that face the commercial aviation industry | M3 Critically evaluate the key factors that are currently affecting the commercial airline industry | LO3 LO4 D3 Provide justified recommendations based on critical reflection for future sustainable developments and strategies to minimise impacts and achieve sustainable key performance indicators |
| Pass | Merit | Distinction |
| LO4 Analyse how air transport operators minimise the economic and environmental impacts to meet sustainable business growth and objectives | ||
| P6 Analyse the economic and environmental factors that are affecting the commercial airline industry P7 Appraise the measures and initiatives taken by airlines to minimise adverse impacts of economic and environmental factors | M4 Critically analyse the measure and initiatives employed by airlines to minimise adverse impacts to meet sustainable objectives, providing specific examples |
Recommended resources
Textbooks
BUDD, L. and ISON, S. (2016) Air Transport Management. An International Perspective. New York: Routledge.
COOK, G. and BILLIG, B. (2017) Airline Operations and Management: A Management Textbook. Oxford: Routledge.
DEMPSEY, P.S. and GESELL, L.E. (2012) Airline Management: Strategies for the 21st Century. 3rd ed. Chandler, Arizona: Coast Aire Publications.
HOLT, M. and POYNER, P. (2016) Air Carrier Operations. 2nd ed. Newcastle, Washington: Aviation Supplies and Academics Inc.
SHAW, S. (2011) Airline Marketing and Management. 7th ed. Oxford: Routledge.
Websites
| www.atwonline.com | Air Transport World (Research) |
| www.caa.co.uk | Civil Aviation Authority (General Reference) |
| www.Iata.org | International Air Transport Association (General Reference) |
| www.icao.int | International Civil Aviation Authority (General Reference) |
Links
This unit links to the following related units:
Unit 6: Managing Aviation Services
Unit 22: Airport Operations Management
Unit 23: Strategic Planning for Air Transport
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