Research Korner: Pricing Examples

Rice and Potato Farming in Australia: A Case Study

INTRODUCTION As a person with experience and knowledge of rice and potato farming in Australia as well as organic farming practices and genetic engineering of food crops, the author has always brought up to his superiors the viability of strategy formation regarding its analysis and at times fail to understand the reasons or logic behind certain strategic implementations imposed on it. By delving into this project paper, the author intends to have better insights into how the consumption behaviour in Australia is thought up, formulated and then interpreted. The author hopes to have an in-depth understanding as to how the changes in customer eating behaviour and their impacts enable the country to compete effectively and profitably in this era of internationalization where competition is extremely intense. In order to reinforce the learning objectives, two key focal issues were focussed upon i.e. innovation and diversity. Innovation was discussed with regards to the consumption behaviour in Australia where it was renowned for its developmental capabilities to constantly innovate. Diversity came under strategic thinking and formation as the author considered the diverse culture, political climate, economic surroundings, social environment, technological settings, government policies and legal systems of Australia in order to better understand the consumption behaviour in Australia. Rice and Potato Farming Rice and potato farming in Australia has blossomed over the years because of the efficient and effective implementation of the farming strategies and tasks necessary to gain abundant rice harvests. Rice and potato farming in Australia focuses on the careful management of the farming processes involved in the production and distribution of rice (George et al. 2002). More often than not, small rice and potato farms in Australia don't really have the capabilities to implement efficient consumption behavior studies. Instead, these farms engage in activities that various schools of agriculture typically associate with consumption behavior. These activities include the monitoring of rice and potato, rice and potato development, production and distribution. However, consumption behavior deals with all operations done within rice and potato farms and plantations. Factors such as the alternative eating habits, the emerging trends, logistics and evaluations are often related with consumption behavior. A great deal of emphasis lies on the efficiency and effectiveness of processes. Therefore, consumption behavior includes the analysis and management of internal processes (Audebert et al. 1998). Consumption Behavior in the Hospitality Industry A. Alternative Eating Habits Gone are the days when Australians work on their desks for eight hours a day. Today’s employees want to become as productive as possible while in their offices and interact with different individuals and groups in different settings. The technological advancement in genetic engineering among a variety of foods including potato and rice has allowed workers and employees to access quality and healthy food products in an instant. Because of this rigorous and hectic schedule of employees, it became imperative for them to indulge in healthy meals with rice and potatoes as staple food to help them ease the pressure after every day’s work (Jones, 1999).   B. Customer Eating-out Behavior Normally, customers typically choose the best quality of food based on two (2) main factors: Convenience The Australian rice and potato farms’ dedication to quality for almost three generations now has led to the satisfaction of millions and millions of its customers worldwide. Australian rice of the medium grain Japonica variety was produced by a group of people who pursued the best quality and craftsmanship in terms of rice farming. The Australian rice and potatoes that its customers and citizens eat today is still being produced using nothing but the original and unparalleled farming strategies discovered three generations ago by the Australian farmers. Their mild sweet taste, fresh aroma, bright color and clarity are obtained by using only the purest planting materials without risks of insecticide and pest infestation (Sahrawat et al. 1997). Health The raw materials in the farms used in the production and harvesting of Australian rice and potatoes are able to meet the high quality standards and specifications. The packaging materials where Australian rice and potatoes are sold are also being subjected to strict quality standards. In line to the Australian farm’s policies in food safety, appropriate measures are taken in the milling process of Australian rice and potatoes and all of their brands to prevent the possible contamination. Australian farms implement the principles of the HACCP (Hazard Analysis and Critical Control Points) system as a testament to their dedication to quality (Asch et al. 1999).   Emerging Trends A. Organic Farming Practices The occurrence of various organic farming practices within Australia reflects the growing difficulty in the management of the procurement of food for consumption in commercial hospitality operations that require the effective use of valuable resources such as money, materials, equipments, and people. And Australia is no exception to these. This is the reason why organic farming practices are being done by Australian farmers in order to implement and endorse it as the most effective way to coordinate these resources through the application of organic farming methods derived from fields of studies such agriculture, crop science and agronomy (Lin, 1998). Through organic farming practices, food procurement problems are solved in different ways and alternative solutions are then relayed to the farm management. The farm management then selects the appropriate course of action in line with the food procurement goals. More often than not, organic farming practices are concerned with complicated issues such as naturally occurring biological processes, crop resource allocation, designing of crop production facilities and systems and crop diversity. Organic farming actually may vary according to the structures of farms and philosophy of the farm management. But in most cases in Australia, it centralizes in green manure and composting. Organic farming may also have the possibility of utilizing natural pest control methods and livestock raising in order to identify and solve a variety of food procurement problems. No matter what the type or structure of the farm is, organic farming operates under similar sets of methodologies in order to carry out the organic and natural way to support the food procurement process.   B. Genetic Engineering of Food Crops The genetic engineering of food crops determines the best ways to utilize the basic factors of food procurement. These resources include the people, materials, information, and energy needed in the production of genetically engineered foods. Genetic engineering of food crops is the bridge that links the goals of food procurement and farm performance although in an unconventional way. Genetic engineering is concerned with the increase in productivity in food procurement through the genetic modification of a particular food crop and choosing the appropriate methods to enhance its nutritive value without endangering the health of the people (Grove-White, 1997). Genetic engineering of food crops makes sure that it performs the careful analysis of the food crops and the target nutrient requirements that will be modified. In this process, they make use of various mathematical methods in its research to meet the requirements. They also develop systems of management control in order to aid in the planning of finances and cost analysis in the process of genetic engineering. These systems are eventually subjected to improvements for the effective distribution of genetically engineered food crops. This process of genetic engineering of food crops performs the tedious task of selecting which among the various food crops have the best combination of availability and costs. This time, genetic engineers make use of computers for simulations and controlling various activities and devices.   Implications for Pricing Rice and potato farms in Australia base their pricing strategies on several key trends that continuously shape the global marketplace of rice and potatoes. One particular trend is labeled as “premium-tization” (Pham et al. 1989). This phenomenon causes the polarization of different rice and potato markets. This would then trigger the consumers to demand and pay much higher prices for perceived rice and potato quality. However, discounting in prices of rice and potatoes are also simultaneously taking place, therefore squeezing out the middle range. More often than not, rice and potato farms undergo internationalization which leads to a tighter squeeze for shelf space. This will in turn leave them as winners. It is for this reason why Australian rice and potato farms value the “premise sector” so much because this would allow consumers to try their brands at low risk and price. In terms of market segments, premium and specialty brands of organic and genetically engineered foods in Australia have a disproportionate share of volume growth at an estimated 4-5% per year, as against the 2-3% overall growth rate. These rates come up as a result of both the rise in GDP among developing markets and consumer demands for higher value propositions, which is obviously dominated by international brands. Therefore, Australian farms have to increase its portfolio and operate globally to overcome the home market. Australian farms practically operate on a relatively fragmented market, with other farms accounting for 22% of global organic and genetically engineered food volume five years ago and only about 28% today (Dingkuhn, 1996). Improving the Production and Distribution of Food in Australia Rice and potato farms in Australia have been able to maintain their reputation as one of the world's leading rice producers for more than 130 years now. They are able to face the challenges in many of its markets directly. This is made possible by the effective production and distribution strategies aimed to deliver not only profit growth, but also on building down the foundation of rice in Australia (Jones et al. 1996). The production and distribution strategies of Australia are focused mainly on driving the growth of its rice and improving the farm’s financial performance. These may include both genetic engineering of food crops as well as organic farming practices. These strategies have also helped secure significant acquisitions and partnerships. And more importantly, these strategies have led to the release of the potentials of the Australian farm’s farmers, thus building a quality performance- based culture (Futakuchi et al. 1998). The production and distribution strategies of Australia’s farms are practically reinforced by the local employees themselves. These moves certainly allow the rice farms to improve even more without the costs of introducing new technologies. These efforts have resulted in increased financial gains for the farms in Australia and have allowed the establishment of distribution networks for Australia’s food products, whether natural or genetically engineered.   CONCLUSION The results of the analysis carried out on the rice and potato farming of Australia indicated very significant effects, even amidst the threats of unrest. Therefore, we could conclude that the rice and potato farming in Australia could still be expected to improve faster than average. The review of the food consumption behavior in Australia revealed very little inconsistencies regarding the farming strategies of Australian farms. This is coherent with their traditional inside-out approach. However, the need to reconcile both the inside-out and outside-in approaches becomes imperative now for the Australian farms. The analysis among the implications of pricing as well as the improvement in the distribution and production of food revealed certain gaps, most of which are biased towards the environment. However, these gaps paved the way towards determining a number of recommended strategic options to secure the competitiveness of Australian foods. Also, the Australian farms have to find a balance between adherence to internal forces within the management and to the changing forces of the environment in order to implement such strategic options.

Rice and Potato Farming in Australia: A Case Study

INTRODUCTION As a person with experience and knowledge of rice and potato farming in Australia as well as organic farming practices and...

Influence of an Individual’s Perceptions and Interpretation In Decision-Making and Judgments

Every single day, people are faced with decisions whether be it as simple as what to do or what to wear for the day. Every single minute is characterized by choices, choices that people make, rationally or irrationally.  decision making is as essential process in the human nature. Much has been learned about the psychology of human decision making as well as decision making within organizations. This paper will examine and assess the extent by which people’s judgments and decisions are influenced by one’s perception and interpretation of the world.             There are many factors affecting our choices in life. The field of judgment and decision making is concerned on how people combine desires and beliefs to choose a course of action. There are three components in the conceptual design for a decision. It includes courses of action or choice options and alternatives; beliefs about objective states, processes and events in the world including outcome states and means to achieve them; and desires, values or utilities that describe the consequences associated with the outcomes of each action-event combination. Decision making is central to every human activity; thus, everybody is a decision-maker. It must be noted though that good decision making begins with a consecutive, purposeful, strategic-thinking process. In addition, good decisions are those that efficiently choose or select means that are available in a given circumstance or situation to attain the goals of the decision maker.             Defines a decision as “the act or process of deciding; a conclusion or resolution reached especially as to future action, after consideration; the settlement of a question; a formal judgment; tendency to decide firmly; resoluteness”. Many theories of decision making exist in disciplines for both scientific and social science paradigms. In statistics, decisional theory is a strategy of measuring the decision-making process, or making it into mathematical form to make the most efficient and effective choice. In early economic theories, there is also a decision-making model of economic utility wherein people choose the best option that provides the maximum positive utility. The aforementioned early theories are also referred to as classical decision-making which basically shows how decisions are made in ideal situations. In psychology, the highlight of the process of decision-making has been a primary area of focus and study. In Janis and Mann’s Conflict Model of Decision-making, the process of decision=making is viewed as a stressful process which involves an assessment of risk and an assessment of success and time availability to make a decision. This model hypothesize that people make a decision through a decision balance sheet wherein individuals evaluate the gains and losses of a decision on the basis of tangible gains or losses for oneself and for significant others and approval or disapproval from the self and from significant others as well.             Usually though, our decisions and judgments are primarily affected and influenced by how we perceive and interpret the world. In psychology, perception is a “neurological process of observation and interpretation; any neurological process of acquiring and mentally interpreting information from the senses”. It is the process by which individuals organize and interpret their sensory impressions in order to give meaning to what happens in their environment perceptions are essential because individuals act upon their interpretation of events and at other times fail to act because of perceptions. People are sometimes faces with the same events; however, there are different perceptions and views on such same events. Comments that perception is like beauty. It is in the eye of the beholder.             It must be noted that an individual’s behavior is based upon their perception of what reality, not on reality itself actually. The world as it is perceived or viewed is the world that is behaviorally important. Each one of use the five senses to experience our surroundings. They are the senses of sight, touch, smell, hearing and taste. Organizing all these information that we receive from these senses is called perception states that perception is a cognitive process. Perception actually helps individuals select, organize, store and interpret stimuli into a meaningful and rational picture of the world. As each person gives one meaning to stimuli, different individuals “see” the same things in different ways.  Obstacles in Making Accurate Perceptions             Sims has outlined some obstacles that hinder individuals from making accurate perceptions. They are stereotyping, first impression error, halo effect, contrast effect, selective perception and implicit personality theories. Each of these obstacles will be examined and discussed in the proceeding part of this paper. Stereotyping. Stereotypes are considered to be a group concept, actually held by one social group about another. They are often used in a negative or prejudicial sense and are usually used to justify certain discriminatory behavior . The basis for commonly held stereotypes may be associated to one’s sex, race, ethnic group and age. An example of stereotyping may be: the belief or perception that older workers are not capable of being trained for new tasks or younger workers cannot handle responsibility. Even though stereotyping may seem inaccurate and worthless, in some cases, there be “kernel of truth” in the basis of stereotyping; Stereotypes are sometimes based on actual group characteristics. It must be noted though that as stereotypes are some typical beliefs based on the element of truth wherein the beliefs are derived from observations that hold true for the entire group but do not hold much truth and accuracy for given individuals in the group. First Impression Error. As the saying goes, “first impressions last”. First impression errors mean that a person may observe a very brief bit about another person’s behavior in their first encounter and conclude that this behavior mirrors what the person is really like. Such impressions may be dangerous in interviews for work as these first impressions become the lasting impressions in the basis for their long-term employment relationships.    The Halo Effect. The halo effect is described as when a person good at something is assumed to be good at something else. This positive assumption creates a halo.  Gives two instances for this type of obstacle in making accurate perceptions. Example one: Let us say that you are a supervisor in a machine shop. An employee, let us call him John, has been one of the best drill operators in your section for the last ten years. A lathe operator is in need in another section. So, you recommend John, assuming that he will do superb at the lathe as he does in drill pressing. However, John fails; he may be very good in the other task but it doesn’t mean that he will definitely be great with the other task as well. He lacked the necessary skill and the training for the other task. Figuratively speaking, you have somehow placed a halo over John’s head. Another example may be when two people have a violent fistfight on the job. One is rather a personal friend of yours with whom you socialize off the job. There may be a tendency for you to place a halo over your friend’s head by assuming that the other person must have been the cause of the fight and conflict . Projection. Projection happens when an individual credit our own feelings and attributes to others. People engaging in projection have the tendency to perceive others according to what they themselves are like instead of according to what the person observed is really like. It must be noted that the observations may be accurate as they make observations of people who are actually like them; however, accuracy don’t always happen as they might have observations on people who are not like them. So, when engaging in projection, one must respond to individual differences. Contrast Effects.  Contrast effect can distort perceptions. A very common example is when illustrated in an old saying among entertainers that states never to follow an act which has kids or animals in it. There is a common belief that majority of the audience just love and adore kids and animals that the entertainer will look bad in comparison. This specific example portrays how contrast effects can affect and distort perceptions. States that people don’t assess a person in isolation. A person’s reaction to one person is influenced by other people we have just encountered. Selective Perception. Selective perception happens when perceptions arise from influences by one’s own interests. When individuals can longer take in all stimuli received, one has the tendency to select out certain elements. For instance, as one purchase a car, for some unknown reason you just begin to notice the same type of car every now and then on the streets compared to before purchasing the car . Implicit Personality Theories. As people have individual mini-theories on how people look and behave, this will result to inaccurate perceptions. These theories, helps each one of us to organize our perceptions and take shortcuts rather than incorporating new information all the time. Adds that people are cognitive misers. As the world becomes more complex and confusing and as people have only a limited mental capacity, people try to make sense of the world by grouping traits and appearances into clusters that may seem to go together. The discussion on what hinders making accurate perceptions have enlightened us on the issue of how much one’s perceptions and interpretation of the world can affect and influence decision-making as well as making judgments. We have seen how perceptions are distorted by stereotyping, first impression error, halo effect, contrast effect, selective perception and implicit personality theories. Researches on judgment and decision making have recognized important limitations in cognitive and emotional processing. It must be noted that errors in decisions occurring due to biases have widespread effects. Many scientists, economists and psychologists are driven to make behavioral assumptions in the market place as a result of real-world violations of the rational choice theory. In psychology, many examinations are made in the concept of rationality. Psychologists are further examining different and alternative frameworks and theories to explain ways of how people make decisions and what influences them upon making their decisions. The future of judgment and decision-making research within psychology lies in its capability and capacity to develop other theories and frameworks that make associations with research on emotions and cognition, in addition to social and institutional factors. Such associations will definitely influence and affect our views in decision making and adjustability and provide good foundations for research in many years ahead.

Influence of an Individual’s Perceptions and Interpretation In Decision-Making and Judgments

Every single day, people are faced with decisions whether be it as simple as what to do or what to wear for the day. Ev...

Law Case Study: Viability of Claim for Loss due to Voidable Contractual Modification for Improper Pressure

Mr. Wong’s claim for the losses he incurred due to the economic pressure made to compel him to agree to deliver at a lower price from the original contract may not be granted by the court. There is no indication, from the facts of the case, that all the necessary elements of economic duress were present. However, Mr. Wong may make a claim for damages not based on economic pressure but the tort of intimidation. Kerr J clarified the elements of economic duress in The Sibeon and The Sibotre (1976) by stating that the presence of commercial pressure is insufficient in proving economic duress. Evidence should be presented to satisfy the court that the consent of the aggrieved party was overcome by compulsion that deprives the person of freely giving consent to the agreement. Thus, the presence of economic duress is a question of fact that includes the consideration of the following questions: 1) did the aggrieved party protested during the expression or communication of the demand and 2) did the aggrieved party consider the transaction as closed after the demand or did the aggrieved party have the intention of repudiating the new agreement. Lord Scarman in the succeeding case of Pao On v Lau Yiu Long (1980) agreed with the decision in the previous case and reiterated the necessity of the existence of coercion to the will of the aggrieved party that vitiates consent. Factors to consider in determining the presence of coercion are whether the aggrieved party protested, had alternative options, independent advice, or took measures to avoid coercion. These qualifications were applied in Atlas Express v Kafco (1989) where the court held that the aggrieved party was not bound to the new terms of the agreement because the threat to cancel the contract if the company did not pay a minimum delivery charge even for a lesser quantity of goods constituted coercion since the survival of the company rested upon its ability to deliver the goods on time and it was difficult or even impossible to find a new delivery service at such as short time. The illegitimate pressure caused the company to agree to the new terms but later on refused to pay the new rate.              In the case of economic duress, there are remedies available to the aggrieved party. Lord Scarman in Universe Tankships v ITWF (1982) stated that if duress is proven, the effects is to render the agreement or transaction voidable but this is also actionable as a tort in case it causes damage or loss. To prove the intimidation as covered by tort, Lord Denning in D&C Builders v Rees (1966) and Morgan v Fry (1968) provided the following requirements: 1) presence of threat to use unlawful means such as violence, tort or breach of contract; 2) for the purpose of compelling the other party to comply with the demand; and 3) the person threatened must comply with the demand rather than incur the risk of the threat being carried into execution. .

Law Case Study: Viability of Claim for Loss due to Voidable Contractual Modification for Improper Pressure

Mr. Wong’s claim for the losses he incurred due to the economic pressure made to compel him to agree to deliver at a lowe...

The Case of China Kelon Group

Problem Statement             The issue in the case of China Kelon Group is whether they should push through their attempts to diversify their economy.    Situation Analysis             According to the case, the fundamental target of the company is the households in China. The case also indicated that there is a growth of the middle class in the country thus creating the demand for their products. The company is faced by competition from other appliance firms such as Matsushita, Sharp, Hitachi, Toshiba, Sanyo, Mitsubishi, Electrolux, Siemens, and Whirlpool. Despite the number of prospective competitors, the case has indicated that local brands still dominate the industry. In addition to this, the company is deeply ingrained in as the foremost refrigerator making brand in China. After acquiring several awards from state, provincial, and international organizations, there is no doubt on the capacity of the company to provide high quality of products and services. Similarly, to maintain this standard of high quality, the company is constantly in coordination with foreign corporations.       Alternatives             There were two other alternatives with regards to the recommendation of the proper course of action for Kelon. These include vertical integration of the firm, and geographical diversification. In the first one, it wasn’t chosen because this entails maintaining the status quo for the company. The other alternative, geographical diversification would not be probably practical for the company since China has already possesses a large market and the company has yet to realize its full potential. Recommendation             The recommendation is to engage in a horizontal diversification plan. The company has long been in the refrigerator industry and has established a name for its brand. It is high time that they move into a new industry. Although there is a great risk in entering into unfamiliar territory, the company still has a wide base from its refrigerator customers which is basically the same target market as that of the air conditioning industry. What they have to carry out is the manner in  this target market to purchase their products, given that they are a new entrant in the air-conditioning scene.    Implementation Plan As a new entrant on the air-conditioning industry, the company must be able to discern how much power it possesses. This is where the company should look into the possibility of existing national competitors of cutting down their price if they are to defend their market position. Moreover, the company should also look into national regulations regarding new entrants in the national market, particularly those which directly affects the products of the company. The company must conquer an assortment of competitive barriers such as economies of scale, capital requirements, access to distribution channels, product differentiation, switching costs, cost disadvantages independent of scale, and government policy. These obstructions lengthens the period during which active companies may be able to make use of competitive advantage devoid of laying bare the competitive rivalry or imitation from others.

The Case of China Kelon Group

Problem Statement The issue in the case of China Kelon Group is whether they should push through their attempts to diversif...

China Hotels

INTRODUCTION Background of the Problem              In China, foreign and domestic hotels are one the country’s important economic source. People from all parts of the world visit China in order to see its famous foreign and domestic hotels and dine in its fine restaurants. In spite of the increasing popularity of China as an urban tourist destination, certain hotel business issues affect the influx of tourist and the revenue acquired from this business. The problem on competition for example, is one of the growing concerns of the foreign and domestic hotel business in China. In addition, customer satisfaction is one of the highly significant priorities in the business. Being the major source of tourism revenue, foreign and domestic hotel business owners in China are applying various strategies that will enhance the experience of visitors coming to the city.             One of the main issues relevant to the need of assessing service quality is the significant transitions that the foreign and domestic hotel business in China must undergo. One of the recognized changes in the hotel business of China was the transformation of its domestic and foreign hotels, where the once conventional hotels were converted into modernized ones. This transition implies the apparent increase of small firms providing tourism services at present, while the foreign and domestic hotel business used to be dominated by a few producers. In other words, the hotel owners in China now have a number of accesses to strategies and factors that amplify business competition. While this tendency has in many ways improved the overall state of foreign and domestic hotel business of the country, hotel owners also encounter difficulties to operate their businesses successfully, making the evaluation of service quality all the more essential. They have also stated that the competition in the domestic and foreign hotel business in China is augmented by new strategies introduced and implemented by various hotels. With the introduction of information and communication technology (ICT) as well as other technological facilities, tourists have more options and control over they type of hotels they want to stay. Hence, with the present advancements, foreign and domestic hotel businesses in China are giving more importance to specialized and enhanced forms of services for tourists, especially the service quality of the restaurants in these hotels. Another issue that is related to the need for evaluating service quality is the tendency of consumer behavior to change drastically. This has been observed by several researchers. According to these researchers, the changes in the consumers’ cultural values are among the most influential factors that affect the foreign and domestic hotel business in China. The difference on how consumer responds to products or services given to them is significantly dependent on their cultural origins and values, which naturally affects visitor experience. There are a number of interconnected issues that falls under the foreign and domestic hotel businesses in China. Competition, new strategies and changing consumer trends are among these issues. The main focus however, is on the comparison of the service quality of the foreign and domestic hotels in China. One way of doing so is by means of assessing the visitors’ expectation and satisfaction. Enhancing the quality of foreign and domestic hotel services given to the customer or tourists naturally leads to satisfaction. This essential business element is highly significant in combating the problems and issues cited. Hence, consumer studies in the foreign and domestic hotel business of China are very important.             By means of evaluating service quality and visitor satisfaction, developing new strategies for tourist hotel facilities that will augment customer satisfaction in China can be done. China is a popular tourist destination. Nonetheless, tourism issues affect this industry in one way or another. The local government should then adopt strategies and methods that will prepare the country for tourism. The comparison of China’s foreign and domestic hotels’ service quality and visitor satisfaction will facilitate the achievement of this objective. In this proposal, focus will be given on the tourists’ expectation and satisfaction upon staying in the foreign and domestic hotels in China. Specifically, this proposed study will evaluate the different hotel features offered by the foreign and domestic hotels in China and determine the level of satisfaction among randomly selected tourists within the vicinity. In order to evaluate the service quality, the survey and interview method will be used. This particular study will be of significant value to the foreign and domestic hotel businesses in China as it will provide an overview of the current status of the foreign and domestic hotel industry in China as well as ways on how its foreign and domestic hotels may be enhanced. Statement of the Problem  The foreign and domestic hotel industry in China is placed in a highly competitive business environment. Various strategies and marketing means must then be employed by entrepreneurs in order to enhance the services they provide. China is among the most popular tourist destinations in the world. With the abundance of historical tourist spots and archaeological sites, China is one of the countries in the world with the highest number of visitors. Nonetheless, considering the changing consumer trends as well other tourism-related issues, China must apply ways on how to enhance its foreign and domestic hotel industry and increase tourists’ satisfactory experience. Studying service quality is then necessary for this issue. This study will then attempt to answer the following inquiries: <li class="MsoNormal" style="COLOR: #333333; LINE-HEIGHT: 200%; TEXT-ALIGN: justify">How did China respond to the changing trends in the hotel industry? </li> <li class="MsoNormal" style="COLOR: #333333; LINE-HEIGHT: 200%; TEXT-ALIGN: justify">How do tourists describe their experience upon staying in the foreign and domestic hotels in China in general? </li> <li class="MsoNormal" style="COLOR: #333333; LINE-HEIGHT: 200%; TEXT-ALIGN: justify">What hotel features do they find most satisfying? </li> <li class="MsoNormal" style="COLOR: #333333; LINE-HEIGHT: 200%; TEXT-ALIGN: justify">What hotel features in the hotels need improvement? </li> <li class="MsoNormal" style="COLOR: #333333; LINE-HEIGHT: 200%; TEXT-ALIGN: justify">In what ways can the facilities, features and services of the foreign and domestic hotels of China be improved? </li> REVIEW OF RELATED LITERATURE The domestic and foreign hotel business is among the fastest growing economic sectors in China. In fact, the domestic and foreign hotel business by itself is recognized as multi-million dollar and still a progressing business in China. The domestic and foreign hotel business is among the major economic forces in the country as its enables growth and creation of job opportunities. The domestic and foreign hotel business has employed over a million workers who were distributed within various hotel establishments, totaling to revenue generation of billions of dollars. From these records, the domestic and foreign hotel business has indeed become one of the most competitive businesses in the world. Important changes in the understanding and management of the service quality of most domestic and foreign hotels have been developed in the past 10 to 15 years. Various researchers, practitioners and policymakers now acknowledge that service quality can be conceptualized from a functional perspective and that appropriate interventions involve the development of alternative measures to cope up. It was also noted that the establishment of a conducive restaurant environment for tourists to enjoy and relax have served effectively in lowering the prevalence of un-satisfaction among tourists. At present, this philosophical shift has extended to various settings, including China. Domestic and foreign hotel owners and entrepreneurs here have recognized that some tourists do not appreciate so much the quality of service that their hotels and restaurants offer. Hence, these tourists may have the tendency to shy away from visiting China and its other great cities because of this bad impression they have. For decades, researchers have tried to discover the elements of service quality among tourist establishments such as foreign and domestic hotels and restaurants. And while they might have been able to identify certain essential elements of service quality, they have yet to determine the elements that common tourists pay particular attention to. However, it has been shown that negligence of service quality produces consequences that foster bad impressions from tourists. Strong evidence suggests that service quality and its negligence engage in a reciprocal relationship that has a short and long term effect on the tourist’s future opinion regarding the service quality of tourist establishments. One of the criteria for identifying if a tourist establishment such as hotels is of high service quality is whether it has an impressive environment with fully operational facilities meant for the relaxation and enjoyment of the tourists and visitors. A deficit in basic services, as well as skills related to making the tourists and guests fully accommodated, significantly impairs a hotel’s ability to encourage more and more tourists to come over to their place. When compared to high quality serviced foreign and domestic hotels, low quality serviced foreign and domestic hotels have lower performance rates, lower income and are less likely to be known all over the place. As a consequence, low quality serviced hotels often experience a lifetime of problems in employment and publicity, and they are likely to become bankrupted even at a developmental stage.             Take for instance the various foreign and domestic hotel establishments in China having difficulty in adapting to the modern standards of service quality. At present, foreign and domestic hotel owners in China are facing an alarming acceleration in the occurrence of disruptive and challenging behaviors among tourists that seriously impede the performance and credibility of their hotels. Also, there has been a rapid increase in percentage of tourists who have failed to be impressed by the hotel and restaurant services of some domestic and foreign Chinese hotels. Unfortunately, many of today’s foreign and domestic hotels all over the world have both problems. Behaviors and tourist impressions such as lack of sanitation, boring environment and unfair tourist price accommodation rates have all been rampant nowadays. True enough, these problems are counterproductive towards the effective performance of foreign and domestic hotels. Serious impressions of tourists such as aggression, argumentativeness, and defiance are even more of a threat to these poorly serviced foreign and domestic hotels, yet common in countries which cannot afford to establish 5 star quality foreign and domestic hotels. Impressions and evaluations of tourists, both positive and negative, affect performance outcomes of hotels at the employee and management level. From a tourist perspective, tourists who displayed their un-satisfaction remarks in staying in poorly serviced foreign and domestic hotels had a 90% chance of not going back or staying again to the same hotel. They reported that such tourists begin to actively dislike the place itself and actually visit less that particular place. Continuing over years, these tourists are not likely to change their minds after a terrible experience staying on a poorly serviced hotel. Similarly, tourists exhibiting ongoing, serious bad impressions well even after so many years of that terrible experience are increasing. Service Quality  Service quality generally pertains to a tourist’s perception over a certain area or destination’s quality of services being offered. People of tourists tend to interpret the services in their surroundings without realizing it. This interpretation is based on the visitors’ needs and preferences that will allow them to function more efficiently. This makes up the visitor’s overall experience or perception. More recently, noted that service quality suggests awareness but not conscious awareness. The service quality is naturally enhanced when tourists could identify with specific environmental characteristics that they need or are important to them. Thus, the perception or experience in terms of service quality of the visitor is significantly related to the environment they wanted to be in. Service quality pertains to the degree of efficiency and effectiveness of the implementation of the policies and tasks necessary to satisfy a firm's customers, employees, and management. Service quality focuses on the careful management of the processes involved in the production and distribution of products and services. More often than not, small firms and business establishments such as hotels and restaurants don't really have the capabilities to directly determine the quality of their services to their clients or customers. Instead, they engage in activities that various schools of management typically associate with service quality management. These activities include the inspection of their products, service development, production and distribution. However, service quality deals with all operations done within companies and organizations. Activities such as the management of purchases, the control of inventories, logistics and evaluations are often related with service quality. A great deal of emphasis lies on the efficiency and effectiveness of processes. Therefore, service quality includes the analysis and management of internal processes. With the increasing competition in the industry as well as the changes observed among consumers, studying service quality is essential not only to keep the industry successful and productive but most importantly to satisfy and meet the needs of the tourists. Specifically, most firms in the industry are applying various strategies on how to improve their services and enhance service quality. Several technologies are being applied by operators so as to take over with some of the businesses’ main activities. Computerized reservation systems for instance, are one of the known advancements in tourism. This in turn, helps in enhancing service quality as it offers them more options and allows a faster access to information.             While there are numerous efforts done to enhance service quality, researchers concluded that there are also several factors that influence service quality. The preferences, attitudes and perceptions of the visitors in terms of service quality are some of the important factors affecting service quality. Other researchers.  Also concluded that the perception on service impacts is also an influential factor of service quality. In general, the researchers noted that the satisfaction and un-satisfaction that tourists experience while using the services in various destinations affect their overall experience. Hence,  stated that this makes this factor a significant dictator or basis for developing standards of service or product quality. China and Hotel Improvement Efforts  China has long been an ancient destination of many tourists from all over the world, who are very eager to see the city’s famed museums and historical sites, especially the Great Wall. During the early times however, a number of problems in tourism has been encountered by China. Pollution, overcrowding and poor domestic and foreign hotel infrastructures are among the country’s major concerns that affected its image among tourists. Since the beginning of the 20th century, the social amenities and hotel infrastructures in China have gone through significant changes. Funds and financial support from both UK and the European Union have made it possible for the nation to establish foreign and domestic hotels such as Beijing hotel and the Grand Hyatt Beijing hotel. The Metro system was also expanded massively. Other private investments also led to the great expansion of hotels and other tourist sites. One of the major developments that China had gone through in terms of tourism was the remodeling of their foreign and domestic hotels. In addition, a great pedestrian area was also constructed. These pedestrian areas are highly beneficial for tourists as these allow them to appreciate the country’s hotel infrastructures while walking calmly along paths of trees. Aside from the developments done for China’s foreign and domestic hotels, some of its major theatres and art galleries that house the world’s most precious artworks have also been renovated. Other famous tourist destinations in the country, including the Great Wall and the Forbidden City, have also been extensively transformed to resemble their original state for the pleasure and satisfaction of their tourists and visitors worldwide. China and Service Quality It appears that most of the country’s efforts for service quality development had led to great results based on the number of tourists that visited the country during the past couple of years. In one article, China has been described as a country that is busier than ever. Yet, in spite of the crowd, the newly-built foreign and domestic hotels have been helpful in accommodating the great number of visitors that came to the city. As a result, overcrowding of tourists has been prevented during this time, benefiting both Chinese residents and visitors. The article also stated that the energy perceived in the country is good and amazing. This perhaps is attributable to the fact that every tourist in the country felt that they are part of a family; hence, every tourist encountered is genuinely happy to be in China.             Some write ups however had commented on China’s spot security personnel on some foreign and domestic hotels and described the hotels as an army camp. The article author pointed out that in spite of their number, the security personnel do not really hinder tourists or visitors from appreciating the country. In addition, China at that time was without a doubt a country of hope and joy; it has definitely been a worthwhile experience for visitors from all over. The author described his experiences in China’s tourist destinations. In general, the author saw China as a historical country edging towards contemporary backgrounds. Though China and its significant foreign and domestic hotels are important tourist destinations, the pollution and overcrowding appear to be a disadvantage. In spite of these problems, trekking through the country’s remarkable foreign and domestic hotels was truly a worthwhile experience. Staying at the foreign and domestic hotels for instance was an exciting experience for the author as it was just like visiting the downtown sceneries. Though hotels offer different scenic views and environment, the impression of excellence can be perceived. According to the author, staying at the foreign and domestic hotels resulted to excellent visitor experience; some facilities offer less elegance, while others are interesting and influential.             Described how his trip to the foreign and domestic hotels in China was similar to the foreign and domestic hotels in America. The area was very busy and going to this place was tiring. However, once the author reached the hotels, the trip was all worth it. McHenry noted that the foreign and domestic hotels in China were different from all others found within America as it highlighted modern facilities in designated rooms. The artworks inside the hotels were more than a place displaying antiquities as treasure of great tastes were exhibited and made available for inspection. The foreign and domestic hotels were also an inviting tourist location with its great sights, food and shops. This, according to McHenry, was one of the main reasons for tourists to come visit China over and over again. During the author’s visit to China, the country was busy preparing itself for hosting the coming Olympic Games in 2008. Thus, he was able to witness the considerable effort China had done to enhance the country’s hotels, transport systems and roadways. Through this experience, the author no longer doubted how China was greatly spearheaded by tourism. There have been literatures describing visitor experience regarding service quality to various tourist destinations. However, studies of service quality in China are apparently insufficient. This further stresses the need to evaluate the perception of the country’s visitors so as to help enhance its existing foreign and domestic hotels and overcome various tourism issues. Service Quality in relation to Customer Satisfaction and Needs Gone are the days when employees work on their desks for eight hours a day. Today’s employees want to become as productive as possible while in their offices and interact with different individuals and groups in different settings. The technological advancement in wireless technologies has allowed workers and employees to access communication tools in new settings. Because of this rigorous and hectic schedule of employees, it became imperative for them to indulge in relaxing products and services to help them ease the pressure after every day’s work. Foreign and Domestic Hotel Service Quality Service quality among foreign and domestic hotels can be subdivided into three main categories. These are: A. Convenience A particular foreign and domestic hotel’s dedication to service quality can easily lead to the satisfaction of its customers in whatever place it is located. Making a particular foreign and domestic hotel convenient to its customers and visitors is not an easy task, and credit must be given to the management who always pursue the best service quality and craftsmanship in the name of convenience. B. Health / Safety / Sanitation The raw materials and ingredients that are used in the production of beverages and other delicacies must be able to meet the high quality standards and specifications. Even the packaging materials must be also subjected to strict quality standards. In line to the hotel’s policies in food and product safety, appropriate measures must be taken in the preparation of all food and drinks to prevent the possible contamination. Hotels must also implement the principles of the HACCP (Hazard Analysis and Critical Control Points) system in order to show their testament to their dedication to service quality. The food and beverages that their customers eat and drink must be prepared using nothing but the original and unparalleled recipes. To achieve a sweet taste, fresh aroma, bright color and clarity, only the purest ingredients must be used. C. Affordability of Services Normally, foreign and domestic hotels base their pricing strategies on several key trends that continuously shape the global marketplace of the foreign and domestic hotel industry. One particular trend is labeled as “premium-tization”. This phenomenon causes the polarization of different markets. This would then trigger the consumers to demand and pay much higher prices for perceived service quality. However, discounting in prices is also simultaneously taking place, therefore squeezing out the middle range. More often than not, hotels and restaurants undergo internationalization which leads to a tighter squeeze for shelf space. This will in turn leave them as winners. It is for this reason why most foreign and domestic hotels value the “premise sector” so much because this would allow consumers can to try their services at low risk and price. MEASURING SERVICE QUALITY A. “Consumer Understanding” The occurrence of consumer research to determine service quality within the economy reflects the growing difficulty in the management of foreign and domestic hotels that require the effective use of valuable resources such as money, materials, equipments, and people. This is the reason why consumer research is being done by most foreign and domestic hotels in order to determine the most effective ways to coordinate these resources through the application of analytical methods derived from fields of studies such as mathematics, science, and engineering. Through this process, problems are solved in different ways and alternative solutions are then relayed to the hotel’s management. The management then selects the appropriate course of action in line with their goals. More often than not, consumer research analysis in foreign and domestic hotels are concerned with complicated issues such as top-level strategy in attracting more customers, hotel resource allocation, designing of hotel facilities and systems, pricing and the analysis of goods and services. B. Balanced Scorecard The balanced scorecard is a strategic management system that allows foreign and domestic hotels to clearly establish and follow their goals and business strategies and put them into action. This approach also enables the foreign and domestic hotels to issue feedbacks around both the internal business processes and external outcomes, and this undoubtedly will help the hotels on their drive to continuously improve in terms of its strategic performance and results. When appropriately implemented, the balanced scorecard will be able to develop strategic planning into the brains of the hotels. The balanced scorecard approach is based on integral concepts of past management ideas such as Total Quality Management (TQM) and measurement-based management and feedback. The balanced scorecard integrates feedback within internal business process outputs, just like in TQM. The only difference is the existence of an additional feedback loop around the results of business strategies. C. Customer Satisfaction A major factor involved in the improvement of foreign and domestic hotels involves the establishment and utilization of performance measures or indicators that in turn measure their customer’s satisfaction. These measures or indicators are measurable characteristics of products and services that foreign and domestic hotels typically utilize in order to study and improve their performance. The indicators that will be chosen should be able to represent the essential factors that are crucial to the improvement of operational and financial performance. Through the analysis of accurate information brought about by the tracking processes, the measures or indicators themselves can possibly be analyzed and improved to support such goals.

China Hotels

INTRODUCTION Background of the Problem In China, foreign and domestic hotels are one the country’s import...

RYANAIR CASE STUDY ANALYSIS

1.  Strategy of Ryanair Overview of the Company             Ryanair started in year 1985 with only 57 staff members and with one 15 seater turboprop plane from the south of east of Ireland to London-Gatwick which carried 5000 passengers on one route (Harrison, 2002). In 1986, inspired from the story of David and Goliath the company go after the big guys for a slice of the action and end up smashing the Aer Lingus or British Airways high fare cartel on the Dublin-London route. The staff increased from mere 57 to 120 staff members and the plane carried for about 82,000 passengers on two routes. In 1989, the company employed 350 staff and their average maximum passengers increased to 600,000. In 1990-1991, the company has 700,000 passengers. However, despite of the increase of passengers, the company is not so good in managing cost that the company has lose its money. A new management team is brought in to sort it out and re-launch as a “low fares or no frills” airline, closely modelling the Southwest Airlines model in the U.S. And in 1994, Ryanair bought its first Boeing 737 aircraft which carried over 1.5 million passengers. In 1995, Ryanair is the biggest passenger carrier on Dublin-London route, the largest Irish airline on every route being operate and carried 2.25 million passengers in the year (Harrison, 2002). In 1997, the EU air transport deregulation allowed the airline for the first time to open up new routes to Continental Europe with over 3 million passengers on 18 routes carried. Ryanair launched services to Stockholm, Oslo, Paris and Brussels and took time out to float Ryanair plc on Dublin and NASDAQ Stock exchanges. The company was awarded as Airline of the Year in 1999 by the Irish Air Transport Users Committee. In 2000, they announced the launch of 10 new European routes for the summer 2000 after much deliberation and watching others burning money. The company has also jump onto the internet with the launch of their new online booking site and in just 3 months the site is taking over 50,000 bookings a week. By 2001 there are more than 1500 employees working for Ryanair and more than 10 million passengers are carried to 56 cities in 13 European countries. The company has opened Frankfurt-Hahn in 2002 as their second continental European base and announce a long term partnership with Boeing which will see the company acquiring up to 150 new Boeing 737-800 series aircraft over an eight year period from 2002-2010. The booking in their web accounts have increased to 94% which has probably has something to do with opening another 26 routes. In year 2003, the company is characterised by rapid expansion and the start the year by announcing that the company has ordered an additional 100 new Boeing 737-800 series aircraft to facilitate the rapid European growth plans (Binggeli and Pompeo, 2002). They acquired Buss from KL M in April and re-launched 13 buss routes in May. In February they opened their first base in Italy at Milan-Bergamo and launched their Stockholm Skavsta base in Sweden with six new European routes. In all 60 new routes are added throughout 2003 to bring the company a total of 127 routes. By 2004, the company is named as the most popular airline on the web by Google and they launched their 10th and 11th bases in Rome Ciampino and Barcelona Girona and continue to add more routes to their already extensive network. The company has also passed out British Airways to become the UK’s favourite airline in United Kingdom and throughout Europe (Binggeli and Pompeo, 2002). Critical Success Factors             Although the company had encountered different problems, specifically in line with its cost structures, the company had been able to survive and grow in the marketplace.  Ryanair implement different marketing strategy to make the company survive in the competition and to be able to gain competitive position in the airline market.  It is said that the company was regarded recently as the most punctual airline between Dublin and London. And because of the strategy of the industry, Ryanair is now recognised as the second largest airline in United Kingdom and Europe’s largest low-fares airline having a network of over 57 routes in 11 countries and served by a fleet of 31 Boeing 737-200 and -800 aircraft with over 1,400 staffs and personnel. In order to position itself in the marketplace the company continuously concentrates on driving own its costs to offer the lowest fares possible and remain profitable.  In addition, Ryanair offer minimum standards of service and very low prices for point-to-point, short haul flights.  The goal of Ryanair is to meet the needs of travelling at the lowest price.  The Critical Success Factors (CSFs) are as follows in airline industry: the strategic focus of having the lowest prices, being reliable within the marketplace, comfort and service and frequency.  It is noted that low-cost companies concentrate on this first critical success factor by trying to offer the lowest prices.  Although Ryanair has eliminated extras such as in-flight meals, advanced seat assignment, free drinks and other services, it still prioritises features which remain important to its target market. Such features include frequent departures, advance reservations, baggage handling and consistent on-time services. Cost Reduction Strategy To achieve its goal of having a competitive position in the airline market, Ryanair uses a cost reduction strategy. Such cost reduction strategy relies on five main aspects like fleet commonality, contracting out services, airport charges and route policies, managed staff costs and productivity and managed marketing costs. In terms of fleet commonality, the company used only one kind of plane which limits the cost for staff training, maintenance services and facility of obtaining spares, facility in scheduling aircraft and crew assignment.  With their purchase of aircraft Boeing 737, Ryanair has been able to gain capacity and reduces the average age of fleet which means savings on maintenance costs and avoiding the fit of European Union-conform equipment on old feet. The next factor under the cost reduction strategy of Ryanair is contracting out services.  In this manner, aircraft handling, ticketing, handling and other functions are contracted out by Ryanair to third parties. In addition, in order to limit their expenses engine and heavy maintenance are also contracted out whereas the staff of Ryanair carries out routine maintenance.  Another factor for the cost reduction strategy of the company is in terms of airport charges and route policies. Herein, Ryanair has made judicious choice of dealing with secondary and regional airports, where the traffic is not jammed and fees incomparably lower. Since Ryanair, is a true windfall for such airports, the airline company has a bargaining power which enables it getting favourable access fees. In addition, Ryanair provides only a point-to-point service, thus, it has no cost concerning connecting passengers.  Moreover, the company pays special focus to on-time departures because it means maximising aircraft utilisation. Managing staff costs and productivity is another factor used for reducing the cost for Ryanair. In this manner, the company pays its staff on modest salary but has set up a performance related pay structure which urges employees to maximise the number of sectors flown daily. This way, Ryanair both controls productivity and keeps staff costs down.  Lastly, managing marketing costs is another factor that makes the company reduces it costs. Ryanair advertises mainly on it website with its logo “Ryanair.com, the Low-Fare Airline”. In addition, it is also advertised in national and regional Irish and UK newspaper, on radio and on television. Porter’s Generic Strategy Aside from it cost-reduction strategy, Ryan has also been able to use Porter’s generic strategies to position itself in the marketplace.  Accordingly, a company positions itself by leveraging its strengths. Today, more and more people and organization are striving to be recognized in the business arena.  With this objective, these organizations had been able to competently and effectively adapt to the situation in the market place by using generic strategies that enhanced their competitiveness.  There are five different generic strategies that a business can choose.  These include cost leadership, differentiation, focused cost leadership and integrated cost leadership/differentiation.  Each generic strategy helps the company to establish and exploit a competitive advantage within a particular competitive scope (Hitt, Ireland & Hoskisson 2003). By applying these strengths, three generic strategies are resulted: cost leadership, differentiation and focus (Johnson & Scholes 1997).  The strategies used by the company include cost leadership, differentiation strategy and focused differentiation. Cost leadership strategy is based upon a business organising and managing its value-adding activities so as to be the lowest cost producer of a product within an industry (Campbell, 2002). Cost advantage may achieve in terms of how product or services is designed or in terms of its quality. Differentiation strategy is based upon persuading customers that a product is superior to that offered by competitors (Campbell, 2002). The value added by the uniqueness of the product or services may allow the company to charge a premium price for it. However, the danger associated with differentiation may include imitation by competitors and changes in customer tastes. Focus-differentiation strategy is aimed at a segment of the market fro a product rather than at the whole market or many markets (Campbell, 2002). The successful way using focus strategy is to tailor a broad of product or service development strengths to a relatively narrow market segment that they know very well. The risk may include imitation and changes in the target segments. In the case of Ryanair, these three generic strategies had been utilised. First, the company offers the lowest cost of fare than its competitors in the airline. On the other hand, Ryanair has also become a focuser because it concentrated on a narrow customer segment which include Irish and UK business people or travellers who could not afro to fly major airlines. The main goal of the company is to provide a no frills service with low fares designed to stimulate demand. At the time, it did not aim to offer the lowest fare on the market.  However, the company expanded to continental Europe and had to focus on critical success factors to survive. Nowadays, it can be said that Ryanair has shifted generic strategies to become more of a cost-leader not only in terms of passenger volumes but being the lowest cost operator in the airline industry.             Ryanair has restyled itself and shifted from a full service conventional airline to the first European low fares, no frills carrier. In 1985, it provided scheduled passenger airline services between Ireland and the UK. By the end of 1990 and despite a growth in passenger volume, the company had experienced some trouble and had to dispose of five chief executives, recording losses of IR£20 million. Ryanair had to fight to survive and the new management team, headed by Michael O’Leary, decides to restyle the company on the model of successful American Southwest Airlines. Indeed, when one considers Porter's original framework, Ryanair's generic strategy used to be unclear: it situated itself somewhere between a cost leader and a focuser, although we can consider it was closer to a focuser. The problem with such niche strategies is that they involve a number of risks, the most obvious being that the niche can get saturated and competitors invade the segment. As long as Ryanair was the only European no frills airline, it did not have to distinctly define its strategic position. It used to try and mix focus and cost leadership and was muzzy about which one it wanted. But as soon as competitors started blooming, it had to decide which strategy it would stick to. This was the very strategy of Michael O'Leary: he decided to ruthlessly pursue cost leadership. This strategy was a success and by 1997, Ryanair was floated on the Dublin Stock Exchange and on NASDAQ. Expansion strategy is another factor that enables Ryanair to position itself in the marketplace. The company has been known to be an airline which launches new routes since its operation begins. In addition, under the expansion strategy, company acquires Buzz in February 26, 2003. Such acquisition enables Ryanair to gain immediate access to11 new French regional airports and makes the company the largest airline operating at London Stansted Airport.  In addition, the company continues to expand by opening two new Continental European bases with low-fare flights from Milan Bergamo and Stockholm. In the year, 2003, the company has been able to launch 73 new routes and carry over 2 million passengers in one month (July). In addition, the company website has been able to make the company position itself in the global market. 2.                  Strategic Options The case study has provided the problems and issues encountered by the Ryanair, in spite of its strategies.  One of the problems is in terms of handling customers or target market. In addition, another problem is assuring quality service. In this manner, the strategic option that can be used by the company for satisfying both internal and external customers and marketing environment is the use of total quality management. The industrial competitions in airline industry worldwide are at brisk, making companies in this field across the globe search for extensive strategic management procedures that would keep them in on the business world.  The tasks of crafting, implementing, and executing company strategies are the heart and soul of managing business enterprise.  A company’s strategy serves as the game plan management and is use to stake out a market position, conduct its operations, attract and please customers, compete successfully, and achieve organizational objectives.  Thus, TQM as a strategy is certainly appropriate for such situation.              Total Quality Management is a philosophy of management that is driven by the constant attainment of customer satisfaction though the continuous improvement of all organizational processes (Robbins, 1998).  It is a management philosophy that seeks to integrate all organizational functions such as marketing, finance, design, engineering, production, customer service, and others to focus on meeting customer needs and organizational objectives (Hashmi, 2000). It is known that every organization’s primary purpose is to stay in business, so that it can promote the stability of the community, generate products and services that are useful to customers, and provide setting for the satisfaction and growth of organization members.  From this perspective, it can be said that TQM strategy for achieving its normative outcomes is rooted in four interlocked assumptions: quality, people, organizations, and the role of the senior management (Wageman, 1995).    Total Quality Management is a planned procedure for satisfying internal and external customers and suppliers by integrating the business environment, continuous improvement, and come through with advancement, growth, and safeguarding the cycles while changing organisational culture. Furthermore, TQM is an array of management system throughout the organisation, geared to ensure that the organisation to continuously attain or surpass customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement (McNamara, 1999). Moreover, Total Quality Management is infinitely variable and adaptable. Although originally applied to manufacturing operations, and over the years only used in that area, TQM is now being recognised as a standard management instrument, just as applicable in service and public sector organisations like the airlines industries (Hashmi, 2004). The Total Quality Management (TQM) philosophy of management is customer-oriented. Hence, the airline operations must be developed in order to steadily deal with the improvement of their operation through the ongoing participation of all employees in problem solving efforts across functional and hierarchical boundaries. TQM incorporates the concepts of service quality, process management, quality assertion, and quality perfection. Consequently, the airline company must be able to control all transformation processes with regards to their operations and services to better satisfy customer needs in the most economical way. In order to apply the TQM to Ryanair especially to be used in its airline operations and services, the management of the airline company must be able to accept the whole concept of the improvement, which means that all the people of the airline company must agree that there is a need for a total transformation especially for the quality of operations and services that the industry will be offered.  Furthermore, the management should be willing to participate to all the improvement, value each and every ones opinion in order to achieve total quality management and provide a total quality operations and services to satisfy their customers. Managers and experts disagree about how to effectively implement Total Quality Management to their organisations.    Eventually, customer satisfaction has always been regarded as the driving force behind quality improvement; others suggest quality management is achieved by internal productivity or cost improvement programs. In other applications, Total Quality Management is regarded as a technique to introduce the context of participative type of management (Schlenker, 1998).  Thus, the management should be more straightforward to provide the potential role of applying the Total Quality Management to their operations and services. In addition, since Total quality management is based on internal or self-control, which is embedded in every element of the work system (technology and people), the employees or the people behind the operation and services being offered to the passengers and customers of the airline must be able to determine the problems beforehand, to anticipate its occurrences. Pushing problem solving and decision-making down in the Ryanair especially to their operations and services may allow people who do the work to both assess and take remedial action in order to deliver an operation or service that meets the needs of their customer.   In applying total quality management to airline operations, they must be able to combine it with the core strategy of the industries; this does not mean that such airline companies must have total changes. It is important that in application of the Total Quality Management to the Ryanair operations and services they must also consider that an appropriate strategy should be used in order to employ a total quality operations and services that would satisfy all clients and customers.

RYANAIR CASE STUDY ANALYSIS

1. Strategy of Ryanair Overview of the Company Ryanair started in year 1985 with only 57 staff members a...