Term Paper – Kenya Airways

Kenya Airways is one of the many companies listed on the Nairobi Stock Exchange. At Kenya Airways, it is believed that the future begins today. Success in the business, as indeed in any business, begins with a clear picture of what is desired most, that is, the vision.
The vision of Kenya Airways is to consistently be a safe and profitable airline that guarantees world- class service. As usual, the vision has to be accompanied with a mission.
The Kenya Airways mission is to maximize stakeholder value by consistently….
• Providing the highest value of customer satisfaction
• Upholding the highest level of safety and security
• Maximizing employee satisfaction
…whilst being committed to corporate and social responsibility,

The Kenya Airways goals are:

• To achieve world-class standards in service delivery, product quality and operational performance.
• To be the airline of choice in Africa.
• To develop Jomo Kenyatta International Airport (JKIA) as a premiere hub in Africa.
• To pursue a business model that will deliver consistent level of profitability.

ORGANIZATIONAL STRUCTURE
The Organizational structure adopted at Kenya Airways is the functional one. Here, grouping is done according to the task they do. Each group does something different. Kenya Airways’ organizational structure comprises of seven departments, each headed by an executive director reporting to the group-managing director. The departments are: –

• Finance
• Information Systems
• Commercial
• Technical
• Human Resources and Administration
• Flight Operations
• Ground Handling

Group Managing Director

Executive Director
Finance Information Commercial Technical Human Flight Ground
Systems Resources Operations Handling and Administration

The advantages of this kind of structure to Kenya Airways is that:
• This method is easy and logical to decide and usually effective in practice.
• It follows the principle of specialization and economies result.
• It doesn’t have redundancy of functions across groups that occur in divisional design.

The disadvantages are:
• Poor communication across functional areas.
• Hard to identify who is responsible for failures, success (for example for poor sakes of a product).

KENYA AIRWAYS SWOT ANALYSIS

STRENGTHS
• Most European Airlines have neglected Africa as a whole. Kenya Airways manages to penetrate into those neglected countries in Africa, giving it an advantage over other airlines.
• Kenya Airways developed a new technology whereby customers can book online. This helps in increasing sales.
• Their good customer service serves as a sales boost to the company.
• The company provides employee training which contributes to making the airline better.
• Kenya Airways has an exceptional recruitment and selection procedure. This helps them get the best of the best out there.
• The company was founded in 1977, following the break-up of the East African community. The amount of time they’ve been in the market is a strength because they have extra experience in the industry.
• The company’s profitability is also a factor in the favor of the organization.

WEAKNESSES
• The company’s casual workers are paid less than they should.
• It is reported that Kenya Airways’ flight attendants are consistently caught with drugs. This reduces its reputation to a very degrading level.
• The company had a problem with its pilots and this serves as a weakness as well.
• The company has had many terminations, causing people to lose their jobs. This not only reduces their level of social responsibility, but it makes people lose confidence in the company.
• The numerous flight delays can make customers choose to travel with other airlines.
• The airline has many flight connections. For instance, from Dubai to Zimbabwe, the passengers have to connect about 3 flights and this can also motivate customers to travel with other faster airlines.

OPPORTUNITIES
• The many routes which have not yet been discovered by other airlines can be an opportunity which can increase their profits.
• Kenya’s geographic location helps Jomo Kenyatta International Airport be a premiere hub in Africa. This can also increase the sales of Kenya Airways.
• Kenya Airways signed a leasing agreement with Boeing, and this allows them to lease aircrafts, thus increasing profits.
• The company has a good reputation, thanks to the many awards the company has received. This can be an opportunity for the organization to increase its sales.
• The many branches all over the world can also be an opportunity for sales increase.

THREATS

• Competition from other airlines like Emirates, Air Malaysia, etc.
• Employees moving on to other airlines and taking the experience and training they got from Kenya Airways can be a threat.
• Luggage mishandling can be a threat in the sense that victims of that act can go about spreading rumors, thus causing people to choose other airlines.
• Air accidents are a very crucial factor as well.
• The growth of terrorism, especially in Kenya serves as a threat as it reduces tourism and profits to Kenya Airways.
• Weather conditions can also be a threat.

KENYA AIRWAYS STRATEGY

An important consistent trend about commercial aviation is that it is a fiercely competitive and highly volatile industry, in which fortunes shift continuously. As the drive towards a free, converging and global market gathers momentum, competition within the airline industry is expected to intensify. Increasingly open skies are likely to impact on yields exception, and extraordinary profits will increasingly be an
Given this potentially turbulent environment, the key to survival in the industry lies in whether an airline is able to clearly anticipate the patterns of change coming, the underlying forces driving these changes, and above all the ability to align its strategies to respond to a changing business and aero-political environment.
With this in mind, Kenya Airways is committed to investing in the development of world-class information gathering capacity, analysis and interpretation so as to facilitate faster and correct business decision-making. This way, Kenya Airways hopes to enhance ability for rapid response to opportunities, threats and challenges in the market place.
In concrete terms, in the next 10 to 20 years, Kenya Airways aims to grow into a decidedly dominant carrier in Africa with notable presence in Asia , Europe and the Americas , while operating a modern fleet of 30 to 40 aircraft. Kenya Airways intends to forge strong partnerships and be a respected member of the global airline community.

FUTURE OUTLOOK

Kenya Airways continues to focus on profitable expansion of our network through a combination of direct access and alliances with other carriers.
Sustainable improvement in yield will be pursued through a combination of a new revenue management system and better discipline. Management will also place emphasis on greater productivity, costs restraints and reduction in wastage.
The people are our greatest asset and focus on their development and the way they are both managed an organized out to ensure we attract and retain the best and that they are equipped to serve our customers in line with our being a world class standard airline.