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Subject Name: Management Research Project (Capstone)Subject No: 21927
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Family Name:DENGGiven Name: CHUHANG
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Question No. & Topic: Analysis Of The Challenges Experienced In The Aviation Industry In Australia, In The Automation To E-Commerce Supply Chain.
Date Submitted:15/04/2020Submitted on time? Yes
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I have carefully read, understood, and taken account of all the requirements and guidelines for assessment and referencing in the subject outline. I affirm that this assignment is my work, that it has not been previously submitted for evaluation, that all material which is quoted is accurately indicated as such, and that I have acknowledged all sources used fully and accurately according to the requirements. I am fully aware that failure to comply with these requirements is a form of cheating and could result in the resubmission, loss of marks, failure and/or disciplinary action.
Signature:CHUHANG DENGDate: 15/04/2020
Table of Contents
TOC o “1-3” h z u Executive Summary PAGEREF _Toc42448893 h 21.Introduction PAGEREF _Toc42448894 h 51.1.Background PAGEREF _Toc42448895 h 51.2.Problem Statement PAGEREF _Toc42448896 h 51.3.Aim of the Research PAGEREF _Toc42448897 h 61.4.Objectives PAGEREF _Toc42448898 h 61.5.Research Questions PAGEREF _Toc42448899 h 71.6.Limitations of Investigation PAGEREF _Toc42448900 h 71.7.Historical Background of Significant Events PAGEREF _Toc42448901 h 81.8.Preliminary Literature review PAGEREF _Toc42448902 h 82.Methodology PAGEREF _Toc42448903 h 83.Findings and Discussion PAGEREF _Toc42448904 h 93.1.Significance Of E-Commerce In Airline Supply Chains PAGEREF _Toc42448905 h 93.2.The Current State Of The E-Commerce Supply Chain In The Aviation Industry PAGEREF _Toc42448906 h 123.3.Challenges That Aviation Industry Faces In The E-Commerce Supply PAGEREF _Toc42448907 h 123.4.How To Address The Challenges In The E-Commerce Supply Chain PAGEREF _Toc42448908 h 154.Conclusion PAGEREF _Toc42448909 h 175.Recommendations PAGEREF _Toc42448910 h 176.References PAGEREF _Toc42448911 h 20
Executive SummaryAviation Industry is essential to the viability of every country’s economic cycle in terms of supply and demand. It is an industry that deals with the aircraft industry and flight. The management process in the industry in the hands of an e-commerce channel that implements any strategies needed. Serving the customers is an essential rule where the customers expect the costs to be low and the purchases to arrive on time. Several omnichannel practices help in managing supply chain and e-commerce that lead to an unusual growth and outcome. The fulfillment of organizational goals in alignment with the objectives is a strategic measure. Different tactics are taken that involve the assessment of the problems and development of options and sound decisions. However, there are no two companies that can have the same strategies and tactics. It is recommended to have a strategic assessment of the company’s supply chain that fits the industry objectives.
The supply chain is a branch in all businesses that aim at satisfying its customer worldwide in the Aviation Industry. Different stakeholders and customers can learn about the e-commerce supply chain in the industry and identify the diversified that exist, therefore, making them have the option to select the best Aviation Company to work with. Customers and managers interact to discuss the various needs needed in the firm since they can access the information concerning it through Social Media. The discussions have revealed different customer needs, which have become a significant problem in the e-commerce supply chain since one cannot predict the customers’ needs and wants. Therefore, the Aviation Industry ensures that it tries its best to provide services and products according to their customers’ needs.
Employing various tools in the supply chain helps change the customer preference. The tools include agile supply chains, just in time and manufacturing requirement planning and capacity requirement planning (CRP). Different markets have to be weighed by the e-commerce supply chain management to examine the significant problem that makes the customers change their preferences in the market. Aviation Industry is required to invest in the technology to innovate the needs and wants of the customers. The different tools have to be used in the chain to ensure that there a timely production of materials that are only needed at the moment to avoid any wastage that may occur in case of any changes experienced in the manufacturing sector. To avoid any unnecessary delays, there must be a flexible supply chain that orders several materials without any delay at different times. To ensure the optimum capacity required in the e-commerce supply sector, CRP is essential since it ensures that the necessary amount is produced. Building the best brand through the use of the best technology helps Aviation Industry focus on high quality customer service strategy. Market factors favor the initiation of new airlines that meet the demand of industry and help it base its businesses and marketing strategies on achieving high and profitable requirements.
Analysis Of The Challenges Experienced In The Aviation Industry In Australia, In The Automation To E-Commerce Supply Chain.
IntroductionBackground The aviation industry has always been subject to the economic cycle of supply and demand in most countries. The convenience of being able to trade without time constraints or geographical barriers has significantly led to increased use of e-commerce. One sector that has been at the forefront to embrace e-commerce in the supply chain is the Aviation Industry. The availability of low-cost communications that are reliable through the internet has enabled the sector to correctly undertake consumer supply chain cycles (Heartland, 2001). E-commerce is an effective way that helps companies to reduce overall costs and streamline its supply chain services. The supply chain plays a critical role in saving costs of business operations in the aviation industry. The success of any airliner depends more on how well they can adapt to supply chain strategies, especially cost reduction through the adoption of new technology and offering customer-oriented products through pursuant of Customer Relationship Management (CRM). Improved technological advancements in the aviation industry have made e-commerce supply chain a game-changer.
Despite the various benefits that have come with the use of the e-commerce supply chain in the aviation industry, there are several challenges airliners face. Mainly, there has been a change in demand, a growing trend of innovation and emerging technologies, and challenges in mitigation of supply interference risks. Such problems have forced airline companies to be more dynamic in their business operations.
Problem StatementIn the aviation industry, the e-commerce supply chain is critical for the survival of all airline companies. However, the ever-changing customer expectations and technological changes have affected the effectiveness of e-commerce applications in the industry. The airline industry is internationally based hence connects various countries in the transportation of goods and humans. Therefore, E-commerce facilitates its operations as transactions can be conducted electronically through the internet. For instance, e-commerce has played a significant role in boosting air cargo traffic in air cargo. E-commerce involvement in the supply chain logistics is also linked to accuracy on inventory management (Qteishat, Alshibly & Al-maiatah, 2014). Through sales and tracking abilities, e-commerce can inform distributors on when to improve on their stock. Furthermore, e-commerce also helps predict future needs so that companies don’t have to contend with the problem of excess products in the supply chain. However, as the aviation industry tries to embrace the benefits of e-commerce, it is also critical to evaluate the existing challenges that e-commerce supply chains face.
Some of the problems that aviation companies have to evaluate include the ever-evolving customer expectations, technological changes, and the change in new business models (Gasson, 2003). According to DHL, it is essential to evaluate the importance of quality customer service within the e-commerce strategy (Jarach, 2001). However, the dynamic changes in consumer needs make it challenging for industry players to meet consumer needs fully. A critical understanding of those challenges will help industry players to institute measures that can meet industry demands and restructure E-commerce application.
Aim of the ResearchThis report aims to analyze the challenges experienced in the automation of the supply chain for the aviation industry through E-commerce. The report will also evaluate the role that the e-commerce supply chain has played in revolutionizing the aviation industry. Particular emphasis will be in regards to the changes in consumer expectations, the changes in technology as well as the unprecedented changes in business models of different industry players. The study will utilize existing literature to identify the changes in the utility of the use of the e-commerce supply chain in the aviation industry. This report can inform airline companies on possible mitigation measures for them to remain competitive.
The study intends to achieve the following objectives.
To elaborate on the significance of automation of the airline industry supply chain through e-commerce.
To identify the challenges airline companies face in incorporating aspects of e-commerce in their supply chain management.
To establish possible mitigation measures that can help airline companies solve the e-commerce supply chain issues, especially the changing demand, dealing with innovation and emerging technologies, and mitigation of supply interference risks.
Research QuestionsFrom the above-highlighted aim and objectives, the following will be the primary questions for the research.
What is the current role and state of the e-commerce supply chain in the airline industry?
What are some of the possible challenges that airlines face as they continue to integrate e-commerce in their supply chain management?
How can airline companies address e-commerce challenges in their supply chain systems?
Limitations of InvestigationThe aviation industry is extensive, and issues that the various stakeholders that make up this industry differ from one stakeholder to another. Even so, airline companies are the core stakeholders. Therefore, the study will be limited to the evaluation of how various airline companies have integrated e-commerce into their supply chain, the challenges that they face, and how they are addressed. Secondly, different airline companies have adopted different business models, which imply that they also face different e-commerce challenges. However, the business model adopted by industry players may not be the same. Nonetheless, the study will concentrate on changing demand, dealing with innovation and emerging technologies, and mitigation of supply interference risks because these issues cut across all the airline companies.
Historical Background of Significant EventsThe rise in the demand for aircraft has forced the modernization of the supply chain in the aviation industry. In her article, Tieman (2016) indicates that the pursuant of cost-reduction, emerging new technologies, and the continually changing customer demands have forced a supply chain hitch among various airlines across the world. Initially, aircraft manufacturers operated as artisans, but the new challenges have forced them to turn out as a manufacturing industry, with a greater focus on robotics, automation, and standardization. These changes have had a more significant impact on the supply chain strategies of many airline companies.
Preliminary Literature reviewAccording to Bourlakis, Julien, and Ali (2018), the e-commerce supply chain involves purchasing goods and services. DHL, which is one of the notable airline industry players, has shown that the e-commerce supply chain is useful both for B2B and B2C markets (Dhar, 2018). However, the challenges of changing demand, dealing with innovation and emerging technologies, and mitigation of supply interference risks, will make it necessary for airline companies to re-strategize on how to optimize the e-commerce within their supply chains. The study’s findings help airline companies to undertake the required plans and strategies that improve the e-commerce supply chain in the industry. The conclusions shall help the Airline Company managers have effective e-commerce supply chains that satisfy employee expectations. The study could also lead to provoking more participation of the companies’ managers on getting solutions to the problems the airline faces and challenges faced by e-commerce supply chains.
MethodologyThe above research will be conducted using secondary research methodology. The method is through an analysis of the existing literature in the research. The paper’s primary objective is to find data on the problems affecting automation of the aviation industry supply chain. Also, it aims to find the challenges faced by airline employees and the stakeholders in e-commerce supply chains in the industry. The methodology is useful in assessing the state of e-commerce in the industry and determine the challenges that have affected the industry over time. Using the literature, the research aims to find the challenges affecting the industry E-Commerce supply chain, and based on the identified challenges, suggest solutions that can help streamline the system according to consumers’ expectations.
The literature analyzed will involve past experiences in the industry and the methods in which the companies in the airline industry have acted to prevent risks caused by the changing expectations. Through the methods they have used, the research aims to find other suggestions that would help to solve the issues of e-commerce and provide a practical means to make operations effective. The data shall be analyzed thematically using different themes and critical topics such as the current role and state of the e-commerce supply chain in the airline industry. Also, challenges that airlines face as they continue to integrate e-commerce in their supply chain management and how airline companies address e-commerce challenges in their supply chain systems. Thematic analysis is used because it will provide insightful research findings by giving a summary of the most critical data set, such as the employee in airline companies.
Findings and DiscussionSignificance Of E-Commerce In Airline Supply ChainsAfter analyzing the literature in the research, different data were presented concerning the importance of the e-commerce supply chain and how it helps the industry achieve its strategies for a competitive advantage in the market. The industry uses the fulfillment process to exchange documents electronically and improve the accuracy of data and reduce any high costs; hence, streamlining the chain of supply and enhancing services to the customers. The buyer and the seller distance is shortened by providing them with benefits of low costs and at any place (Kolhe, 2016). E-commerce supply chain management strives to help the industry to benefit from the increasing customers. E-commerce connects various stakeholders in various countries, as well as customers who need services from the companies in the aviation industry. Also, it is easier for companies to structure their supply chain for effective operations, which enhances their performance. The challenge that affects the automation process is the changing needs of consumers, which are also influenced by the changing technologies and systems, which consumers apply.
To begin with, e-commerce helps in cost reduction by allowing transportation companies to exchange documents electronically. The airline industries handle their materials from one sector to another without wastage of money and also saves on time. Data accuracy is improved through, and the company’s business cycle is enhanced through the supply chain. The company enjoys reduced costs and enhanced customer service through the managers’ excellent management of the supply chain. Second, e-commerce impacts demand patterns through the incorporation of globalization and technology. The aviation industry takes this opportunity to improve their networks with other companies and increases the speed of conducting any transaction son sales. The improvement of technology has helped the enterprise communicate with their customers and provide for their needs while they understand their shopping interests.
Third, e-commerce creates room for logistics such as buffer stocks, returned items, and individual picking and packing. Third-party logistics helps the industry benefit through digital marketing campaigns and different warehouse services. Adequate space for warehousing responsibilities helps the airline Companies focus on their marketing and sales activities. Fourth, through the digital revolution and the introduction of e-commerce, there has been a balanced relationship between the customers and the sellers since before the development, businesses had more power on their customers, making them change their perception of the company’s ethical and services. Today the power is on a vice versa take where the customers have more control over the industry that directs how the businesses should operate to meet their needs. Consumers are used to using the internet to find information, make orders and bookings, as well as communicating with the stakeholders of the company. Therefore, as the consumers’ expectations change, the companies in the industry also need to change their system to incorporate the new factors, which the consumers require to improve their experiences. Also, a change in technological advancement affects the experience of consumers. The trends in technological advancements need to be incorporated in the automation process of the companies to improve operations of the company. A change in the delivery of substances has been detected where customers receive their orders the same day they make the orders.
Fifth, the traditional roles that governed the Aviation Industry have changed, and now they are working on tasks that rhyme with the modern world. The functions of stores, distribution centers, and transport providers have changed due to the introduction of e-commerce supply chains. The current retail stores operate as centers of product fulfillment, where the packaging and picking of online orders from the customers take place (Kolhe, 2016). Lastly, changes in the distribution systems are made by the e-commerce chain, making it easier for the industry to more flexible in managing the movements that keep on the increase each day. The activities to be maintained in the distribution system include; moving of products from one place to another, and taking information from one business to another, and to the customers, as well as suppliers. Through the development of e-commerce, links between the customers and the distribution center of different products were closed since operations were done through technology. Through the supply chains, customers can manage their movements of products and able to receive their information without struggles. E-commerce is an essential link in the transportation sector for both internal and external customers. Excellent services are delivered to their customers, which boosts the growth of the industry. Shareholders’ value is built through the arrangement of transportation services, which helps strengthen the company. Aviation Industry has made their websites a place where customers can get detailed information concerning the services offered by the industry and how they can conduct business with it. Customers can establish an account through e-commerce where they can place shipment orders, submit any claims, and carry out different activities through the account (Kolhe, 2016). Through shipment, the industry’s e-commerce automates the receiving process of goods through transmitting a packing list ahead of the delivery. Shipping documentation and labelling are done through e-commerce supply chains where human power is replaced. Through the shipment processes, things have been made easier in the airline industry.
The Current State Of The E-Commerce Supply Chain In The Aviation IndustryThe rapid growth of e-commerce is bringing a lot of changes to the airline industry by increasing excellent delivery services and tightening up trucking capacity. It has made the chain management leverage diverse systems making the process to be more efficient. E-commerce has created satisfaction to customers in terms of excellent delivery and a transparent supply chain, which has also become essential to the retailers and other brands. Through the research done, customers want their goods delivered on time, and they are always eager to know when their products will arrive. E-commerce has changed the way shoppers approach their carrier relationship leading to significant and more essential partnerships. The ability to serve customers with the speed they want through delivering their errands is necessary. Any information collected through e-commerce is necessary since it helps retailers plan their supply chain and also customers to arrange for the request of their goods. It is also necessary for supply management to accurately organize their extra resources and inventories. The technology concerned with e-commerce in the aviation industry is rapidly growing. It pushes other partners to work together to ensure that it works on different platforms. E-commerce is changing the way shippers find the labor they need and a challenge to the retailers since there is a fear of unemployment as the time progresses.
Challenges That Aviation Industry in Australia Faces In The E-Commerce Supply
E-commerce faces a lot of problems, especially with the financial services where the industry has to accept all the effects accompanied by the e-commerce supply chain. One of the challenges is with the customers where there is a lack of transparent verification of the specific good they want. Their genuineness becomes a significant problem through the industry’s websites and portals, whereby the managers have got the phone number and the address and no more details that can help them trace the clients. A considerable loss is experienced by the industry if a customer orders for goods and insists on cash on delivery. The person to deliver comes across with a fake address without their knowledge (Arawwawala & Gunawardana, 2017). It becomes a challenge to the management since they have to ensure that they have maintained the customer’s loyalty. It becomes a total disappointment if the industry sends orders that are not relevant to the intended customer. Most customers quit the industry if their store is not familiar with the customer’s needs and wants. There is no visibility of the buyer and the seller, which leads to no trust, unlike in physical shopping, where the seller and the buyer see each other.
The absence of an online verification code makes the customers lack trust in the goods to be delivered. Aviation Industry has to ensure that it has an omnichannel where they can reach all their customers through different websites, numbers, and agents (Casey, 2017). It faces the challenge of finding the right product that it can sell to its customers. A lot of struggle has faced the management and retailers in providing a unique product to its customers through several platforms that compete with the industry. For instance, shopping cart platforms and Amazon have taken over the e-commerce world where they have massive product catalog making it hard for the Aviation industry to penetrate the products to the market peacefully.
It has been a challenge for the airline industry to attract perfect customers, especially in online shopping, where shoppers have to search for products using Amazon and not just Google. Most of them ask for recommendations through social media and use their smartphones to request for the good-paying their cash through the specific company’s account. It becomes challenging to convince them and buy the industry’s products since they get distracted with products from other companies. Retailers understand the most challenging duty of figuring out where to get the customers and how to attract them efficiently without interfering with their needs. Different digital marketing channels have developed, which makes the supply management and retailers not to depend on one way of communicating their products and services. They have to establish other forms of communication, for instance, the emails, shopping engines, advertisements, among others, and be available where most of their customers’ flood.
Aviation Industry spends a lot of money while capturing the quality leads to get most of its marketing efforts appreciated by the consumers. To achieve the leads, the e-commerce supply chain management has to build their communication platform and request subscribers to communicate their messages and prospects better for long-term success. Retailers must draft the right letter, which will be delivered to the customers, which helps change them into leads and like the Aviation products. It becomes a challenge for the industry to nurture the ideal prospects since there is no perfect engagement with subscribers of different communication platforms. It forces the retailers to deliver the valued message in the various platforms to reveal their marketing efforts and attract the customers. By advertising them on different entertainment platforms, managers have to actively participate in the promotion of their products, thus adding value to their products.
The management of the aviation industry has to struggle in converting online shoppers into paying customers through having quality traffics and nurtured leads. To pay for any marketing campaigns for their products, they have to turn the leads. It forces the retailer and managers to convert the email leads and any other platform subscribers into customers through an optimized conversation. Retaining customers is another struggle, and it is more expensive. What matters in an organization is long-term profit and growth. However, it is a sweat of the day to accomplish this strategy sine the management has to ensure that their customers are given their goods on time and at low cost to maintain them for profitability to be detected at the end of the day. The challenges that the retailers face is the limited technology or hiring the wrong agencies that fail to assist them in marketing the products of the industry. To achieve growth and profit, the company must have good technology and choose the right social platforms for marketing their products. The growth of the company can be limited by hiring the wrong group to help in implementing marketing campaigns and projects, which becomes a significant challenge to the Aviation Industry management.
How To Address The Challenges In The E-Commerce Supply Chain The management of the supply chain has to be creative to manage the challenges the aviation industry faces. The business strategy should ensure that it covers the problems that may meet the industry and provide solutions. It is not possible to solve all the issues at once. However, planning can help in conquering some of the challenges face by the e-commerce supply chain. E-commerce can be sustained if it adapts to the changes that affect technology.
Moreover, it is always difficult to forget the high technology-based systems, but the management has to consider the great benefits of moving to another new technology. Applying the latest tool in the industry will help to stay in the current and relevant field to give the best value of the industry. Determining the right device and analyzing what the business requires helps ensure that the technology installed is agile and dependable (Kayikci, 2019). There should be flexible technology to respond to market trends quicker and easier.
The management has to should ensure that the industry maintains a global presence. Dwelling on the local presence supports the industry to local businesses where the growth and development are slow. A tremendous robust economy can be created by identifying the industry’s goals on sales targets. The new online shoppers provide great opportunities; therefore, the management has to look at their planning list of all sales done in the company and, at the same time, check at the rising economy that dominates the supply chain market. Following the steps of giant corporations like Amazon and Walmart gives a challenge to the management system to ensure that they follow the same steps to raise the online businesses across borders and worldwide to obtain the targeted profit.
Most customers use their mobile phones since they are comfortable engaging with online businesses and place their demand for different goods. The management should ensure that they adopt a mobile-first approach for the primary online shopping portal. Online transactions are mostly done through mobile stores optimized by different companies (Thöni & Tjoa, 2017). Due to oversight, the industry might lose a lot of customers; therefore, a mobile platform should be developed. The company’s retailers and managers should know using a mobile-first design approach, which provides an excellent opportunity for understanding the customers’ experience. The design approach can capture the imagination and attention of different customers through a unique mobile user interface. The portable design approach helps to make the store responsive and fast, making it reliable for the customers (Laudon & Traver, 2016). E-commerce supply chain management should ensure that they keep the customers engaged with good mobile designs that make them feel comfortable with the different transaction s they engage in.
The management system should ensure that there is an uninterrupted experience in the brand industry since creating trust is the most significant core of determining its position in the market. Through all platforms and channels, managers and retailers should be consistent in communicating with their clients, which creates loyalty. A branding identity should be formed by integrating information to all communication platforms, and one should ensure that all the promises to the customers are delivered to build the trust. These efforts help the industry to grow according to the needs of the customer leading to evolutionary growth. A comfort zone is created for the customers since they will be pulled by the positive connectivity making the brand grow organically. Inconsistency creates mistrust for the customers; thus, it is essential to consider every detail presented in the communication platform to ensure that it gives a seamless experience.
ConclusionBased on the findings presented and discussed in this report, the following conclusions have been drawn to layout a practical path that explains the challenges that face the e-commerce supply chain for the Aviation Industry. According to the responses given by the available interviewees, it is possible to conclude that e-co