Executive summary

The following report will outline Qantass operational process and explain the
operations strategies to achieve their performance objectives which enables
them to compete internationally.

Background information
Over recent years, Qantas has experienced an influx of subsidised low-cost
carriers which have caused an oversupply in the aviation market. This has
resulted in a competitive aviation market, which is deteriorating Qantas's market
share and profitability. To combat this issue, Qantas is implementing various
strategy ies such as the accelerated Qantas transformation program.

Inputs
Transformed resources
Transformed resources are inputs used by transforming resources to create
output. Qantas purchases materials such as fuel from its suppliers to operate
their services. Qantas sources information from customer bookings and
government statistics to make business decisions accordingly. Customers are
transformed by boarding flights from point a to point b.

Transforming resources
Transforming resources are inputs that transform transformed resources. Human
resources such as pilots and sales managers are employed for their skills to
assemble and operate inputs. Facilities such as terminal buildings and aircraft are
purchased as physical assets to help produce output.

Transformation processes
Influences
Volume- Qantas strategically lowers ticket prices before take-off to fill up
seating capacity, reduce wastage and cover their expenses.

Variety- Qantas offers the greatest frequency of flights for the business market
and a diverse range of flights destinations, thanks to their membership in the
Oneworld alliance.

Variation in demand-Qantas adopts a fleet strategy which is designed for

flexibility to adapt to any market conditions.

Visibility- Qantas has designed new uniforms and opened up more lounges to
improve the look and feel of their business.

Sequencing and scheduling

Qantass sequencing process involves all necessary checks to perform their
services such as filling aircraft with passengers and baggage.
Qantas uses Sabre Air flight Suite Systems software to automate their flight
scheduling and access information regarding fuel levels, time and destinations of
take-off and arrival.

Technology, task design and process layout

Qantas uses technology such as e-check ins and online bookings to streamline
the operations process.
The use of technology has reduced the need for repetitive labour. Therefore
technology has allowed Qantas to create a more efficient and more mechanist
operational structure.
Qantas has upgraded their Sydney international terminal 1 to increase efficiency
in their process layout.

Monitoring, control and improvement

Qantas monitors and controls discrepancies between planned and actual activity
by identify shortcomings and undertake corrective action. Qantas uses customer
feedback to improve on unsatisfactory components of their service.

Outputs
Customer service
Qantas uses the closed loop feedback program to provide assistance and advice
for their customers and improve their services.

Performance objectives
All performance objectives and strategies have the end goal of retaining their
competitive advantage and increasing market share to compete internationally.
Qantas aims to achieve the following performance objectives
1. Adhere to quality expectations
2. Achieve speed within the logistics and customer-based section of Qantas
3. Achieve reliability and consistency in flight departures and customer service
4. Offer a sense of flexibility in flight availability
5. Achieve customisation in plane seats and locations
6. Minimize cost to ensure financial prosperity.

Performance strategies
New product/service design and global factors
Qantas updates existing services and offers new products to maintain
competitiveness.
Qantas's partnership with French company Airbus, allows Qantas to could order
aircraft suited specifically towards their requirements. The a380 accesses
economies of scale and increased fuel-efficiency to achieve cost objectives. By
improving on-board customer experience, quality objectives are met as well.
Qantas launched Jetstar Asia after it had identified rapidly emerging markets in
Asia through research and development. By tapping into new markets and
offering more routes, customisation objectives are achieved. By offering a
service with a solid reputation at a modest price, quality objectives are achieved.
New models typically come with improved safety records, ensuring Qantas is
able to keep breakdowns of all planes below 10%.This has helped Jetstar Asia to
increase seat capacity by 22% between 2005 and 2013 in an increasingly
competitive regional market.
However the introduction of new products also are substantial in cost where they
will accumulate payments in interest. The a380 is also not compatible with some
airports around the world, limiting its potential use.

Supply chain management

Logistics
Qantas performs the task of logistics to ensure their inputs are in the right place
at the right time. Qantas employs a polycentric staffing model to ensure their
staff are able to speak the local language. This improves customer comfort with
staff to achieve quality objectives. By ensuring staff is compatible with the
stages in operations, Qantas is able to achieve a smooth flow of logistics, thus
achieving dependability.

E-commerce
Qantas uses e-commerce to procure their inputs on the internet. Qantas uses
electronic-funds-transfer to access real time information on their suppliers
goods/services. This allows Qantas to change their volume of supplies ordered at
any given time in response to changes in demand and market conditions, thus
achieving flexibility objectives. E-commerce is often cheaper than procuring in
conventional means and help contribute to reducing expenses. However

Sourcing
Qantas sources their supplies from other businesses to acquire the inputs
required to produce output. By choosing between multiple suppliers with the
primary aim of minimizing cost and maximising quality of supplies, Qantas is
able their meet cost and quality objectives. Qantas also forecasts the quantity
and quality requirement of these inputs to meet dependability objectives.
However this may undermine the relationship between Qantas and Qantass
suppliers, reducing the chance of occasional price concessions on their supplies.

Global sourcing
Qantas sources many of their supplies from global markets. If the China Eastern
and Qantas joint venture is approved, Qantas is able to co-ordinate
complementary schedules and pricing on flights to achieve cost objectives.
Qantas customers can also access the China eastern lounge to achieve
customisation objectives. However the sharing of lounges will need to undergo
quality control to meet Qantass set of criteria in order to ensure customer
satisfaction.

Outsourcing
Qantas uses outsourcing as a strategic use of outside resources to perform some
activities. Qantas outsources some of their functions such as Information
technology, maintenance and their catering service. By outsourcing their
maintenance facilities overseas, Qantas avoids expensive labour costs, accesses
lower exchange rates and indirectly accesses economies of scale to increase
cash-on-hand and meet cost objectives. Qantas also avoids labour on-costs to
improve cash flow. However outsourcing reduces Qantass control of the relevant

function of the business and reduces communication between corporate and

functions.

Technology
Qantas uses technology to utilise their resources efficiently and to reduce waste.
Qantas has adopted leading edge technology such as q-tags and incorporation of
i-pads on flights. By fastening terminal check-ins, q-tags are designed to
facilitate for a faster and easier baggage check-in process to achieve speed
objectives. Wireless inflight entertainment on i-pads facilitate for an enhanced
flight experience to achieve quality objectives. However leading edge technology
is exposed to the increased likelihood of defects and faults.
Qantas has adopted established technology such as online bookings and older
plane models. Online bookings are also very accurate and fast which achieves
speed objectives. By using older planes where newer models may not be
compatible with some airports, Qantas ensures it has the compatibility to fly to
their diverse range of destinations to achieve customisation objectives.
Technology also is able to improve customer satisfaction and ease, achieving
quality objectives. However established technology does not provide Qantas the
competitive advantage which is crucial in carrying out their strategic scope of
marketing.

Inventory management
Qantas uses inventory management to efficiently manage the resources required
to produce output.
Just in time is used to receive customised raw materials only as they are needed
for the operational process. Qantas is able to adjust orders seamlessly according
to market demand to achieve flexibility and customisation objectives.JIT
eliminates the need for storage which reduces expenses to achieve cost
objectives. However Just in time runs the risk of short-term input shortages,
possibly leading to customer delays and frustration.
Altea inventory is used for the management of inventory within Qantas. Qantas
improves resource management by accurately controlling airline inventory and
calculating availability to achieve speed objectives. By using Altea customer
control, Qantas is able to tailor their service to the customer by customising
seat-selection to achieve customisation objectives. This achieves customer
satisfaction, achieving quality objectives. However this form of management
could be subject to security threats and malware, exposing the customers
privacy details.

Quality management
Qantas uses quality management to measure the quality of its service to a
predetermined standard. Qantas implements 3 strategies to achieve quality
objectives.

Quality control
Qantas checks all processes are meeting predetermined quality criteria through
their extensive training processes and total quality management checkpoints. By
doing so Qantas ensures their staff are professional and the quality of their
output align with customer expectation. It also helps improve productivity as
Qantas now expects 3% annual growth in their average seat kilometres per
employee.

Quality assurance
Qantas monitors all stages of their processes to be of satisfactory quality by
completing the IOSA program, a global benchmark for airline safety and quality
standards. By doing so, Qantas ensures their operational processes are of the
highest quality to meet customer expectations. This allows them to secure their
solid reputation, ensuring future financial success.

Quality improvement
Qantas continuously improves quality by using the Kaizen technique and
accessing employee feedback .By doing so, Qantas is able to increase quality of
output and decrease cost of their operational processes.
However quality control is substantial in cost, leading to higher prices for plane
tickets.

Overcoming resistance to change

Financial resistance can arise from cost of new equipment, retraining costs and
inflation. To overcome these restrictions, management conducts a feasibility
study to evaluate if their subsidiaries are worth keeping. Subsidiaries that are
determined to be not worth keeping such as Qantass catering function are sold
off to improve Qantass cash position. By doing so Qantas improves liquidity to
ensure long-term prosperity. Overcoming financial resistance is helped by Qantas
strong liquidity of 3.6 billion, ensuring Qantas can make short-term investments
if deemed appropriate.
Social resistance can arise from inertia and apprehensive behaviour from staff. To
overcome these resistant, Qantas has brought in new CEO Alan Joyce to instil

contemporary business practice into Qantass management strategy. By aligning

employees with a new business culture and philosophy, Qantas is able to
minimize resistance and improve productivity of employees to reach Qantass
goals. The use of voluntary and involuntary redundancy packages are used to
separate resistant employees from Qantas, ensuring all employees at Qantas are
on board with the businesss future direction.
Overcoming financial and social resistance will inevitably require a redesign of
the businesss various processes, possibly resulting in cohesion in the short-term
but eventually lead to prosperity in the long term.

Conclusion
Qantas has implemented various strategies to achieve their performance
objectives. By doing so they increase market share, minimize waste, improve
customer satisfaction and retain the competitive advantage needed to compete
internationally.