1.

Etihad Airways ProductA research study

on:Offerings, Key Success Factors, CriticalIssues, Mission
and Strategy By Arshed Aydrose University of Wollongong
2. Etihads Product Offerings to the Far East
nations.Etihad Airways has been the winner of Air
Transport Worlds Passenger ServiceAward for 2012 and it
have been recognized the carriers excellent customer
serviceproduct and offerings of a premium service across
all cabins. Etihad Airways is alsonoted as it maintains a
genuine service philosophy combining with best
hospitalitywith comfort with the help of employees from
more than 120 different nationalities. Itis also remarkable
that Etihad not only maintained but also improved its
service levelto customers notably to its Far East
customers. One of the major first in industrymove by
Etihad is that they have launched its first premium
connect services for itscustomers from Bangkok and Hong
Kong to provide bespoke and personalized traveloptions
using the fleet of modern luxurious executive jets. The
national carrier ofUAE have also upgraded it on-board
product with new private suites in First Classand Business
Class named next generation seating which is also made
available to theselected Airbus A330_300 flights to Beijing
and Bangkok is that Et. Economy classincluded the
Panasonic eX2 IFE system which had new trim and finish
and audiovisuals on demand which enabled in-seat
capability for live news, USB file sharing,SMS, Email and
access to Microsoft office. Another turn over in the
industry EtihadAirways had started operating scheduled
flights between its hub in Abu Dhabi andShanghai, China.
It will operate non-stop commercial passenger flight
between itshub in Abu Dhabi and Shanghai with its world
leading first class suites with onboardchefs and E-Box
onboard entertainment system. Etihad ensured that its
travelers willhave unlimited access to the First and
Business Class lounge in all of the airports inmajor cities of
China, Thailand, Malaysia and Indonesia. As Bangkok was
Etihadsfirst ever long haul destinations in Far Eastern
countries and the routes seventh year
3. anniversary Etihad introduced regional Thailanguage website which facilitate itsThai costumers for
easy access to it products and services. Etihad believes

significantgrowth in aviation industry in Far East countries

mainly China, Thailand andSingapore and set their product
line early to the customers in order to take an
earlyadvantage in the market as well as the good will. By
the end of 2010, the airlinesproduct and service team
made a significant change and improvement in
efficienciesin order to support their best in class customer
service by reducing cost. For the pastcouple of years
Etihad Airways have made inflight and aircraft
developments in orderto penetrate the far eastern market
and serve it customers better. Etihads premiuminflight
service philosophy have expanded to all the Economy
class on all flights androutes to many major far east
destinations like Bangkok, Seoul, Beijing and otherAsian
routes. On longer flights to these destinations included hot
beverages, multiplecourse main meal with hot deserts. On
March 2010, Etihad introduced a Japaneseinflight service
method and which included Kaiseki menu a Japanese
traditionaldining concept. A Kaiseki menu had bespoke
utensils and beverages such as sake,Japanese tea and
Asahi beer. Their new adaptive service like Express Dinner
couldwhich supported many Etihad guest by choosing
preflight dining and reduced take ofweight and thus less
fuel burnt. Their new meal automated planning system
andinflight duty free offerings resulted in gaining high
material revenue.Etihads Key Success
Factors.Identification of key success factors for strategic
groups in the market is an importantoutput of market
analysis. It in important to identify the key success factors
and it isalso important to project them into the future and
making uncertain key successfactors certain. Etihad
airways have been successful in finding its key success
factorin the market as compared to its competitors.
Etihads Key Success Factors areclassified into many major
sub units like People, Products and services, Route
System,Partnership and Alliance and Revenue and Cost
control.Its People: People and performance division should
always support and be supportedby various business
divisions in order to improve the productivity and process
for asuccessful high performance organization. Etihad
unique way of recruiting andtraining process led to provide
a better inflight customer service and gained them the

4. name of award winning cabin crew title. It also

provide its cabin crewmembers andpilots a chance to see
the world by visiting their destinations and therefor a
betterworking satisfaction. Etihad provided its guest a 1st
in industry inflight chef for the 1stclass and business
travelers and enabled its economy class travels a chance
toconsume the inflight chef service with a low charges.
Etihad also opened its aviationacademy in Abu Dhabi for
developing the skills of is staffs and a special training
forthe communicative skills and crisis management. For a
better serving its customersthe management introduced
iachieve model paying its staffs on performance
base.The introduction of iachieve method of paying it
enhanced the performance of itsworking members by
serving guest better and receiving appreciation
accordingly.Product and services: As Etihad dealing in a
service industry identifying its keysuccess factors in the
field of product and services are very important for
attaining abetter competitive advantage. Etihads KSF in
product and service have beenidentified as inflight
developments, aircraft developments and ground
productofferings. For the past couple of years Etihad
Airways have made inflight and aircraftdevelopments in
order to penetrate the far eastern market and serve it
customers better.Etihads premium inflight service
philosophy have expanded to all the Economy classon all
flights and routes to many major far east destinations like
Bangkok, Seoul,Beijing and other Asian routes. On longer
flights to these destinations included hotbeverages,
multiple course main meal with hot deserts. On March
2010, Etihadintroduced a Japanese inflight service method
and which included Kaiseki menu aJapanese traditional
dining concept. A Kaiseki menu had bespoke utensils
andbeverages such as sake, Japanese tea and Asahi beer.
Economy class included thePanasonic eX2 IFE system
made new trim and finish and audio visuals on
demandwhich enabled in-seat capability for live news, USB
file sharing, SMS, Email andaccess to Microsoft office. As
ground product offerings Economy class passengershave
the access to free Wi-Fi at home airport, printing facility,
luggage storagefunction, family lounges and prayer rooms
at Etihads home based terminal in AbuDhabi.Route

Systems: Etihads new and increased frequencies in the

route flight schedulesystem made them to achieve a
better advantage in the competitive markets of FarEast
region. Etihads daily flights to the several destinations like
Beijing, Seoul andBangkok made their route systems
unique and famous in Far East markets. By the end
5. of 2010 Etihad had five per week to daily flights
from Abu Dhabi to Beijing China,six per week to daily
flights from Abu Dhabi to Seoul South Korea and ten flights
perweek to double daily from Abu Dhabi to Bangkok
Thailand.Partnership and Alliances: At 31st December
2010, Etihad had almost most of thecodeshare
agreements with many international carriers which also
served Far Eastregion. It had a total of 28 codeshare
agreements in place with leading airlines andgave them a
advantage in serving several international destinations. By
Etihadsremarkable alliance with Australias Virgin Blue
Group of Airlines in September2010, made its Far East
customers having easy travel to Australia with no
stopover. By receiving the approval from Australias
competition regulator madeboth of the airliners easy to
cooperate on scheduling, pricing and other variouscooperations. By developing a strategic alliance with virgin
airlines alone madeEtihad to create 1million USD daily as
revenue and 1 billion USD in othercodeshare and alliances
with other major airlines all over the world.Etihads
Revenue and Cost Control:Etihad made a significant
improvement inRevenue and Cost Control with a robust
support from finance division byproviding support to the
business with financial, risk management, financing
andother services. Another unique key success in the field
of cost control was thatEtihads Express Dinning Service
for long over night flight passengers could havetheir meal
at the airport lounge before the departure so it can reduce
the amountof meal carried in the aircraft and thus reduces
weight and made less fuel burned.On April 2010, by the
introduction of New Meal Planning System Etihad
couldreduce the cost of excess order of meals and could
eliminate the chaos due toshortage of meals delivers to its
passengers onboard. At the time of high fuelexpense and
in order to take the advantage over the competitors by
reducingfuel cost Etihad asked their pilots to adapt a high

altitude flying strategy forreducing the atmospheric

pressure and therefor less fuel burnt during the
flight.Critical Issues faced by Etihad AirwaysEtihad is
always flying high with its plans to double its destinations
around theglobe and serve 25million passengers by 2020.
Like every international carrier
6. Etihad faces many issues and challenges now and
ahead. One of the main issuesfacing by Etihad like many
other independent carriers is that the increase in
fuelexpense. With the leadership of CEO James Hogan,
Etihad have successfullyhedged aggressively and are
keeping a strong focus on reducing its cost andbringing it
under control without compromising its products offered
tocustomers or customer service. Even though Etihad is a
product of a oil richcountry United Arab Emirates, Etihads
competitors are running for the costcontrol and reduce its
fuel expenses with the means of many advanced
strategiesaround the world. So it is important for Etihad to
follow the same rule of costcontrol in order to avoid
gaining a advantage by its competitors.The next important
issue faced by Etihad is that gaining the operational
rightsand issue of receiving slots from the foreign
countries in order to operate in theregion. After the down
turn of the global economy most of the
foreigngovernments bring many regulations for the foreign
airliners for the purpose ofprotecting their home carriers.
For example, in the last year Australia andGermany
reportedly blocking more flights from Emirates and Etihad
andrevoking the permission to serve in their new airports
like Germanys inBrandenburg international airport.
Etihads one of the major issue faced in theexpansion of
Far East regions is that getting landing slots at the
Singaporeairport. Even though Singapore is a key market
for expansion the issue of gettingnew slots at the airport
due to air traffic conditions create a greater threat
andchallenge for Etihad. These challenges faced in Europe
will effect Etihadsambition to serve Europe to Far East
market.The next threat is that is about how Asian and
European rivals make use if thenew generation aircrafts
and new technologies. As New generation aircrafts
arecapable of flying up to 19hours and 17500 km and
threat of loosing Etihads hubin Middle East for the

passengers between Europe and Asia. Due to the

muchmore sophisticated aircrafts advantage of Etihads
stop over at Abu Dhabi mayloose later in the future by
bypassing Middle East Hubs.In short the main regions that
creates problems for Etihad are fuel expenses,home
infrastructure, foreign regulatory policies and staff for the
airline. If Etihad
7. wants to expand its presence in many other
destinations in the world, a fineequipped home airport
with latest facilities and with desired manpower
areinevitable and important. The growing fuel prices
globally are creating anegative after effects for the total
aviation industry as well as Etihad Airways too.Even
though Etihad is attracting many candidates to the pilot
programs fromdifferent part of the world, the lifestyle and
living in Gulf in a setback for thesuccess.Mission (Etihad
Tomorrow)Social responsibility and sustainability are the
core factor of Etihads businessprocess. Etihad airways are
fully committed to work its business to make surefor a
responsible management that had a positive impact on
the environment.The adoption of the new environment
policy and the partnership with theMasdar Future and
focusing on its fuel-efficient flight Etihad is focused
onfollowing the policy of reduce, reuse and recycle. A part
from the environment,Etihad is trying to create a mission
and objectives in the competitive globalmarket mainly FarEast regions. With the commitment of growing in the Far
Eastregion Etihad is planning to open many other
destinations in Japan, South Korea,China and Thailand.
Etihads interest in this region have made to set a goal
ofcreating 15 more destinations and setting two Etihad
lounges in the region bythe end of 2019. Etihad believes
that by creating many other codeshare andalliances with
other airlines and by opening many other offices in this
region willhelp serving their passengers directly and
better. By the end of 2012, Etihad isplanning to operate
nonstop economy flights from Abu Dhabi to Bangkok
andAbu Dhabi to Shanghai daily. By 2030, Etihad mission
is it expand its productofferings and enhance customer
experience by replacing its entire inflightpremium class
individual screens to 3D technology and all of its economic
classindividual screens to high definition graphics. One of

the missions of Etihad inthe field of its people is to create

diversity among its staffs across the world byemploying
staffs from different countries and of different sex. As the
nationalcarrier of United Arab Emirates Etihad mission is
to make Arabian hospitalitycloser and available to other
part of the world by creating a sense of
cultured,considerate, warm and generous staff attitude
and services. As now remarked as
8. innovative carrier Etihad wanted to maintain its
name as most innovativeairlines in the world as
compared.StrategyEtihads cooperate strategy is to be the
best airline in the world, to become profitableand to
contribute at its best to Abu Dhabi 2030 plan. Most of
Etihads cooperatestrategy is created and planned by the
mandate from its shareholders. On the year of2010
Etihads top management team were focused on a
strategy to grow and achieveits scale quickly and to
develop sustainable business process and its systems and
tolead from a start up position to maturity level. In order
to measure and analyze theprogress and assess the
strategic direction of the airline Etihad hired a
leadingmanagement consulting firm called Booz and
Company in 2010. The company foundthat Etihad have
successfully and efficiently delivered its shareholders
vision, butthere are several structural limitations, which
complicated the airlines ability to reachprofitability. To
overcome the limitations Booz and Company suggested a
betterbusiness model in order to diversify its current
structure to engage in manypartnerships, distribution, hub
operations and its air cargo. By approval of thisbusiness
model by Etihads senior management and board on 2010,
Etihad havedoubled its global activity and profit level as
compared to its other competitors sincepast 2 years from
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