Answer To: BIZ202_Environmental_Scan_B.docx Page 1 of 6 ASSESSMENT BRIEF Subject Code and Title BIZ202: The...
Sangeeta answered on May 03 2020
The Collapse of Ansett Airline Australia
Contents
Introduction 3
Discovered Issues 5
PESTEL Analysis 7
SWOT Analysis 11
Building Strategies to Succeed 12
Conclusion 13
References 16
Introduction
Established during the 1935, Ansett was considered as being Australia’s second-leading airline and operated for the period of over 65 years (Schneider, 2015). The company carried over 14 million passengers yearly and had a yearly turnover of over 3 billion dollars by the time Ansett was positioned into administration during the year 2001 (Schneider, 2015). Regrettably, Ansett turned out to be the country’s most high-profile aviation let-down and one among the biggest corporate failures ever. In actuality, it was bleeding a huge amount of 1.3 million dollars daily as per parent corporation Air New Zealand (Schneider, 2015). The collapse of the Airline left around 15,000 people jobless as well as out of pocket to the tune of 758 million dollars in lost privileges (Schneider, 2015). The majority of employees were ultimately paid back, nevertheless there were so many dark days. Moreover, the collapse of Ansett resulted in huge pain along with hardship for several Australian people (Schneider, 2015). Additionally, the final dividend paid off to prior Ansett staff members attained an overall average return of 96% in dollars — an outcome, which exceeded actual stakeholder anticipations at the time of the failure (Schneider, 2015). Further, taking the above discussion into consideration the below sections examine the company by examining the external environment in which the company operated and the possible reasons that led to the failure of Ansett as a whole.
Process Flow
Process Flow
Discovered Issues
A number of issues in the Ansett customer service process have been discovered through the process maps (Schneider, 2015). These include:
Issue One – Poor Backup Plan
The process map detailed above clearly illustrates that the backup plan available for the customers was highly inefficient and required improvements. After problems faced with the website, the customer was presented with three backup plans i.e. email or fax, online chat and calling the customer service. However, none of them actually worked. First, emailing or sending fax to the company for refund never worked as no reply was ever received. It was basically impracticable and wastage of time to approach them through email or fax. Second, the online chat was basically an automated identification system, which worked on a set of templates and pre-defined words. On typing the word “refund” basically a set of steps opened up taking the customer back to step one itself. The third option was to contact customer service but it was not easy. It was a huge complication in itself with a wait time of as high as 45 minutes.
All these problems simply resulted in the destruction of company’s image and ultimately loosing the customers. The best solution for the above problems could have been re-designing the backup system. This could have offered an increased assurance and a much better level of customer experience to the customers, with an easy and quick refund processing. Overall, it could have helped in saving a lot of time and effort especially in case of unexpected problems.
Issue Two – Improper Route Designing
After having failed to resolve the queries online themselves customers usually end up calling for help with a hope to get their problem resolved and refund processed quickly. The first step at involved talking to an automated machine that usually never solved a problem. It just routed the call from one wrong end to another. This made customers more confused and added to the existing level of frustration. The main problem here was that the automated machine could not understand the command and it took back to the first step. And again the entire set of commands was replayed till the time customer finally somehow ends up talking to an agent. Also, this was the first level agent, who was usually not aware of the problem and basically was not in a position to resolve the problem. The calls then got routed to the service care desk. There was no doubt that the service care desk agents were highly professional and directly routed the call to the refund department. However, there was again a waiting period of approximately 5 minutes, which by this time seems to be too long.
Upon that, refund department can only process the refund if reservation had been cancelled completely, which did not happen. The process of cancellation was then explained to the customer at this step. This means that customers had to connect with a different department first to get the reservation cancelled and then, get the refund processed, which meant atleast 15 minutes more. Overall, the length of the entire process became a minimum of 45 minutes. Ultimately, the airline started loosing the customers and over a period of time developed a bad image of its customer service. Further, the most appropriate solution for handling this and improving the overall process could have been re-building and re-designing the entire call routing process. The strategic aim should have been to make it as simple as process and reduce the call time. The manual effort must have been carefully removed and IT should be incorporated.
Issue Three – Bad Self Care Service
The self care service had a lot of problems with customers having to wait upto ten days to just receive the tracking number after submitting the online form. Beyond that, the tracking number may or may not work and caused extreme frustration. Further, the back up process of speaking to the agents was also daunting and more confusing. The agents were not aware of the scenario and the refund problem. Overall, in the end, customer got an extremely bad impression and never wanted to try self-care option again. In regards to this specific problem, airlines must have invested both time and money in training the employees. Employees are regarded as the most valuable resource of an organisation and they can easily make or break an organisation (Schneider, 2015). Agents were just fluent in speaking but they did not actually know how to tackle a situation in the shortest possible time for the customers (Schneider, 2015). They did not know how to effectively use the company’s tools and technologies in order to remain competitive and be an edge above the competitors. An effort must have been constantly made to understand the ongoing market trends and customer demands.
S_No
Risk
Impact
Probability
Description
Mitigation Plan
1
Customers not using the system
H
L
There may be a difference in the system design and customers may not be comfortable using it.
Regular feedback, video and online tutorial, online help.
2
Imitation of customer details
H
L
Misuse of customer information for duplicate refund processing.
Three step customer verification, usage on one time code and encrypted passwords with security questions.
3
Network issues
H
L
Risk of delays and server crash down in case of large number of refund requests.
Usage of backup websites and systems.
PESTEL Analysis
According to Kotler and Armstrong (2004), PESTEL analysis is an extremely powerful tool to analyse and examine an organisation’s external operational environment. PESTEL includes political, economical, social, technological, environmental and legal surroundings (Kotler, 1998). Using PESTEL as base, the following paragraphs will now focus upon the external risks applicable to Ansett.
Political Risks
Ansett operated within several regions of Australia and Asia and as a result, always required to consider the political stability and conditions across diverse countries. This chiefly involved the controlling party, political institutions and government outlook towards protectionism. Also, Ansett had a continually augmenting dealer network with over half of the earnings being generated alone from Australia. It’s true that there was still a good scope for growth but the corporation needed to be cautious of the political instability within the operating regions.
Economical Risks
Economical risks are basically associated with the purchasing pattern of the buyers and if the offered item would be preferred or not...