Oil represents a critical commodity in contemporary society, utilized by people to operate automobiles, fly people across continents, and generate machines for manufacturing plants. Despite diminishing supply, the demand for oil persists, as people depend on it for survival in their ordinary lives. Yet, these recent declines in oil supply, accompanied by elevated environmental and economic factors, present a relevant issue emerging to the forefront of 21st century globalization, especially for airline operation management within many industrialized nations.
Such deficits pose devastating consequences, particularly for airline service, a primarily oil dependent industry, diminishing its value, and thereby elevating expenses. Likewise, as oil prices soar, the need for alternative energy sources becomes strikingly apparent. Yet, aviation technology presently lacks the ability to effectively harness alternative sources, which proves particularly problematic for airlines.
Though, despite recent global climate changes, fossil fuels still rank among humanitys most efficient energy sources. However, fuel costs contribute considerably to total operating expenditures for airlines, disrupting the continuity of long-term flight operation. Hence, the airline industry demands a comprehensive guideline, to enhance flight operation. Ultimately, a comprehensive guideline, as presented, not only evaluates mechanics, but considers economic, environmental, and technological trends, which directly impact flight operations, including the reorganization of infrastructure with responsible regulation, relying on active leadership, implementing collaborative contribution through independent oversight, to propose innovations in operation management that help reduce unnecessary fuel expense.
Literature review
The literature for this analysis encompasses an extensive range of research including books, journals, case studies, and personal background to assess collective factors impacting fuel cost management. Research offers a guideline to facilitate long-term global continuity of commercial airlines. Essay assumes an interdisciplinary approach, focusing on the economic, environmental, and technological concerns influencing airline operation management. Dissertation also exposes the various fallacies and misconceptions surrounding airline management. Rigorously researched for maximum accuracy, analysis references an abundant range of resources, to support conclusions.
Oil price fluctuation
On January 24, 2010, as compared to a year ago, the price of crude oil nearly doubled from its previous 45 amount, now priced at almost 80 per barrel (Williams 2010 1). Obviously, the recent economic recession escalated expenses, as diminished demand for commerce aggravated inflation, depreciating value of dollars in currency. Indeed, this striking spike seems sufficient to spur scientific investigation of renewable resources.
In Peak Oil, prolific author Jerican predicts dramatic lifestyle alterations, as a psychological reaction to environmental changes. An incisive analysis, Jerican suggests substantial declines in crude oil consumption by the U.S. and other industrialized nations, as alternative energy sources become increasingly widespread.
However, Jerican acknowledges the improbability of any complete transition from crude oil to alternatives by 2050 because crude oil represents more than some mere energy source, but rather a raw resource used for, manufacturing drugs, plastics, chemicals, and fabrics, (Jerican 2007 1). Therefore, since airfare predominantly derives its revenue from fuel costs, frequent fluctuations in oil price presently impose unfavorable prospects to the airline industry, thwarting transportation among consumers. As deficits in resources surmount, depleting accessible supply, airlines face the future proposition of preparing alternative substitutes.
Figure 1 illustrates a typical costs contribution model for airlines, whereby about 31 of total airline expenses derive from fuel costs, as promulgated by the General Aviation Bureau. For further reference regarding the Figure 1 model, please evaluate pie chart, portraying percentage distribution of operational costs, as listed below on page 4.
Increases in fuel prices influence airlines in one of two ways. Obviously, fuel costs maintain a direct impact on the expense of operation, and in some cases, managed to trigger, economic recessions, diminishing demand for air travel and cargo transportation (Algoe 2010 3). Hence, any fluctuations in oil price almost inevitably compromises profitability, by compelling airlines to increase airfares, which consequently, runs the risk of either discouraging passengers, or maintaining affordable airfares, offered at cheaper prices. Consequently, such losses in income for airlines not only instigate, higher operational costs, due to diminished demand, but also elevates insurance costs (LaLa Lajpatrai College 2010 12). The following sections describe economic influences on operational costs and fuel expense. This kind of unpromising trade-off resulting from oil price fluctuations remains a common challenge for airlines.
According to analysts, the most attractive energy crisis solution involves the utilization of bio fuel in vehicles and machines at manufacturing plants. For example, Bill Glover, managing director environmental strategist at Boeing aircraft, envisions, a variety of bio fuels, available to aircraft because, from an environmental perspective, it offers the advantage of producing, fewer particulates that cause pollution, (Hamilton 2007 11).
Moreover, Boeing estimates the probability of deflating flight-related greenhouse gas emissions, by approximately 60-80 (Gonzalez 2010 3). Furthermore, to compensate for frequent fluctuations in jet fuel as anticipated within the future, airlines consolidated several alternatives that decrease operating costs without requiring any reductions of ground staff or flight personnel.
As figure 2 displays, technical operations, operational planning, ground operational preparation, and flights operations, provide a particularly effective alternative to diminishing operational costs.
To accommodate exponential jet fuel consumption, as supposedly predicted in the near future, industrialized European nations, including Germany and Netherlands, seek accelerated development of alternative solutions (Jerican, 2007). For further reference, please observe Figure 3 model as displayed on page 5, a bar graph demonstrating differences in expenses with regard to dollar consumption per gallon of jet fuel from 2000-2008. Figure 3 assesses U.S. passengercargo airlines based upon 75K to employ one FTE and approximately 70M per aircraft, with average prices paid, excluding, taxes, into-plane fees, pipeline tariffs, and hedging costs (ATA 2008 1).
While bio fuels may enhance fuel efficiency, facilitating environmentally friendly and economically feasible alternatives, adverse trade-offs seem to accompany attempts at infrastructural innovations. For example, engineering solutions designed to treat one problem, increasing fuel efficiency by the 15 desired by airlines, might counterproductively exacerbate CO2 emissions, increasing heat from energy cores (Hamilton 2007 11). Likewise, in some cases, the production of bio fuels perhaps proved more harmful than fossil fuels (Rajni 2007 1). One author ventured so far as to denounce the rising prices of bio fuel, indicating its responsibility in accelerating rainforest destruction (Clean Air Environmental Quality 2006).
Global Climate Change The Science of Energy Shortage
Additionally, the introduction of bio fuel presents another relevant problem, as continuous energy consumption triggers substantial shortages in vegetable supply. As Jerican insightfully asserts, after switching to bio fuels, some European countries already began witnessing the effects and complications, in some cases, causing shortages of vegetable oils, (Jerican 2007 1).
Consequently, such shortages significantly heighten the risk of environmental problems, especially widespread global climate changes. The increased risk of environmental decline compels manufacturers to consider deforestation, removing trees that inhabit tropical regions, and instead substitute palm oil, rather than vegetable oil. After all, palm oil, when properly harnessed, may generate electricity.
Although scientists possess the technological capability to convert palm oil into methyl ester, a byproduct which may eventually serve as diesel fuel, and reduce palm oil stock, oleochemicals producers strongly oppose its use for financial reasons (AllBusiness.com 2003 1). Even so, recent studies overwhelmingly suggest the environmental dangers of palm oil.
According to a Center for Science in the Public Interest (CSPI) study, palm oil production, promotes destruction of the rain forest, and further losses in forest may force various endangered animal species into extinction, further worsening food deficits (CSPI 2005 1). Though global climate change most likely evolves progressively, over thousands of years, as overwhelmingly supported by scientific evidence, it still remains a critical concern, and precautionary measures may mitigate its effects to prevent additional acceleration. As Jonathan H. Adler, renowned legal scholar and environmental spokesperson for the Federalist Society, insightfully acknowledged, global climate change is a global phenomenon, not limited to localized or national concerns, which proves historically and politically significant for international commercial airlines, seeking reduction of mounting fuel costs resulting from inefficient energy sources (Adler 2007 75). With time, technology offers a solution.
A controversial, though carefully researched analysis, prolific writer Antonia Juhasz, in her distinguished book The Tyranny of Oil discusses the global environmental impact of CO2 accumulation, and its future ramifications in contemporary society. In her stylistically bold approach, Juhasz attempts to expose an alleged corruption surrounding the oil industry, which she believes, permeates every aspect of fuel production. According to Juhasz, climate change and global warming represent increasingly critical issues pervading society, as perpetual burning of fossil fuels, primarily oil, natural gas, and coal, increase atmospheric CO2 concentrations, the principle greenhouse gas possibly elevating Earths temperature, thereby instigating turbulent weather patterns, characterized by accelerated ice melting, elevated oceans, etc (Juhasz 2008 15).
Thomas Friedman, renowned economist and leading globalization proponent, professed similar concerns. Increased production of palm oil, extracted from Indonesia and Malaysia, to appease China threatens many natural habitats, and if left uninhibited, may accelerate global climate changes, such as extreme temperature disparities, while very likely condemning many currently threatened species into extinction (Friedman 2005 412). Yet, global climate change remains a huge symptom not the root problem perhaps largely resulting from present inabilities to develop renewable resources of energy, or more specifically, adapt alternative fuel sources for transportation at present (Dent 2009 332).
If left untreated, palm oil production may instigate, soil erosion, increased sedimentation in rivers, accompanied by, air pollution resulting from forest fires, all of which contribute considerably to widespread climatic changes, such as unpredictable weather patterns, natural disasters, and dangerous temperature disparities developing randomly among various geographic regions across the global landscape (Brown, Jacobson 20055). Climate location remains irrelevant to CO2 emission because its accumulation lingers in Earths atmosphere, for a 100 years and permeates around the globe, as Bill Glover, Boeings environmental managing director, affirmed (Hamilton 2007 11).
Hence, the destruction of forests not only contributes considerably to CO2 emissions, by releasing carbon dioxide, cumulatively stored within trees, into Earths atmosphere, but replaces a relatively mild resource, vegetable sources, with palm oil, something far more destructive in chemical composition (EPA 2009). Indeed, the increased production of palm oil resulting from inadequate vegetable supply alone, and necessary political motives, may pose significant environmental consequences, unless a collaborative effort emerges to change consumption patterns, (Friedman 2005 412).
Recall the previous example of European nations, suffering complications, after switching to bio fuels. Imagine if nations like China and India, with their tremendous populations, followed in similar pursuit, relying on bio fuels, to compensate for oil deficits. The ecological ramifications seem almost unfathomable. One might expect an almost universal shortage, perhaps unprecedented in human history, as never previously experienced, whereby the environment becomes especially vulnerable, forcing people to exploit Earths limited resources for mere survival (Jerican 2007 1).
Energy Shortage The Macroeconomics of Price Volatility
Now consider these shortages in the sociological context of aviation and operational management with regard to unstable oil prices. What might happen if all the major international players depleted Earths fuel supply After all, the U.S. annually consumes approximately 25 of global oil alone, an amount equivalent to oil consumption by, China, Japan, Russia, Germany, and India combined, (Juhasz 2008 15).
Forget the environmental ramifications of limited supply. Consider how that limited supply, from an economic standpoint, almost inevitably skyrockets operational costs for airlines all over the world, perhaps bankrupting nations, and subsequently, possibly driving them into full-fledged depression. Macroeconomic principles significantly suggest the likelihood of such a phenomenon, stemming directly from depleted energy sources.
Indeed, the cyclical downturn in economic activity, exacerbated by, global financial instability, issues concerning airport capacity and associated environmental implications thereof, already managed to push some airlines toward the brink of bankruptcy as Kent N. Gourdin asserts, author of Global Airlines Competition in a Transnational Industry (Gourdin 2007 1). Why Common sense logic and economic theory strongly portend it. After all, the airline industry remains, highly susceptible to situations that undermine air travel, specifically, conditions involving, political instability, regional hostilities, recession, fuel price escalation, inflation, adverse weather conditions, consumer preferences, labor instability, or regulatory oversight, (LaLa Lajpatrai College 2010 17). Consider the laws of Supply and Demand in relation to oil price.
In a capitalistic economy, characterized by competition among private industries, the laws of supply and demand presumably apply. The economic structure of a business tends to function in cycles. These business cycles, like any circular process, fluctuate due to socioeconomic conditions, often depending upon the supply and demand of services.
According to the laws of supply, prices increase proportionate with surges in quantities supplied. By contrast, the laws of demand state that prices rise proportionate to decreases in quantities demanded. Obviously, the essential principles of common sense logic show an inverse relationship between supply and demand. Elevations in quantity supplied, diminish demand output, and vice versa.
Therefore, escalating oil prices, a function of heightened oil supply, insinuate relative declines in the demand for oil. Though oil presently witnesses erratic shifts in prices from one year to another, the overall trend in recent years projects an upward progression in oil price. General shortages of goods, or a decrease in available quantities demanded, causes, prices to rise (Ekelund, Tollison 1994499).
In other words, shortage occurs when quantity demanded surpasses the amount supplied, at levels operating below equilibrium. For further reference, Figure 4 diagrams the traditional Supply Demand Curve model, a graphical display designed to mathematically depict market correlations affecting oil price. Figure 5 displays an Aggregate Supply Demand Curve to measure the collective domestic production of goods. Both diagrams accurately depict shortages that occur at levels below equilibrium.
Perhaps current macroeconomic conditions, characterized by a periodic elevation in oil prices, implicate the possibility of oil shortage. When price rates remain, inflexible over a period of time, shortages likely occur with fluctuations in demand (Ekelund, Tollison 1994430). As the economy expanded, and became increasingly globalized, dependent upon other industrialized countries for feasible sources of production, it demanded more oil to remain sustainable. Consequently, the accelerated demand for oil subsequently drove prices to rise (tech-archive.net 2009). Demand for oil expects to surpass supply very soon, as inevitably foreshadowed by traditional economic theories. Driven predominantly by, the U.S., China, and India, oil demand stands on the precipice of exceeding supply, quite possibly within the very near future (Juhasz 2008 129).
Some economists reasonably propose technological development as a solution to prevent widespread oil shortages that shortened oil supply most likely propels the production of alternative fuel sources in markets (Ekelund, Tollison 1994777). Conversely, this notion runs counterintuitive, contradicting the reality of current conditions, at least from a technological perspective. Why Oil maintains a mostly inelastic supply and demand market, at least involving short-run economic operations. The transportation industries permit few, if any, similar substitutes to replace oil and thereby support technology. They lack the technological interchangeability. Airplanes simply, cannot transition its fuel source from diesel oil and kerosene for propulsion (The Oil Drum 2007 4).
Moreover, the issue concerns not one of shortage, since supply still remains mostly profuse, culminating with its highest levels since almost a decade, back in 2007 (Juhasz 2008 129). Rather, the real relevant question involves whether adequate oil supply exists proportionate to sustain an accelerating global economy. At this rate, assuming conditions continue without change, a deficiency in oil supply, or failure to maintain pace with economic expansion may suggest catastrophic consequences.
An expert of energy and environmental issues concerning oil, lawyer, Matt Savinar, discusses the significant economic ramifications resulting from small deficits in oil supply or demand. Savinar asserts that, 10-15 shortfall between supply and demand may prove devastating, perhaps sufficient, to wholly shatter an oil-dependent economy, (Savinar 20101). Similarly, H.S. Dent predicts the strong likelihood of a looming economic depression, especially if oil prices skyrocket, as he suspects, perhaps peaking at, 200, consequently inflicting severe damage upon emerging countries, which appear particularly sensitive to commodity prices (Dent 2009 25).
Furthermore, without viable and accessible alternatives entire economies almost inevitably collapse, summoning extensive government control, financial support, to subsidize industries (Juhasz 2008 129). The situation presents a global catastrophe. Consider the detrimental impact upon airlines. The unavailability of fuel efficient alternatives, coupled with an inability to replace these nonrenewable resources, almost inevitably foreshadows devastating consequences for commercial airline industries, which likely suggests global economic complications.
Figure 6 displays the chart of crude oil price per barrel as it practically doubles from 2007-2008, attenuating in 2009, only to nearly double again during 2009-2010 period, reaching 74.09 in Jan 24, 2010, as compared with 45 for Jan 2009.
Effects of the Rising Oil Price on Airline Industry
These undulating oil prices pose a problem of gargantuan proportions to the airline industry, people, and surrounding companies directly damaged by its unstable influence. Why The entire global economy depends on a super-infrastructure, or combination of mass transportation, especially air travel, to deliver energy sources and minimize expenses. Therefore, if oil prices continue at this rate, the airline industry almost inevitably collapses, which foreshadows a global economic crisis.
Consider Delta Airlines. Due to skyrocketing fuel expenses, a direct result of the spiraling demand demonstrated earlier, Delta airlines increased fuel surcharges 20 for nearly all its domestic round-trip flights. Interestingly, other airlines report similar trends. Since jet fuel prices practically, doubled from 2007 to 2008, most carriers panicked, and like Delta Airlines, announced, a wave of fuel surcharges, throughout that period, as airlines across the U.S. reacted fearfully after witnessing serious financial losses (Tharpe, Crotts 2008 1).
This problem persisted unchangeably into 2009, while society still waits to witness the total effect of its aftermath. For instance, in the first four months of 2009, industry passenger revenues, declined nearly 20 compared to 2008 for Delta Airlines (Delta Air Lines 20091). With fuel prices tripling since 2000, currently unable to handle the high price of oil, an estimated sixty European airlines only five may survive these unstable economic conditions (Vaidya, Energy Bulletin 2008 2). Below describes the unbelievable impact of fuel consumption on airline operation.
In The End of Aviation, Bradford Plumer, correspondent for the New Republic, provides invaluable insight regarding future airline conditions, predicting the early signs of aviation apocalypse as twenty-five airlines have gone belly-up during 2008 which her verbatim describes clearly an astounding statistic, approximately three to four times the usual yearly rate, (Plumer 2008 1).
Indeed, in an authoritative piece presented by Sara Algoe, historical trends reveal the economic consequences of oil price instability with regard to its destruction upon global airliners, which as she claims, if escalates irregularly again, may entail considerable expense possibly increasing inflation, undermining GDP, and jeopardizing employment prospects for various countries (Algoe 2010 3). She wisely assesses the relationship between fluctuating oil values and operational management of airline expenses. Presuming current oil conditions unceasingly persist, such enormous figures insinuate the, decline of global air transportation, which reasonably suggests a financial crisis for airlines, perhaps unlike any other before it in world history (Vaidya, Energy Bulletin 2008 2).
Additionally, as oil values continuously vary unpredictably with economic cycles, circumstances become increasingly uncertain for the airline industry, consequently resulting in some severe environmental effects, demanding alternative resources, not yet adaptable to current aircraft technology. For example, while rising oil prices may encourage development of some alternative energy sources, conventional fuels systems likely lack the endurance necessary to sustain bio fuels, because they operate at a lower energy density than conventional jet fuel, (Luft 2006 20-21).
Airlines lack the flexibility to influence Air Traffic Control (ATC) systems. Such inadequate flexibility in authority instigates unpredictable consequences, causing inefficiencies that sometimes result in so much as 18 atmospheric waste (Hamilton 2007 10). Additionally, specific model formulation errors derived from various laboratory, numerical, and atmospheric studies, present numerous uncertainties in determining aviation effects on climate (FAA 20067).
The Technological Implications of Energy Alternatives
Again, any attempt to incorporate alternative energy sources into the technological engineering of aircraft, at least for now, seems almost unrealistic. Why Generating sufficient bio fuel to compensate for the more than 60 billion gallons of jet fuel that yearly empower aircraft engines, represents an overwhelming challenge as environmental news correspondent David Biello, writer for Yale Environment 360, astutely reports (Biello 20093). Hence, the trial and error experimentation of alternative energy sources, such as wasteful efforts trying to integrate bio fuels into aviation technology, remains flawed.
Since the introduction of innovative energy sources to counteract rising oil prices almost inevitably requires, more fuel carried on board, consequently increasing drag and fuel consumption, thereby requiring more frequent refueling, such an option appears economically impractical (Luft 2006 21). Therefore, the effort appears counterproductive, only contributing to expenses.
Consider the operational costs simply required to keep airlines sustainable. After all, the price per barrel of oil maintains a direct impact on airliners in the European aviation industry (Algoe 2010 3). The same premise applies elsewhere. As the developing world economy grows more dependent upon oil to sustain its expanding demand, technological incorporation of alternative energy sources becomes increasingly difficult. Likewise, the relentless refueling required to regulate flight, releasing excess carcinogenic chemicals into Earths atmosphere, may also counterproductively render bio fuels environmentally unsuitable as a technological alternative.
Yet, reducing the range of commercial airline fuel consumption by no measure constitutes an insurmountable challenge. Obviously, current conditions implicate the need to contemplate possible alternatives for future references, as non renewable resources become exhausted and eventually expire. As needs, economics, and unrealistic alternatives materialize with modernization, the future direction for change becomes increasingly necessary to meet these challenges, (Jerican 2007 1).
With the appropriate balance of realism and idealism, airlines may soon discover operational alternatives to counteract consistently climbing fuel costs. Some reputable aviation companies, including Boeing envision potential replacement of traditional petroleum sources with bio fuels within the next five years (Wilson 2009 1).
Others ponder alternative possibilities. For example, some aviation engineers located in Connecticut, Rotating Composite Technologies, already began developing an innovative turbofan engine, with the assumption that it may reduce fuel consumption for airlines, by approximately 14 compared to present turbo fans, if implemented properly.
After intense testing, Rotating Composite Technologies consider the Hywind wind turbine, which, when activated, musters a momentum sufficient to generate electricity. These wind turbines rely upon the sound they produce for energy, and require tuning in a manner analogous to musical instruments.
While past models failed, lacking the proper blade pitch necessary for successful operation, Rotating Composite Technologies discovered a way to overcome previous deficiencies, using pitch angles with greater efficiency for future wave motions (Langston 2009 2-3).
It seems some solutions already lurk on the horizon. Though, these alternative options appear too premature, in the preliminary phase of development, to determine an actual solution. Still, some experts believe otherwise. Nevertheless, the introduction of alternative sources, without permitting sufficient time for technological adjustment, appears most likely to compromise an already respectable environmental reputation.
How to Enhance Operational Management A Multifaceted Strategy Leadership through Incentive, Investment, Innovation
Enhancing airline operational management in the early 21st Century represents a daunting task demanding innovative alternatives, as business leaders aspire to maximize productivity. Indeed, the airline industry requires a multifaceted, multidimensional strategy, one that incorporates a balance of cooperative incentive, leadership, personal investment, and innovation.
After all, these tough economic times tend to amplify difficulties, especially without the timely transition of reasonable, diplomatic approaches. However, with some clever business savvy, creative insight, and a clear suggestion of common sense, airlines possess the opportunity to significantly enhance operational management, minimizing unnecessary expense.
According to the Atlanta Journal, 6 U.S. airlines American, Continental, Delta, Northwest, United, U.S. Airways, all exceed 100 in total fuel surcharges for round-trips, fuel costs per ticket, with American, Delta, and United tied at 130 (Tharpe, Crotts 2008 1). Atlanta-based Delta seems to lead the pack.
Worse, as if 65 per flight meant nothing, Atlanta-based Delta stiffed customers out of another several hundred dollars, imposing exorbitant handling charges on accessories such as luggage, additional baggage, etc. Even the price for an unaccompanied minor, previously 50, doubled over one year. The airline industry, as evidenced from these ridiculous increases, obviously demands extensive reform, with regard to its poor operational management of flight expenses at present.
Obviously, selfish motives remain partially to blame. The destructive presence of unionized labor, presents a particularly prominent, pervasive problem undermining operational management for airlines. The corruption surrounding culpable unions exerts a corrosive influence upon airlines. Laziness, incompetence, and the worst of greed permeates almost every level in its managerial hierarchy, as workers often demand unreasonable pay raises. Reprehensible conduct generally goes unpunished, as union employees violate professional standards, accepting welfare benefits not entitled to them, manipulating the system, while lackadaisical leaders lazily permit it. Why
Gordon Bethune, CEO of Continental Airlines, witnessed firsthand the destruction inflicted by union managers in their avaricious agendas. A disorganized, dysfunctional environment, Continental Airlines descended down through the ranks, whereby people, made a lot less moneyin constant fear for their jobs, and stubborn workers relentlessly resisted change compromising operational integrity without the authority necessary to institute change (Bethune, Hutler 1998 14-16). With prudence, clarity, and understanding, Bethume captures the destructive nature inherently surrounding labor unions, as witnessed from his earliest experiences at Continental Airlines. Yet, this social phenomenon pervades almost every level of airline management. Why Fear drives their motives. Reluctant to relinquish any control, they relentlessly refuse change, perceiving it as a threat against their own personal ambitions and financial position.
However, as Bethune reasonably asserts, change remains the first step toward advancement, yet remains practically impossible unless people want it, and such desire for change almost always coincides with the psychological anticipation of mutual benefit. Because the top executive received no reciprocal reward, compensation for change, he hence, maintained no motivation to promote it (Bethune, Hutler 1998 14-16).
Ultimately, airline management demands leadership, a concept perhaps best understood by Joseph Rost. In his publication Leadership for the Twenty First Century, Rost defined leadership as, a dynamic relationship based upon mutual influence whereby leaders and collaborators unite in the common purpose of achieving success, whereby through their intentional efforts, both parties advance with heightened motivation, promoting, moral development as they facilitate tangible, positive change (Rost 1991 283).
Thus, motivation for enhanced management, in any industry, almost inevitably demands an incentive. Alan Deutschman from Fortune Magazine recommends that the airline industry, create an incentive for employees to share in the savings, process when implementing cost reduction strategies (Deutschman, 1991 79). The consolidation of a collaborative compromise, through mutual compensation, may offer sufficient incentive to stimulate development, and thereby enhance operational management at various administrative levels.
Therefore, to ensure reasonable economic and environmental outcomes, the aviation industry demands enhanced operational management of its airlines. Boeings Bill Glover understood this reality, with apparent clarity as he underscores the significance of superior organization, advocating a philosophy that incorporates, better planning and improved flight operations for airlines, through independent oversight (Hamilton 2007 10).
Seasoned financial consultant and nationally acclaimed author of several prominent publications, Harry S. Dent Junior seems to espouse a similar view, identifying radical organizational changes accompanied by sizeable, investments in infrastructures, as supposedly, the best means for subsequently addressing imbalances confronting contemporary society (Dent 2009 349).
As a global economic force, the airline industry obviously remains no exception. Independent efforts to more effectively streamline flight operations and coordinate initiatives that facilitate environmental efficiency, not only help mitigate mounting fuel costs, but prove instrumental in preserving the sustained longevity of operational management for commercial airlines.
Though, again, cooperative incentive remains the key. Flight personnel need the assurance of personal benefit to embrace operational development. The LaLa Lajpatrai College verbatim defines assurances as, the ability to convey trust and confidence (LaLa Lajpatrai College 2010 34). Essentially, they need an incentive. To acquire the trust and confidence of flight personnel, airlines need an incentive for its workers through encouraging responsibilities. It all starts with diplomacy. How Consider the collaborative initiative coordinated by Gordon Bethune for Continental Airlines.
Deploying diplomacy, Bethune designed a strategy that proves equally advantageous for both airlines and customers, delegating responsibility to employees, who decisively determine infrastructural functions within their discretion, because, as he reasons, approximately, 95 of people remain inherently optimistic, graciously accepting opportunities with gratitude, which thereby helps them more effectively prioritize, effortlessly establishing a balancing act that distributes benefits among all, as they eventually become strong leaders, managing operations successfully between, themselves, (Bethune, Hutler 1998 110, 112). Though this inference may seem a bit overstated, the strategy remains structurally sound. Consider the following example.
Southwest Airlines embodies this principle. Unafraid to offer people lacing experience, big, big responsibilities, Southwest Airlines challenges many such people, who evidently, rise to the occasion, transcend expectations, promoting its advancement (Frieberg, 1996 126). For example, seeking renovation of its corporate headquarters, aspiring to innovatively refashion the buildings interior in an architecturally beautiful way, Southwest Airline summoned Robert Dorsey, who almost overnight designed it himself. A precocious prodigy, Dorsey remained determined to persevere. Indeed, he succeeded. The executive planning committee congratulated him with unanimous approval.
Thanks to Dorsey, business blossomed. Recognizing his resourcefulness, Southwest Airlines thereafter appointed Dorsey as its project construction manager. Hence, if not for the ideal principles of incentive advocated by Southwest Airlines, harnessing its hardest workers, simple, ordinary people, exploiting them advantageously, in an environment that transforms them into brilliant, extraordinary leaders, such an achievement remained virtually impossible. Both Continental and Southwest Airlines seem to intuitively understand the purpose-driven power of perseverance that lofty leaders emerge from modest means, within their own historical framework, when encouraged with incentives. Why History produces the most favorable conditions for a quintessential leader to emerge.
Leadership is not a position of power. People are not simply born into leadership. Likewise, leaders are not determined by personal status but rather shape andor become shaped through the sociological context of individual circumstance, which inevitably influences their purpose (Gardner 1990). Rather, people influence leaders, as leaders influence others. At Southwest Airlines, sometimes assertive influence originates from people other than the executive officers. For example, employees participating in the Fuel from the Heart program accepted pay reductions to offset escalating prices, without permission or authoritative instruction by persons with power (Frieberg, 1996 303). These people asserted leadership when the opportunity emerged, sacrificing themselves, for company advancement, and everyone else involved in it.
As Southwest Chairman, Herb Kelleher verbatim proclaims, Our people have determined not to regard title or position as especially important because they wouldnt be as free to make things happen, (Keheller 1991 12). Essentially, positions of title often hinder the freedom for others, specifically, those persons sufficiently determined to persevere through their creative, entrepreneurial spirit. Why Leaders create the incentive for others to prosper by assigning positions of responsibility. Those persons who then assume responsibility, through their individual determination, eventually become assertive leaders themselves, facilitating opportunities in much the same way as previously provided to them.
How do you think unseasoned professionals like Dorsey achieve such unprecedented success Granted, Dorsey possessed superior intelligence. However, he achieved such a position of prominence, not purely through intellect, but with perseverance. Almost anyone, regardless of natural aptitude, possesses the ability to attain such leadership, with healthy optimism, accompanied by an enthusiastic, intellectually curious attitude, determination, and through these qualities, education. People must recognize the gift and activate it within themselves to achieve personal success.
If only every airline, executives in the highest ranked levels of management, and employees working with them, recognized this aforementioned principle. Why Customers appreciate empathy. Empathy, the ability to be approachable, by psychologically identifying yourself with the concerns of others through care and compassion, involves treating customers as individuals, (LaLa Lajpatrai College 2010 34). Companies achieve empathy with a pleasant, knowledgeable staff that adapts to the special interests and concerns of their customers simply by listening. Leadership begins when reasonably intelligent, ambitious workers, confident in their aptitude, competently harness their faculties to empathize with customers and address critical concerns, as professional representatives of the corporation.
Like Continental Airlines, Southwest Airlines also espouses the notion that people flourish when endowed, more responsibility to develop their strengths and grow, as scholars Kevin and Jackie Frieberg stipulate in Nuts Southwest Airlines Crazy Recipe for Business and Personal Success, a story summarizing the spectacular history of Southwest Airlines (Frieberg, 1996 126). Indeed, the implementation of independent oversight, as recommended by Glover, Dent, and Bethune, among others, provides a means to motivate workers, facilitating privilege through heightened personal responsibility.
Indeed, true leadership emerges as people unite in common purpose and cooperate to achieve a collective goal, financial success, by pursing their own independent operations. These individual leaders learn thereby teamwork, exploiting their authoritative status in a way which promotes collaboration, ultimately serving the greatest interests of airlines, its workers, and clients, establishing economic prosperity for all parties. Why Leadership requires collaboration. Leaders, individuals entrusted with responsibility of direction, work together to help others recognize the collective goal, that through commitment, personal agendas become encompassed by a shared purpose, achieving financial success (Frieberg, 1996 299).
Consequently, the organization of sovereign leaders enables airlines to connect with their targeted customer base, strengthening management capacity, while slashing costs. How With greater executive command distributed fairly throughout the hierarchy of airline management, among various departments, people function more independently, weakening union power over flight preparation and operations.
Though unionized labor comprises approximately, 84 of its workforce, Southwest Airlines effectively negotiated contracts that permit flexibility in implementing system operations, as workers surpass, previously defined job categories, assuming whatever roles necessary for promptness, to get flights out on time, which thereby economizes expense, and saved an unbelievable, 1.3 billion on capital expenditures during 1995 (Frieberg, 1996 57, 60). This agreement between Southwest Airlines and unions resulted in lower fares for customers, consequently permitting shareholders to capitalize.
The primary purpose of such enhanced organization and efficiency, at least for airlines, serves to reduce operational costs. After all, operational costs remain, a critical part of airline management especially in this struggling economy (IATA 1 1997-2010). In 2008, an Air Transport Association study already concluded that fuel comprised, more than 35 of airline operating costs, and constitute, 15 even during periods characterized by lower fuel costs (Langston 2009 1).
Of course, leadership means nothing without innovation. Enhanced airline management efficiency necessitates the leadership of many determined people consolidating creative strategies through their entrepreneurial spirit. Originality becomes the key. Airlines must think outside the box, if they wish to outperform their industrial competitors. A strategy that transcends traditional methods, usually offers innovative solutions to pertinent problems.
For example, Southwest Airlines in an, unconventional, nonconformist approach, modified its ticket stock by inscribing the words, THIS IS A TICKET instead of following the crowd, other airlines, which perhaps spent about, 2 million when customers complained of losing their tickets. Likewise, by not subscribing to the computer reservations system, Southwest Airlines also saves millions of dollars per year (Frieberg, 1996 56-57).
Like Southwest, other airlines, and the airline industry in general, needs to distinguish itself, with unorthodox strategies, for competitive survival. Industries require sheepherders, not sheep. This principle epitomizes the social Darwinist theory of natural selection, survival of the fittest. Only the economically fit survive. Staying fit, competitively sustainable, requires innovation. Strive to become the pioneer. Leadership depends on innovation cause, without it, minimal incentive exists to achieve prosperity.
Therefore, airlines demand a multifaceted management approach to minimize the mounting fuel costs instigated by modern economic trends. The airline industry needs to consider all angles. As with any industry, airlines seek to maximize profit, increasing revenue, while simultaneously diminish expenses. Airlines may achieve this aspiration in various ways. Perhaps a reduction in marketing communications materials, such as, statements to promote cheaper programs offers one particularly prominent advantage (de Boer 5 2008).
Marketability maintains significance. According to Bethune, marketing constitutes a necessary aspect of airline operations. Hence, CEO of Continental Airlines, Gordon Bethune sought to revitalize airline operations, initially, by reforming its marketing department. He immediately realized the need for effective exploitation of a superior product, and seized it to his advantage.
With marketing as a prerequisite, he simply, could not change airline operations without first controlling, how the product was presented, because good operation obviously depends upon top quality services, to economically maximize productivity and profitability (Bethune, Hutler 1998 16). Through a multidimensional marketing stratagem, airlines maintain the infrastructural muscle to massively mitigate mounting management expenses.
Business savvy companies possess the capability to economize, considerably cut management costs, without compromising travel, or significantly reducing its convenience, simply by negotiating agreements with companies that almost inevitably guarantee enormous savings. For example, airlines may compromise to arrange approximately, 45-60 discounts on regular coach fares, and acquire an estimated 40 reduction in hotel room rates (Deutschman, 1991 79). Refer to section 4.2 for further discussion.
The concept of charity also coincides with innovation, and proves immensely resourceful. Airlines may coordinate philanthropic programs, opportunities to help others without compensation, material or financial expectations. The volunteer initiative of social entrepreneurship offers an altruistic marketing strategy designed to attract many underprivileged clients, which may indirectly generate revenue. For example, Southwest Airlines implements a community outreach system known as Home for the Holidays which donates tickets to senior citizens, so they may fly home and visit relatives. For over 2 decades, by targeting the elderly demographic, and reaching their specific needs, countless senior citizens managed to reconnect with friends and family. As a testament to its unprecedented success, in 1986 and 1987, President Reagan acknowledged Southwest Airlines for this program (Frieberg, 1996 238).
Misconceptions Surrounding the Airline Industry
Airlines retain a reputation especially distinguished among, the most efficient of all energy intensive sectors in our modern economy (Luft 2006 19). Throughout its history, commercial aviation demanded the most fuel efficient aircraft possible, and directed engine manufacturers to incorporate methods that reduce fuel consumption (Algoe 2010 3). Yet, others argue otherwise. Some people entirely disagree with the previous claims though offer no support for their arguments. For instance, the environmental community complains about excessive CO2 emissions produced by airlines, without any reasonable support for their biased claims. Yet, the 2-3 CO2 emissions produced by airlines, barely constitutes anything of paramount significance, and seems inconsequential when compared with other transportation trends, such as the automobile industry (Hamilton 2007 10). Additionally, the U.S. airline industry supposedly remains responsible for only 11 of greenhouse gas emissions, in contrast to automobiles, which comprise approximately 56 as professed by an Federal Aviation Administration (FAA) report (Gonzalez 20072). Hence, the environmentalists subscribe to a flawed argument. Yet, they remain unflinching in their position.
Some environmentally motivated institutions even attempted to associate airlines as supposedly responsible for global warming (Hamilton 2007 10). They seem to depend on the unwarranted assumption that industrialization primarily influenced climate change, without considering any positive advances resulting from technological development. By neglecting the potential benefit of technology, these stubborn advocacy groups, overlook other reasons more likely responsible as contributing factors to environmental decline.
Contrary to popular opinion, technological advances of the manufacturing process in recent years facilitated enhanced efficiency, decreasing disposable waste. Despite a 12 percent increase in passengers, accompanied by 22 more freight, aviation CO2 emissions for the U.S. declined approximately 4 from 2000-2006 (FAA 20061). With a 70 improved fuel efficiency from aircraft produced 40 years ago, the aviation industry managed to suppress its efficacy by 1 annually for 30 years, translating into savings that supposedly surpass an astounding, 80,000 gallons of fuel per year, every year, (Luft 2006 19).
Furthermore, federal legislation only further facilitated fuel efficiency, through congressional enactment of the 1990 Clean Air Act, which required EPA regulations to minimize industrial emissions, as permitted by technology (Schubert 2004 665). Elaborating upon standards previously institutionalized by the Clean Air Act of 1970, which, strictly regulated emissions from factories and motor vehicles recent legislation serves to promote utilization of renewable energy sources (BowmanKearney 2008 483, 485). Though inherently economical, at that time the initiative primarily focused on health considerations, in stark contrast from technological feasibility or economic costs, as emphasized today, vis--vis fuel expenses for airlines (Blackford, Kerr 1994 329).
Meanwhile, the diverse environmental regulatory functions, orchestrated by President Richard Nixon, who sought to establish compromises at various governmental echelons, proved particularly pivotal to subsequent political sanctioning as well. Thus, established in 1971, the Environmental Protection Agency (EPA), as introduced under Nixon, became a cohesive interdependent system, one that simultaneously summoned all three governmental branches, the implementation, legislation, and interpretation of regulations, to help reduce pollution, which promoted significant improvement even at local levels for interstate airline businesses.
Hence, at a domestic level, the federal government facilitated technological advances to stimulate constructive environmental initiatives, which also proved instrumental thereafter in airline operational management. The Nixon Administration institutionalized a precedent which proved immeasurably beneficial to airline management as EPA policies stimulated legislation that considerably cut fuel costs in future years.
Objectives
Concerning the rising of oil price, this paper maintains four fundamental objectives enumerated explicitly as follows
In its purpose, paper primarily intends to institute a guideline for airline operators in managing increased fuel operation cost resulting from increased fuel price.
To refute fallacies and resolve common misconceptions regarding fuel prices
Provide an accurate appraisal of commercial standards implemented in the airline industry
Using the non-participant observation method, collecting data while simultaneously analyzing qualitative information from miscellaneous materials, including journals, books, magazines, online sources, etc., this paper provides detailed analysis concerning fuel costs, operational expenses, and strategies to minimize exorbitant expenditures.
To reduce operational costs and still prevent employee lay off
To deliver a comprehensive guideline for airline operators in preparing the costs reduction program for 2010-2011 period.
Outcomes
Despite its increasing dependence on transportation sectors, especially the airline industry, oil also heightens environmental concerns as the application of fossil fuel catalyzes global climate change. Additionally, since fuel costs comprise approximately 31 of total airlines, a well established guideline that delivers effective strategy to minimize operating expenses remains pivotal. This guideline, which endorses International Air Transport Association (IATA) recommendations, incorporates the following alternatives as a potentially strategic solution to mitigate mounting fuel expenses for commercial airlines in modern society. IATA proposes a four-tiered plan to reduce fuel expenses.
IATA - Four major areas for costs reduction
IATA estimates that in 2009, the total costs that airline spending surpasses US464 billion (2009) in which 25 (US116 billion) constitutes fuel. Due to the excess expenses stemming from fuel costs, IATA Green Teams organized a fuel potential savings plan, which enumerates as follows
Asset Management
Flight Operations
Technical Operations
Ground Operations
The four former categories constitute a financial savings budget, which primarily serves to reallocate fuel expenses. In time, such a strategy helps reduce long term operational costs. A straightforward strategy, this costs reduction plan optimizes operation management. Recognizing the unnecessary investment typified by traditional bureaucracy, IATA structured an ideal four-tiered cost reduction plan, one designed to considerably cut expense without compromising profitability. Thus, for five years IATA consistently managed to economize, through its implementation of these four aforementioned categories (IATA 2010). Using the four areas of operations as previously listed, IATA Green Teams managed to develop, Operational Cost Reduction Initiative (OCRI), an innovative organizational program which provides several services, including
IATA Guidance Material
Training Courses
Checklists and Scorecards
On-site assessments (GO Teams)
Remote support (benchmark data, website, telephone conference, etc.) (IATA 2010).
As implemented by IATA, this rigorous routine represents offers a reasonable system to decrease operational costs. However, this system also facilitates flexibility, offering airlines the ability to customize objectives in a manner most favorably suited toward its individual needs.
Hence, through its prudent approach, IATA produced an innovative program, one that prioritizes, discriminating between options, in a way perhaps most consistent with Bill Glovers independent aims, and other similar commercial airlines seeking self-sufficient ways to minimize operational costs.
Amadeus Implementation of IATA procedure
Testifying to the flexibility of these assessment measures, Amadeus already assumes an assertive approach, creatively emulating IATA and its clever cost efficiency principles. Incorporating IATA protocols, Amadeus, an active IATA Simplifying the Business Strategic Partner represents the future of operational cost reduction innovations (Amadeus Airline IT Group 2009 1).
Emphasizing global innovation, particularly for the commercial airline industry, Amadeus more than merely subscribes to IATA. Rather, through its collaborative role, as consolidated by IATA, Amadeus harnesses advanced technological solutions to improve operational expenses for airlines. Amadeus distinguishes itself at the forefront of aircraft management. Whereas IATA aspired, Amadeus achieved, translating theory into action.
Airlines demand a sustainable model custom tailored to suit their agendas. Amadeus accomplishes those aims. How With its reputed Global Distribution System (GDS), as the preeminent, industry-leading IT systems for airlines Amadeus offers numerous technological advantages, implementing policies that, help airlines to maximize sales, enhance yield and cut costs through increased efficiency, streamlining processes, from end-to-end by shortening wait times at airports, providing greater self-service options, and permitting enhanced baggage management, while simultaneously, integrating the sale of ancillary services with existing processes, (Sritama 2009 2-3).
Epitomizing innovation, Amadeus features just the ideal brand of professional opportunity that airlines may need in seeking to minimize ever-increasing fuel expenditures. Amadeus, in its operational management strategy, helps its clients, adapt, grow, and succeed in the fast changing travel industry, (Amadeus.com 20092). Most importantly, Amadeus reduces unnecessary operational costs by advantageously exploiting increasingly abundant technological resources. It accomplishes these objectives by subscribing to a specific arrangement of operational processes, organized into the following categories.
Schedule management costs A cost reduction plan that promotes business policy, organizes new schedules, and re-accommodates individual passengers, while simultaneously manages unanticipated seasonal schedule changes (Amadeus Airline IT Group 2009 1). This technological strategy offers simplified way to inventory information, immediately documented into the computer database, for easily accessible reference, available almost anytime.
Distribution Costs A cost reduction plan designed to facilitate, implementation of optimized distribution strategy (maximizing margin per customer) which effortlessly integrates direct and indirect sales channels, incorporating technological access, such as internet purchases. This sterling strategy not only eradicates, passive bookings costs with Amadeus travel agencies by promoting flexibility and convenience for customers, who may now purchase orders at their independent discretion, but permits, cost effective direct online channels, which, when accurately implemented, dramatically reduces ticketing costs, transitioning from traditional customer processing, recently rendered obsolete, toward, 100 e-ticketing thereby effectively, ensuring e-ticket synchronisation (Amadeus Airline IT Group 2009 1).
The computer immediately synchronizes customer information, providing immediate on-line order confirmation of airline travel services. The internet becomes a resourceful engine for communication, simplifying correspondence between customers and flight agents, via email. Hence, the distribution costs approach not only reduces operational expense, but offers a solid, profit maximizing option, attracting many diverse consumers, some who previously lacked patience to visit travel agencies, or simply wished for some quicker, more expedient approach.
Servicing Costs Servicing costs function to reduce expenses associated with serving regular travelers, managing costs in a way that effectively accommodate them, and perhaps those of your partner who frequently supervise airline services. Thus, by carefully scrutinizing servicing costs, Amadeus assumes a bold approach to drastically diminish costs associated with codeshare customers and previously unaccounted for codeshare discrepancies (Amadeus Airline IT Group 2009 2). Codeshare, as defined, involves an interline partnership between airlines, whereby one carrier markets services transfers its code to a different airline carrier flight, often resulting from travel limitations in destination, sometimes unavailable, by the former airline carrier (ABC News 2005 1). It also offers the opportunity to increase service rebates and discounts reducing costs for subsequent ticket changes.
Check-In and Airport Servicing Costs Amadeus particularly flourishes in this department, simplifying agent check-in process and developing self service check-in, while simultaneously prioritizing, discriminatively selecting, the most appropriate customers for transfer or offload, to minimize potential overbooking costs. Likewise, the system reduces costs for check-in customers from alliance partners and expenses incurred as a consequence of flight delay.
Additionally, eliminating cost penalties imposed by automating regulatory checks Amadeus again employs a psychological prioritizing system that selects only personalities most suited to handle automated processing, which offers another means to effectively allocate the budget, minimizing disruption management costs occasionally demonstrated among dissatisfied customers (Amadeus Airline IT Group 2009 2). With a system like Amadeus, airlines learn to more appropriately, refocus their attention on customers, by offering, self-servicing kiosks living (LaLa Lajpatrai College 2010 18). Such a system addresses multiple interests, many people, with increased alacrity.
Load Planning Costs With painstaking precision, Amadeus assumes responsibility for pre-flight preparation, calculating cost reductions attributable to, flight departure by automating weight and balance incorporating particular precautionary measures that precipitate the overall flight process, preventing delays sometimes instigated by load planner mistakes (Amadeus Airline IT Group 2009 2).
Training Costs Through thorough preparation and planning, the training costs process reduces requisite training expenses to properly educate pilots, flight personnel, and operational employees, appropriating graphical user interfaces, with a manual that facilitates masterful manipulation of work flows (Amadeus Airline IT Group 2009 2). Thus, Amadeus enhances competence without compromising operational management. It promotes efficiency without exceeding its budgetary constraints.
Communication Costs The Amadeus community maintains a close correspondence with its partners to considerably cut communication costs, minimizing unnecessary messaging and wasteful expenses.
With its budget, subdivided into various segments each assigned specific functions, Amadeus maintains essentially the same system introduced by IATA. It performs various functions in accordance with IATA protocols. For example, Amadeus effectively utilizes IATA guidance material to calculate costs associated with schedule management, service processing, and load planning, matriculating information into computer database for flight personnel, which provides immediate, easily accessible instruction.
Recall toward the end of Section 2.7, page 32, a brief introduction to cost reduction strategies. Apparently, following the cost reduction strategies previously presented by IATA, Amadeus incorporates innovative ways to shrink travel expense. For example, Amadeus establishes fair bargains with companies by compiling, hard data assessing the number of flights people take between cities, including time spent in at each place, amassing facts about company travel patterns to consolidate bookings which become processed into a computerized management information system, that generates statistics (Deutschman, 1991 79).
Amadeus coordinates a necessary training course for new personnel, as aforementioned, accompanied by various checklists, onsite assessments, and remote support to also efficiently organize data. The Distribution and Check-InAirport Servicing systems implemented by Amadeus tabulates data, carefully consolidating calculations into spreadsheets, equipped with automated devices, and knowledgeable computer personnel to provide competent, reliable service, such as onsite assessment through technical quality assistance.
Moreover, to ensure appropriate asset management, Amadeus meticulously monitors scheduling, distribution, and servicing costs, by following its balanced budget, to condense costs associated with airline operations. By shortening costs attributed to load planning, training, and communication, Amadeus considerably enhances flight operations, integrating superior technical operations with properly equipped technicians executing ground operations, which guarantees greater satisfaction for general consumers. Hence, Amadeus epitomizes the IATA management ideal, translating innovative programming into effective action.
A smart, tech-savvy solution, Amadeus blends traditional service with mechanical efficiency, targeting customer convenience, using computerized systems to promptly address their concerns. Thanks to Amadeus, Thai airways already witnessed a 200 increase in online bookings (Amadeus.com 2005-2009 1). Envision the world wide productivity if every airline used Amadeus.
Globalization - Harnessing Alternative Fuel
In terms of oil consumption, customers reduce dependence on gasoline to minimize the costs associated with automobiles. Nonetheless, the investment of hybrid cars perhaps proves to be a more energy efficient investment. An increasing need for hybrid vehicles, and other alternative energy sources to sustain transportation, derives largely from the fact that American cars, as currently designed, deplete oil reserves. Transportation comprises approximately, 70 of petroleum produced in the U.S., with cars, dominating oil consumption, (Juhasz 2008 16). As diminishing resources continue to dwindle, industrialized nations desperately demand alternative sources of energy for economic sustainability, achieved primarily through innovations that spur technological development.
After all, as Friedman astutely observes, development is a voluntary decision (Friedman 2004 313). Hence, people possess free-will, through their own efforts, to influence the fate of development, as perhaps best summarized in a pithy aphorism presented by H.S. Dent, which he verbatim asserts, You cant change the direction of the winds, but you can reset your sails (Dent 2009 19). Circumstances often exceed personal control. However, as aforementioned in Section 2.7, page 27, history produces the most favorable conditions for leaders to emerge. Society demands scientific investigation. The recent decline of resources requires people to pursue opportunities, and discover new technological applications. Within the context of contemporary circumstances, nations must function collectively as independent leaders to promote positive changes in society, since globalization demands it.
As issues become increasingly apparent, nations may soon realize the effectiveness of global cooperation, establishing equitable agreements among, political institutions, which remain almost indispensable for, continued prosperity, (Dent 2009 349). The advent of globalization in contemporary society, an interdependent connection between nations through international relations involving business and politics, offers such incentive for subsequent scientific discovery. Obviously, technological advances not only facilitated global integration trends over the past 50 years, but served as a catalyst, major milestones that increased transportation technology, which eventually permitted higher standards of living (LaLa Lajpatrai College 2010 14).
Dent contends a conspicuous need for revolution in business and political organization sufficient to compel initiatives that challenge the current oil crises (Dent 2009 349). Globalization forces nations to exercise diplomacy and unite in the common cause of alternative energy solutions. A collaborative consensus consolidated between governments and private industries, driven by conscious efforts, provides the ideal opportunity to capitalize upon scientific exploration, possibly catalyzing immeasurable technological innovations.
At the forefront of 21st Century modernization, increased technological advancement and industrialization, resulting from globalization, serve to encourage invaluable discoveries in future years. Accompanied by this resurgence in scientific discovery, economists ponder the probability of accessing oil reserves at previously unattainable depths (Ekelund, Tollison 1994777).
With this significant surge in industrialization comes the emergence of a new Renaissance, stimulating alternative solutions for modern civilization, as people become enlightened, possessing enhanced sophistication to access and utilize information.
However, harnessing such alternative sources remains an unrealistic proposition at present, and certainly not to the advantage of commercial airlines. Evidently, outside the Middle East, acquisition of remaining oil, continues to become, more technologically difficult, expensive, and environmentally destructive, perhaps proving, far more energy intensive and ozone depleting than traditional oil production methods, thereby worsening global climate change conditions (Juhasz 2008 15). Again, the main problem apparently lies in refashioning alternative energy sources to suit technological capabilities of aircraft engineering.
Still, alternatives exist. Scientists already began to implement innovative strategies. For example, although not yet sustainable, one factory in Missouri, through a process known as thermal depolymerization, managed to transform, turkey bones into crude oil, and consequently produced, over 7 million gallons of bio derived oil, (BowmanKearney 2008 486). Therefore, technological innovation remains the force to drive higher standards of living, likely slowing environmental and economic complications for commercial airlines, as society becomes increasingly advanced, absorbing knowledge previously unavailable.
4.4 Research methods
This paper, a comprehensive guideline for airline operation management, incorporates qualitative approaches, research implemented through observation. Observation plays a pivotal role in the collecting of data to assess actual real-life scenarios. This method also offers comprehensive understanding about the psychological and ideological perceptions of those studied, determining their reaction in a given situation. Research employs a non-participant observation method especially by analyzing qualitative information from journals, books, magazines and other miscellaneous resources. None of the subjects mentioned volunteered to engage in any experimentation.
Moreover, the guideline employs an indirect approach to retrieve data, which means that any information obtained remains secondary in nature. Most importantly, observation provides researchers an invaluable sociological approach to more effectively understand the subjects under scientific inquiry, and perceptions of people studied.
However, since observation assesses personal perception, the research presented inherently contains a certain extent of bias. Therefore, this guideline intentionally incorporates a vast range of corroborative evidence to minimize prejudice and maximize accuracy. Hence, all conclusions elicited throughout the paper, remain well-supported, documented extensively by available facts and statistical data.
Furthermore, to facilitate comprehension, this guideline provides research derived from my company, offering a sociological context of observation, substantiating theories, with actual tangible experience in the vocational environment. The supplementation of professional examples not only supports academic research but further reinforces understanding, offering a more personal, humanized interpretation, as witnessed through real-life situations. Hence, analysis integrates various reference materials including electronic journals, scholarly essays, government archives, viable internet sources books, etc., as resources relating to oil and the airline industry.
People depend on oil, almost as a necessity for transportation purposes. Despite its decline in recent years, the need for oil remains unchanged. Yet, such depletion of oil and other nonrenewable resources remains an increasingly relevant global concern, affecting the airline industry.
Macroeconomics seems to suggest a strong decline in the demand for oil, which if left uninhibited, may prove devastating, particularly to commercial airlines, likely signaling their demise. Of course, without sufficient technological capacity at present to accommodate alternative energy sources, or counteract the skyrocketing oil prices, circumstances at present look bleak for commercial airlines.
However, people possess the ultimate decision to inevitably drive and determine humanitys destiny. The establishment of novel programs, such as IATA protocols, provides an inspiration for airlines seeking to refashion internal infrastructure and cost management. Yet, such inspiration necessitates an incentive through cooperative, collaborative consensus, consolidating creative compromises between airline employees and customers.
As for the airline industry, its survival overwhelmingly depends upon a compelling obligation to discover feasible energy efficient alternatives. Success demands innovation through leadership. Airlines require the determination of intelligent leaders, to facilitate transformation, translating theory into action, implementing feasible economic approaches appropriately tailored to suit transitioning technological trends.
This essay offers just the insight needed to improve commercial airline operations, a comprehensive instructional guide prescribing practical measures for professionals seeking advancement. When followed with prudence, the guide furnishes a foundation to facilitate enhanced industry operations. Assuming an interdisciplinary approach, analyzing assessing the economic, environmental, and technological trends in its management operations, this guide offers invaluable advice to help mitigate the mounting expense of fuel for airlines in modern society.
