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VBD Management Report

1.0. Introduction

Customer satisfaction refers to the extent through which the services and/or products offered by an organization meets or surpasses the consumers’ expectation. According to Gounaris and Boukis (2013) a higher level of customer satisfaction is positively associated with the performance of the organization. Satisfied customers are likely to be loyal to the organization and make future purchases thus translating to higher profitability (Khan & Haseeb, 2015). In the current case, the Upward Airlines organization has reported a reduced level of customer satisfaction in its provision of flight services to students and travelers within and without Australia. The current report presents and analyses two major underlying causes of the reduced level of customer satisfaction. The report also present the possible solutions to the problems identified as well as the recommendations that needs to be adopted by the management of the company to improve their customer satisfaction levels.

2.0. Analysis of the Problem

This section presents the analysis of the issue of reduced customer satisfaction as reported by Upward Airlines. The underlying cause (s) of the reduced level of customer satisfaction is also presented using the principles and concepts of the functions of management.

2.1. Problem Identification

The major underlying cause of the reduced level of customer satisfaction is the failure by the organization to incorporate e-business strategy in their operations. It is reported that the expectations of the customers is largely influenced by the changes on the business environment (Phillips & Moutinho, 2014). According to Oliver (2014) the advancement in information technology has led to the changes in interaction between travelers and flight service providers that every organization needs to comply with to meet the expectation of the customers. The failure by the management to set in place scenario plans that takes into considerations the changes in business environment led to their inability to improve the quality of their services through the adoption of B2C e-business strategy, thus leading to reduced customer satisfaction.
The provision of poor quality services to the customers have also contributed to their reduced level of satisfaction. The flight booking services, luggage handling and provision of assistance and meals during flights have failed to meet or surpass the expectations of the clients. According to Haines (2016) the nature of power adopted by the managers to the organization has failed to influence positively the employees of the organization. The managers have mainly focused on the adoption of the position power that mainly entails the use of rewards, coercion or legitimacy to get things done by the staff. As Munari, Ielasi & Bajetta, 2013) indicate, relying on the position power approach can only lead to temporary compliance with the rules and regulations set. The employees are likely to go back to their normal ways of providing poor quality services if there are no rewards, coercion or authority from the managers. The use of position power in managing the employees is therefore not effective in influencing them to offer quality services to the customers that are likely to meet their expectations.
2.2. The Underlying Causes of the Organizational Problem
The position power approach is not effective in influencing the employees to comply with the set regulations of work over a longer period of time. According to Prayag, Hosany and Odeh (2013) the provision of rewards, coercing the employees to work, or giving authoritative orders can only influence the employees to work in accordance with the set regulations over a short period of time. In the absence of the above mentioned forms of power from the management, then the employees are likely not to comply with the rules set hence offers poor quality customer services. Torres and Kline (2013) have indicated that the employees are only likely to perform and interact with customers appropriately if they are promised rewards, ordered or coerced to do so. There will be no consistency in the provision of quality services with the adoption of the position power approach in influencing the employees to act (Popli & Rizvi, 2016). When left unresolved, the adoption of the position power by the managers will influence the employees to offer quality services temporarily and will lead to the provision of poor quality services in the long run that are likely to affect negatively the satisfaction of the customers hence reducing the overall organizational performance.
B2C e-business strategy entails the use of the internet in various transactions and communications between the business and customers. Many flight organizations are considering the adoption of the e business strategy to communicate with the customers, respond swiftly to the queries, and provide an opportunity for them to make online bookings Dabholkar and Sheng (2012). The approach is more convenient to the customers hence they are likely to move to service providers that have put in place the strategy (Veasna, Wu & Huang, 2013). The e-business strategy is therefore critical to the organization since its adoption or abolition will influence the number of clients that the company is likely to retain. In case that the issue is not resolved then the company will not only report a reduced customer satisfaction level but will equally loose a considerable number of clients.
Proposed Solutions
The management of Upward airlines needs to adopt personal power to get things done. According to Hsiao, Lee and Chen (2015) personal power is the ability used by the manager to get things done based on how they are viewed by others. The managers should have adopted the expert power and the referent power that comes from the personal qualities of an individual. The expert power focuses on influencing the employees to act through special expertise (Namasivayam, Guchait & Lei, 2014). The managers should have convinced the employees to comply with the regulation set when dealing with the customers by being an expertise in the interaction process in way that the other employees recognize and copy their expertise in doing the same. Referent power focuses on the ability of influencing the employees to act through identify (Cina, 2013). The managers should have developed a good charisma when dealing with the customer such that the other employees follow sought. This could have resulted into their compliance with the regulations set in a way that they constantly offer quality services when dealing with the customers.
The organization also needs to have strategic plan that take into consideration the possible changes in business environment that are likely to be reported. In the formulation of the long-term goals, the management to the organization needs to look ahead, understand the nature of the environment and evaluate the possible changes that are likely to occur, and develop a plan that will ensure the organization remain competitive regardless of the possible changes in the business environment. Strategic plan should have included the long-term goal of implementing an e-business strategy in the management of business activities.
Scenario planning is planning tool that should have been adopted by the organization to identify the alternative causes of actions that can be implemented to accomplish the strategic plan. Scenario planning provides an opportunity for the management to implement different plans depending on the changing business environment (Kara, Uysal, Sirgy & Lee, 2013). As such, the organization is likely to be more prepared for any changes in business than its competitors.
The management should have also constantly analyzed the external business environment. Through the use of the porters five forces analysis, the management to the organization ought to have established the changes in the bargaining power of the customers so as to know whether there is need to improve the quality of the services/products offered or not. Moreover, carrying out SWOT analysis for internal business analysis was also important to identify the threats to the organization that needs to be managed and the opportunities that ought to be exploited. Analyzing the external and internal business environments would have ensured that the company sets an appropriate scenario plan that would have ensured they introduced the e-business strategy in their operations to enhance the level of customer satisfaction.
4.0. Recommendations
Upward airline organization has reported a reduced level of customer satisfaction due to its failure to incorporate a scenario plan and the adoption of a position power approach in getting things done. The company needs to adopt the following recommendations to improve their customer satisfaction levels
Implement a personal power approach in getting things done. It is recommended that the managers interact actively with the customers when offering flight booking services and responding to their queries. A high level of expertise in doing so needs to be shown such that their knowledge, skills and understanding can be easily copied by the other staff. Moreover, the managers need to adopt referent power to influence the employees to act through identification. As Hsiao, Lee and Chen (2015) indicate, the adoption of the personal power approach to influence the employees to offer quality services to the customer is effective in ensuring there is a high commitment such that quality services are provided over a longer period of time to enhance customer satisfaction levels.
Adopt the scenario planning technique in developing plans that are capable of managing any changes in technology. It is recommended that the management carries out internal and external business environment analysis to identify the most suitable scenario plans on e-business that needs to be adopted for the organization to be better prepared for any future changes in business technology. According to Kara, Uysal, Sirgy and Lee (2013) scenario planning is effective in improving flexibility and focus. Focus is vital in ensuring that the company knows the needs of its customers and the possible changes in the needs and expectations that have been reported over time. On the other hand, flexibility is important in ensuring that the company is able to adapt to the shifting circumstances on the business environment and to adopt a scenario plan that is in compliant with the changes observed.

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