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Leadership at Etihad Airways

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Executive Summary

The report is an analysis of leadership in Etihad Airlines from various dimensions. First,

there is the assessment of the company's challenges, especially now that the world is facing a

hard time dealing with the outbreak of coronavirus. The company has not been left out in the

interferences the virus has brought and, it has been profoundly affected. Since the outbreak of the

virus, new regulations have emerged that require the company to suspend its flights out of the

nation. Additionally, traveling has become a challenge, and the company has been affected as it

has recorded a reduction in the number of travelers using the airline.

Besides, the emerging Gulf carriers are another challenge facing the company due to the

high levels of competition they bring along in the field operations. Due to reduced revenues,

aligning the company's physical and digital plan remains a challenge. The project needs to wait

until the time customers return to normal or close to their usual numbers. On the

recommendations focus, the company should plan strategically to cover the needs of employees

and measures that will reduce the risk of infections. It should also focus on problems that it can

handle and provide solutions to them rather than stress on those it lacks power and ends up

wasting time and resources. Lastly, the company should maintain communications within online

channels to avoid overworking employees operating on their call centers and reduce queue to

satisfy everyone's needs.

LEADERSHIP AT ETIHAD AIRWAYS 3

Table of Contents
Executive Summary.........................................................................................................................2

Introduction......................................................................................................................................4

Evaluation of The Organizational Challenges.................................................................................4

Reduced Number of Travelers.....................................................................................................4

Competition from The Emerging Gulf Carriers...........................................................................5

Creating Standout Experiences....................................................................................................6

Aligning Digital with Physical.....................................................................................................6

Assessment of Methodologies Implemented to Facilitate Organizational Change.........................7

Pay cut for all Employees............................................................................................................8

Increase Flight for Cargo Goods..................................................................................................9

Payment Holidays Ranged with Lessors....................................................................................10

Evaluation of What Worked and What did not.............................................................................11

Success for Pay cut for all Employees.......................................................................................11

Success for Increase flight for Cargo Goods.............................................................................11

Success for Payment Holidays Ranged with Lessors................................................................12

Recommendations..........................................................................................................................13

Establish Clarity.........................................................................................................................13

Develop Commitment and Awareness.......................................................................................14

Understand the Company’s Capability......................................................................................14

Summary and Conclusion..............................................................................................................15

References......................................................................................................................................17
LEADERSHIP AT ETIHAD AIRWAYS 4

Introduction

Etihad Airways has one of the best leadership systems that focus on helping the UAE

community, mainly during a crisis. Besides, from leading community initiatives, the company

engages in activities that transform the world through traveling. The leaders are also committed

to improving their customers' wellbeing as it also focuses on four primary pillars, namely, global

education initiatives, empowerment through development, humanitarian aid, and stable and safe

housing for the community (Etihad Airways, 2020). The company leadership team has also been

active in various activities in the nation that range from plastic collection to assist in minimizing

the environmental impact of the company operations together with sustainability developments

(Bose, 2018). There is also the approach of empowering other workers in the company the

leaders engage in to help attain goals, working in relation to their missions and vision. The

objective of this report is to assess the leadership of Etihad Airways, the challenges the company

is experiencing currently, now that the word is fighting Coronavirus pandemic, the

methodologies implemented to assist in organizational changes, evaluation of the methods that

worked and those that failed as well as recommendations that will help in fighting these

challenges.

Evaluation of The Organizational Challenges

Reduced Number of Travelers

Since the covid-19 virus outbreak, it has become difficult for the company to operate

since there was a restriction of movement to and from the nation. The airline, whose significant

flights were to Hong Cong, stopped operating, and the company has recorded a reduction in

profits or revenue. As a result, Etihad airlines asked their employees to take paid leaves since
LEADERSHIP AT ETIHAD AIRWAYS 5

there are little operations taking place. Besides, passengers are not boarding the airline since

there is a fear of infections as the company is a global airline.

Therefore, their travel demand has reduced with a considerable number, which is a

challenge to the company. Moreover, since 2019, the company has reduced its direct operating

costs. In recent months, Airberlin is the company that is giving Etihad Airlines an upper

challenge phase since its widening to the European network but has very little productivity.

Additionally, the lossmaking German carrier is challenging the company, as the investment is

just creating more challenges than benefits that were not anticipated in the company (Kamel,

2020). The jet Is operating with lesser prices than Etihad charges, which adds to the problems the

company needs to address as their revenue is dropping with every passing operation of this

investment.

Competition from The Emerging Gulf Carriers

Due to the establishment of Gulf carriers within the region, Etihad Airlines has felt the

impact of the competition in the industry. In response to match up to their competitors, Etihad

invested in other airlines. Now that the movement of goods and services through the air has

reduced, the company is experiencing challenges. This is because the firms it invested in requires

much financial help and management time from the company workers who are required to go on

leave. Additionally, some of the Etihad investment deals have gone sour as its first deal, which

was that the purchase of Air berlin 29% of their stakes have remained a court battle over the

sharing agreement. Due to this, the company wastes resources on court hearings and time, which

are vital subjects now that their profits have reduced. Moreover, managing their time in the

company operations and the firms, they are partnering with services. Since the movement of

people is minimal, the company faces a challenge to travel and hold the required meetings as
LEADERSHIP AT ETIHAD AIRWAYS 6

transportation is also expensive compared to when the world was not experiencing the covid-19

crisis (Massey, 2019).

Creating Standout Experiences

During this pandemic time, passenger air travel is highly sensitive but has low margin

outputs. Since the company is cutting costs and services level, it is coming with a challenging

phase as people are very selective and need a memorable experience. As a result, the company is

facing a challenge to stand out from similar carries that still operate in the same route of

operations. Etihad objects provide their clients with personalized preferences in terms of the

provision of meals, transportation, and present in-flight services. Therefore, this demands the

company to generate a new approach in their system to meet the expectations. In terms of

innovation or technology, there needs to be a cooperative environment, one with customer

services and data of passengers’ preferences. In order to make this a success, the company will

spend the right amount of money, time, and resources. This is challenging since the company has

very little income and the number of passengers, so meeting this new requirement remains a

problem. Therefore, the company will take time to implement this, and other companies who are

well equipped to offer these services take the lead in the operations, thus creating more

challenges to the company and making it hard for them to recover their losses.

Aligning Digital with Physical

For the longest time, Etihad Airlines have been in operations while using off-the-shelf

check-in, which has become obsolete over time. Additionally, this operation the company uses

has reached a period that it is no longer convenient and does not help in the running of saliently

smooth as well as reliable customer services. Customers feel the application is challenging to

comply with, and it's complicated for them. Besides, the application lacks the personalization
LEADERSHIP AT ETIHAD AIRWAYS 7

theme that the company is determined to achieve in the long run. It is becoming difficult to

provide a personalized approach and slowing the digital experience, which is expected to have

great services.

Consequently, the company finds it challenging to achieve this goal since coronavirus

kicked in (The Millennium Project, 2020). As there are very few services taking place, the

technology and innovation sector remains the most significant challenge facing the company

since it cannot engage in these services and personalize clients' experiences. Again, this puts the

company in a vulnerable state since there will be a more reduction of employees experienced

because their application is complex to familiarize with and opt to use other companies. As a

result, the leading team is experiencing a challenge in improving their customers' digital

experiences and promoting their productive level, especially now that they need to spend very

little to save the little revenue they are generating. Furthermore, their old system cannot

accommodate the new company's requirements emerging on a routine basis for vital activities in

their operations like that of contract management.

Assessment of Methodologies Implemented to Facilitate Organizational Change

Etihad airways has for a long time created and implemented certain changes within the

organization, this was done due to the increasing market change in demand and supply of flight

services. The current state of Covid-19 has got many companies in the UAE rethinking their

performance strategy, Tony Douglas the CEO of Etihad aviation group indicted that though the

airlines had reduced its passenger capacity, the situation provided a good opportunity for the

group to restructure properly to give the company the agility to better manage its operation.

Change management is a systematic approach and application of knowledge, tools, and resources

to deal with change the process of change management involves the adoption of corporate
LEADERSHIP AT ETIHAD AIRWAYS 8

strategies, procedures, and technologies to tackle changes that happen within the organization

internally and externally (Weick & Quinn, 1999, p. 361).

Prior to grounding Etihad airways was only operating 40% of its normal flight capacity

and was later forced to shut down after most governments banned the entry of foreigners in their

countries. Etihad airlines is a mid-sized airline and it has different flight configurations making it

highly adaptable after the pandemic, change management is the most important factor within the

company since the company has had to make some changes within the company to reduce costs

within the company.

Pay cut for all Employees

According to Flight Global (2020, p. 1), Etihad airlines has had to cut down cost on the

level of salary in give to its employees, the executive management team received over a 50% pay

cut while the junior staff received over 25% pay cut. This makes it easier for the company to

manage the remaining operations and keep their employees; this is advantageous to the company

in so many different ways. The company will be able to keep its previously trained employees;

employee is an important concept to Etihad airways since the company will not have to incur

more costs in training and development of new employees. All employees working in Etihad

airlines have been trained to deal with challenges and issues facing the company so whenever the

company gets a new employee no matter the expertise or professionalism they will have to adapt

to the working culture of the company. This takes time and during this time the new employees’

performance is average and which reduces the general performance of the company.

The company’s management team resulted to reducing their salary the most to show

employees the importance of this step, employees are likely not to feel any impact to the

reduction of their financial incentives if the same is done to the management as it shows the level
LEADERSHIP AT ETIHAD AIRWAYS 9

of engagement between employees and the management on the importance of conserving the

financial stability of the company. Etihad airways CEO indicated that the reduction of passenger

flights highly affected the company’s work force since most of its employees work with

passenger flights and only a fraction of the total employment sector in the company work on the

freight cargo planes which are the only operating planes in the company today (Flight Global,

2020, p. 1)

Increase Flight for Cargo Goods

Corona virus is a communicable disease that is transmitted from humans and the

cancelation of passenger flights was due to the increasing level of infection on people from

different continents. The main connection between people from different continents is airplanes

or ships which in this case led to the spread of the virus, Etihad airlines decide to adopt more

freight services at this time by releasing more cargo planes to transport goods. The demand for

air shipment of materials has increased tremendously due to the need of other countries to supply

medical equipment’s to other countries; according to Etihad airlines most shipment

transportation services included supplying services to and from China.

Air cargo services in the airline industry are not as common as passenger services due to

the high cost of transporting goods by air and the availability of water transport which is cheaper

and affordable. This change helps the company continue providing services to consumers across

the globe who are in need of goods from other parts of the world, Etihad company choose to

change some of its customer flights to cargo flights to cater for the increasing demand of cargo

transportation across the globe. However, the company has chosen to conserve most of its

passenger flights for service, repairs, and checkups which in future will guarantee the safety

measures of the passenger flights from the company.

LEADERSHIP AT ETIHAD AIRWAYS 10

The company’s management team has done a lot of briefings with the employees to

prepare them for some of this changes, today employees who are still working and those that are

on paid leave trust the company’s decisions and measures it is willing to take to save the

existence of the company. The best type of leadership for thus type of change is the

transformational leadership, and according to PPT 6 (2020 slide, 2), transformational leadership

attempts to create a learning environment for employees on why change is a required concept

with the organization. This charismatically models desired behaviors among employees making

it easy for the organization to initiate change and adopt new operational techniques that are more

aligned to the visions and missions of the organization.

Payment Holidays Ranged with Lessors

Etihad employees are benefited with payed holidays across the globe for their hard work,

however, due to the corona virus pandemic the company has decided to halt any plans of taking

any employees to a holiday. This helps the company save up on cost of operation increasing the

financial capability of the company after the pandemic, the CEO of the company Tony Douglas

is quoted saying that the pandemic will equalize the opportunities in the market since the level of

air carriage right now has reduced equally across all networks. The management of the company

indicated that they have taken this opportunity to strategize on the different ways in which they

could improve their flights and services which will see them earn more customers than before.

The holidays are meant to motivate employees and increase their loyalty to the company,

employee retention is a key aspect in all organizations since it helps the company save up on

costs of hiring and training new employees. Half (2020, p. 1) indicates that it is important for a

company to retain some of its best employees as they are the backbone of the company and have

enough experience in the company's way of operation. Increased employee retention possesses a
LEADERSHIP AT ETIHAD AIRWAYS 11

great challenge to the management of the company since they have to incur extra costs which in

this case might be a lot challenging given the already impact of the Covid 19 pandemic.

Evaluation of What Worked and What did not

The corona virus pandemic is still an ongoing situation and it is not certain which

methods worked and which ones did not, however, from the current progress of the company

probabilities of success or failure in the methodologies applied by the company are visible.

Today, Etihad is looking to reopen its passenger flights on a limited capacity for the few people

who are in urgent need to move. Based on the above methodologies applied in the company to

help the company deal with the pandemic all methods seem to be working well with the

company and no strategy or measure has raised questions on the reliability or accuracy of the

step.

Success for Pay cut for all Employees

The management of Etihad Company made the decision to reduce the salaries of all

employees to manage the financial constrain of the pandemic, the rationality used by the

company in the reduction of salaries made it easier for employees to see the need for salary

reduction. The company opted to reduce the salary of the management by 50% and that of junior

employees by 25%, most junior employees receive a lesser salary than their seniors and if the

company was to reduce the salary of juniors alone leaving the management this would be unfair

to the junior staff who make up most of the employees in the company. Bonilla (2017, p. 1)

explains that it is important for leaders to lead by example which in the case of Etihad’s

management team they did so in a decorative manner, in order to ease the pain of employees for

cutting their salaries by a quarter the company decided to cut the managements salary by half.
LEADERSHIP AT ETIHAD AIRWAYS 12

Success for Increase flight for Cargo Goods

Although this step was a bit challenging in the beginning, the company was able to work

through all the obstacles and provide a good working environment for the cargo fleets and

employees. Increasing the number of cargo flights meant changing a whole outlook in a

passenger plane to make it more flexible and are able to accommodate the transportation of

goods, this measure has helped the company regain back some of its lost profit since goods

transportation requires minimum work staff and are cost effective.

Changing the fleets’ services has enabled the company to maintain a constant level of

income which has helped them be able to provide all their employees with paid leaves. If Etihad

airways had not thought of this plan and had decided to shut down completely without any type

of income coming in to the company, the organization would not have been able to provide the

little financial incentives it gives to its employees. Companies that have not created appropriate

and workable strategies will have a hard time regaining their position in the market if they were

existent or make a successful penetration to the market if they are new companies (Slide 3,

2020).

Success for Payment Holidays Ranged with Lessors

Rocchigiani and Herbel (2020, p. 95) states that employees are more accepting to change

when they are more educated on the impact of the change to the organization and the process of

the change is communicated to them in a more accepting and understanding manner. On this

change the company had to collectively communicate with the employees on the need to halt any

plans for a vacation especially for employees that were set out to have a vacation in 2020, the

fact that this type of change does not affect a large number of employees the level of reaction to

this change was expected to be low. However, employees at Etihad operate more in teams than
LEADERSHIP AT ETIHAD AIRWAYS 13

individuals and when one of the employee has an issue they could first discuss among

themselves then point the issue to a senior official who then takes to the management. The

management team in Etihad was forced to come up significant measures that would help

employees understand the impact and the need to carry out certain measures laid out by the

company. The open type of communication between employees and the management made it

easy for the leaders within the organization explain to the employees the reason for the halted

holiday trips and why halting them is really important.

Recommendations

Establish Clarity

Focusing on what the company can manage will generate solutions within their means

and ones that will not waste a lot of their resources. Since covid-19 is a global pandemic, the

company should create solutions that they can manage like, costs. It should generate a cost plan

that will ensure it does not go in-depth or in the loss while serving its customers. The charges

must align with the regulations the WHO has given out, to avoid spending a lot while generating

little revenue or negative revenue. Internal procedures are other focuses within the control of the

company that it needs to focus on as well as communicating with their stakeholders to ensure

they plan on the way forward and adjusts to fit in the new business world.

Therefore, above planning on solutions within their means, the leaders need to think long

term (Chapter 13, 2020). In order to have a successful adaptation of the new regulations, the

company needs to engage in strategic planning as early as now and make sure the actions they

take to align with the long term goals. There should be a revision of the budget, operate on the

risk assessments, and check the potential of various scenarios based on the understanding they

have in today's business world. Routine planning should be a common theme within the
LEADERSHIP AT ETIHAD AIRWAYS 14

organization as the covid-19 pandemic is unpredictable. The company needs to be agile; there

should be group meetings every morning before they begin their operations, develop decisions

routinely, and inform the other stakeholders on the progress or changes formulated on that day.

Develop Commitment and Awareness

During these trying times, the leadership team needs to be closer to other workers to keep

them informed and aware of the company's new decisions. Activities like cleaning procedures

and announcements on operations will ensure everyone is well informed, and services will run

smoothly and on time to deliver the company goals. Since employees play a vital role in the

operations of the company, their wellbeing should be catered for. They need to be prioritized

throughout the decision making phases to satisfy their needs.

The company should also ensure it keeps everyone updated on every action it takes to

ensure there are few risks of exposure in the workstation. Additionally, the company needs to

update their contact list and also give them the contact emergency details that are up to date.

Besides, the company should also look for ways or adopt measures that reduce the menace of the

spread of coronavirus (International Civil Aviation Organization, 2020). This can be achieved

when the company allows the groups to work remotely or distribute equal customer services as

well as centers for calls on various levels or rooms. They can also quarantine the company's

operational control center and implement strict controls on the individuals who are allowed

inside. Besides, there should be a plan B where the executive control center should be located in

case one of these individuals gets infected with the virus.

Understand the Company’s Capability

By re-examining the available resources, the company will meet the new demands in the

industry and have ample time to add items missing. It may involve intensifying the teams
LEADERSHIP AT ETIHAD AIRWAYS 15

responsible for responses within the company and training other groups on customer service

skills to assist in the field. Communications should be smart and empowered, but not too much to

avoid creating tension. There should only be sharing of information that is relevant as

notifications are many and are formulated routinely; there might develop confusion and stress,

which will bring other challenges that might need additional time and resources. Additionally,

the company should encourage their customers to reach out to them via online channels. This

will reduce the time required to respond as there are increasing issues that need to be addressed

compared to the available call centers.

The company website should have equal attention, like call services. It will promote

communication through it and avoid overworking personnel working in call centers to reduce

burnout and generate more production. Besides, everyone will be busy tackling a group of

customers either physically or on websites with company call centers, as discussed by Dreimane

(2020).

Summary and Conclusion

The concept of leadership in an organization is highly significant as it helps in the

management of issues and problems affecting the company, this aspect needs to be more

efficient and effective at this time where most companies are struggling to maintain the market,

financial, or cultural success of the company. Based on the above analysis it is clear that

organizational leadership at Etihad airlines has been engulfed with various challenges that make

it hard for a company to fully enact and practice good leadership especially during the Covid-19

pandemic. If Etihad Airline Company wants to promote customer satisfaction, it needs to adopt

leadership techniques that favor a highly motivated workforce.

LEADERSHIP AT ETIHAD AIRWAYS 16

One of the main organizational leadership challenges faced by Etihad airlines is coming

up with some of the best ways to deal with organizational change since leaders have to spearhead

major changes taking place within a company and come up with the best methods that they think

might be a great. The main reason for this challenge is that there are various factors and concepts

within the organization that need to be adhered to like, the mission of Etihad airways and the

goals and objectives of the company. In conclusion, I believe that organizational leadership at

Etihad airways has greatly helped the company work through some of its toughest moments;

however, I think that it is important for the company to increase their level of leadership

proffesionality and expertise by training the current leaders more and impacting them with more

knowledge on how to deal with global situations.

LEADERSHIP AT ETIHAD AIRWAYS 17

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Bose, I. (2018). The Strategic Environment of the Aviation Industry in UAE: A Case Study on

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LEADERSHIP AT ETIHAD AIRWAYS 18

International Civil Aviation Organization. (2020). Guidance for air travel through the COVID-

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