Question

"Discuss the financial and operational implications for airlines as they try to offer the newest technology services?"

Answer 1

Answer with Explanation:

The introducing of newest technology would definitely have financial and operational implications. These implications are given as under:

Financial implications

• Cost Reduction: The operational costs would be reduced by investing in the newest technology which will make the cash flow position better with time.

• Benefits Lost Risk: It is possible that the investment might not bring value to the company because of any emergent problems, whose mitigation requires incurring of additional costs.
• Cost Advantage: The lower operational cost can drive higher sales because the company will be charging lower fare prices to its customer thus giving Cost Advantage.
• Investing in newest technology might not bring value to the company because it is not attracting potential customers but it might pay off later in the form of developed customer loyalty.

Operational implications

• Implementing a newest technology might improve the operational processes through which the customer go through, which would increase the customer satisfaction.
• Implementation problems of newest technology.
• Long term Customer retention will easy for the airline company due increased customer satisfaction.
• Operational efficiencies related to services will process the customer fastly saving the companies precious time wasted in these process thus reducing the future human resource cost.
• Using robots might bring adverse marketing because the people might think that the human resource are no more required and risks associated with the acceptance of technology due to cultural differences.
• Better Security systems would increase the security level and safety levels for the customers.