Title
Key indicators of management strategies for air cargo carriers Key indicators of management strategies for air cargo carriers
Author
Faculty/Department
Faculty of Applied Economics
Publication type
conferenceObject
Publication
Antwerp , [*]
Subject
Economics
Source (book)
Air transport research society : World Conference 2011
Carrier
E
Target language
English (eng)
Affiliation
University of Antwerp
Abstract
The global air cargo industry represents about 89 billion USD in direct revenue (figures of 2008) and substantially more in related supply chain services. Therefore, this industry can nowadays be judged as a mature industry, where strategy is being drafted far beyond the basic entrepreneurial framework in which an emerging industry tends to operate. This paper deals with the management strategy of air cargo carriers, and more particularly focuses on its key indicators. At first, the short and long term objectives of the executive management of air cargo carriers are being discussed and analyzed. These objectives can be extremely diverse, and have different mixes of priorities over time. The second part of this paper initiates some strategic considerations on the air freight value proposition and the justification for using air freight. These form the basis for the identification of key drivers influencing management strategy development at air cargo carriers, which are being determined and discussed here. Pricing and capacity management strategies are elementary key decision factors in the core strategy development process. Moreover, an overall understanding of the airlines resulting cost structure is a critical key factor in a companys strategic planning phase. The above mentioned key drivers can furthermore be strongly influenced and reinforced by strategic choices to be made on air cargo product differentiation and participation in both vertical and horizontal alliances. These and other supporting drivers are being grouped in a strategic framework, consisting of three main areas: product, market and network strategy, each with their own driving factors. Thirdly, based on the previously identified strategic framework, indicators are being defined and set for the most significant key and supporting variables. Data for a representative sample of 50 air cargo carriers have been collected and analyzed. Striking differences and similarities are being highlighted. The empirical work results in a typology of five strategy models for air cargo carriers, each with their own value proposition, based on observed differences and similarities in the results and data sets of key indicators.
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