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in PGDM
By KAMAL SOOD (58) PRATHAM SABHARWAL (67) PULAK SHUKLA (68) Class of 2011-13
Bharatiya Vidya Bhavans Usha & Lakshmi Mittal Institute of Management Copernicus Lane, Kasturba Gandhi Marg New Delhi
March 2012
Certificate of Originality
(To be filled in by the student in his / her handwriting)
I --------------------------------------------------- Roll No -------------- Class o f 2 0 1 1 - 1 3 , a f u l l t i m e b o n e f i d e s t u d e n t o f f i r s t ye a r o f P o s t G r a d u a t e D i p l o m a i n M a n a g e m e n t ( P G D M ) P r o g r a m m e o f B h a r a t i y a V i d ya B h a v a n s Usha and Lakshmi Mittal Institute of Management, New Delhi hereb y certify that this project work carried out by me at --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- and the report submitted in partial fulfillment of the requirements of the programme is an original work of mine under the guidance of the industry mentor ------------------------------------------------------------------------------- -------------------------------------------------------------------------- and is not based or reproduced from any existing work of any other person or on any earlier work undertaken at any other t i m e o r f o r a n y o t h e r p u r p o s e , a n d h a s n o t b e e n s u b m i t t e d a n yw h e r e e l s e at any time
Certificate of Originality
(To be filled in by the student in his / her handwriting)
I --------------------------------------------------- Roll No -------------- Class o f 2 0 1 1 - 1 3 , a f u l l t i m e b o n e f i d e s t u d e n t o f f i r s t ye a r o f P o s t G r a d u a t e D i p l o m a i n M a n a g e m e n t ( P G D M ) P r o g r a m m e o f B h a r a t i y a V i d ya B h a v a n s Usha and Lakshmi Mittal Institute of Management, New Delhi hereb y certify that this project work carried out by me at --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- and the report submitted in partial fulfillment of the requirements of the programme is an original work of mine under the guidance of the industry me ntor --------------------------------------------------------------------------------------------------------------------------------------------------------- and is not based or reproduced from any existing work of any other person or on any earlier wor k undertaken at any other t i m e o r f o r a n y o t h e r p u r p o s e , a n d h a s n o t b e e n s u b m i t t e d a n yw h e r e e l s e at any time
Certificate of Originality
(To be filled in by the student in his / her handwriting)
I --------------------------------------------------- Roll No -------------- Class o f 2 0 1 1 - 1 3 , a f u l l t i m e b o n e f i d e s t u d e n t o f f i r s t ye a r o f P o s t G r a d u a t e D i p l o m a i n M a n a g e m e n t ( P G D M ) P r o g r a m m e o f B h a r a t i y a V i d ya B h a v a n s Usha and Lakshmi Mittal Institute of Management, New Delhi hereb y certify that this project work carried out by me at --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- and the report submitted in partial fulfillment of the requirements of the programme is an original work of mine under the guidance of the industry me ntor --------------------------------------------------------------------------------------------------------------------------------------------------------- and is not based or reproduced from any existing work of any other person or on any earlier wor k undertaken at any other t i m e o r f o r a n y o t h e r p u r p o s e , a n d h a s n o t b e e n s u b m i t t e d a n yw h e r e e l s e at any time
E x e c u t i v e S u mma r y
Air India is the oldest carrier in the domestic aviation industry. It has been the mainstay for domestic air travel in India for more than 4 5 ye a r s . W i t h t h e a r r i v a l o f o t h e r p r i v a t e a i r l i n e s , i t s i n t e r e s t s h a v e been hurt, but it is continuing its quest to be the leader in this i n d u s t r y. D u r i n g t h e r e s e a r c h , t h e m a i n o b j e c t i v e s o f t h e s t u d y h a v e been: a) To understand the perception of travelers towards Air India. b) To know how Air India can improve its overall performance. c) The specific objectives are to improve service quality of Air India d) To have a better marketing strategy e)Market image of Air India as compared to its counterparts
To find out the required information primary data was collected through self-administered questionnaire for the passengers and travel agents and secondary data from library and the internet. A sample size of 50 was taken . The passengers felt that private airlines were better in certain service factors. They also could identify a change in Air India, after the arrival of private airlines and believed that it was overcoming its I care less syn drome. For a n a l ys i s o f t h e d a t a , s t a t i s t i c a l t o o l s , b a s e d o n t h e d a t a c o l l e c t e d w e r e u s e d a n d c o m p a r a t i v e ye a r a n a l y s i s w a s d o n e . A i r I n d i a i s a financially strong company and if it carefully plans its strategies, with more focus on passengers, it will remain the market leader .
CO NT E N T S
1. Objectives
3. Research Methodology
Research method Sample Design Methods of data collection Instruments of method research Research proposal & Hypothesis formulation Research Plan
6. Conclusions
7. Bibliography
RESEARCH OBJECTIVES
I NT RO D U CT I O N T O
Air India is the flag carrier airline of India. It is part of the government of India owned Air India Limited (AIL). The airline operates a fleet of Airbus and Boeing aircraft serving Asia, Australia, Europe and North America. Its corporate office is located at the Air India Building at Nariman Point in South Mumbai . Air India has two major domestic hubs at Indira Gandhi International Airport and Chhatrapati Shivaji International Airport . An international hub at Dubai International Airport is currently being planned. Air India has the third largest share in India's domestic air travel market, b e h i n d J e t A i r w a ys a n d I n d i G o . F o l l o w i n g i t s m e r g e r w i t h I n d i a n , A i r India has faced multiple problems, including escalating financial l o s s e s , d i s c o n t e n t a m o n g s t e m p l o ye e s , a n d p o o r c u s t o m e r s e r v i c e . Between September 2007 and May 2011, Air India's domestic market share declined from 19.2% to 14%, primarily due to stiff competition from private Indian carriers. In August 2011, Air In dia's invitation to join Star Alliance was suspended due to its failure to meet the minimum standards for the membership . In October 2011, talks between the airline and Star Alliance have resumed . Re-privatisation plans In 2001, Air India was put up for sale by the then NDA government One of the bids was by a consortium of Tata Group-Singapore Airlines. However the re-privatisation plans were shelved after Singapore Airlines pulled out and the global economy slumped Merger with Air India
In 2007, the Government of India announced that Air India would be merged with Air India. As part of the merger process, a new company called the National Aviation Company of India Limited(NACIL) was established, into which both Air India (along with Air India Express) and Air India (along with Alliance Air) will be merged. On 27 February 2011, Air India and Air India merged along with their subsidiaries to form Air India Limited. Financial crisis Around 20062007, the airlines began showing signs of financial distress. The combined losses for Air India and Indian in 2006-07 were airlines, this went up to 770 crores ( 7.7 billion). After the merger of the 7,200 crores ( 72 billion) by March 2009.[13] This was followed by
restructuring plans which are still in progress.[14] In July 2009, SBI Capital Markets Ltd was appointed to prepare a road map for the recovery of the airline.[15] The carrier sold three Airbus A300 and oneBoeing 747-300M in March 2009 for $18.75 million to survive the financial crunch As of March 2011, Air India has accumulated a debt of Rs. 42,570 crore (approximately $10 billion) and an operating loss of Rs. 22,000 crore, and is seeking Rs. 42,920 crore from the government For the past three months (June, July, August 2011), the carrier has been missing salary payments and interest payments and Moodys Investor Service has warned that missing payments by Air India to creditors, such as the State Bank of India, will negatively affect the credit ratings of those banks A report by the Comptroller and Auditor General (CAG) blamed the decision to buy 111 new planes as one of the major causes of the debt troubles in Air India; in addition it blamed on the ill timed merger with Air India as well, Due to high fuel and loan costs, Indian government has already pumped 32 billion rupees into Air India since April 2009 and in March 2012 government bailed out Air India Ltd. with a 67.5 billion ruppes ($1.4 billion) which the amount almost double of the federal government has spent on new hospitals over the past three years Air India's corporate headquarters is located at the Air India Building at Nariman Point in South Mumbai. The airline moved there in 1970. TheAir India Building also serves as a regional office for Indian.
Narrow Body B737-800 (AIX) A320 A319 A321 CRJ-700 ATR42 Narrow Body Total Total Fleet 17 12 19 20 0 0 68 91 0 6 0 0 0 0 6 8 4 0 5 0 4 7 20 22 21 18 24 20 4 7 94 121
R E S E A RC H M E T H O DO L O G Y O F T H E S T U D Y
Exploratory
Descriptive
Descriptive Research was initiated because it was generally a study which was carried out to describe the market characteristics of various airlines, and of Air India in particular, as well as the buying behavior of travelers. Situation Analysis: - Conducting a situational analysis means analyzing the company, its market, its competition and the industry in general. The situation analysis is a background investigation. It involves obtaining information about the company and its business environment by means of library, research.
Data collection- primary and secondary data: Data would be collected through both primary and secondary data for carrying out the research project. Primary Data: - Primary data relates to data which h as been collected first hand and which has been collected for the purpose of analysis. It is undertaken, when data needed by the researcher does not exist, or are dated inaccurate, incomplete or unreliable, the
researcher has to collect primary data. The primary data was collected through questionnaires. Sources of Primary Data: -Primary data was collected through
Corporate travelers.
Professionals
Students.
Secondary Data : Secondary Data research invariably precedes primary research. Secondary data are data that were collected for another purpose and already exists somewhere. Sources of Secondary Data
Sample Design Doing research via sampling was important because of impossibili t y o f f i n d i n g a l l o f a population, as well as other restrictive parameters like cost, time etc. Our sampling decision should be in -coordination with the research and data objectives. The metho d opted for taking s a m p l e s w a s Non-probability sampling. I t w a s a ` P u r p o s i v e N o n - p r o b a b i l i t y s a m p l i n g / Judgement Sampling was used. The key assumption underlined this type of sampling is t hat with sound judgement or expertise, and an appropriate strategy, o n e c a n c a r e f u l l y a n d consciously choose the elements to be included in the sample, so that samples can be developed that are suitable for ones needs. My objective for using `Judgement Sampling was that since airline travel is not experienced by everybody, so `Judgement Sampling was a must to get the closest and the correct response.
Sample Size :-
50 respondants .
Survey/ Personal Contact Method:- In a survey, the researcher carries out opinion polls involving customers, sales persons, dealers, traders a n d e x p e r t s . I n t h e s u r v e y, t h e m a i n m e t h o d o f interviewing was by Personal Interviews, as this gave me a better understanding of the needs and p r e f e r e n c e s o f t h e p a s s e n g e r . M o s t o f t h e d a t a i s q u a n t i t a t i v e i n n a t u r e a n d s u p p o r t e d b y qualitative data.
The research instruments used for this survey were structured questionnaires. The questionnaires were designed to find the satisfaction levels of Domestic Airlines, in particular, Air India .
H0 : Providing comfortable Seats In cannot improve customer satisfaction . H1 : Providing comfortable Seats may improve customer satisfaction .
H0 : Reduction in price of tickets will not lead to an increase in sales. H1 : Reduction in price of tickets may lead to an increase in sales.
H0 : Providing discounts on bulk booking will not lead to increase in sales. H1 : Providing discounts on bulk booking may lead to increase in sales.
H0 : Providing Proper customer service will not lead to increase in sales H1 : Providing Proper customer service may improve increase in sales.
H0: Providing proper cleanliness inside planes will not lead to increase in sales . H1 : Providing proper cleanliness inside planes may lead to increase in sales .
Research Plan:
Company Documentation
Sampling Unit Airlines Passengers Sampling Plan Travel Agents Sampling Size 50 Passengers Sampling Procedure Non Probability Judgement Contact Method Personal Interviews
RESULTS
25 3 6
74% 9% 18%
2 13 13 6
13 9 3 4 5
6 28
18% 82%
20 13 0 1
59% 38% 0% 3%
11 7 6 10 0
Yes No
11 23
32% 68%
Yes No
31 3
91% 9%
Yes No
5 29
15% 85%
1 2 3 4 5
7 11 7 4 5
1 2 3 4 5
9 11 9 5 0
1 2 3 4 5
5 11 12 4 2
1 2 3 4 5
7 6 11 10 0
How do you like to rate AIR-INDIA on? (tick in column) - Customer Service
1 2 3 4 5
6 8 11 7 2
How do you like to rate AIR-INDIA on? (tick in column) - Value for money
1 2 3 4 5
9 8 11 4 2
How do you like to rate AIR-INDIA on? (tick in column) - Flying Exp
1 2 3 4 5
4 5 17 7 1
How do you like to rate AIR-INDIA on? (tick in column) - Personal Treatment
1 2 3 4 5
8 8 6 9 3
8 10 12 4
Yes No
27 7
79% 21%
3 9 13 7 2
Have you ever faced any problem with Air-India? No, No, No, No, NO, no, No, No, no, no , improvment needed , yes no , No no cleanliness No No no No No No yes comfort problem , no , no , no, comfort No No
comfort No no comfort no
If NO state the reason please improve comfortness and cleanliness comfort Because services as compared to other comfort comfort and
Basic objective of this Research is to find out the customer satisfaction level who used to travel by AIR INDIA Airlines as their mode of traveling
Total number of people in pilot survey = 50 Number of Respondents who were selected according to our objective = 35
From these 35 respondents we conclude that most of the People travelling through this Airline want better comfortable seats , want more cleanliness inside the plane, they are just satisfied with the airlines not happy. They are Ok with the Price of tickets. People who are travelling international prefer other airlines only because of long route comfortable seats in other airlines.
Customers want more Discounts on bulk Purchase of tickets. Overall this AIR INDIA is preferred by most of the people so they expect more improvement in this so as to maintain their journey with it..
H0:- Provision of Arrival /Departure, Customer service, Flying Experience and personal treatment will not lead to increase in sales H1:- Provision of Arrival /Departure, Customer service, Flying Experience and personal treatment will lead to increase in sales.
Calculated observed Values Factor 1 1 2 3 4 5 Observed Value Column Arrival /Departure 9 6 11 6 3 35 Total Column Customer Service 6 9 10 6 4 35 Total Column Flying Experience 3 8 13 10 1 35 Total Column Personal Treatment Total 9 27 6 29 7 41 8 30 5 13 35 Total 140 Total
Expected Value 1 Arrival /Departure Customer Service Flying Experience Personal Treatment 6.75 6.75 6.75 6.75 2 7.25 7.25 7.25 7.25 3 10.25 10.25 10.25 10.25 4 7.5 7.5 7.5 7.5 5 3.25 3.25 3.25 3.25
Chi Square Value 1 Arrival /departure Customer service Flying Service Personal Treatment 0.75 .83 2.08 .75 2 .21 .42 .07 .21 3 .05 .01 .73 1.03 4 .3 .3 .83 .03 5 Sum .28 .17 1.55 .94 1.59 Sum 1 1.726 Sum 2 5.26 Sum 3 2.96 Sum 4 Sum 1+ Total 4.41 .91 1.82 1.46 2.94 11.536 2+3+4
2 calculated = 11.536
Table value of 2 at alpha (level of significance) 0.05 , degree of freedom (3) = 7.815
When 2 calculated value < 2 , (r-1)* (c-1) Accept H0, otherwise reject H0
H0:- Provision of Comfort and cleanliness will not lead to increase in sales
Factor 2
Observed Value:
Calculated observed Values Factor 2 1 2 3 4 5 Observed Value Column Comfort 11 6 11 6 1 35 Total Column Cleanliness Total 6 17 9 15 12 23 4 10 4 5 35 Total 70 Total
Expected Value 1 Comfort Cleanliness 8.5 8.5 2 7.5 7.5 3 11.5 11.5 4 5 5 5 2.5 2.5
Chi Square Value 1 Comfort Cleanliness .73 .73 .3 .3 2 .02 .02 3 .2 .2 4 .9 .9 5 Sum 2.15 2.15 Sum 1 Sum 2 Sum 1+ Sum Total 1.46 .6 .04 .4 1.8 4.30 2
When 2 calculated value < 2 , (r-1)* (c-1) Accept H0, otherwise reject H0
Hence, Provision of Comfort and cleanliness will not lead to increase in sales
.
H0:- Provision of Food and Value for Money will not lead to increase in sales
H1:- Provision of Food and Value for Money will lead to increase in sales
Factor 3
Observed Value:
Calculated observed Values Factor 3 1 2 3 4 5 Observed Value Column Food 6 11 11 5 2 35 Total Column Value for Money Total 10 16 6 17 10 6 3 5 35 Total 70 Total
21 11
Expected Value 1 Food Value for Money 8 8 2 8.5 8.5 3 10.5 10.5 4 5.5 5.5 5 2.5 2.5
Chi Square Value 1 Food Value for Money .5 .5 .73 .73 2 .02 .02 3 .04 .04 4 .1 .1 5 Sum 1.39 1.39 Sum 1 Sum 2 Sum 1+ Sum Total 1 1.46 .04 .08 .2 2.78 2
When 2 calculated value < 2 , (r-1)* (c-1) Accept H0, otherwise reject H0
Hence, Provision of Food and Value for Money will not lead to increase in sales
.
CONCLUSION
After this Survey We Conclude that the customers are satisfied with the airlines but not entirely with its comfortability , Arrival Departure , value for money .
We have performed various tests Alfa test and Chi Square test which Results in that we should Definitely need to work on : 1.Arrival /Departure, Customer service, Flying Experience and personal treatment will lead to increase in order to improve customer satisfaction and sales. 2. Comfort and cleanliness Food and Value for Money are not that important factor as they are already been Provided .
Other than these Tests we have also observed people are preferring AIR INDIA as it is government owned , they have a faith factor in them.
LIMITATIONS
The study could have been more comprehensive and more representative of the universe, had the simple-size been larger, but it was not possible mainly due to lack of time and some other constraints.
The area covered is restricted to Delhi city only and as such the results of questionnaires are valid for Delhi city only.
All this report has been an individual attempt and also it involves the human process of interpretation and analysis, so there are chances of human error.
The marketing research is done on the basis of certain assumptions as regards to the future of the industry, but due to environmental changes, research results may not be valid.
Despite repeated proof-reading there is a possibility of spelling error of otherwise, which may have been overloaded.
Survey is very time consuming, respondents were not ready to fill the form.
BIBLIOGRAPHY
www.airindia.com
http://www.airindia.com/SBCMS/Webpages/Fleet-Details1.aspx?MID=196
www.wikipedia.com