Industrial Report

on

INDIAN

Submitted in partial fulfillment of the requirement for the award of

Bachelor of business administration

(BBA)

By

AJAY SHARMA

BHARATI VIDYAPEETH UNIVERSITY, SDE ACADEMIC STUDY CENTRE; BVIMR,

NEW

2010 STUDENT DECLARATION

I AJAY SHARMA, BBA student, BVU, SDE, Academic Study Center: BVIMR, hereby declare and understand that the project on Industrial Exposure submitted by me titling “” under the guidance of Miss NEHA in partial fulfillment for the award of any diploma/degree in any university elsewhere to the best of my knowledge and belief. Any material quoted from others sources has been duly acknowledged at appropriate places in the text. I am solely responsible for any duplication.

AJAY SHARMA ACKNOWLEDGEMENT

Project work is never the work of an individual. It is more a combination of ideas, suggestions, contribution and work involving many jobs. One of the most important part of writing a report is the opportunity to thank all those who have contributed to it. The list of expression of thanks, no matter how extensive, is always incomplete and inadequate. This acknowledgement is no exception.

I want to express my sincere gratitude towards Miss NEHA who provided me all the expert guidance and invaluable suggestion.

I would like to thank my classmates and all those who directly or indirectly helped me in one or the other way in the successful completion of the project.

AJAY SHARMA CERTIFICATE

To whom so ever it may concern

This is to certify that the project on Industrial Exposure entitled “INDIAN AIRLINES” is an original piece of work done by “AJAY SHARMA” in the partial fulfillment of the requirement for the award of the degree of “BBA” from “BVU, SDE, Academic Study Centre: BVIMR, New Delhi”. To the best of my knowledge, data and information presented by her in the project has not been submitted earlier.

Miss NEHA

( INTERNAL GUIDE )

CERTIFICATE To whom so ever it may concern

This is to certify that the project on Industrial Exposure entitled “INDIAN AIRLINES” is an original piece of work done by “AJAY SHARMA” in the partial fulfillment of the requirement for the award of the degree of “BBA” from “BVU, SDE, Academic Study Centre: BVIMR, New Delhi”. To the best of my knowledge, data and information presented by her in the project has not been submitted earlier.

Dr. SACHIN VERNEKAR

( DIRECTOR )

INDEX

CHAPTER-1 INTRODUCTION o Introduction to INDIAN AIRLINES o History of Indian airlines o Nature of Business o Type and Ownership Pattern o Vision o Mission o Board of Directors o Registered office

CHAPTER-2 MARKET ANALYSIS o Brand o Products o Product Mix o Product Line o Fleet Details o Netwrok o Competitors o Market share o Market Strategies CHAPTER-3 FINANCIAL ANALYSIS o Auditing company and auditors report o Financial; and physical performance o Balnce sheet o Profit and loss statement

CHAPTER-4 ORGANIZATIONAL STRUCTURE o Organization structure o Organization chart o Recruitment section o Training o Training section o departments

CHAPTER-5 SWOT ANALYSIS

MY LEARNINGS FROM THE PROJECT

BIBLIOGRAPHY

CURRENT INDUSTRIAL SCENARIO

The current growth rate in domestic and international travel exceeds 25%, the highest in the world. In the period April-September 2006, the total aircraft movements witnessed an increase of 29.6% year-on-year to 494.92 thousand aircraft movements, as compared to 318.89 thousand during April-September 2005. The Indian domestic market grew at almost 50% in the first half of 2006. On average, full service carriers are shedding a remarkable 1.5% of market share every month to low cost carriers

FUTURE INDUSTRIAL SCENARIO

The aviation industry is expected to grow at a compounded annual growth rate of 25% till 2010. Also, by 2010 Indian airports will be handling between 90 and 100 million passengers per year, as against the current 34 million passengers. It is expected that nearly 80% of this growth will be driven by the low cost carrier segment (LCC). By 2008, the LCCs would capture 65% of the direct on-line air ticket market from 61% in 2005.

International Domestic Total No. in Percentage No. in Percentage No. in Percentage millions growth millions growth millions growth 1999- 13.29 2.90% 25.74 6.90% 39.04 5.5% 00 2000- 14 5.40% 28.01 8.80% 42.02 7.70% 01 2001- 13.63 (-)2.7% 26.36 (-) 5.9% 39.98 (-)4.9% 02 2002- 14.82 8.80% 28.9 9.60% 43.72 9.40% 03 2003- 16.65 12.30% 32.04 10.09% 48.69 11.40% 04 2004- 19.45 17.00% 40.1 25.00% 59.54 22.30% 05 2005- 22.36 15.10% 50.98 27.90% 73.34 23.70% 06 CHAPTER-1

INTRODUCTION INTRODUCTION TO INDIAN AIRLINES

Indian Airlines was founded in 1953. Today Indian Airlines, together with its fully owned subsidiary , is one of the largest regional systems in Asia with a fleet of 62 aircraft(4 wide bodied Airbus A300s, 41 fly-by-wire Airbus A320s, 11 Boeing 737s, 2 Dornier D-228 aircraft and 4 ATR-42).

It has many firsts to its credit, including introduction of the wide-bodied A300 aircraft on the domestic network, the fly-by-wire A320, Domestic Shuttle Service, Walk-in Flights and Flexi-fares.

The airlines network spans from Kuwait in the west to Singapore in the East and covers 75 destinations - 57 within and 20 abroad. The Indian Airlines international network covers Kuwait, Oman, UAE, Qatar and Bahrain in West Asia, Thailand, Singapore, Yangon and Malaysia in South East Asia and Pakistan, Nepal, Bangladesh, Myanmar, and Maldives in the South Asian sub-continent.

Indian Airlines is presently fully owned by the and has total staff strength of around 18562 employees. Its annual turnover, together with that of its subsidiary Alliance Air, is well over Rs.4000 crores (around US$ 1 billion).

Indian Airlines flight operations centre around its four main hubs- the main metro cities of Delhi, , Calcutta and Chennai. Together with its subsidiary Alliance Air, Indian Airlines carries a total of over 7.5 million passengers annually HISTORY OF THE COMPANY

In 1953, a new dream took shape - to air link the vast South Asian 14subcontinent by a single, modern and efficient airline. The airline was Indian Airlines. As per Air corporations Act 1994, the entire undertaking of Indian Airlines was transferred to and vested in “Indian Airlines Limited”, with effect from 1.3.1994.

Indian Airlines came into being with the enactment of the Air Corporations Act 1953 and was entrusted with the responsibility of providing air transportation within the country as well as to the neighboring countries.

This national domestic airline came into being with the amalgation of the following eight private airlines:

1 Airways (India) Ltd. 2 Ltd. 3 Kalinga Airways Ltd. 4 Bharat Airways Ltd.

5 Ltd. 6 Ltd. 7 Deccan Airways Ltd. 8 Indian National Airways Ltd.

At its birth in 1953, Indian Airlines had to absorb eight separate airlines with varying organizational structures, operations and administrative set ups, 99 aircrafts with headquarters and maintenance basis in 6 cities and a total of 7017 men working in 8 organizations.

The task of molding these into one single organization with a common standard of operation and administration was indeed difficult. Not only that fixing uniform scale of pay and condition of services and at the time rationalizing the routes and ground organization, reducing cost and improving efficiency all round were other tasks to be performed. The job was tackled with remarkable confidence and ability and pushed through great determination. Now it has been transformed into a homogeneous and increasingly efficient organization. The management has been integrated streamlined and operational standards have been progressively raised.

The airlines began its operation on 1st August, 1953. At the time of nationalization, Indian Airlines inherited a fleet of 99 aircraft consisting of various types of aircraft which were gradually replaced by Viscount, F27 and HS748. Nineteen hundred and sixty four (1964) was the beginning of the jet era in Indian Airlines when the Caravelle aircraft was inducted into the fleet. Between 1970 and 1982 Indian Airlines started inducting first batch of wide bodied Airbus A320 aircraft (19 aircraft) in June, 1989. Latest acquisition in IAL’s fleet, the Airbus A319, was inducted in December, 2005.

Indian Airlines has been setting the standards for since its inception in 1953. It has many firsts to its credit, including introduction of the wide bodied A300 aircraft on the domestic network, the fly-by-wire A320, domestic shuttle service, walk in flights and easy fares. Its unique logo emblazoned on the tails of all its aircraft has become synonymous with service, efficiency and reliability.

The Airlines’ network spans from Kuwait in the west to Singapore in the West and covers 76 destinations - 58 within India and 18 abroad. The Indian Airlines international network covers Kuwait, Oman, UAE, Qatar and Bahrain in West Asia; Thailand, Singapore, Malaysia and Mayanmar in South East Asia and Pakistan, Afghanistan, Nepal, Bangladesh, Sri Lanka and Maldives in the South Asia sub-continent. Indian Airlines is presently fully owned by the Government of India and has total staff strength of around 19300 employees including that of Alliance Air. Its annual turnover, together with that of its subsidiary Alliance Air, is well over Rs.6000 crores (around US$ 1.4 billion). Indian Airlines flight operations centre on its four main hubs the main metro cities of Delhi, Mumbai, Calcutta and Chennai. Together with its subsidiary Alliance, Air Indian Airlines carrier a total of over 7.5 million passengers annually. In 1960, the logo for Indian Airlines was selected which was based on golden section of ancient Greeks. “A” had been italicized to suggest speed and the truncation of first stroke indicated movement while the second emphasized on reliability. The forward surging of the symbol was intended to show the “looking ahead” characteristic and the orange colour gave vibrancy and purity.

The logo has now been changed and the “wheel of konark” which his replica of the sun now symbolizes Indian Airlines.It depicts that the “sun” may set but it will rise

By 1990, Airbus A320s were introduced. The economic liberalisation process initiated by the Government of India in the early 1990s ended Indian Airlines' dominance of India's domestic air transport industry. Indian Airlines faced tough competition from , Air Sahara (now Jet Lite), East-West Airlines and . As of 2005, Indian Airlines was the second largest airline in India after Jet Airways while Air Sahara controlled 17% of the Indian aviation industry.

East-West Airlines and ModiLuft discontinued flight operations but the entry of several low-cost airlines in India, such as , SpiceJet and others like continue to give competition in its market, forcing Indian to cut down air-fares. However, as of 2006, Indian Airlines was still a profit making airline.

Indian Airlines Limited is wholly owned by the Government of India through a holding company and has 19,300 employees as of March 2007.[4] Its annual turn- over, together with that of its subsidiary Alliance Air, is well over Rs.4000 crores (around US$ 1 billion). Together with its subsidiary, Alliance Air, Indian Airlines carries a total of over 7.5 million passengers annually.[

On 22 February 2007, the Group of Ministers (GoM) approved the merger of state-owned carriers, Air India and Indian Airlines.[5] Operating under the name Air India, the two airlines formally became one entity on 15 July 2007 upon receiving the new Boeing 777-200LR with the new livery of the merged airline. The new airline's headquarters will remain in Mumbai, and will have a fleet of over 130 aircraft. In December 2007, Air India was invited to join the Star Alliance. Since Indian Airlines is in the midst of merging with Air India, it too will effectively be a member

1.4 Nature of the business

INDIAN AIRLINES comes under Tertiary sector of the economy.

1.5 MISSION

To become a world-class Airline & to provide the finest services in the areas we operate.

OBJECTIVES OF INDIAN AIRLINES

With the socio-economic aspect in consideration, the main objective of Indian Airlines is to operate on commercial basis and earn profits. Policies are made and decisions are taken keeping in view of these objectives.

1 To meet the demand for reliable, economic and efficient air transport services to customer and passengers.

2 To maintain essential and strategic communications within India in times of national emergencies and also a reliable second line of defense.

3 To maximize customer satisfaction by continuously improving passenger- cargo service and other amenities.

4 To enhance the corporation’s contribution to the national economy by securing a reasonable return on capital consistent with its social objectives.

5 To stimulate domestic tourism and international trade by air in order to develop and broaden the Indian Airlines market. 6 To foster international tourism to India and improve the national balance of payments.

7 To share in the promotion of the social, cultural and emotional integration of India and to participate in the process of redressing regional economical imbalances.

8 To encourage self impression and participation in the activities of the corporation by all the employees and to encourage their legitimate aspirations for growth and self development

9 To participate in the development of national aircraft and ancillary industry.

10 To promote the good image of public sector in consonance with national aspirations.

CHAPTER-2

MARKET ANALYSIS

2.1 BRAND Brand is the heart and soul of an organization. It centers on uniqueness and dramatic difference.

A brand is more than just a logo or a name, it is a complex and dynamic set of consumer beliefs entrenched in consumers' hearts and minds. Building a strong brand requires understanding consumer needs and developing a point of difference that is meaningful and sustainable in generating customer loyalty.

A strong brand can take a lifetime to build. It can take moments to destroy. But properly executed, it helps build trust and a preference for a specific company. A customer who trusts and likes a certain brand is more likely to buy additional products or services based on loyalty alone.

Explaining the significance of the wheel in the new logo, Praful Patel (Patel), Minister for Civil Aviation, Government of India (GoI) said, "The wheel symbolises timeless motion and trust that has stood the test of time."5

On December 7, 2005, a brand new A-319 aircraft adorned with a new 'Indian' look joined the Indian Airlines Limited's (IA) fleet in New Delhi. IA, the state- owned airline company in India became 'Indian' on December 7, 2005.3

The new brand name was accompanied by a new logo, a partly visible blue wheel on an orange background (Refer Exhibit I and II for old and new logos of IA). The blue wheel of the logo was a graphic representation of the wheel of the Sun Temple at Konark4 which represented "timeless motion, convergence and divergence." Commenting on the new IA logo, Ajit Shah, executive director at R K Swamy BBDO, the advertising agency which created the new logo, said, "It signifies motion and represents the Indian image perfectly."6

The 'new look' aircraft was one of the four A-319 aircraft that the company had leased from Airbus Industrie (Airbus) during 2005. IA was to acquire another 43 new aircraft from Airbus, as per a deal struck in 2005.

Said Patel, "The new aircraft signals a new era for Indian Airlines and the airlines would induct one new plane every month from the latter half of 2006."7

The makeover of the existing aircraft and the arrival of new fleet of aircraft were expected to be completed over a period of 16-18 months beginning from 2006. The re-branding was to be comprehensive - covering features in-flight and on the ground too.

The aircraft seats, crew uniforms, crockery as well as customer contact points would bear evidence of the new brand 'Indian' and its new logo. Until the liberalization of the airline industry in the early 1990s, IA enjoyed a monopoly in India's domestic air transport. After liberalization, many private air carriers entered the Indian domestic airline industry and began gaining more and more market share. IA's bureaucratic management style caused it additional problems. The airline began making losses in 1989-90, but recovered to post profits from 1997-98. However, in 2000-01, IA again slipped into the red.8 By the early 2000s, there was new competition in the form of low cost carriers.

By this time, IA was just one of the players in the industry. Battered by the competition from low cost carriers, full service airline companies like IA started looking for new ways to attract passengers. During the early 2000s, IA undertook various measures to enhance its position in the industry. For instance, IA embarked on an ambitious fleet replacement program to replace its aging fleet.

To improve the quality of the services being offered, the company conducted training programs for its cabin crew, upgraded the quality of food being offered on board, etc. When faced with competition from low cost carriers, IA reacted by cutting its fares and offering a variety of promotional schemes.

IA became profitable in 2003-04 after posting losses for three years. The re- branding exercise of IA was another move to counter the competition. According to analysts and industry observers, re-branding alone will not help IA beat the competition. Opined R Krishnan, an aviation analyst, "The new name and brand looks expressive, the colour looks impressive.

Overall, the makeover is good. Still, it is only cosmetic. Inside-the-flight and on- ground service levels, punctuality, stability of schedules should improve significantly."9 In the words of Kapil Kaul (Kaul), CEO, Center for Asia Pacific Aviation (CAPA),10 Indian Subcontinent and Middle East, "The airline needs to restructure itself to face competition... 2.2 SERVICE MIX

Product mix is a combination of products manufactured or traded by the same business house to reinforce their presence in the market, increase market share and increase the turnover for more profitability. Normally the product mix is within the synergy of other products for a medium size organization. However large groups of Industries may have diversified products within core competency.

To explain, Bajaj Electrical a household name in India, has almost ninety products in i8ts portfolio ranging from low value items like bulbs to high priced consumer durables like mixers and luminaries and lighting projects. This product mix contains product lines and product items .In other words it’s a composite of products offered for sale by a firm.

One of the realities of business is that most firms deal with multi-products .This helps a firm diffuse its risk across different product groups. Also it enables the firm to appeal to a much larger group of customers or to different needs of the same customer group .Tata Indicom product mix includes mobile phones, internet and broadband, landline phones and wireless phones . It seeks to satisfy the needs of individuals, students, business man, business houses and also households.

PRODUCTS The noun product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce from the Latin prōdūce (re), (to) lead or bring forth. Since 1575, the word "product" has referred to anything produced. Since 1695, the word has referred to "thing or things produced". The economic or commercial meaning of product was first used by political economist Adam Smith.

In marketing, a product is anything that can be offered to a market that might satisfy a want or need. In retailing, products are called merchandise. In manufacturing, products are purchased as raw materials and sold as finished goods. Commodities are usually raw materials such as metals and agricultural products, but a commodity can also be anything widely available in the open market. In project management, products are the formal definition of the project deliverables that make up or contribute to delivering the objectives of the project.

In general usage, product may refer to a single item or unit, a group of equivalent products, a grouping of goods or services, or an industrial classification for the goods or services. 2.3 SERVICES OFFERED BY INDIAN AIRLINES LIMITED

Indian Airlines provide services in different areas to become an excellent airline. In recent years, customers have enhanced expectations from the service provider by virtue of being exposed to world-class services and products of competitors. Eventually, Indian airlines services upgrade and the following is the brief of some of its imported as regulated by the regulations of DGCA such as.

(i) RESERVATION

IA’s computerized reservation system at Delhi; a state of the art mainframe is accessible to all major computerized reservation system of the world. There are also 1600 approved travel agents all over India at the service of passengers.

Passengers can also make reservation over telephone on time limit basis and purchase the ticket before the expiry of indicated time limit.

Special assistance is offered to passengers who require special handling over and above normal attention like the disabled, those on wheel chair, stretcher or unoccupied minors.

(ii) FARES

IA’s domestic fares are quoted in Indian Rupees as well as US dollars (USD).

Besides, there are some special fares and discounts for senior citizens, students, the armed forces personnel, war disabled personnel and many others.

Details of all concessions and the special fares are available at IA’s booking offices and Travel agents.

(iii) CANCELLATION CHARGES

To allow flexibility to passengers in their travel plan, they do not levy any cancellation charge provided the cancellation is effected at least one hour before the scheduled departure. Rebooking and refund charges may be applicable on a few specified routes during peak season to avoid fictitious booking and help availability of seats to bonafide passengers.

(iv) RECONFORMATION PROCEDURE

Passengers are advised to reconfirm their return or onward reservation if they break their journey for more than 72 hours at any of the stations on their itinerary.

(v) CHECK-IN-PROCEDURE

At all major metros, IA offers computerized check-in facilities for domestic flights, the following facilities are available.

(vi) TELE CHECK-IN

Executive class passengers and members of ‘flying return’ are offered the facility of tele check-in at six major metros provided they travel without checked baggage.

City Check-in, Return Check-in and Through Check-in are certain other check in facilities provided by the company.

Along with the above services, certain other major services provided by the company are:

1 Passenger Service 2 Baggage Allowance 3 Cabin Baggage 4 Security Regulation Service 5 In-flight Services 6 Liability for the loss of baggage 7 In case of delayed flights

The above services and commitment will be honored without the citizen having to pay any bribe. Vigilence cell takes care of that 2.4 PRODUCT LINE

A product line is "a group of products that are closely related, either because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges."

Many businesses offer a range of product lines which may be unique to a single organization or may be common across the business's industry. In 2002 the US Census compiled revenue figures for the finance and insurance industry by various product lines such as "accident, health and medical insurance premiums" and "income from secured consumer loans". Within the insurance industry, product lines are indicated by the type of risk coverage, such as auto insurance, commercial insurance and life insurance. Fleet Details

The total aircraft on order are 111 (68 from Boeing and 43 from Airbus)

"Aircraft on order include eight B777-200LRs, fifteen B777-300ERs, twenty seven B787 Dreamliners, eighteen B737-800s, nineteen A319s, twenty A321s and four A320s. Of the 111 aircraft ordered, twenty three Boeing (five B777-200LRs, five B777-300ERs, thirteen B737- 800s) and nineteen Airbus (ten A321s and nine A319s) have been in the fleet so far. "

Aircraft Type Owned Leased Total B777 10 4 14 B747 3 3 6 A310 0 9 9 A319 9 5 14 A321 10 0 10 A320 30 18 48 A330 0 2 2 B737-800 13 7 20 ATR 0 7 7 CRJ 700 0 3 3 B737-800 5 0 5 B737 Freighters 6 0 6 A310 Freighters 4 0 4 TOTAL 90 58 148

Including five B777-300ERs

THE NETWORK

Table of National Network

EAST WEST NORTH SOUTH

Kolkatta Mumbai Delhi Chennai Bhuvaneshwar Ahmedabad Jaipur Bagdogra Goa Khajuraho Guwahati Calicut Patna Nagpur Trivandrum Ranchi Aurangabad Aizwal Mangalore Varanasi Trichi Dibrugarh Vadodara Udaipur Jorhat Jaisalmer Vizag Dimapur Tirupati Portblair Agati Tezpur Jam nagar Puttaparthy Imphal Kullu Amritsar Chandighar Dharamshala Dehradun

Table of International Network

SOUTH ASIA WEST ASIA SOUTH EAST ASIA

Kathmandu Sharjah Singapore Dhaka Bahrain Bangkok Muscat Kuala Lumpur Kuwait Yangon Male Doha Rasal Khaimah Fujairah Dubai • Operations to West Asia and South East Asia region cover bulk

of the markets, major regional hubs.

• Own sales/ticketing outlets at all stations, airports, distribution reach through nine GSAs.

• Own IBM reservations and check in host, support about 2000

terminals.

• Exclusive airport terminals at Delhi and Mumbai.

• Wide network size.

• Strong schedule, appropriate aircraft, high frequency, well

timed, direct and non-stop flights.

ROUTE MAP

Competitors

1 JET AIRWAYS

Jet Airways, which commenced operations on May 5, 1993 has, within a short span of 14 years, established its position as a market leader. The airline has had the distinction of being repeatedly adjudged India's 'Best Domestic Airline' and has won several national and international awards. Under the guidance of its Chairman, Mr. Naresh Goyal, Jet Airways won the ‘Best Domestic Airline’ award for the fourth consecutive year and the fifth time in the past six years at the 18th annual TTG Travel Awards 2007. Jet Airways has also been voted the Best Airline in Central/South Asia and India in an annual Global Traveler magazine survey in January 2008. Emerging as a world-class international airline, Jet Airways offers economical air fares, a high quality of service and reliable and comfortable operations. From smart and proficient crew to in-flight convenience, the airline offers many other services including in-flight meals and in-flight entertainment, several check-in options, such as Tele Check-in, Web Check-in, Kiosk Check-in at select domestic airports and many other customer friendly facilities and services. Operating three classes of service - First Class, Première and Economy, Jet Airways has a wide cross section of partnership and alliances, and members of its award-winning frequent flyer program, JetPrivilege, can enjoy special benefits and earn JPMiles with carefully chosen program partners such as some of the leading International airlines, hotels, banks, lifestyle, retail, telecommunication, car rental and publishing partners.

2 SAHARA AIRWAYS

Air Sahara, presently known as Jet Lite is a privately owned airline based in Delhi. Air Sahara or Jet Lite operates scheduled services connecting all the major metropolitan cities and other key destinations of India. Air Sahara offers international standards of in-flight services to provide you with a comfortable journey. Air sahara was previously the part of the huge Sahara India Group headed by Mr Subroto Roy. It commenced its journey on 3 December 1993 with two Boeing aircrafts 737-200 with Delhi and Mumbai as its major hub. Air Sahara has now been acquired by Jet Airways and has been renamed as JetLite.

It is a privately owned airline operating scheduled services connecting all metropolitan centres in India. The airline also provides helicopters which are available for charter services and aerial photography. Its main base is International Airport, New Delhi, with hubs at , Hyderabad, Chatrapati Shivaji International Airport, Mumbai, Chennai International Airport, Chennai and Netaji Subhash Chandra Bose International Airport, . The uncertainty over the airline's fare has caused its share of the domestic Indian air transport market, from approximately 11% in January 2006 to a reported 8.5% in April.

Sahara Airlines is part of the multi-crore Sahara India Pariwar. Air Sahara connects to 24 domestic and 4 international destinations with 134 daily direct flights and offer 13900 seats per day.

3 KINGFISHER AIRWAYS

Based in Bangalore, Kingfisher Airline is a private airline owned by Dr. Vijay Mallya. It started its operations on May 9, 2005 with a fleet of 4 leased Airbus A- 320 aircrafts. Presently it covers destinations like Agartala, Ahmedabad, Bangalore, Bhubaneswar, Chennai, Coimbatore, Delhi, Dibrugarh, Guwahati, Goa, Hyderabad, Jaipur, Jammu, , Kolkata, Mangalore Mumbai Nagpur, Pune, Srinagar , Udaipur, Varanasi, Vijayawada and Visakhapatnam

It offers several specialized services to its customers like personal valet at the airport to assist in baggage handling and boarding, exclusive lounges with private space, audio and video on-demand, extra-wide personalized screens in the aircraft and three-course gourmet cuisine.

Currently operating aircraft like Airbus A320, Airbus A319-100 and ATR-72, Kingfisher was the first airline in India to operate with all-new aircrafts. Kingfisher Airlines has notched up several firsts to its credit like being the first Indian airline to order the new Airbus A380.

In June 2005, it hit the headlines by placing an order for 5 A380s, 5 A350-800 aircraft and 5 Airbus A330-200 aircraft in a deal valued at over $3 billion.

At the Dubai Air Show in November 2005, Kingfisher Airlines placed an order for 20 ATR 72-500s in a deal estimated to be worth $500 million alongwith an order to acquire 30 more A320s in a deal estimated to be worth $2 billion.

The Airbus A380-the largest passenger liner in the world visited India as part of Kingfisher Airlines' Second Anniversary celebrations from May 7, 2007 to May 10, 2007. Kingfisher has set high standards in terms of product and service offering and has been constantly innovating. Its vision is to constantly deliver a safe, value-based and enjoyable travel experience to all its customers. It has placed a strong emphasis on safety.

2.7 MARKET SHARE

According to the figures on market share of various scheduled airlines in the same year, Jet Airways topped the list with 46.7 % in 2003-04, followed by Indian Airlines (IA) and its subsidiary Alliance Air together at 39.3%, Air Sahara at 13% and Air Deccan 1 %

MARKETING STRATEGIES

Over the years, Indian Airlines has been proactive in the introduction of various marketing initiatives to provide improved services to the passengers and thereby retain competitiveness in the market. The initiatives seek to stimulate the market by creating new market segments and to provide value-enhanced services to our passengers. In line with its status as the national carrier of the country, IAL offers various discounts on domestic fares on a permanent basis. Such concessions are extended to the Armed forces personnel, War Disabled persons/War Widows, Para military forces, Recipients of Gallantry awards-Civilians, Students, Senior Citizens, Cancer Patients, Blind Persons, etc. Similar concessions are also extended to Sports persons participating in national sports events and to Arjuna awardees. There are various other promotional fares and schemes available to the public at large. Some of the efforts, taken in this direction during the year which were aimed at offering an enhanced product value to passengers as well as increasing awareness about our brand in the market, are listed hereunder:

1 Corporate help desks have been set up at the metros to facilitate corporate clients.

2 A Bumper Super Saver Scheme was introduced during the year offering 16 coupons for Rs 65,000/- in Economy Class and Rs 100,000/- in Executive Class.

• The Smart Super Saver Scheme was introduced to offer multiple coupon tickets for a fixed price for those who aim to travel extensively in a short period of time

• The Super Saver International Scheme was introduced which offered multiple coupons at a fixed price to foreign nationals and non-resident Indians.

• The Joint Frequent Flier programme of IAL and Air India called 'Flying Returns' was further strengthened by launching a dedicated micro-site www.flyingreturns.co.in. The programme has been further extended to Sri Lanka, Bangladesh and Nepal during the year.

• IAL offers single window holiday packages under the name of 'IA Flyaways'. These Holiday Packages were further strengthened during the year and now are 30 in number covering more than 80 destinations spanning 8 other countries apart from India giving a choice of more than 200 hotels.

• The Advance Purchase Excursion Fares (APEX) schemes continued during the year and were available for sale within India at INR fare level as well as world-wide on USD fare level. Apart from the already existing D-7, D-21 fares, new Apex Fares under D-28 and D-45 were also launched during the year.

• Effective 1st April 2004 Positioning Flight Fares were introduced on certain select sectors, which have brought down the fares on these sectors to the level of almost AC Chair Car levels. These fares were available on 24 sectors of the domestic leg of international flights.

• lA's special promotional fares under the name of Fly Select Fares were launched w.e.f 15th September 2004. These were lower than the normal published fares and were available at two levels for limited seats on first come first served basis.

• Effective 5th July, 2005, Indian Airlines has introduced lower fares called 'Easy Fares' on specified domestic sectors for travel in economy class. These fares are lower than the normal published fares and are available on a maximum of four levels on rupee fare. The levels vary between 1 and 4. With the introduction of 'Easy Fares", the APEX Fares, Positioning Flight Fares and Flight Select Fares have been withdrawn.

• Bookings through IDBI Bank ATMs introduced w.e.f. 27,th October, 2005.

• The Pay Smart Scheme launched in collaboration with ICICI Bank offers ICICI Credit Card holders to pay for their travel in 10 monthly installments. This facility is currently available only at the six IA Major Metros and is effective till March 2006.

• Various Co-Branded Cards of IA also continued during the year viz. lA- Amex Gold Card, lA-Amex Green Card, IA - Amex credit card, IA-ABN Amro Debit Card. • The Bid and Fly Scheme as well as the Website and on-line booking of tickets also continued during the year offering tickets at attractive prices as well as making available various interactive features .

• The Net Ticket facility launched during the year enables passengers to log on to the IA Website and reserve, buy and print ticket image.

• The IA Access facility launched during the year is an information service for passengers where they can send an'SMS' to the number "67671407" and get arrival and departure information of any flight of the same day, previous day or next day.

• The J Smart Scheme launched during the year is a short term promotional scheme which offers a passenger paying full fare on business class, a ticket for a companion at 50% discount on the full business class fare.

. • The IA Family Ticket Scheme launched effective 1st Nov'04 offers a maximum of two children under the age of 12 years of age to travel free with two full fare paying adult passengers.

• Indian Airlines Call Centre is now accessible from anywhere in the country on a Single Toll Free Number 1800-180-1407 from any landline or Mobile of MTNL/BSNL. The user of landline or Mobiles other than MTNL/BSNL atBangalore, Chennai, Delhi, Hyderabad, Kolkata and Mumbai can access IA Call Centre on 1407. Similarly, passengers using any landline or Mobile other than MTNL/BSNL from places other than six cities mentioned above, , can access 1407 with prefixing the STD code of any of the six cities mentioned above.

, • To keep pace with the changing aviation scenario in the market place and with a view to offer value added services to our esteemed passengers, a new facility called 'Dial - a - Ticket' (DAT) has been introduced from 21st October2005 through IA Call Centre. Using this facility a passenger can call any time, from any part of India, and make a reservation on real time basis and pay for the same through credit card and receive the equivalent of ticket termed as "Itinerary Receipt" (ITR). CHAPTER-3

FINANCIAL ANALYSIS

(Rs Balance sheet crore) Mar ' 06 Mar ' 05 Mar ' 04 Mar ' 01 Mar ' 00 Sources of funds Owner's fund Equity share capital 107.14 107.14 107.14 105.19 105.19 Share application money - - - - Preference share capital - - - - Reserves & surplus -440.80 -440.80 -506.19 -118.44 37.34 Loan funds Secured loans 313.43 313.43 406.89 91.28 51.05 Unsecured loans 118.56 118.56 283.90 1,336.53 1,627.88 Total 98.33 98.33 291.74 1,414.57 1,821.47 Uses of funds Fixed assets Gross block 5,497.00 5,497.00 5,458.74 5,484.50 5,369.74 Less : revaluation reserve - - - - Less : accumulated depreciation 3,931.82 3,931.82 3,665.83 2,933.60 2,660.38 Net block 1,565.18 1,565.18 1,792.91 2,550.89 2,709.36 Capital work-in-progress 12.62 12.62 3.69 5.35 13.55 Investments 112.40 112.40 66.35 2.36 2.36 Net current assets Current assets, loans & advances 1,276.64 1,276.64 1,149.30 1,091.57 1,005.35 Less : current liabilities & provisions 2,868.51 2,868.51 2,720.51 2,235.61 1,909.16 Total net current assets -1,591.87 -1,591.87 -1,571.21 -1,144.04 -903.81 Miscellaneous expenses not written - - - - Total 98.33 98.33 291.74 1,414.57 1,821.47 Notes: Book value of unquoted investments - - - 2.25 2.25 Market value of quoted investments - - - 1.32 Contingent liabilities - - - 65.83 33.27 Number of equity sharesoutstanding (Lacs) - - - 1051.94 1051.94 CHAPTER-4

ORGANIZATIONAL STRUCTURE 4.1 ORGANIZATIONAL STRUCTURE

The form of an organization that is evident in the way divisions, departments, functions, and people link together and interact. Organization structure reveals vertical operational responsibilities, and horizontal linkages, and may be represented by an organization chart. The complexity of an organization's structure is often proportional to its size and its geographic dispersal. The traditional organization structure for many businesses in the 20th century was the bureaucracy, originally defined by Max Weber. More recent forms include the flat, network, matrix, and virtual organizations. These forms became more prevalent during the last decades of the 20th century as a result of the trend toward restructuring and downsizing and developments in telecommunications technology. According to Harold J. Leavitt, organization structure is inextricably linked to the technology and people who perform the tasks. Charles Handy has shown that it is also directly linked to corporate culture. ORGANISATION CHART

Chairman & Managing Director

Dy. Managing Director Dy.Managing Director

Director Director Director Direct Director Director Director Director Director Director Director GM GM Director JEOC Ground Planning or Flt. Corpt Systems Cargo Training HRD (IT) (Med) (Civil) Egg. Support & Oprns. Safety Affairs Projects

Director Director Director Director Director Director Director Regional Pers.& Chief Vig. Inflt. Sves. Finance Audit PR Comml. Security Directors IR Officer RECRUITMENT SECTION

In Indian airlines, recruitment is mainly done for three categories- . Flying crew . Technicians . Non technical

Here the recruitment is done in three ways o Direct recruitment o Promotional recruitment o Deputation

Direct recruitment

In this the person is supposed to go through the actual procedure of recruitment and selection according to the different eligibility criteria. Entrance tests, group discussions and interviews are the methods of selection in IAL.

Promotional recruitment

In this, the already employed employee is promoted on the basis of appraisal, service, conduct etc. The employee is given proper training to perform the new job in the best way.

Deputation

It is a process of hiring an employee for specific purpose. The employee can be hired from some other department or branch for a certain time period according to the requirement. In such cases, the employee is paid for his original post and apart from this he is given certain deputation allowance. Once the requirement is fulfilled, the employee reports back to his original department or branch. 3% reservation is made for handicaps. Three categories of handicaps have been identified which are --Visually impaired --Hearing problem --Orthopedic problem

The selection board constitutes of three officers which are the General Manager (Personnel), nominee of the concerned department and a SC/ST/OBC officer.

GM (personnel) and departmental officer are the competent authority for grade ½ and the selection of the employees of this cadre are done through interviews only.

Employees, who have applied through sports quota, are exempted for any written tests and group discussions TRAINING:

Training is generally defined as “Change in behavior”.

According to Edwin B.Flippo, training is the act of increasing the knowledge and skills of an employee for doing a particular job. Training refers to the methods used to give new or present employees the skills they need to perform their jobs. Training is a hallmark of good management, and a task manager ignore at their peril. Having high-potential employees doesn’t guarantee they will succeed. Instead, they must know what you want them to do and how you want them to do it. If they don’t, they will do the jobs their way, not yours and do nothing productive at all. Good training is vital.

Employee training is the most important sub-system of human resources development. Training is a specialized function and is one of the fundamental operative functions for human resource management. Training is an act of increasing knowledge, skill, behaviour and attitude. It bridges the differences between job requirements and employee’s present specifications. Organizational objectives like viability, stability and growth can also be achieved through training. Training enhances 4Cs viz. competence, commitment, creativity and contribution for the organization.

GENERAL BENEFITS FROM EMPLOYEE TRAINING AND DEVELOPMENT

1. Increased job satisfaction and morale among employees. 2. Increased employee motivation. 3. Increased efficiencies in processes, resulting in financial gain. 4. Increased capacity to adopt new technologies and methods. 5. Increased innovation in strategies and products. 6. Reduced employee turnover. 7. Enhanced company image. 8. Risk management, e.g., training about sexual harassment, diversity training. 9. Increase in profitability. 10. Improve health and safety. 11. Improves labour-management relationship.

Need for training:

Training needs are identified on the basis of organizational analysis, job analysis and manpower analysis. Training needs are those aspects necessary to perform the job in an organization in which employee is lacking attitude, aptitude, knowledge and skill.

Specifically the need for training arises with to following objectives: 1 To match employee specifications with the job requirements and organizational needs. 2 Organizational viability and transformation process 3 Technological advancement 4 Organizational complexity 5 Human relations

Training needs can be assessed by using the following tools:

1. Meet with the management:

Since most supervisors are involved with the planning of projects and the future of the company, they know what will be needed. They should be able to communicate where their employee’s current abilities lie and what is needed to get them to the next level for new project on the horizon.

2. Meet with the employees:

Discussion can be done with the employees regarding what struggles they may be facing from day-to-day and what would make their job easier and more efficient. Care should be taken to keep them focused on what they need rather than what they want. 3. Conduct surveys:

Surveys are beneficial because many people can be polled in a short period of time. Additionally, surveys provide employees with the opportunity to confess a need on paper that they may be too embarrassed to admit needing in a face-to-face meeting.Surveys can be performed in the form of a questionnaire and can include close- ended or open-ended questions, or a series of both. Close-ended questions require the respondent stay within certain perimeters, so the answers are limited, tabulating the data is simple. Open-ended questions allow an employee to provide more feedback and introduce new ideas that may not have been considered initially.

4. Conduct focus group:

Focus groups allow for small group interaction, allowing the assessor to uncover details about their target audience. Brainstorming is encouraged allowing for an exchange of new ideas and a revelation of what training may be needed.

5. Review company goals and mission statement:

A brief review of the company’s past and where they are headed for the future may reveal valuable information for training. A comparison should be made of what employees are currently doing and what will be expected of them as the company continues to grow and change. METHODS OF TRAINING:

The various methods of training may be classified into the following categories:

(i) On-the-job training. (ii) Off-the-job training. (iii) Vestibule training.

On-the-job training:

On-the-job training is considered to be the most effective method of training. Under this method, the worker is given training at the work place by his immediate supervisor. The worker learns in the actual work environment. It is based on the principle of ‘learning by doing’. This method is suitable for imparting skills that can be learned in a relatively short period of time. It has the chief advantage of strongly motivating the trainee to learn. On-the-job training methods are relatively cheaper and less time consuming. There are four methods of on-the-job training described below:

(i)Coaching

The trainee is placed under a particular supervisor who functions as a coach in training the individual. The supervisor provides feedback and offers suggestions for improvement.

(ii)Position rotation

This type of training involves movement of the trainee from one job to another. The trainee receives job knowledge and gains experience from his trainer in each of the different job assignments. (iii)Job instruction

The trainer explains to the trainee the way of doing the jobs, job knowledge and allows him to do the job. The trainer appraises the performance and corrects the trainee.

(iv)Committee assignments

A group of trainees are given and asked to solve an actual organizational problem. It develops team work.

Off-the-job training:

It requires the worker to undergo training for specific periods away from the work-place. Off-the-training methods are concerned with both knowledge and skills in doing certain jobs. There are several off-the-job methods of training described below:

(i) Special lecture cum discussion .

It is also known as ‘class room training’. It is associated with imparting knowledge. The special lecture may be delivered by some executives of the organization from vocational and professional institutes. Many firms also follow the practice of inviting experts for special lectures for the staff. The lecturer communicates his thoughts in such a manner as to interest the class and cause the trainees to retain what he has aid. This method can be used for providing instruction to large groups. Thus, the cost per trainee is low.

(ii) Conference training

In this method the members tries to develop knowledge and understanding by oral participation. It is conducted in a big hall where the participants are allowed to exchange their views and raise queries. The proceedings of the conference are conducted by the chairman who is also responsible for summing up the proceedings of the conference. (iii) Case study

Under this method, the trainees are given a case which is more or less related to the concepts and principles already taught. They analyse the problem and suggest solutions .This method gives the trainee an opportunity to apply his knowledge to the problem.

(iv) Programmed instruction

The subject matter to be learned is presented in a series of carefully planned sequential units. These units are arranged from simple to more complex levels of instruction.

Vestibule training:

The term ‘vestibule training’ is used to designate training in a class- room for semi-skilled jobs. It is most suitable where a large number of employees must be trained at the same time for same kind of work. Here the emphasis tends to be on learning rather than production. In this method an attempt is made to duplicate, as nearly as possible, the actual material, equipment and conditions found in the real workplace. TRAINING SECTION

Training section coordinates with various departments and outside faculty for organizing the programs. Training and development programs were initiated almost 30 years ago with the establishment of management training centre at corporate level and regional training centers at regional level. Training programs are basically for job knowledge, induction of company information, personal growth and supervisory management and development.

IAL carries out the training programs on the basis of following policies:

1. Needs are identified at various levels in the organization and organize programs to meet these needs.

2. Nomination to be made on the basis of individual need for personal growth and career progression in the company and requirement of the job.

3. Training to be a continuous activity.

4. New entrants to be included through special orientation program.

5. Participants on return from training are expected to share learning with colleagues.

6. Development of team works and inter department relations.

7. To develop more people from within as faculty resource in training effort.

8. Communication of plants and policies of the company at different levels DEPARTMENTS IN INDIAN AIRLINES

Indian Airlines has a well defined classification of the services on the establishment. The services are classified in accordance with their functional groups into departments. Each department is further classified into cadres based on the sub-functional groups. This classification of the establishment strength achieves the professed objectives of the Air Corporation Act of 1953, namely ‘efficiency and safety in operations’. The classification defines the objectives and functions of the personnel on the establishment strength and achieves a well defined structure of focused responsibility contributing significantly to the achievements of the organization. The departments on the establishment are:

1. Flying operation 2. Ground operation 3. Central Training Establishment 4. Voice communication cell 5. Engineering 6. Engineering Facilities And Plant Maintenance 7. Engineering (Non Tech.) 8. Civil Work 9. Ground Support 10. Surface Training 11. Commercial 12. Catering 13. Public Relation 14. Finance 15. Internal Audit 16. Electrical data processing 17. Medical 18. Personnel 19. Vigilance/ security 20. Planning 21. Canteen 22. Flight safety 23. Store & Purchases A brief description of few departments, which were visited, is as follows:

--Internal audit --Medical --Finance --Public relations --Avionics Complex A-320

INTERNAL AUDIT DEPARTMENT

Traditionally Internal Audit was confined to the verification of accounting data and to determine the accuracy and reliability of accounting statement and report. With the increasing size of business having diversified range of product spread over the vast geographical areas, because of economic competition with the fast pace of globalization and government regulation, the role of Internal Audit had to change in order to provide continuous support to management in identifying areas for improvements & to review the system to ensure adequacy of internal controls, greater transparency & to better corporate governance

Today, the role of Internal Audit in emerging as business consultants where in it has to perform multifunctional audit which meets the requirements of the organization not only for various compliances but also to provide value added suggestion for the overall improvement. Internal audit in IAL has also been changing its role to meet the need of the company & emerging as an aid to input to make the business more efficient & effective by adopting the best business practices. A minimum audit program is drawn in advance & is carried out keeping in mind the convenience & availability of staff of the audit. Audits are performed by the audit committee, statuary auditors & government auditors. MEDICAL DEPARTMENT All employees of IAL are eligible to get treated free of cost at hospitals and medical centers which have a tie-up with IAL. Until the employee is working with the organization, his treatment and his spouse’s treatment are 100% reimbursed or credited towards the company while after retirement the benefits for the employee remains the same but not for the spouse. Medical benefits for children is provided up till the age of 30 years or until they get employed or until get married. While selecting the suppliers, purchase orders are made and the suppliers with the best required quality & lowest quotation is finalized. Medical claim & leave system for different employees are different depending on their work profile. Every station of IAL in India has a medical department set up for the convenience of the employees.

FINANCE DEPARTMENT

The Finance department in IAL, Northern Region has 6 functions: i. Payroll processing

The salary of any employee consists of a fixed part, which is the basic salary, & variable part. A program has been designed in such a way where few variable quantities when entered results in the attainment of final figure of the salary. These variables can be overtime; holiday’s etc. promotion of an employee is also a case, which is considered while processing of the payroll. ii. Final settlement

When an employee gets retired or expires while in service the finance department pays all his dues. iii. Provident fund

Every employee of IAL maintains a provident fund account updating which is the function of finance department. 10% deduction in the salary is made for provident fund purpose.

iv. Revenue by handling

IAL has been assigning the flight handling duties for all the airlines at Palam Airport. The revenue generated by this is also collected & taken care off by the finance department. On an average, 5 to 10% of the total revenue is generated by the handling. v. Finance and budget

The finance department supports strategically decisions involving financial issues like investment. Budgeting is also a major function of finance department where capital & revenue budgets are made considering the requirements of each department. The rules and regulations made by the government are followed while making the budget. The budget is made in February each year and revised after 9 months. The revenue for the period 2005-2006 was 6048 crores & expenditure for the same period was 5965.50 crores. vi. Banking

The finance department has a bank section whereby all the cheques are cleared & payments are made. The signing authority for the cheques is not any employee of the bank section. At least two officers above the grade of Dy.Manager are necessary for clearance of any cheque. This is a provision made to check and avoid any sort of fraud or mal practices. PUBLIC RELATIONS

The role of Public Relations department is to identify, establish & maintain relations between organization & various policies. The public to the organization include customers, suppliers, agents, general public and the employees. The Director of Public Relation has to report everything to the CMD of IAL, as he is the one answerable to the public.

There are three units I the PR department namely:

1. Media relations 2. Advertising 1. Publication

The functions of media relations are:

• Interaction with journalists • Scanning of news papers, magazines & other advertisements • Press releases • Press conferences

The functions of advertising unit are:

• Inform about schedule changes • Inform about promotional schemes • Institutional advertising

Publication unit of PR department handles the publishing of “SWAGAT” which is the in-flight magazine, “IMAGE” which is the in-house publication, annual reports, timetables, company brochure etc. the PR department is also looking after community relations as well. It also organizes cultural evenings, meetings with trade & commerce etc. The budget allotted to PR department is about 12 crores. CHAPTER-5

SWOT ANALYSIS SWOT ANALYSIS OF THE ORGANISATION

For a country of continental size like India, a strong reliable and efficient civil aviation sector goes a long way in promoting and sustaining tourism. Indian Airlines being the undoubted leader in this industry cannot operate in a vacuum. It needs to keep its eyes and ears open to survive in the liberalized economy of our country, which has paved a way for any private airlines to operate along with it. The internal and external environment contained various strengths, weaknesses ,opportunities and treats which need to be identified well in advance to take care of various situations arises out of them. We shall now try to focus on the above mentioned factors in context with present scenario none by one.

STRENGTHS

The major strength of Indian Airlines is its vast infrastructure support built over last four decades. We shall now identify the major strengths of Indian Airlines.

FLEET’S STRENGTH

 Indian Airlines is one of the largest regional airlines the world and is equipped with modern fleet of airbus A-300, A-320, and Aircrafts.  As compared to the fleet of Indian Airlines the total fleet of all private Airlines combined together is just half of that Indian Airlines which clearly shows the superiority of Indian Airlines over this factor.

VAST COMPUTERIZED NETWORK

 All the domestic stations of Indian Airlines each of linked with computer network, which provides an instant reservations and up to date information of each station instantly. This is no doubt a great achievement, which proves that Indian Airlines has realized its potential.

 Hence acquired the needed technology quite earlier. However a private airlines is still a way far behind in this regard. LARGEST NETWORK

 Over the last 46 years, the airlines have built up a reliable and stable services schedule one that today links 73 destinations including 16 in the neighboring countries. From the gateway cities of Delhi in the north, Bombay in the west and Calcutta in the east and Madras in the south, the passengers can take off in an Indian Airlines flight to any places of his choice, so wherever you are Indian Airlines is within easy reach. In comparison of this each private airline operates to maximum of 30.  Destinations, which is no way near the destinations provided by Indian Airlines.

MOST MODERN FLEET

 Indian Airlines has been regularly updating its fleet. Starting from Viking and Dakotas it has now acquired Airbus A-320 the modern aircraft having a technology of fly by wire and is now in now in the process of phasing out Boeing 737 or other smallest aircraft, which are becoming obsolete and uneconomical too.

MAINTENANCE FACILITIES

 In aviation industry, maintenance plays a vital role. It is the backbone of the organization and no organization can survive unless and until it has good maintenance facilities, Indian Airlines have understood this very well and have maintenance facilities in Delhi, Hyderabad and Calcutta. The engineers here are well qualified and hold a reputation of one of the best aviation industry. Private airlines are quite dependent upon their foreign collaborators to maintain their aircraft, which is a costly affair. WEAKNESSES

LACK OF PERSONALIZED AND CUSTOMER FRIENDLY SERVICES

 This is one of the major findings of the study .Almost every passenger has found that Indian Airlines staff needs to be more customer friendly and more professional in his approach. In service industry, it s a kind of that matters and leaves its impression in the mind of the passengers and is the measurement of the quality of product. Indian Airlines needs to take immediate steps in this regard to change the public opinion.

OVERSTAFFING

 The total staff of IOL is 20945. On an average 21000-22000 people daily travel on IOL on its 230 flights daily which mean that there is no staff recruited against every passenger traveling. This is no doubt a bad sign. IOL has understood his weakness now as a result which there is no major recruitment for last 5 years. Also there are around 2000 employees retiring with in next 2 years, which will trim the staff size automatically.

UNDER UTILISATION OF CAPACITY

 IAL sells space, which is highly perishable. An empty space means an opportunity lost. By capacity, we mean the total no. of seats offered by Indian Airlines daily to its passengers, it has observed that Indian Airlines offers around 34000 seats daily where as on average 22000 seats are utilized meaning an average seat factor of about 64%, it is imperative to improve upon the situation before it is too late. M ore marketing efforts is required to attract large passengers. OPPURTUNITIES

GROWTH OF AVITION INDUSTRY

 The recession in the west, the gulf war and Surat outbreak /Kargil war all these slowed tourist growth and consequently affected the airlines revenue. However, these were transit setbacks as has been proven by the recovery of global tourist activity. Aviation industry is growing at the rate of 10% per year. This is no doubt a good sign and IO must exploit this opportunity and take maximum benefits out of it.

CLOSING DOWN OF VARIOUS PRIVATE AIRLINES

 Private airlines started operations with great zeal and enthusiasm after the revival of OPEN SKY POLICY. Their history is only few years and we are already findings the signs of their decline. The private airlines like Dalmania, East, West, Modiluft, UP Airways, have all ceased to exit. This clearly indicates that aviation is not an easy business or a child’s play.

 IAL should take it as an opportunity and try to fill this space by expanding its market share but it has to serious efforts in this regards by taking out various attractive schemes of discounts and wider advertisement.

CLEARANCE BY THE GOVERNMENT TO OPERATE AN INTERNATIONAL ROUTE

 Earlier IOL was not allowed to operate on international sectors, as Air Indian took it. With the liberalization of Indian economy, government of India gave Indian Airlines a green signal to operate on long routes and it is only this attraction Indian Airlines has branched out to operate on 17 international sectors. NET PROFITS AFTER A GAP OF 7 YEARS

 Indian Airlines has been running in red from the year 1989-90 to 1996- 97 for one reason or the other. It has started earning profits since then, (profits for the year 1997-98 47.27 crores for the year 1998-99 Rs.14.5 crores and the tentative profits for the 1999-2000 is also expected to be more than Rs.50 crores).

CREATION OF PROFITS CENTERS

 Due to its size Indian Airlines in unable to be nimble, as it ought to be in terms of decision-making, customer services and employee motivation. Consequently, an integral part of turn around strategy was to hype off certain activities into separate profit.  Centers, to make them more focused, flexible and accountable. It was with this in mind that Indian Airlines created the following profits centers.  Central training establishment.  Jet engine overhaul complex.  Alliance Air.  Ground support  Cargo  Auxiliary power unit  The profit centers have already made useful contribution in the improved performance of Indian Airlines.

PROPOSED DISINVESTMENT IN INDIAN AIRLINES

 The government of India has recently announced its decision to disinvest 51% of the government equity would be given to a joint partner who will have the functional autonomy in running the airlines. The remaining 25% would be done within the framework of Domestic Air Transport policy, which at present permits foreign equity up to 40% & non resident Indian/Overseas corporate bodies investment up to 100% in domestic air transport services. THREATS

COMPETITION ITSELF

 Ever since the inception of Indian Airlines it had never tasted competition, as it was a protected monopoly. When the private airlines entered this field of way to tackle, it started condemning the government policy and thoughts it as a threat to its existence. It is only recently that it realized that private airlines are here to stay.

INSTABILITY IN THE POLITICS OF INDIA

 For the last 4-5 years there has been a great uncertainty in the politics of India. Since majority of Indian Airlines policies requires the approval of government, hence uncertainty in the political circle hinders the decision making of Indian Airlines. Every government has its own perception about aviation industry resulting in the change in the policy under short intervals. This not only results in the low morale of the management but also makes it indecisive which is not good for the organization.

INDUSTRIAL UNREST

 Strike is a familiar word for Indian Airlines. Every now and then we hear the call of strike either by pilots, engineers, or ground staff, which result not only in huge losses but also causes lot of inconvenience to the passenger resulting in loss of image and credibility in the market. Indian Airlines must take a serious view about it and sort the things before it is too late.

These were the strengths, weaknesses, opportunities and threats. Indian Airlines must try to evaluate each of them with regards to its internal and external environment. MY LEARNINGS FROM THIS PROJECT

While preparing this project report I learned lots of facts about Indian Airlines Limited which I never knew before. It was a great experience making this project report as it taught me the following:

How did it developed its business?

Its market share

Its distributional channel

Its brands, product mix and product lines

The marketing strategies

The strengths, weaknesses, opportunities & threats

Training & development policies.

Recruitment & selection procedures BIBLIOGRAPHY

References: www.indianairlines.nic.in www.google.com