Management and organizational structures

Management and Organizations

Brief History of the Organization

The French company states that they first came to being in order to challenge the Americans' supremacy on the international aircraft market. The company was formed in 1970 as the result of a consortium between France's Aerospatiale and Dutch Airbus. The company then merged with Spain's CASA and British Aerospace. In 2001, all four components unified under a single company, based in Toulouse, France (headquarters were set in 1974). In 2004, the aircraft company managed to overthrow their main competitor, American Boeing, by registering more sales and securing more orders. Today, they are the sole possessor of the largest airplane on the globe, the Airbus A380, which can transport up to 800 travellers at one flight.

Mission and Vision

Airbus' mission is to meet the needs of airlines and operators by producing the most modern and comprehensive aircraft family on the market, complemented by the highest standard of product support.

The company's vision is that of carefully listening to what their customers have to say in order to improve the quality of their products and services. Their vision is represented by the forward thinking which has placed Airbus at the forefront of the industry.

3. CEO management style

Airbus is presided by Thomas Enders, President and Chief Executive Officer, since August 2007. Under his leadership, "Airbus management will implement cost reduction and cash generating measures leading to EBIT contributions of €2.1 billion from 2010 onwards and an additional €5 billion of cumulative cash flow from 2007 to 2010." The management at Airbus is focused on employees' and company's overall performance, the satisfaction of customers' needs and the registration of profits.

4. Location

In 2001, the four components, Spain, England, France and Germany joined under a single company, headquartered in Toulouse, France. However, the company continued to operate in all four countries, increasing their customer palette and expanding towards other international markets. Most components are designed and produced in Russia, North America, Japan, China and other 16 European countries, but they are generally assembled in Toulouse. The French city was kept as headquarters of the unified company as it is a rapidly developing European city and, by hosting Airbus, Galileo Positioning System, SPOT Satellite System and CNES, it is the largest space centre in Europe.

5. Environmental Scanning

Airbus continually scans the surrounding social and economic environments in order to identify the latest requirements that must be met. Aside from analyzing the developments made by the competition and attempting to top their offer, environment requirements also include:

Environmental protection through the development of economy and fuel efficient engines

The usage of the latest technologies

The complete satisfaction of customers' needs.

Out of these three features, the usage of the latest technologies is best revealed by Airbus' actions, in the detriment of the other two.

6. SWOT analysis

Strengths increased sales revenues increased orders an increased market share (44%) highly skilled and trained personnel significant and rapid growth and development, revealed by strong financial highlights the ability to produce high quality aircrafts with reduced human and financial resources commitment to satisfying the customers' needs excellence in the area of product development, improvement as well as design

Weaknesses in their immense desire to create technologically perfect aircrafts, Airbus sometimes neglects customers' needs and the environment requirements

Airbus airplanes are extremely large, hosting up to 800 individuals, but lack in regard to the comfort and the safety offered

Opportunities market liberalization and globalization which allow Airbus to benefit from each country's comparative advantage (production and design in numerous countries and assembly in France) increased demand for high quality aircrafts that promote safety and comfort the setting at the core of the European space technology grants easy access to the latest technologies in the domain

Threats fierce competition on the international aircraft market, especially from American Boeing consumers' mistrust in airplanes and decreasing demand, as a result of increasing terrorist attacks the possibility of loosing territory to Boeing due to less experience in the aircraft business and the association to a new entrant

7. Comparison to Boeing

The general perception is that Boeing is the undisputed international leader on the aerospace market and that Airbus is generally unable to properly function and its success is only based on state subsidies and sponsorships. However, in his book Boeing vs. Airbus: The Inside Story of the Greatest International Competition in Business, John Newhouse proves the opposite. He states that Airbus deserves the title of international leader as they produce similar products of sometimes superior qualities than Boeing. In addition, they do this by using fewer financial resources and with the aid of fewer people than Boeing. Also, to prove their superiority, he cites the years 2004 and 2005, when Airbus outnumbered Boeing's sales and orders.