Air China Hrm

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Air China

Human Resources Management

Monday, 8 May 2006

Bader Al Sagri


2Context of the industry3
3Air China Business Challenges and Strategies4
3.1Business Challenges4
3.2Business Strategies4
4.1Recruitment & Selection5
4.3.1Current policy8
4.3.2Issue identification9
5Human Resources Recommendation10
5.1Recruitment and Selection10
5.3.2Middle term recommendations:11
5.3.3Long-term recommendations:12

Air travel plays a significant role in today’s world, not only for leisure passengers, but also for business passengers. Air travel has become an important form of transport for many and is no longer viewed as a service only for the elite, which is apparent when considering two billion airline passengers are transported annually. (ATAG, 2005) This in turn provides benefits to global economies, especially developing countries such as in the Asia Pacific. Air China is an example.

In this report we will begin briefly by an Airline industry analysis. This is followed by Air China’s Business Challenges and Strategies, in which we will look into its HR Policies, and align it with Air China’s Overall Strategy. Then conclude with recommendations.

Although, Air China has focused on 2 aspects of Human Resources Tools, one was of improving their employee evaluation system. We have chosen 3 HR tools, which does not include the employee evaluation system, not because its lack of importance, but its difficulty in finding appropriate information to develop a accurate analysis and recommendations on the topic. Our 3 topics are: -

Recruitment & Selection
Context of the industry
It’s amazing to know that 900 airlines are in operation that contributes to 22,000 aircrafts, flying over several million kilometers. (ATAG, 2005) In 2004, passenger traffic jumped 14% overall, 16% in international service from the previous year. (Rolls Royce, Donoghue, 2005) Although, there are 900 airlines, we only hear about the top airlines and their powerful brands. With 900 airlines, the airlines industry is an extremely competitive.

Although, Chinese airlines have not emerged as global brands, with the exception of Cathy Pacific Airlines, they are now looking into the future, especially after Chinas induction into the World Trade Organization.

Chinas economy is forecasted to grow by 8 percent a year through the year 2010 and an aviation market growing at rates above the world average. China is experiencing tremendous strain on its aviation and airport infrastructure. Over the next twenty years, China predicts that its air transportation passenger volume is expected to grow by an average of 8 percent annually, become the world’s second-largest aviation market, and will need to acquire an additional 2,600 aircraft to handle the volume. (US Commercial Service, 2005) Air China Business Challenges and Strategies

Business Challenges
One of the most challenges faced by Air China is that how to differentiate its service characteristics and value from competitors. Because of its current ownership (government owned), Air China with an outmoded and rigid management system lacks flexibility to advocate service quality and management model innovation (Efendiog and William 2003). As a result, Air China only copies other players’ training programs and management model without obvious competitive advantages to cope with imminent international and fiercer domestic competitions.

Another challenge is China’s induction into the World Trade Organization (WTO), which has an agreement; four air transportation services should be opened among the member countries (Ahmed et al. 2003). That means China Airlines will face significant challenges that will come from international...
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