Information Management Strategy: Virgin Australia

Executive summary This report serves as an information management strategy for the company Virgin Australia and has been written by the Masters of library and information science students Ramiro Moyano and Stefan Studer.

In the chapter ‘About Virgin Australia’, the reader gets an impression from the organisation which has been examined for this report. The part about historical milestones outlines briefly the most important changes and happenings in the history of the company, dating back to the year 2000. Followed by that, the authors present the business in general, also touching briefly down on the main operational focus of Virgin Australia. The SWOT analysis gives an overview about how the business sees itself concerning its strengths, weaknesses, opportunities and threats in the market.

The main chapter with the information audit is the core of the whole report and shows how a possible information strategy in practice could look like. After briefly explaining why the method of Henczel has been chosen and what this model is all about, the authors go through all the seven steps how to set up a possible information strategy solution for Virgin Australia.

The planning stage is regarded as a very critical point in this process where it is a must to understand the organisation and develop clear goals. The next step in the information audit model of Henczel is the data collection. Three different types of data can be collected: data relating to information required to perform tasks and activities, data relating to the ‘level of criticality’ of information resources, tasks and activities and data relating to information transfer. Before data can be used for further evaluation, it has to be analysed. A set of data could show anomalies or prove some developments which the company was aware of. At the fourth stage, the data evaluation, the authors took a closer look at the information needs and issues of Virgin Australia. In this step, the company has to evaluate if the problem has a strategic significance for the future. The fifth stage is about communicating the recommendations. In the case of Virgin Australia, we recommend to contact the Executive team of Virgin Australia. The implementation of the recommendations is part of the sixth step in Henczel’s method. Here we came up with the solution of implementation via seminars and workshops. The final step in this model emphasises, that the whole process is iterative since the environment of Virgin Australia is always changing and highly competitive.

For the final of this report we created a roadmap, how a practical implementation of this information management solution could happen. The roadmap is based on the Prosci ADKAR model and contains three phases.

Table of Content Information Management Strategy: Virgin Australia .............................................................................. 1

Executive summary ............................................................................................................................. 1

Introduction ............................................................................................................................................. 3

About Virgin Australia ............................................................................................................................. 4

Historical milestones: .......................................................................................................................... 4

Business Overview ............................................................................................................................... 4

Products and Services: ........................................................................................................................ 5

SWOT Analysis: .................................................................................................................................... 5

Information Audit .................................................................................................................................... 7

Selection of the method ...................................................................................................................... 7

Henczel’s information audit ................................................................................................................ 7

1. Planning ........................................................................................................................................... 8

2. Data collection ................................................................................................................................. 9

3. Data analysis .................................................................................................................................... 9

4. Data evaluation ................................................................................................................................. 10

5. Communicating the recommendations ............................................................................................. 13

6. Implementing the recommendations ............................................................................................... 14

7. The continuum – information strategy ............................................................................................. 14

Roadmap ............................................................................................................................................... 15

Bibliography ........................................................................................................................................... 16

Introduction This report covers several information management issues around the example of Virgin Australia airline based on the information audit model of Henczel.

The authors give an overview of the organisation by providing insight into historical milestones of Virgin Australia, a business overview, a sub-chapter called products and services briefly displaying the operational scope of the airline, followed by the SWOT-analysis.

The part with the information audit is where the model of Henczel plays the main role. Since we do not have access to all the relevant information pieces of the company, we had to deal with limitations in this report and connect the literature knowledge with the material we could find by our research about Virgin Australia. This information audit process of Henczel consists of seven parts. The first stage is all about planning, where basic information about the organisation has to be understood and located. Data collection is the second step, where it is explained how an airline like Virgin Australia could access strategic relevant information. Followed by the collection comes data analysis. What kind of data has been collected and what type of data tells the organisation a relevant message for further operational decisions? Step number four is looking at data evaluation. In this chapter, several information needs and issues of Virgin Australia have been analysed and discussed with the approach of Henczel. The next chapter discusses how the recommendations for the information issues are being communicated within the organisation. For the sixth chapter, there are possible solutions how the recommendations which base on the previous steps, can be implemented into the airline Virgin Australia. The seventh chapter explains that the whole process of Henczel’s information audit is an iterative progress, which will repeat itself, since the market in which Virgin Australia operates changes over time.

About Virgin Australia Historical milestones: According to the website of Virgin Australia (n.d.), the organisation entered the market in 2000 under the name Virgin Blue with only two aircrafts, flying between Sydney and Brisbane, seven times per week. Only one year later, it expanded the amount of flight routes to 14 new domestic destinations and the one millionth guest has been welcomed on board.

In 2004, the business expanded to the Pacific Island with Pacific Blue, based in New Zealand and specialised in flights between Australia, New Zealand, the Cook Islands, Fiji, Tonga and Vanuatu.

Five years later, Virgin Blue flew for the first time to Los Angeles, USA from Sydney and from Brisbane to Los Angeles as well.

The year 2011 was a big year for the company where the name has been changed to Virgin Australia and the first destination in Middle East has been opened with a route from Sydney to Abu Dhabi. The agreement in a long term alliance between Singapore Airlines and Virgin Australia is a landmark moment in the history of the company. Virgin Australia offers a frequent flyer program called Velocity.

In 2012, Virgin Australia has been awarded as ‘Best Airline’ and ‘Best Staff Service’ in the 2012 Skytrax World Airline Awards. In that year, the airline went mobile with an app so that passengers can manage their travels online via smartphone.

Since the last year – 2016 – Virgin Australia collaborates with Air New Zealand in investigating new possibilities in locally produced biofuel. Virgin Australia also introduced a new seat category called Economy+ for more comfort during the flights. Plans of an alliance with HNA Aviation from China occur, since China has huge potential in terms of tourism.

Business Overview Virgin Australia Holding Limited (2017) offers a wide range of national and international passenger and cargo flights. It also provides solutions tailored for leisure, corporate, government and regional markets. The cabin classes of Virgin Australia are economy, premium economy and business class.

The business operations are classified into four different categories: Domestic Operations, International Operations, Velocity and Tigerair Australia.

On the domestic flight activities, Virgin Australia covers 47 destination with its fleet, to and from all major Australian cities. With a revenue of AUD 3,201.2 million from the domestic operations, it is accounting 63.8% of the total revenue according to the financial year of 2016.

Looking at the international traffic of Virgin Australia, there are 16 destinations being covered. The international flights are set in Trans-Pacific, Pacific Island, Trans Tasman, Middle East and South East Asian routes. The financial report of 2016 stated a revenue of AUD 1,016.3 million, which is 20.2% of the total revenue.

What is the Velocity segment? Velocity is the frequent flyer program of Virgin Australia where customers can earn points by using different type of services or by travelling with Virgin Australia. According to the financial report of 2016, the Velocity segment generated a revenue of AUD 327.6 million, which covers a percentage of 6.5 from the overall revenue.

Tigerair Australia is the budget category of Virgin Australia, covering routes across Australia and also reaches out to Indonesia. The report of 2016 displayed a revenue of AUD 475.9 million, 9.5% of the total revenue.

Virgin Australia not only deals with transport of passengers, but also cargo deliveries with a flight frequency of around 3400 flights per week. Cargo also includes the transport of animals. In addition to that, charter flights are also offered where passengers have the possibility to choose their personal flight schedule, destinations and services. On top of the flight services, Virgin Australia offers ancillary services such as holiday packages, hotel bookings, travel insurance, cruise booking, airport transfers, airport parking and car rental services. (Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis, p. 13, 2016)

Products and Services: According to Virgin Australia Holding Limited (2016), the main products and services offered are passenger transportation, cargo transportation, holiday packages, hotel booking, car hire, travel insurance, airport transfers, and airport parking. Brands being represented are Virgin Australia and Virgin Australia Holidays.

SWOT Analysis:

Fig 1: SWOT Analysis Virgin Australia, taken from Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis. (2016)

Strengths:

Strong business partnerships allow Virgin Australia alliances with several international companies to strengthen its position in the market. The company benefits from code-sharing and other agreements which create fruitful synergies to defend Virgin Australia’s position in the market.

These strong business partnerships work hand in hand with a strong market postion. Due to alliances with prestigious and international airlines such as Air New Zealand Limited, Etihad Airways P.J.S.C, Delta Air Lines Inc. and Singapore Airlines Limited, Virgin Australia could hold a strong market position and lead the company to one of the leading international airlines.

Virgin Australia is practicing a strong loyalty program in order to keep a stem of customers by rewarding their travel activities with a frequent flyer program called Velocity. A Velocity membership opens the possibility to earn points by using services of Virgin Australia. The airline works with organisations such as BP for example so that the customers have the possibility to earn points while making use of the gas station services. The Velocity system attracts thousands of new customers every year and Virgin Australia benefits from that development with a rising revenue. (Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis (2016)

Weaknesses:

The financial reports of 2016 revealed that there was a significant decline in income. The operational performance compared to its direct competitor Singapore Airlines is weaker even though Virgin Australia experienced a revenue increase on annual basis. The relatively poor performance could have negative effects on investors and the future growths prospects of Virgin Australia.

With a ratio of 0.6 in the year of 2016, Virgin Australia had to deal with a limited liquidity position. This limited liquidity brings Virgin Australia in a disadvantage, when it comes to funding opportunities in the airline market. (Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis (2016)

Opportunities:

In May 2016, Virgin Australia decided to cooperate with HNA Aviation Group Co. Ltd. in order to expand into the Chinese market as a part of strategic growth initiatives. Not only Virgin Australia expanded towards China, but also Italy via Alitalia. A code-share agreement with Singapore Airlines allows to fly new routes between Canberra, Singapore and Wellington. Initiatives such as these could strengthen the company’s return and operations.

A generally growing global travel and tourism industry could help to boost Virgin Australia’s position in the airline market. The World Travel & Tourism Council indicates with a worldwide GDP increase of 3.3% in 2016 a significant growth in this sector which will continue in the following decade. Especially countries such as China, India, Peru, Thailand, Indonesia and Kenya are potential contributors to the GDP among other nations in Africa and Asia. This growth could lead to further expansion of business activities of Virgin Australia.

Another development which could have positive effects on Virgin Australia is the rising global air traffic activity. If people fly more, Virgin Australia has to offer more services and therefore earns more revenue in return. (Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis (2016)

Threats:

There are numbers of unforeseen circumstances which could harm the business activities of Virgin Australia. Sicknesses occurring such as swine flu, Zika, SARS and others can have significant drops in numbers of tourists in countries which are affected. Other threats which could happen unforeseen are natural calamities and terrorist attacks. Circumstances like these trigger fear and people are less willing to travel.

One other major threat for the airline is the fierce competition in the market with other airlines. Direct competitors which are Singapore Airlines Limited, Air New Zealand Limited, Quantas Airlines Limited and Regional Express Holdings Limited are also planning to expand and grow in their business. Due to that aggressive competition between the airlines, there is always the danger of losing customers and revenue for Virgin Australia.

Stringent regulations could also threaten the airline business of Virgin Australia. All the airlines in the world have to strictly follow regulations of organisations, to make sure the airlines meet the standards while offering their services. Virgin Australia is complied with Federal Aviation Administration (FAA) and the Department of Transportation (DOT). In the past, the FAA came up with a new regulation, defining the amount of hours and rest periods of pilots. As a result, Virgin Australia has to react with hiring more pilots and pay more for the pilots. Violation of the regulations lead to fines and other penalties for the airline. (Virgin australia holdings limited : Leisure and arts - company profile, SWOT & financial analysis (2016)

Information Audit Selection of the method For this case, examining Virgin Australia, we decided to go for the information audit method of Henczel. What made us choosing Henczel’s approach of an information audit? First “unofficial” step was our first impression when we looked at the seven steps of the information audit model of Henczel. It seemed to us, that this method is straight forward and easy to understand and apply in this case where we have to write this report focusing on Virgin Australia. Raliphada & Botha (2006) concluded in their viability test of Henczel’s method, that the flexibility and cost effectiveness are the main advantages of this model. The aspect of flexibility comes from the seven steps, which might not be as detailed as other information audit methods, but organisations profit from that fact because it can be applied to many different contexts. In terms of the scope which can be covered with this approach, Henczel allows to conduct information from a large scope within the organisation. Henczel’s information audit How can the term “information audit” be defined? Henczel’s definition is as following: “An information audit is a systematic evaluation of information use, resources and flows, with a verification by reference to both people and existing documents in order to establish the extent to which they are contributing to an organisation’s objectives.” (Henczel, p. 215, 2000) Henczel (2000) generally describes information audit as a way to identify, which tasks occur in which part of an organisation. In addition to that, this process reveals, where knowledge is being created and shared. On top of that, information audit enables to identify the information flow between an organisation and its environment. If done right, an

information audit can tell us where it lacks on information and knowledge flow or where it lacks on efficiency when it comes to information sharing within an organisation. Henczel’s information audit model consists of seven steps:

1. “Planning 2. Data collection 3. Data analysis 4. Data evaluation 5. Communication recommendations 6. Implementing recommendations 7. The information audit as a continuum” (Henczel, p. 217, 2000)

1. Planning According to Henczel (2000), the planning stage is the critical step, in which the project could develop into a failure or a success. In order to set up the information audit process in a proper way, following five steps have to be included:

1. “Understand your organisation and develop clear objectives 2. Determine the scope and resource allocation 3. Choose a methodology 4. Develop a communication strategy 5. Enlist management support” (Henczel, p. 218, 2000)

Due to our limitations concerning information access and knowledge of the organisation, we stick in the planning section to the understanding of Virgin Australia and reference to the knowledge we have from the documents available online about the airline. From the annual report (2016), there are some clear statements what Virgin Airline stands for and is aiming for in the future. The organisation puts high efforts and costs into customer satisfaction and in their improvement of the financial base. The partnership with HNA Aviation Group from China is regarded as a very important alliance, since China is the most valuable inbound travel market. Not only tourism is being supported by Virgin Australia, but also several communities in Australia and in the Pacific islands. Virgin Australia has a partnership with Australian Indginous Mentoring Experience (AIME). With their help, mentors can reach more indigenous students in Australia than ever before. One other partnership would be with Starlight Children’s Foundation, supporting ill children and fulfilling their travel wishes. One other important focus Virgin Australia is emphasising in their annual report is the aspect of sustainability and environment protection. With the Virgin Australia Group Fuel Efficiency Program, the organisation is on a mission to find new ways how to make more efficiently use of fuel. Supporting the Sustainable Aviation Fuels User Group (SAFUG), Virgin Australia targets to use more fuel from renewable sources in the future and makes other companies aware of the benefits of biofuel usage.

Generally speaking, Virgin Australia has a strong focus on partnerships with organisations which are saving the environment by preventing damaging the nature with waste recycling programs.

2. Data collection One of the major sources for data being collected for further analysis, is the Velocity program, briefly described in the previous chapter in the organisation’s overview. Customers are registered with the membership and their data is in the system of Virgin Australia, being updated while customer make use of any service related to the Velocity membership. Data is constantly being collected with such membership cards and being automatically generated into special offers for the customers once they reach an amount of points. For an organisation of this size, it is important that the data is kept in a system, which is functioning worldwide. Of course this system is not only valid for the Velocity program, but the frequent flyer system is a great example of data collection in a big dimension. Usually, organisations collect three types of data:

1. “data relating to information required to perform tasks and activities 2. data relating to the ‘level of criticality’ of information resources, tasks and activities 3. data relating to information transfer” (Henczel, p. 220, 2000)

3. Data analysis According to Henczel (2000), once the data has been gathered, it has to be analysed in order to evaluate if knowledge has been produced or where it is required for re-use. So in the case of Virgin Australia, customer data from the Velocity program can indicate, how attractive this membership and its services is for the customers. Based on that, the organisation can make future decision whether these kind of services have to be improved or if they can make new partnerships with other businesses to grow and provide even more types of customer services. Henczel (2000) also mentions three different types of analysis which can be extracted from a pool of data. These are general analysis, strategic significance analysis and information flow mapping. The general analysis is very straight forward, it is basically just collecting general data with an open question and common tools for creating data bases. With the strategic significance approach, data is being analysed with the information resources database and the collected data is being matched with specific operational strategic questions. Is there a message from the data collected which has a significance for future organisational development? In the case of Virgin Australia it could happen that one destination or region experiences dropping of passengers not flying that often anymore to a country. The organisation can assume that there is a specific reason and react according to this statistic anomaly. The mapping of information flow is an analysis process which uncovers how information and data flows within the organisation. Are there so called bottlenecks and information flow inefficiencies? This mapping makes sure that information flows in a balanced an appropriate way so that the information is there at the right time and place when it is needed.

4. Data evaluation At this stage several information needs and issues within Virgin Australia and specifically their Velocity Frequent Flyer program will be identified and evaluated. Some of these issues are:

Volatility in oil markets (price of jet fuel) Stringent regulations Significant ethical dilemmas posed by the Velocity Frequent Flyer (VFF) program VFF data at risk of hacking by outside parties Lack of transparency and accountability Data mining

There are also opportunities that have been identified:

Strategic growth initiatives (partnership with NHA) Growth in global travel and tourism

As a way to evaluate and assess these issues a number of questions will be asked according to Henczel (2000) as a set of criteria to determine the capacity of the company in addressing these issues, and what is the strategic significance of them. These are the questions:

Does the problem have strategic significance? Is there a reason for the problem? What are the cost implications? What alternatives are possible? What are the implications of suggesting a change?

By answering these questions, the most optimal solutions will be recommended. Henczel (2000) states “it is important that the recommendations that are formulated in this stage are realistic, achievable and manageable”. It is important to achieve a level of pragmatism in finding solutions to these issues. The recommendations need to be implementable.

A strategic information issue to be identified is undoubtedly the constant risk to airlines posed by jet fuel price increases and decreases. Decreases in price can be just as difficult to manage as increases. According to Macquarie (2016, para. 3) “While weakening crude oil prices enhance profits, they can also lead to lower airfares, spurring demand for travel and pushing airlines to increase capacity.” Airlines like Virgin Australia have to find a constant balance between expanding fleet and routes when prices are low and damage to their profitability when those prices recover. Furthermore, this easily becomes a potent political issue- in a news story by Sawer (2017) he quotes British MP Michael Fabricant as saying “there’s a very real argument here to say that airline customers are being ripped off. The price of tickets must go down to reflect the fall in the price of fuel, but airlines are failing to pass on in full the savings they are making as a result of falling fuel prices”. To create better external information flow, recently a new information research probability model has been suggested for airlines in Europe. Called “Probability Map proprietary research”, it looks at

behavioural finance as a way to predict fluctuations in the market. Macquarie (2016) suggests that “this technique helps identify the anomalies and assumptions from which future share price movements may result”.

Another significant strategic information issue is the need by Virgin Australia to keep abreast of changes to the stringent regulations the Federal Aviation Authority (FAA), Civil Aviation Safety Authority (CASA) and the Department of Transportation. Amongst other things, these bodies regulate the standard amount of work and rest hours pilots must have, time zones and flight types (ICD Research reports, 2016). This is an issue that is simply part of the industry Virgin Australia is in. It is essential that the airline maintains superb communication with these bodies as a way to safeguard itself to any changes and be compliant with the regulations and licensing requirements.

From an information point of view, the largest potential issue that has been identified is the ethical dilemma posed by the airlines’ award-winning frequent flyer programme, Velocity. By utilising the above set of criteria it can be established that:

Velocity is of great strategic significance to Virgin Airlines. This program gives Virgin an edge over their competitors in the market through its great reputation and advertising. The Information management (IM) security issue in this instance is two-fold, internal and external:

1. The ethics of data mining by Virgin Australia and their use of this personal data

(Internal) 2. The risk of hacking by outside parties (external)

There is a great deal of ambiguity in the wording of Virgin’s privacy statement for the product. Who are the third parties Virgin is giving their passengers’ data to? This poses a strong ethical issue for the company and the way they conduct business. Virgin has a responsibility and a duty to protect the private information of their clients. This is something the airline refers to in their privacy statement, albeit through indeterminate language. But with expansions into data analytics, intelligent campaign automation and aggressive advances into the Asian market - through selling off pieces of Velocity to private equity firms and massive conglomerates (NHA, Affinity Equity Partners) - they are placing themselves at great strategic risk. The reasons for this ethical conflict of interest could be explained within one of the sentences of Velocity’s privacy statement when explaining the reasoning behind their collecting of data from their clients: “developing insights about you so that we can better understand your preferences and interests” and further, they state they give the data to “third parties that may be of interest to you” This is essentially, data mining and purchasing behaviour. Without explicitly saying so, they are telling their client they can give their data to whoever they choose.

The cost implications for a company the size of Virgin Australia changing the way they conduct business would be large. However, the loss of reputation and subsequent market share could be greater.

There is a case to be made for a more ethical business model. Rayport (2011) mentions the need for companies to develop a code of practice when it comes to dealing with their clients’ data. This is a system that Virgin Australia could adopt. He suggests four principles:

1. Clarity on practices – The Company informs users data is being collected as it happens, in real time and gives users access to what the company knows about them. The author explains this would be a good way to build trust.

2. Simplicity of settings - Allow users to decide for themselves the level of privacy they want and abide by it.

3. Privacy by design – This term was coined by Ann Cavoukian, privacy commissioner for the province of Ontario. It proposes the organization should incorporate privacy protections into every step and make customer privacy a guiding principle.

4. Exchange of value – What is the customer getting for their data? This step proposes complete transparency in telling customers what they will get for sharing their data. The author uses Netflix as an example of a company using viewers’ history to offer more targeted recommendations. A clear exchange that the client can see and understand. At the moment, Virgin’s VFF privacy statement is obscure in the way they tell the customer they will share their data with companies Virgin assumes the customer is interested in.

This could be a good outline for a new process to be implemented. The implications of putting such a program in place would be that Virgin Australia would have to take a proactive approach and be a leader in this field by acknowledging that steps need to be taken in order to protect people’s private data. This clearly involves strategic risk on the part of the company but there is an abundance of evidence to indicate that the issue of ethics in data has been gaining increasing relevance over the last decade. From a public relations point of view, companies realize that the public is becoming more educated in these matters. As a way to illustrate this public awareness, for the last ten years an organization called The Ethisphere Institute has been giving awards to the world’s most ethical companies. Some of this year’s winners and honourees include Microsoft, L’oreal, Colgate-Palmolive, Ford, Levi-Strauss, LinkedIn and Illy coffee from Australia. This is more than just a public relations exercise. Over the last two years, the Ethisphere institute has been able to compare the 2017 world’s most ethical companies’ honourees to the American Stock Market index S&P 500 (Standard and Poor 500) and have established a gap of 6.4% to the positive toward the ethical companies. They have begun referring to this as “The Ethics premium”. According to Ethisphere (2017) These are the five categories supporting the methodology they refer to as their “Ethics quotient”:

Ethics and compliance program (35%) Corporate citizenship and responsibility (20%) Culture of ethics (20%)

Governance (15%) Leadership, innovation and reputation (10%)

This is another approach Virgin Australia could take towards a more sustainable and transparent ethics code of practice.

The issue of external hacking of a company by outside parties is unfortunately a fixture of today’s corporate environment. Strategically, this would be a potential breach of privacy that could lead to a great loss in reputation for the company. Furthermore, there is the possibility of legal liability on the part of Virgin Australia.

Most large companies at some stage or another suffer data breaches. It is certainly only a matter of time until this happens to Virgin Australia. A preventative approach would indicate that it is important to take into account the importance of ensuring Virgin staff are well-versed in protecting the private information of their clients. Agrawal, A. (2017) refers to the importance of developing an organizational culture that embraces security. Masclet, L., & Goujon, P. (2012) maintain that Information systems’ professionals have a narrow minded-view of what constitutes ethics and “often reduce it to a constraint that has to be fulfilled”. It is essential that Virgin incorporates a greater degree of ethics into their business model as a way to create a more transparent relationship with their clients.

Another option that is becoming popular in the market is to hire hackers to break into the systems of large companies in order to identify weaknesses. Elazari, K. (2017) writes that “Surprisingly, software giants now encourage hackers to hack them”. The writer goes on to describe how Google, Microsoft and Facebook have been engaging in this practice since 2010 in order to spot vulnerabilities in the system. They call this “vulnerability reward programs”. This could be a feasible way for Virgin Australia to take a proactive approach to this issue.

This report identifies the issue of ethics in data mining and protection of private data as the issue of most strategic importance for Virgin Australia. Velocity Frequent Flyer (VFF) has been clearly established as a strong strategic resource for Virgin. The company relies on it heavily as it is proven by the part-sale of it in 2014 to Affinity Equity Partners (Associated Press, 2014). The damage through loss of reputation and trust to the company would be considerable. Furthermore, as opposed to issues like the prize of fuel and stringent regulations, this is an issue entirely within the control of the company. They can do something about it. This report recommends a combination of all of the above suggestions as a way for Virgin to begin a process of change in the company culture.

5. Communicating the recommendations As per Henczel methodology, there will be a combination of ways in which these recommendations will be communicated. Firstly, this report will be presented to the Executive team at Virgin for perusal and appraisal. As per Henczel (2000) there will be regular communication with the executive and management teams during the auditing process as a way to minimise the impact of the findings and recommendations within the report. As it has been established in the data evaluation section of this report, there is a compelling business case to be built for the company developing a more ethical-driven

business model. This will clearly be outlined to the executive and management departments in addition to the clear public relations benefits. The results of this report and its recommendations will also go through a formal presentation to the different departments of the company as a way to begin the introduction to the new system and code of conduct. This will be a gradual, tiered introduction to the new system. At this stage it will be paramount to engage with the managers from different departments ensuring they have a clear understanding of the changes ahead and why they are taking place. Most importantly, Virgin Australia is a publicly-listed company and therefore it is decisive that the shareholders are aware from the very beginning that there will be a change in the corporate code of conduct with the introduction of a higher emphasis on ethics.

6. Implementing the recommendations As a way to begin the change management process, a number of seminars and workshops will be introduced as a part of implementing the new recommendations. This change will be identified by many as a departure from the way that things have been done at the company before and therefore a long-term process is advised as a way for these recommendations to achieve longevity. This report encourages the company to engage the services of Prosci Solutions as a method of scaffolding the process of change management within Virgin Australia through Prosci’s enterprise capability and advisory services. Prosci maintains that “building change capability means effective change becomes common practice for your organization. Leaders, managers and employees understand and effectively demonstrate their role in change. Projects have effective change management applied every time. People embrace, adopt and actively drive change”. Given the scope of the change ahead at the company, the writers of this report would emphasize the term ‘dynamism’ as the operational keyword to describe the necessary implementation. Henczel (2000) explains that “the development of a comprehensive implementation plan and a post-implementation review strategy will facilitate the changes and minimise resistance”.

7. The continuum – information strategy Henczel (2000) refers to the data captured during the first information audit as a “rich dataset that presents a 'snapshot' of where the organisation is at with regard to its information”. Henczel refers to this as the ‘Information baseline’. As such, it can be established that this is the information foundation upon which the rest of the organizational structure is built. It is intended that this will be the first information audit at Virgin Australia in a process that will become iterative. By its very nature the aviation industry is a fiercely competitive market and a constantly changing one. The only way to keep reassessing the information priorities and strategy for the company is to keep building on the knowledge base already created. By progressing in this manner more data will be regularly added and the shifting changes in the organization and the market will be factored into the following information audits. The methodology and objectives of following audits may vary in scope or focus depending on the changing nature of the market and the organisation. The changes and recommendations proposed in this report are quite significant and therefore will need to be followed closely, in order to analyse their effect and effectiveness. The process of the information audit needs to become part of the corporate landscape at Virgin Australia as a way to ensure not just compliance but also a new culture.

Roadmap As previously mentioned, the Prosci methodology is recommended in implementing a roadmap for the airline. This road map will begin on an individual level by utilising the Prosci ADKAR model. Subsequently, the Prosci three-phase process for structural change would be applied.

Phase 1. Preparing for change. Using a top-down approach, prepare the executive team to lead by example. The management team would follow. This would begin straight away. Allocated time: 1 month

Phase 2. Managing change. Encourage the executive and management to ‘be seen’ at the right places and moments using the new systems. Identify who they need to align themselves with to support the change. A resistance management plan would have been put into place- this would include diagnose and manage resistance. Allocated time: 6 weeks.

Phase three. Reinforcing change. At this stage the initial feedback would be analysed and corrective action be implemented if necessary. The successes would also be celebrated. 8 weeks.

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