A new MBA (Aviation Management) in the University of Limerick focuses specifically on an industry that has continued to see growth, despite economic difficulties in other sectors
THE SHANNON region’s long association with aviation makes it entirely appropriate that Ireland’s first MBA (aviation management) should be offered by the Kemmy Business School at the University of Limerick. “The Shannon region has a long historical association with the aviation sector dating back to the Flying Boats era in Foynes and of course the invention of the Irish coffee, and later with the requirement for transatlantic flights to refuel in Shannon,” explains course director Siobhan Tiernan.
The programme has been designed to educate students from diverse disciplines within the airline, airport, aviation and aircraft leasing sectors. The first cohort of students started in September 2010. “We developed it in response to requests from the aviation sector based here in the region. They wanted an MBA course that was a bit more grounded in their industry and up until now they would have had to go to Cranfield University in England to get one.”
The MBA, specifically focusing on aviation management, was designed with the unique characteristics of the sector in mind. “The airline industry itself is the driving force behind the wider aviation sector, which includes aviation manufacturing, maintenance and overhaul, airports, and financial and other related services,” says Tiernan. “Strategically, the airline industry has an important global role to play; it’s the bedrock of the leisure and tourism industry; the conduct of business and trade depends on the ability to travel; it is responsible for 31.9 million jobs globally and drives 12 per cent of the global economy.”
With the International Air Transport Association estimating global airline revenues at more than $500 billion for 2010, the sector represents one of the biggest industries worldwide. “In addition, unlike other sectors it has experienced unprecedented and sustained levels of growth, with the exception of minor dips in demand for air travel brought about by external events. Current industry predictions are that it will continue to grow by 5 per cent per annum,” she adds.
Yet despite such growth, profitability has remained marginal and presents one of the apparent contradictions within the industry. This is partly due to cyclical reasons but also due to instabilities within the industry.
Demand for the product is dependent on demand for related activities such as holidays or business travel. It is also instantly perishable, and demand is seasonal in nature. There are high fixed costs relative to variable costs, so volume is crucial. The industry is also susceptible to environmental influences and competition from other modes of transport is an ever present threat to short haul operations.
“Competition in the airline industry has been transformed over the last 20 years by deregulation in the US and liberalisation initiatives in the EU, leading to the emergence of a variety of new entrants,” says Tiernan. “As a result, restrictions on the provision of low fares have been removed and legislation has aided the proliferation of new entrant low-cost carriers and fuelled competition.”
All of these factors contribute to an industry sector with unique managerial challenges. “Anecdotal evidence would suggest that people employed within the aviation sector tend to stay within the sector. Education and learning to meet these specific requirements in the form of an MBA was therefore a logical progression for the Corporate MBA at the University of Limerick,” she adds.
The Corporate MBA (Aviation Management) aims to combine the traditional benefits of an MBA with a particular focus on the aviation sector, resulting in maximum value for participants and employers. A variety of pedagogical approaches, appropriate to both the discipline and to the level of the award, are employed, including lectures, small group teamwork, seminars and workshops, e-learning and action learning through case studies and guest speakers.
The MBA moves from a discipline base in year one to general management and leadership competence in year two, with a strong emphasis on teamwork. Doyle believes this will replicate real-life management teams, given the mix of disciplines and career backgrounds on both the Aviation Management programme and the general Corporate MBA programme.
The flexible block release structure of the programme was developed in consultation with leading experts in the aviation sector, along with leading academics, and has been highly praised for its innovative approach. Many of the aviation-specific modules are taught in conjunction with faculty from leading European universities. The attendance requirement for the UL campus model averages three days per month along with two residential summer schools and an international workshop in Toulouse, the European aviation sector’s version of Seattle, delivered by the Airbus-owned AirBusiness Academy and the ESC Business School.
The Aircraft Leasing module summer school is believed to be the world’s only academic course on aircraft leasing. “More than half of all commercial aircraft are currently leased and this important module aims to provide students with a thorough and systematic coverage of the important aspects of aircraft leasing – and it explains why this financing mechanism has become a core competency when acquiring aircraft,” says Tiernan.
The course is not only designed to meet the business needs of the aviation sector, it also fits in with students’ busy schedules. “One of the big selling points of the programme is the block release structure,” says Tiernan. “That makes a big difference. People working in the aviation industry are on the move all the time and would find it very different to attend a course on a set day every week. With this programme, they attend from Wednesday to Friday once a month – this is fairly easy for them to schedule in advance.”
Full details are available at ul.ie/business or from siobhan.tiernan@ul.ie.
What the students say
Susan Keating is senior vice president and head of sales with Shannon Engine Support, a commercial aircraft engine leasing company. She chose the programme because of the international and industry focus. “The programme allows students to develop the core managerial skills required to ensure growth and development of a business in today’s competitive environment,” she says. “From a business perspective, the returns are immediate – the aviation element provides students with an opportunity to research areas that are both topical and directly related to the industry itself.
“An industry-tailored MBA is an obvious choice for those already in or planning to move into senior management positions within any sector.”
Enda Corneille is director of shared services with Aer Lingus. “I chose this programme as it is extremely relevant to a wide number of aspects of management practice,” he says. “The curriculum and format appealed to me as well as the emphasis on group assignment which has introduced me to a whole new network of contacts.”
He appreciates the structure. “The three-day monthly residential blocks provide a structure around which I can plan my study.”
He believes that while the qualification itself will be a real achievement, the experience of completing the programme will be equally significant. “It is sometimes easy to feel that no amount of theory can substitute for experience. However I have certainly found that the investment in time and learning, something I certainly had not done in many years, has been extremely enjoyable and very worthwhile.”