The business, organizational problem, or topic:
In the past decade, the prices of fuel cost were increasing rapidly that impacted on the
financial and operational performance of airlines and Aviation industry. According to Mouawad
(2011), fuel price increased in the past decade reduced profits and increased operation losses of
airlines. According to Airlines for America, the average price increased 9% during January 2011
and January 2012 that means the spot price of jet fuel grew 18% over the same time period. It
predicts that Airlines burn approx 48 million gallons in per day and the jet fuel is the biggest
expense of an airline, so increased in the cost of fuel price directly impacted on the performance
and growth of all airlines (Mouawad, 2011).
In addition, Firestine & Guarino (2012) depict that the fuel cost approached approx 50%
of the airline total operating costs, so increased in the jet fuel prices impacted on the profit and
performance of airlines. Moreover, according to the U.S. Department of Transportation,
Research and Innovative Technology Administration, airlines paid on average approx $3.5
billion for fuel and around $8.6 billion for labor in a quarter of 2000 that is increased as airlines
paid about $8.4 billion for fuel and approx $8.2 billion for labor in a quarter of 2010 (Firestine
& Guarino, 2012).
It indicates that labor cost in total operating cost is not major changed in during the past
decade but the fuel cost is increased by three times that mainly impacted on the financial
performance of airlines. In recent times, most of the airlines in all around the world faced
financial losses due to rapidly increased in the cost of jet fuel prices in the last ten years.
The problem statement:
To assess the impact of regular increased in fuel costs per gallon on the growth and
performance of the American Airlines.
The research question:
Why is the relationship between jet fuel cost and performance of American Airline?
The research strategy & Data collection technique:
In the context of this research, exploratory research design is selected. It helps where the
scope of the problem is not fully clear or conclusive research has not yet been undertaken.
Another important factor is that it helps determine the best research design, data collection
methods as well as at selection of subjects. As well as it is this research design is also helpful at
testing concepts before putting them in the marketplace. It is quite informal and data can be
gathered from secondary sources or by informal discussions with people or by interviews and
case studies (McNabb, 2008).
The research methods I am considering are Mixed and action research method. In this
research, mixed methods qualitative and quantitative are used to achieve the appropriate
outcomes of this research. Under this research method data can be collected by quantitative and
qualitative methods or the research can be conducted while being a part of a change process in
any organization. Both types of data collection methods primary and secondary are used in this
research (Johnson & Christensen, 2010).
The data will be collected mainly from the secondary resources through conducting a
literature review and case study. Quantitative and qualitative data can be collected from the
already available literature as well as from the participants in research. It involves reviewing the
literature available online for data or information. Apart from that data will also be collected by
the interview of participants and questionnaires.
Primary data collected by conducting interviews of the manager of American Airline and
questionnaire from employees of the company to assess its view related to impact of regular
increased in fuel costs per gallon on the financial performance of the company. For this
participant will be given a set of questions to answer as well as in depth interviews may also be
taken in gathering further information necessary for research (Kuada, 2012).
Q.1 Do you agree that there is the relationship between jet fuel cost and performance of airlines?
Q. 2 Do you agree that increased in the jet fuel prices impacted on the operation cost of the
Q. 3 Do you agree that increased in the jet fuel prices played a major role in increased ticket
prices and declined in the sales or revenue of airlines?
Q. 4 Do you agree that increased in the jet fuel prices forced airlines to reduce its services for
customers that impacted on the sales or revenue of airlines?
Q.5 According to you, what are the strategies should be used by airlines to reduce the negative
impact of increase in jet fuel cost and improved its overall financial performance?
Changes in airline operation
Focus on raising revenue through providing more services to customers
Changes in fuel burn ways to improve aircraft fuel productivity
Adopt latest technologies in operations to save cost and time
Fuel saving technologies adopted, and aircraft retrofits
Use high fuel effective aircraft and airplanes to reduce operation costs
Others (Please specify)……….
This part of research ensures the reliability and credibility of the data that is collected for
the research. The researcher makes sure about the data and information collected from
authenticate and validate information sources. The researcher also provides appropriate
credibility to the secondary data sources for gathering information and ideas of his/her research.
The credibility will be provided by proper citing and referencing of authenticate and validate
sources (Wrycza, 2012)..
The ethical reflection can be provided by keeping confidential information of the
participant. These participants provide the primary data for the research that must be in privacy,
because it protects the human subjects and rights in favor of the research. There may be several
issues related to ethical consideration, so that the feedback and identity of the respondents will
be kept top secret to reduce these ethical issues. In addition, the data obtained for literature and
case study analysis must be obtained from the authenticated sources. These sources will be
helpful to increase the reliability and quality of the research study (McNabb, 2008).
The researcher can reduce ethical issues by protecting the data with the use of firewall
and password protection for emails and online surveys. All the data and information collected
through conventional survey method that will be completed on November 2012. Once the data
will be collected, it will be disposed in the proper way to make a research. In future, this
confidentiality and privacy will help to build a strong relationship among the researcher and
their respondents. The respondents will be able to provide appropriate information about any of
subject matter (Kuada, 2012).
In this research, five top rank managers are selected by American Airline to conduct the
interview. In addition, twenty five employees of America Airline are selected to collected data
from questionnaire survey (McNabb, 2008).
Data analysis summary:
Data is collected from primary and secondary data collection method is analyzed in this
chapter. The collected data are analyzed and represented in the form of tables, charts and graphs
ways that helped the researcher to accomplish the result of this research (Johnson & Christensen,
In this section, primary method collected data measure on the basis of secondary data and
research aim and objectives. Data collected from interviews and a questionnaire is interrelated
with the secondary data and literature review to generate the result of this research with
considers the topic of research (Kuada, 2012).
Firestine, T. & Guarino, J. (2012). A Decade of Change in Fuel Prices and U.S. Domestic
Passenger Aviation Operations. Retrieved from:
Johnson, B. & Christensen, L. (2010). Educational Research: Quantitative, Qualitative, and
Mixed Approaches. (4th ed.). USA: SAGE.
Kuada, J. (2012). Research Methodology: A Project Guide for University Students. USA:
McNabb, D.E. (2008). Research Methods in Public Administration and Nonprofit Management:
Quantitative and Qualitative Approaches. (2nd ed.). USA: M.E. Sharpe.
Mouawad, J. (2011). Airfares Are Chasing Oil Prices Higher. Retrieved from:
Wrycza, S. (2012). Research in Systems Analysis and Design: Models and Methods. USA: