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Strategic Communication and Competitive Advantage: Assessing CEO Letters of Global Airline Alliances

Gang-Hoon Seo

Gang-Hoon Seo

Hiroshima Shudo University, The Faculty of Commercial SciencesHiroshima, JAPAN
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Seo, Gang-Hoon
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Munehiko Itoh

Munehiko Itoh

Kobe University, Research Institute for Economics and Business AdministrationKobe, JAPAN
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Itoh, Munehiko
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Zhonghui Li

Zhonghui Li

Kobe University, Graduate School of Business AdministrationKobe, JAPAN
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Li, Zhonghui
  
08 giu 2021
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Pubblicato online: 08 giu 2021
Pagine: 57 - 72
DOI: https://doi.org/10.2478/fman-2021-0005
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© 2021 Gang-Hoon Seo et al., published by Sciendo
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Sources of sample (Source: Authors’ own research)

Source Airlines
Annual report Finnair, LATAM, Qantas, SriLankan Airlines, China Eastern, Garuda Indonesia, Kenya Airways, KLM Royal Dutch Airlines, Vietnam Airlines, Aegean Airlines, Air Canada, Air China, Air India, Air New Zealand, ANA All Nippon Airways, EGYPTAIR, Ethiopian Airlines, EVA Air, Lufthansa, Singapore Airlines, South African Airways, TAP Air Portugal, Thai Airways International, Turkish Airlines, China Southern Airlines, Emirates Airline, Hawaiian Airlines, Oman Air, TUI Airways, Virgin Atlantic
Corporate social responsibility report American Airlines, Croatia Airlines
Sustainability report Cathay Pacific Airways, Korean Air, Asiana Airlines, Copa Airlines, TAP Air Portugal, Hainan Airlines, Delta Air Lines
Integrated report Air France, SAS Scandinavian Airlines
Official web page Japan Airlines, Alitalia, Middle East Airlines, Copa Airlines, Alaska Airlines, Emirates Airline
Not open to the public British Airways, Iberia, Malaysia Airlines, Royal Air Maroc, S7 Airlines, Fiji Airways, Aerolíneas Argentinas, Aeroméxico, Air Europa, Saudia, TAROM, Xiamen Air, Austrian Airlines, Avianca, Brussels Airlines, LOT Polish Airlines, Shenzhen Airlines, Swiss International Air Lines, United Airlines, Etihad Airways, Philippine Airlines, Sichuan Airlines

Descriptive data of airline attributes (Source: Authors’ own research)

Categorization Number of data
Airlines belonging to global alliances 38
oneworld 7
SkyTeam 12
Star Alliance 19
Non-alliance airlines 8
Total 46

Averaged component numbers of each subject groups’ CEO letters (Source: Authors’ own research)

Alliance Non-alliance oneworld SkyTeam Star Alliance
8.625 9.5 7.44 8.66 9.157

Differences of CEO letter effectiveness item measures between alliance and non-alliance airlines (Source: Authors’ own research)

Item Mean SD SE t-value p-value
Alliance Non-alliance Alliance Non-alliance Alliance Non-alliance
CR1 6.31 6.14 0.977 0.900 0.157 0.340 0.415 0.680
CR2 5.87 5.00 1.525 1.414 0.244 0.535 1.406 0.167
CR3 5.51 4.57 1.620 1.618 0.259 0.612 1.416 0.164
CR4 6.36 6.00 1.038 0.816 0.166 0.309 0.865 0.392
CR5 5.72 5.86 1.503 1.215 0.241 0.459 −0.231 0.818
EF1 5.67 6.29 1.722 0.488 0.276 0.184 −0.937 0.354
EF2 5.33 6.29 1.510 0.488 0.242 0.184 −3.132 0.004**
EF3 5.26 6.29 1.482 0.488 0.237 0.184 −3.425 0.002**
EF4 4.23 4.00 2.218 2.082 0.355 0.787 0.256 0.799
CO1 4.38 3.86 1.786 1.464 0.286 0.553 0.736 0.466
CO2 6.03 5.71 1.709 1.604 0.274 0.606 0.448 0.657
CO3 4.44 4.86 1.957 1.864 0.313 0.705 −0.528 0.600
CO4 4.03 4.86 2.006 2.673 0.321 1.010 −0.960 0.342
RE1 4.87 6.57 2.430 1.134 0.389 0.429 −2.936 0.009**
RE2 3.31 3.71 2.296 1.496 0.368 0.565 −0.449 0.655
RE3 3.28 3.86 1.589 2.035 0.254 0.769 −0.846 0.402
RE4 3.36 4.29 2.254 2.289 0.361 0.865 −1.000 0.323

Differences of CEO letter effectiveness item measures among the three global alliance (Source: Authors’ own research)

Item Alliance Mean SD SE F/p
CR1 oneworld 6.57 0.535 0.202 0.576/0.567
SkyTeam 6.42 1.443 0.417
Star Alliance 6.15 0.745 0.167
CR2 oneworld 6.57 0.535 0.202 1.063/0.356
SkyTeam 5.92 2.065 0.596
Star Alliance 5.60 1.353 0.303
CR3 oneworld 6.14 0.690 0.261 0.795/0.459
SkyTeam 5.58 2.353 0.679
Star Alliance 5.25 1.293 0.289
CR4 oneworld 6.86 0.378 0.143 1.586/0.219
SkyTeam 6.50 1.446 0.417
Star Alliance 6.10 0.852 0.191
CR5 oneworld 5.71 1.799 0.680 0.011/0.989
SkyTeam 5.67 2.015 0.582
Star Alliance 5.75 1.070 0.239
EF1 oneworld 5.57 1.618 0.612 0.046/0.955
SkyTeam 5.58 2.314 0.668
Star Alliance 5.75 1.410 0.315
EF2 oneworld 5.86 1.345 0.508 0.703/0.502
SkyTeam 5.00 1.954 0.564
Star Alliance 5.35 1.268 0.284
EF3 oneworld 5.14 1.215 0.459 0.663/0.522
SkyTeam 5.67 1.969 0.569
Star Alliance 5.05 1.234 0.276
EF4 oneworld 5.14 1.864 0.705 0.155/0.857
SkyTeam 3.83 2.038 0.588
Star Alliance 4.45 1.572 0.352
CO1 oneworld 5.14 1.864 0.705 1.230/0.304
SkyTeam 3.83 2.038 0.588
Star Alliance 4.45 1.572 0.352
CO2 oneworld 6.14 1.215 0.459 1.964/0.155
SkyTeam 5.25 2.454 0.708
Star Alliance 6.45 1.146 0.256
CO3 oneworld 3.43 2.699 1.020 1.422/0.254
SkyTeam 4.33 1.497 0.432
Star Alliance 4.85 1.872 0.418
CO4 oneworld 4.29 2.563 0.969 0.098/0.907
SkyTeam 4.08 2.466 0.712
Star Alliance 3.90 1.553 0.347
RE1 oneworld 6.57 1.134 0.429 4.793/0.014*
SkyTeam 3.42 2.466 0.712
Star Alliance 5.15 2.323 0.519
RE2 Oneworld 3.29 2.430 0.918 0.275/0.761
SkyTeam 2.92 2.644 0.763
Star Alliance 3.55 2.114 0.473
RE3 oneworld 3.86 1.215 0.459 2.483/0.098
SkyTeam 3.83 1.899 0.548
Star Alliance 2.75 1.372 0.307
RE4 oneworld 2.71 2.360 0.892 0.992/0.381
SkyTeam 2.92 2.151 0.621
Star Alliance 3.85 2.277 0.509

Main topics of the CEO letter (Source: Authors’ own research)

Topics Definition and description
Customer (Judd and Tims, 1991; Chang, et al., 2003; Conaway and Wardrope, 2010) The concern for customers. It includes the following words: customer, demand, experience, loyalty, need, passenger
External environment (Kohut and Segars, 1992; Conaway and Wardrope, 2010) The concern for external factors to affect airlines’ performance. It includes the following words: challenge, crisis, risk, trade
Governance (Conaway and Wardrope, 2010) The concern for leadership and control by the CEO. It includes the following words: control, director, management
Infrastructure (Conaway and Wardrope, 2010) The concern for airlines’ infrastructure, technology investment. It includes the following words: aircraft, fleet, investment, seat, technology
Market (Kohut and Segars, 1992; Bournois and Point, 2006) The concern for airlines’ target markets.It includes the following words: area, aviation, country, industry, market, region, sector, tourism, world
Product (Kohut and Segars, 1992; Bournois and Point, 2006) The concern for airlines’ product mix. It includes the following words: service, operation, route, network, brand, cargo, operating, product, quality, program, destination, resource, opportunity, city, programme
Performance (Kohut and Segars, 1992; Bournois and Point, 2006; Conaway and Wardrope, 2010; Beauchamp and O’Connor, 2012; Dumitru, et al., 2015) The concern for airlines’ performance and growth, survival. It includes the following words: achievement, advantage, asset, benefit, capital, cash, capacity, cost, development, economy, efficiency, expansion, fuel, growth, increase, interest, loss, performance, profit, result, revenue, sale, success, traffic
Stakeholders (Dumitru, et al., 2015) The concern for airlines’ stakeholders.It includes the following words: airport, community, cooperation, employee, government, member, partner, partnership, people, shareholder, staff, stakeholder, team
Strategy (Kohut and Segars, 1992; Santema and van de Rijt, 2001; Bournois and Point, 2006; Conaway and Wardrope, 2010) The concern for airlines’ strategic plans and mission, vision, goal, operating philosophy. It includes the following words: culture, goal, history, objective, plan, policy, position, priority, safety, strategy, target, value
Social responsibility (Conaway and Wardrope, 2010; Beauchamp and O’Connor, 2012; Dumitru, et al., 2015) The concern for social issues including the environment, ethics, contribution to the community. It includes the following words: carbon, community, environment, emission, reduction, responsibility, society, sustainability

Comparing alliance and non-alliance groups based on the frequency of the main topics in CEO letters (Source: Authors’ own research)

Topics Alliance Non-alliance
Frequency Percentage Rank Frequency Percentage Rank
Customer 40 100 1 8 100 1
External environment 30 75 6 7 87.5 2
Governance 25 62.5 7 5 62.5 3
Infrastructure 34 85 5 8 100 1
Market 39 97.5 2 8 100 1
Performance 34 85 5 8 100 1
Product 39 97.5 2 8 100 1
Social responsibility 37 92.5 3 8 100 1
Stakeholder 34 85 5 8 100 1
Strategy 36 90 4 8 100 1

Comparing the three leading alliances based on the frequency of the main topics in CEO letters (Source: Authors’ own research)

Topics oneworld SkyTeam Star Alliance
Frequency Percentage Rank Frequency Percentage Rank Frequency Percentage Rank
Customer 10 100 1 12 100 1 18 94.7 2
External environment 5 50 4 8 66.6 4 16 84.2 4
Governance 1 10 5 8 66.6 4 13 68.4 5
Infrastructure 7 70 3 10 83.3 3 17 89.4 3
Market 8 80 2 11 91.6 2 18 94.7 2
Performance 7 70 3 12 100 1 19 100 1
Product 8 80 2 10 83.3 3 19 100 1
Social responsibility 8 80 2 10 83.3 3 17 89.4 3
Stakeholder 7 70 3 12 100 1 17 89.4 3
Strategy 7 70 3 11 91.6 2 19 100 1

Measurements of CEO letter effectiveness (Source: Segars and Kohut, 2001, p_544)_

Credibility

The image of the CEO as a sincere and accurate interpreter of corporate events:

CR1: The information conveyed by top-management is reliable

CR2: The strategic direction of top-management is focused

CR3: The strategic direction of top-management is realistic

CR4: The information conveyed by top-management is sincere

CR5: The information conveyed by top-management is accurate

Efficacy

The image of the CEO as a controlling force in organizational and environmental events.

EF1: The actions of top-management have impacted the outcomes of the organization.

EF2: Top-management understands the variables that affect the organization.

EF3: Top-management is in control of organizational activities.

EF4: Top-management is responsive to changing competitive conditions.

Commitment

The image of the CEO as a good steward to current and potential customers.

CO1: Top-management appreciates customers.

CO2: Top-management is committed to meeting customers’ needs.

CO3: Top-management is actively generating new business.

CO4: Top-management is building cooperative relationships with business partners.

Responsibility

The image of the CEO as a “good citizen” in business relationships.

RE1: Top-management is concerned about emerging social and environmental issues.

RE2: Top-management fosters values and ethical standards for employees of the organization.

RE3: Top-management endeavors to create mutual benefit among business partners.

RE4: Top-management is concerned about employee well-being.
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