CUSTOMER INTEGRATION PRACTICES AND ORGANIZATIONAL SUCCESS IN AIRLINE INDUSTRY IN RIVERS STATE

This study examines the extent of the relationship between customer integration practices and organizational success in airline industry in Port Harcourt, Rivers State. It involves survey design and uses structured questionnaire to collect data from fifty (50) management staff of airline firms. The data collection instrument was validated using Cronbach Alpha test while spearman’s rank order correlation coefficient statistical tool and partial correlation are used in testing the hypotheses. Results show that all two dimensions of customer integration practices (crowd-sourcing, user co-design) have significant relationship with all two measures of organizational success (profitability and relative sales volume). The study therefore concludes that appropriate customer integration practices could be a means of gaining strong competitive advantage in the aviation industry. Based on the findings, airline firms in Rivers state aew, among others, advised to inject more customer-based ideas and competences in the organization for maximum success. A. Introduction The Nigerian aviation industry is a major sector within the tourism industry that has contributed in no small measure to the development of economic stability of the country. It comprises several commercial airlines that shuttle various domestic communities and international destinations. The airline sector is one of the fastest growing sectors in the service industry (Lovelock, Patterson and Walker, 2004) and has attracted seamless investment opportunities to the economy. The airline industry is a major driver that controls the direction of other activities in the tourism industry. It is a vital component of the travel and tourism industry and remains essential to the conduct of international business (Tiernan et al., 2008). Ghana Airports Company Limited (GACL, 2012) revealed that the airline industry is known to be the major catalyst for the socio-economic development of emerging economies. It is the connecting rod that links peoples, cultures and businesses together and a stimulator of economic activities globally. In 2012, International Air Transport Association (IATA) estimated that about 2.2 billion passengers globally patronize the airline firms annually. According to the Nigerian Aviation Sector third quarter report (2015), the traffic level of passengers via Nigerian routes had a staggering increase of (8.5%) relative to the number in the second quarter within the period under review. This influx of passengers is an indication of the economic importance of the airline sector to the economy. However, the Nigerian airline industry, despite these healthy reports, are faced with myriad of challenges ranging from natural disasters, security issues, low service quality and high fuel prices which have affected organizational success. On April 29, 2016, THIS DAY newspaper as reported by Egene (2016), highlighted a hike and scarcity of aviation fuel (Jet A1) which hampered flight operations in Nigeria and caused unquantifiable financial losses to these airline firms. Also, Phillip Consulting Limited, revealed in a survey in 2015, a sharp and abysmal reduction of patronage rate in Rivers State based airline firms which were attributed to poor service quality delivery and safety challenges. As a result of this downward trend, profit and sales level of airline firms in Nigeria nose-dived in the fourth quarter (NAS 2015). This decline could be attributed to inability of the airline firms to integrate their passengers in the service delivery processes. Traditionally, the core aim of effective and improved marketing is to ensure that there are right products, at the right price, in the right place and at the right time. However, successful marketing today requires a complete reliance on the customer and their preferences (Christopher et al., 1993). This is called, Customer retention. It is ideal, reliable and a potent source of superior performance (Reichhled and Sasser, 1990). CEKA IJABA VOL.5 NO.1 SEPTEMBER, 2018 2 Bateson (1983; 1985) demonstrated empirically that, across several service industries, an aggregate of customers find self-service intrinsically attractive. According to Mills, Chase and Margulies (1983), improved service performance can be attained by viewing the client/customer as a “partial” employee. There are myriad of literature on customer integration pointing to its usefulness in achieving corporate organizational performance in different sectors of the economy. The thrust of this study is therefore, on Customer Integration Practices and organizational success of airline Firms in Rivers State. B. Statement of the Problem The aviation industry in Nigeria is one that requires huge financial outlay to participate in. Granted this and the huge opportunities inherent in the industry, one expects all participants to successfully propagate their businesses. However, evidence abound that most participants in the industry are barely managing to survive. This brings a lot of questions to mind as to what may be responsible for this present state of affairs. Organizational success is viewed by many scholars and practitioners as a reflection of the extent to which customers are integrated in the service delivery process. There are practical evidence in the academic literature on the significant association between customer integration and organizational stability. Many of these authors have emphasized the importance of cocreation in gaining competitive advantage especially in current converging business environment. The need to achieve steady and improved organizational success has been a bone of contention in the ever increasing cut-throat aviation sector. It is possible that this success can be achieved if adequate integration activities are introduced by these airline firms. Adequate customer collaborated design in terms of integration practices expected to result to rapid influx of passengers which will impact positively on organizational success. Therefore, this study sought to determine the degree of relationship between customer integration and organizational success of airline firms in Rivers State with particular reference to crowdsourcing and User co design. In line with achieving this objective, the following hypotheses were tested in the study. H01: The relationship between crowd-sourcing and profitability is not significant. H02: The relationship between crowd-sourcing and relative sales volume is not significant. H03: The relationship between user co-design and profitability is not significant. H04: The relationship between user co-design and relative sales volume is not significant. Literature Review Theoretical Foundation Understanding the nitty-gritty of this scholarly investigation will require an appreciation of some theoretical underpinings that laid the foundation for this study. This study is specifically anchored on Value Co-creation and Service Dominant (SD) logic theory of Vargo and Lusch (2004)and Prahalad and Ramaswamy (2004a, 2004b, 2004c) which clearly state that “the consumer is networked, active, informed and involved in consumer communities, while co-creation is the result of the changing role of consumers” (Prahalad and Ramaswamy,2004c). According to Vargo and Lusch (2004),specialized skills and knowledge are the key components in creating and sustaining competitive pressure and these special skills and competencies are embedded in customers. The theory recognized consumers as brand evangelists and their knowledge, a key asset as a result of years of experiences they have gathered. According to this view, all the efforts between production and consumption are to successfully harness the endowed creative intelligence of the consumer. Based on the view of the Service Dominant (SD) Logic, people go for products that provide maximum satisfaction and value that depends largely on customer experiences than mere purchase of goods and services. Customer Integration Practices (CIP) CEKA IJABA VOL.5 NO.1 SEPTEMBER, 2018 3 Customers are a resource in value networks (Lusch et al. 2010) and the value creation process; organizations work towards involving the customers in the production and service delivery processes. There is a growing body of literature on the need to integrate consumers in the service delivery process. Customers have special skills, ideas and competencies coupled with information technology that drive rapid innovation in every sector and increasingly serve as active partners in value delivery processes. In the new frontier, the role of the consumer has changed from unaware to informed, from passive to active, and from isolated to connected thinkers. As a result of this healthy development, service providers can no longer boast of having monopoly of ideas and capability to enforce efficient service delivery. The adoption of customer integration is therefore, the crux of emerging reality in the service sector. Customer integration is a collaboration of ideas, skills, competencies and capabilities between the organization and its customers for efficient service delivery. In service settings, customers „often find that performing tasks themselves is faster, more efficient, affords a larger sense of control, and in some cases presents greater customization of the results and this makes customers able to unlock more value from purchased goods and services when they can successfully complete tasks themselves,‟ (Honebein and Cammarano,2006). Despite the importance attached to customers as value creators, the opportunity of regarding customers as partners of value creation during new product development as well as the chance of actively involving them into the process is often neglected, (Joshi/Sharma, 2004). Most organizations have reduced their customers to a more passive role than active role. Eric von Hippel, (1978) criticizes the insufficient customer and user involvement in innovation processes as “speaking only when spok