Features of strategic management of passenger service quality in Cuban airports

Hartman Romero Gretell ORCID: 0000-0002-0212-9807 Lecturer; Faculty of Economics; University de Oriente (Cuba) Santiago de Cuba, Provincia de Santiago de Cuba, Cuba gretellh@eco.uo.edu.cu Shevchenko Dmitry Aleksandrovich ORCID: 0000-0002-9758-4107 PhD in Economics Dean; Faculty of Management; Southern Federal University 105/42 Bolshaya Sadovaya str., Rostov-on-Don, 344006, Russia dashevchenko@sfedu.ru Other publications by this author     Fomicheva Elena PhD in Economics Associate Professor; Department of Innovation and International Management; Southern Federal University 344006, Russia, Rostov region, Rostov-on-Don, Bolshaya Sadovaya St., zd 105/42 efomicheva@sfedu.ru

Castellanos Pallerols Graciela Maria ORCID: 0000-0003-2542-5972 PhD in Economics Associate Professor; Faculty of Economics and Business Administration; University of Oriente Santiago de Cuba, Provincia de Santiago de Cuba, Cuba gcp@uo.edu.cu

Introduction

Airports are considered an important tool for the socio-economic development of the regions in which they are located. They are key markers of urban areas on the world map, an essential factor in the development of tourist destinations and trade and economic cooperation in general. Over time, airports have moved away from their original mission of meeting the transportation needs of passengers and cargo and have become true business, logistics, and retail business centers, with an impact that goes beyond the strict boundaries of the airport area.

The development of airports as economic entities was accompanied by the transformation of their processes and management systems ^{[1; 2; 3]}. Airport management has traditionally been a subject of government regulation. For the Government of Cuba, the main purpose of such regulation is to provide services to users of air transport. Currently, as a result of the development and complexity of the air transport system, the differentiation of production and consumption processes, airport management has entered the market dimension, which is becoming increasingly important. The growing mobility of the population, including due to air transport, and the need to meet the needs of a variety of internal and external passengers make improving the quality of comprehensive airport services and customer satisfaction a top priority when choosing strategic directions for airport development and tools for their implementation. At the same time, airport services include not only proper transportation services, but are also designed to facilitate transit and meet the diverse needs of customers ^[4].

Taking into account the fact that due to the geographical features of Cuba, more than 98% of the total number of passengers enter the island by air, the airport infrastructure is the main pillar of ensuring the tourist flow, which is of great importance for Cuba. It is impossible not to take into account the fact that a large number of economic and other restrictions have been imposed on Cuba for a long time by the United States and its partners, which make it difficult and block the possibility of gaining access to advanced technologies used in the provision of services in this area. All this, coupled with the specifics of the business and its complexity, affects the quality of services offered and the business efficiency of many local airports.

These circumstances make it necessary to develop and adapt strategic analysis tools and improve passenger service at Cuban airports. The object of the research is the airport management system, and the subject is the formation of a strategy to improve the quality of service and customer satisfaction.

The research objective was to formulate strategies to improve passenger service at Cuban airports using SWOT analysis.

Methodology

To achieve the research goal, a number of elements and stages of the classical Menguzzato and Renau strategy formation model ^[5] are used, adapted to the specifics of the analyzed activity and the set research objectives, i.e. from defining the mission and goals of the organization to searching and determining possible development and functioning strategies.

SWOT analysis is used as a basic research method as a comprehensive analysis of the interaction and mutual influence of strengths, weaknesses, opportunities and threats, which is of great importance and is used by many authors to develop business strategies. ^{[6; 7; 8; 9; 10]}. It should be noted that when analyzing the external environment, two main levels were identified. First, the macro- or global environment is assessed, in which numerous forces operate, grouped into 5 main dimensions ^[11]. The results of the PESTEL analysis conducted in relation to airport management in Cuba formed the basis for the selection of influencing factors. Secondly, a more specific, specified environment is being studied ^[12] related to the activity in question and the selected airport (customers, suppliers, etc.).

To increase the objectivity of the conducted research and ensure the effectiveness of the tools used, the expert assessment method was applied. For this purpose, a working group was formed consisting of 19 people (senior managers, specialists, managers of production processes and work sites, executive workers directly involved in providing services to passengers at the airport) with many years of experience and knowledge in the provision of services and management of this process. The participation of selected experts was carried out in accordance with the objectives of the study and their functional affiliation. The DECISION v. 3.0 software was used to collect and summarize the factual material.

To assess the internal factors and resources of the company, first of all, business processes were studied in order to identify relevant processes in providing services to passengers and disruptions that threaten their good work. Then the financial component of the company's activities was assessed by calculating and interpreting financial ratios and economic indicators. A job satisfaction survey was conducted to find out how satisfied and/or motivated employees are and how they rate the service through surveys, and finally, an analysis of the airport's resources and capabilities was conducted.

The results of these studies made it possible to diagnose the internal situation at the airport and form a database, which, using expert criteria and using the professional software Statistical Package for the Social Sciences (SPSS) version 25.0, were evaluated and classified according to the strengths and weaknesses of the company, some of which allow it to enjoy a competitive advantage, others are restrictions, obstacles that threaten the effectiveness of the organization and put it at a disadvantage compared to competitors. After determining all these conditions and factors, conditions are created for the transition to the search and formation of possible strategies.

Macro environment analysis

This study was conducted at Antonio Maceo Grajales International Airport (AI "AMG") in Santiago de Cuba, part of the national airport network operated by the Cuban Airports and Airport Services Company (ECASA S.A.), which is primarily responsible for aircraft maintenance, as well as the supply of fuel and lubricants for aircraft, passenger service, and operation of the country's airport facilities. Through its airports, it carries out the mission "... to guarantee airport, commercial and fuel supply services in accordance with the standards of safety, regularity and efficiency established for international civil aviation." Its motto is: "We are a system of airports of high international standard, with employees of great values and high professionalism, which makes us one of the best in the region" ^[13].

As already mentioned, the environmental analysis will be carried out on two levels. Taking into account the importance of each of the parameters affecting the management and efficiency of airports in Cuba, we define the following list of macro-environment factors.

1. Political and legal sphere:

• domestic political stability of the country;
• the economic and social policy of the country, approved by the guidelines of the Communist Party of Cuba (CPC);
• support for the policy of attracting foreign investments at the state level;
• implementation of national and international standards for regulating airport operations, which define quality and safety standards for the provision of relevant services.

2. Economic sphere:

• the economic, commercial and financial embargo imposed on Cuba by the United States and its allies;
• crisis processes in the modern world economy and its postpandenomic transformation ^[14];
• domestic energy crisis;
• transformation of the state business management model, with subsequent approval of non-state forms of its implementation;
• centralized management decision-making;
• lack of competition due to the fact that ECASA S.A. is the only state-owned enterprise of its kind in Cuba;
• signing contracts with new international airlines, as well as strengthening relations with existing partners;
• weak tourism potential and slow growth of the tourist pole of Santiago.

3. Socio-cultural sphere:

• high educational level of the population and opportunities for professional improvement;
• the aging of the population in Cuba, and especially in the province of Santiago de Cuba;
• intensification of migration flows inside and outside the country;
• the potential for cultural tourism in an area rich in historical and cultural traditions;
• there is no alternative to air transportation due to the peculiarities of the geographical location of the country.

4. Technological sphere:

• the need to use advanced technologies and special and technological equipment in airport operations to ensure international competitiveness ^[15], which implies the need to advance capital and attract investments to finance this process.;
• restriction of access to modern technologies due to the blockade by the United States and its allies.

5. Environmental sphere:

• the existence of a regulatory framework at the national, industry, and company levels in favor of protecting and preserving the environment;
• the need for adequate risk management in airport operations due to man-made hazards or environmental vulnerability associated with air transportation;
• The exposure of the Latin American and Caribbean region to frequent and diverse climatic events that have a negative impact on airport operations.

During brainstorming and consensus-building, experts determined the specific weight and assessment of each factor in accordance with its impact on airport operations. This estimate was supported by the Kendall coefficient W = 0.899 and an asymptotic value of 0.000, which indicates agreement between experts. The Likert scale with values from 1 to 5 was used to evaluate the factors, where 5 is a very positive influence, 4 is a positive influence, 3 is an average influence, 2 is a negative influence and 1 is a very negative influence.

When processing expert assessments using SPSS v. 25.0 two criteria were chosen: the mode and the arithmetic mean. Fashion as a descriptive statistic, which represents a consensus value among experts, allowed us to create an external strategic profile, presented in Table 1, and identify the most significant factors of the macro environment. The relevant factors are those that have a very positive or very negative impact on airport operations and, in turn, on the efficiency of work at the airport level. These factors represent opportunities and threats that promote or slow down organizational change.

Table 1. External strategic profile of the macro environment analysis

The arithmetic mean was used as the second criterion, which, when multiplied by the weight of each factor, makes it possible to determine its overall impact. To determine the overall impact, the following decision rule is proposed: if the value is between [1 – 2.33] – the impact is negative, [2.34 – 3.67] – the impact is average and [3.68 – 5] – the impact is positive. The results are presented in table 2.

Table 2. Matrix for assessing the impact of macro environment factors

As can be seen from the matrix, according to the established decision–making rule, the influence of these factors on the activities of ECASA S.A. and, accordingly, on AI "AMG" in Santiago de Cuba is average (3.04), being in the range of 2.34 – 3.67, therefore, the organization has the potential to use the opportunities and at the same time mitigating the impact of threats. The following blocks have the greatest impact on this result: economic, political, legal, and socio-cultural.

According to the assessment of the strength and direction of influence, the following opportunities and threats can be identified, formed by factors of the macro environment: opportunities – political stability in the country, support for attracting foreign investment, ECASA S.A. – the only company, contracts with international companies, geographical features of the country; threats – the foreign economic blockade by the United States, centralization of management decisions, difficult access towards technology.

Microenvironment analysis

The main focus of the analysis of the external microenvironment is on passengers-customers, suppliers and other actors. With the help of customer analysis, it was possible to classify the types of passengers, identify their deployment markets, assess their satisfaction with the services received, and characterize the demand for airport services based on the dynamics of the passenger flow indicator.

Domestic passengers traveling within the borders of a State whose destination or departure is Havana travel mainly on national airlines. International passengers travel on international airlines or domestic airlines that operate international flights. Currently, AI AMG employs about 17 international airlines, and the most significant consumers of services and target audience are citizens of the United States, Spain, the Dominican Republic, Haiti, Venezuela, Suriname and Jamaica.

To assess the dynamics of passenger demand for airport services, a group of experts reviewed the passenger traffic indicator based on available data for the period 2000-2023. The analysis showed that passenger traffic tends to decrease, with a peak value in 2019 not exceeding the maximum value of the total number of passengers transported in 2000. This trend has continued until 2024, which, according to preliminary estimates, accounts for a total of 52,316 passengers.

The passenger satisfaction survey was conducted based on data obtained from two sources of information: 1) Google Maps reviews, which combined the opinions of 115 customers related to the services received at AI AMG and their assessment of their stay at the airport; 2) a survey in January and February 2024 of national and international passengers. This study showed that passengers demonstrate moderate satisfaction with the services they receive at the airport.

Among the main requests and needs of passengers were: an increase in the number and variety of gastronomic offers, a guarantee of transfer to or from the airport to the city, matching the quality of services / products offered to their price, the speed of baggage delivery and adequate handling, improved air conditioning in waiting rooms, timely notification in case of flight delays, the accuracy of flights time management and additional facilities in the terminal.

The supplier analysis showed that the airport interacts with 17 suppliers, of which 7 are suppliers of goods and 10 are service providers. The Pareto principle was used to classify suppliers, based on the criterion of the purchase amount during 2023 and its ratio to the total volume. During the analysis, it was found that slightly more than 80% of the goods and services needed by the organization are supplied by 3 companies: Empresa Comercializadora y Exportadora DIVEP (39.73%), Corporación CIMEX S.A. (32.58%) and Empresa de Acueducto y Alcantarillado Aguas Santiago (14.83%).

Despite the fact that only three suppliers represent 80% or more, it was considered appropriate to evaluate 100% of them. Through interviews and brainstorming, the experts determined the requirements for their assessment, the weight or importance of each of these parameters was determined using the Delphi method and the Decision software, and a supplier evaluation matrix was prepared. These requirements are as follows: R1 – the quality of the products and services offered, R2 – stability and diversification of supplies, R3 – price, R4 –payment discipline, R5 – compliance with contracts, R6 – guarantees.

Table 3. Evaluation matrix for suppliers of AI "AMG" goods and services

According to the table, it can be seen that 8 of the 17 analyzed suppliers (about 47%) have an average level of efficiency, the rest have a high level of efficiency, according to the accepted decision–making rule. Despite this, at the general level, the average efficiency index is 3.64, and is in the range (2.34–3.67), therefore, it can be argued that suppliers have an average level of efficiency. The worst assessed requirements are stability and diversity in the offer, as well as the guarantees offered. According to these two criteria, the analyzed service providers receive the lowest level of ratings.

The airport's activities involve the actions of many entities that are involved in providing services to passengers. And at Cuban airports, passengers, in addition to the aviation structures themselves, interact with various agencies and companies that offer their services and/or products, which affects their satisfaction and opinion about the airport ^[16].

When interviewing employees of each of these entities about their focus on improving the quality of passenger service, 100% of the respondents stated that their organization is interested in passenger satisfaction and contributes to improving their stay at the airport. However, only 90% believe that their organization implements the necessary measures to meet the needs of passengers in a timely manner and maintains good communication and mutual cooperation with other organizations involved in the process. At the same time, 30% of respondents report that they have received complaints from passengers about the service offered. Based on the use of MACTOR software, convergence between the entities and the potentially high possibility of creating strategic alliances were identified in order to improve the quality of services and ensure a comfortable stay for passengers at the airport.

Based on the conducted subjective analysis of the microenvironment, the following influencing factors can be formulated (Table 4):

1) - decrease in demand, identified as a trend as a result of the analysis of the dynamics of passenger traffic;

2) - moderately satisfied passengers;

3) - suppliers with an average level of performance;

4) - high opportunities for creating strategic alliances between actors.

Having determined the weight of each of the microenvironment influencing factors using the Delphi method, using the Decision software, taking into account the Kendall coefficient W = 0.892 and the asymptotic significance = 0.000, indicating agreement between experts, it is possible to present an assessment of the impact of the identified microenvironment factors on the passenger service system at the airport (Table 5).

Table 4. External strategic profile of the microenvironment

Table 5. Matrix for assessing the impact of microenvironment factors

According to the table, it can be seen that the influence of microenvironment factors on the organization is average (3.16 points), being in the range (2.34–3.67), therefore, this allows us to conclude that there are conditions to counteract the negative impact of threats, provided that the organization makes comprehensive use of the positive impact of the capabilities of the microenvironment environment.

Internal analysis

When analyzing the airport's internal environment, the main focus is on characterizing business processes. The company has implemented and certified a quality management system that analyzes various functional processes and types of activities. Based on a critical assessment by experts and after processing the survey results, it was revealed that the following business processes have the greatest impact on passenger service: 1) non-aviation commercial management; 2) passenger service technology; 3) airport services, taking into account their compliance with previously identified passenger requirements. In the period 2022-2023, a number of disruptions were identified that harm the overall quality of passenger service, the comfort of staying at the airport, as well as income generation and the airport's image.

Financial ratios were calculated and interpreted to characterize the financial situation of the airport. The liquidity ratios showed that the company has the ability to meet its obligations in the short term, and has a positive and growing working capital. The high degree of sustainability of the organization is evidenced by the fact that it has no long-term debts in the analyzed periods, and therefore assets are generally fully financed from its own sources, with its own resources accounting for 86% of the total financing ^[17].

The calculation of profitability coefficients showed that the return on shareholders' equity reaches 53.7%, and the return on total assets is 42.6%, which indicates that the company has achieved an adequate combination of liquidity, asset management and debt based on its performance. An analysis of the behavior of economic, labor and salary indicators in the period from 2022 to 2023 was also carried out, which confirms that the organization has a good financial condition.

As part of the human resources analysis, an employee satisfaction survey was conducted, which showed that employees feel moderately satisfied. More than 70% of workers identify with the organization, contribute 100% of their work to the achievement of the organization's mission, learn and apply in practice general and specific rules and procedures for their work area. Approximately 80% of the respondents believe that their position fully corresponds to the functions they perform.

However, 78.6% of respondents report dissatisfaction with their working conditions and the state of their workplaces; 100% are dissatisfied with the lack of a stable transfer to their place of work at the airport; 57.1% believe that the organization's managers do not understand their problems or do not support them; 71.4% believe that wages do not match the results of their work. To complete the analysis, a Fischer questionnaire was applied to these employees in order to assess the level of service based on this tool. The results showed that the employees of the analyzed airport offer a high level of service, but recognize that it is necessary to continue to improve their operational and functional skills and competencies.

To complete the internal diagnostics, an analysis of the airport's resources and its capacity to provide passenger services was carried out. During the inventory of resources, the tangible and intangible assets of the airport were systematized as the main types of strategic resources of the organization ^[18]. The overall index of added value of tangible resources is 3.79 points, and of intangible resources – 3.78 points, therefore, the added value of resources in the system is average, with a tendency to high. The assessment of the organization's assets has shown that the ratio between the availability and the need for strategic resources is satisfactory.

Further analysis focused on defining the characteristics and calculating the airport's capacity, in close relationship with the infrastructure and technological equipment. The airport has a single terminal building, in which domestic and international flights are serviced in separate zones (a mixed terminal), with a total area of 6,400 square meters.m.

To assess the capacity of the terminal, passenger traffic indicators established by ECASA S.A. ^[19] were used for both domestic and international departure and arrival flows. The analysis made it possible to verify that the real passenger traffic at AI AMG is significantly lower than its capabilities, which indicates the underutilization of the airport's infrastructure, and, therefore, it can be argued that the airport is able to comfortably meet the higher demand for its services.

Summarizing the analysis, we present the identified influencing factors with an expert assessment of their impact on the airport's operations, on the basis of which the internal strategic profile of the organization was developed.

Table 6. Internal strategic profile

Discussion of the research results

The purpose of developing a strategy to improve the quality of passenger service at the airport is a systematic presentation of all available influencing factors and an integrated approach to the process of creating a comfortable stay for passengers at Antonio Maceo Grajales International Airport in Santiago de Cuba. In accordance with the factors and characteristics identified during the external and internal diagnostics, and taking into account that the organization meets the conditions that make it possible to implement organizational changes, it is necessary to present a comprehensive vision of the mutual impact and potential of interaction between various subsystems and structural elements of airport activities (Table 7).

Table 7. SWOT analysis of the activities of Antonio Maceo Grajales airport in Santiago de Cuba

The analysis of the factors of the external macro environment, reflected in Tables 1 and 2, showed that AI "AMG" should maximize the opportunities offered by this environment in order to mitigate the negative effect of its threats. The measures presented in Table 7 make it possible to maximize the opportunities of the external environment (SO, WO fields) and neutralize threats (ST, WT fields), which are of the greatest importance based on the matrix for assessing the impact of macro-environment factors. An analysis of the external microenvironment confirmed that passengers do not feel fully satisfied with the services offered by the airport under study, it is necessary to strengthen relationships with suppliers, and there are opportunities for strategic alliances with other system participants.

During the internal analysis, the main shortcomings and weaknesses affecting the quality of passenger service were identified, as well as strengths that need to be strengthened to eliminate these shortcomings, counter threats and exploit the opportunities of the environment. Among the weaknesses, the following can be identified as the main ones: a low level of industrial communications and coordination of activities between organizations involved in the process of servicing and meeting the needs of passengers; an insufficient level of comfort during a stay at the airport due to limited space in waiting rooms, unstable supplies and a small assortment in food outlets and shops; as well as a low level of job satisfaction on the part of the staff and the underutilization of the terminal's capacity. The main strengths in the activities of Antonio Maceo Grajales airport in Santiago de Cuba are determined by a stable level of economic and financial stability; a high assessment of the level of service from domestic customers and the availability of reserve capacities and resources to expand operations, which suggests the possibility of using them under favorable environmental conditions to reduce influence and elimination of identified deficiencies.

Conclusions and other research directions

The development of a strategy to improve the quality of passenger service at Antonio Maceo Grajales airport involves an integrated approach, taking into account not only economic and social factors, but also the historical and climatic features of the region's development; general trends in the development of Cuba, as well as the global economy as a whole, industry specifics and customer needs. As components of the airport's development strategy, we can suggest: improving the production and passenger infrastructure (updating terminals, creating comfortable waiting areas, zoning check-in points, etc.); improving the quality, accessibility and breadth of information support for activities (digitalization of processes, simple and convenient access to information about flights, services and airport navigation, marketing companies that disseminate information about new services and establish feedback with passengers); development and enhancement of staff competencies (professional development programs, trainings, exchange of experience, mentoring, inclusion in the functions of research-type managers).

It seems that this approach has prospects for further application for management analysis and development of an airport development strategy. By integrating objective data, the opinions of microenvironment stakeholders on a subject-oriented basis, and the assessments of practitioners regarding the opportunities and prospects for the development of the internal environment, it allows us to see non-obvious areas and opportunities for development. Taking into account the scope and nature of airports' activities in the context of sanctions restrictions, special emphasis is placed on the quality of service, which is determined not only by the decisions of the airport management itself, but also by the work of service companies, as well as existing restrictions. Due to the special importance of airport infrastructure, the development of management tools and technologies, it seems promising to further develop the methodology of strategic analysis in terms of more accurate consideration of various factors, integration of approaches and assessments, automation of analytical actions to ensure more accurate and prompt reflection of changes in management decisions.

Observing a certain similarity in the influence of a number of environmental factors, both among the opportunities (political stability within the country, government support for policies to attract foreign investment, suppliers with an average level of productivity) and among the threats (sanctions confrontation with a number of countries, difficult access to advanced technologies due to the already outlined policies of Western countries), we can say about the possibility of adapting the strategic directions of development of Antonio Maceo Grajales airport and the tools for their implementation to the Russian business practice. Of particular interest may be the creation of vertical and horizontal strategic alliances with various system participants in order to improve the level of passenger service, as well as negotiating with suppliers and/or their competitive selection in order to improve performance, which should have a positive impact on the activities of domestic airports.