GROUP ASSIGNMENT

BM017-3-M-MCI

Management Creativity and Innovation

TITLE: Munich International Airport

STUDENT NAME STUDENT ID NUMBER

SUSHMA CHHETRI NPB000185
SAROJ KC NPB000177
JAYBR KUMAR AGRAHARI NPB000160
BISHAL KUNWAR NPB000123

COLLEGE : SKY INTERNATIONAL COLLEGE

INTAKE : NPSMF2001MBA

SEMESTER : 1st

MODULE LEADER : Mr. SANJEEV BHANDARI

HAND IN DATE : 10th July, 2020

 ABSTRACT

This report is about Munich International Airport and has discussed two main things.

1. How innovation in airport industry is developing to attract the customer as well as

the economic growth.
2. How the external factor affects the airport business.

The study shows that Non-aviation sectors like shopping, restaurant, mall; entertainment etc.
has become the Centre of driving the innovations. These innovations not only improve the
passenger experience but also further enhance the creativity of the innovators.

And shows the airport business is affected by external factors like political, Socio cultural,
technology and economics.

Further we have discussed on future oriented innovations on pollution control, Expansion of

runways due to huge air traffic and Lab-Campus for innovation at Munich International
Airport.

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Contents
List of figures..................................................................................................................................iii

1. Introduction and background....................................................................................................1

1.1 Munich Airport Profile..........................................................................................................2

2. Innovations & up-gradations....................................................................................................6

2.1 The micro-brewery "Airbräu"................................................................................................6

2.2 Conceptual Store: My Corner................................................................................................7

2.3 Five-Star Airport....................................................................................................................8

2.4 Napcabs..................................................................................................................................9

2.5 Meeting Cab...........................................................................................................................9

2.6 Heating, cooling, lighting and latest building technologies................................................10

2.7 Importance of Innovation in Airport business.....................................................................11

3. External Factors affecting airport...........................................................................................12

3.1.1 Political and Legal........................................................................................................12

3.1.2 Economic......................................................................................................................13

3.1.3 Socio-culture................................................................................................................13

3.1.4 Technology...................................................................................................................14

4. Future Innovation...................................................................................................................16

4.1 Carbon-neutrality by 2030...................................................................................................16

4.2 Third Runway......................................................................................................................16

4.3 LabCampus – a Global Platform for Pioneering Innovation...............................................17

5. Conclusion..............................................................................................................................18

References......................................................................................................................................19

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List of figures

Figure 1: Munich International Airport’s passenger statistics.............................................3

Figure 2: Munich International Airport’s aircraft movement’s statistics............................3
Figure 3: Munich International Airport’s Air freight statistics...........................................4
Figure 4: Munich International Airport’s Air mail statistics...............................................4
Figure 5: Munich International Airport services.................................................................5
Figure 6:‘Airbrau’ beer in making.......................................................................................7
Figure 7: MyCorner............................................................................................................8
Figure 8: Winner of the Oscar of the aviation industry.......................................................9
Figure 9: Sleeping quarters in Munich Airport....................................................................9
Figure 10 MeetingCab.......................................................................................................10
Figure 11: Reducing Munich Airport's CO2 emissions.....................................................16

iii
 [Introduction and Background]
`

1. Introduction and background

(Amabile, 1988) defined creativity as production of novel and useful ideas by an

individual or small group of individuals working together. Also, mention that innovation is
built on creative ideas as the basic elements and Organization innovation is the successful
implementation of creative ideas within an organization. from the definition, it is clear that
idea is anything i.e. process, products, and services within the organization lines of business,
and also idea for new policies or new procedures within the organization (Luecke, Richard
& Katz, Ralph & Harvard Business School`, 2003), “the main goal of managing creativity
and innovation is the individual and organization more creative and more effective on the
important- innovation front. And Because of Creative and innovative minds, many countries
like China, Germany, the UK, the USA, Japan, and India have a drastic change in economic
growth. Innovations are everywhere in the world nowadays. People come with many
creative ideas that have changed the economic status globally. Innovations like Facebook,
Instagram, Twitter, Whatsapp, google in Information technology, Artificial intelligence in
robotics, Driverless cars in automobiles, many other innovations in products, processes, and
services have set an example of Creativity and innovation

Page 1
 [Introduction and Background]
`

With millions of passengers traveling around the globe every day, air travel has become a
has to bother these days. Problems like delayed flights, overbooking, gate changes, and long
layovers are most common the passenger experiences. To ease the passengers, airline
industries are coming with many innovative and creative ideas. The reason why passenger is
happy in many airports is due to the creative ideas and new innovation that the customer
would always like to have. According to Skytrax, customers from more than 100 different
countries participated in the survey, which was conducted from September 2019 to February
2020 and covers 550 airports. The Munich airport (Germany) is in the 5th position in the
world. Here we discussed how the airport has used creativity and innovation to be in
position from the day it started its service.

1.1 Munich Airport Profile

Munich Airport was founded by Flughafen München Gmbh in 1949 along with its
subsidiaries which lie in the heart of Bavaria and voted for the best Airport in 2020. It
started its operation in 1992. The airport is located 28.5 km (17.7 mi) northeast of Munich
near the city of Freising. The airport is made in 1575 hectares of land where 2 third portions
is covered with greeneries. This airport lies in no. 2 in Germany in terms of passenger traffic
after Frankfurt airport. In the (Fiscalyear, 2018), the total revenue roses by T€40,082 or 2.7
% to 1.51 billion Euros. But earning after tax fell by T€10,067 to T€148,733

The shareholders of Flughafen München GmbH (FMG) are the Free State of Bavaria
with a 51 percent stake, the Federal Republic of Germany (26 percent), and the state capital
Munich (23 percent).As per statistical data of 2019, the total number of the airline was 101.
The airport links to 74 countries and has destinations of 254 as transit. The company
consists of 38000 employees.

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 [Introduction and Background]
`

Source: (MunichAirport, 2019)

Figure 1: Munich International Airport’s passenger statistics

When the airport started there were 12 million passengers and now it has become
one of the most important passenger terminals. The airport has become one of the busiest
airports handling 47.9 million (Flughafen München Gmbh, 2019).

Source: (MunichAirport, 2019)

Figure 2: Munich International Airport’s aircraft movement’s statistics

Starting from 1992 to 2019, the data shows that the number of aircraft movements is
more than 2 times.

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 [Introduction and Background]
`

Source: (MunichAirport, 2019)

Figure 3: Munich International Airport’s Air freight statistics

Source: (MunichAirport, 2019)

Figure 4: Munich International Airport’s Air mail statistics

From figure 3 and figure 4, the data shown are the traffic on airmails and freight or
cargo. Figure 3 shows the gradual increase in air freight. And the figure shows a decrease in
airmails.

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 [Introduction and Background]
`

Source:
(MunchAirport, 2019)

Figure 5: Munich International Airport services

The airport is not only an airport but it’s a city with the airport. Lots of facilities like
more than 60 restaurants, bars and café. It has a whole shopping complex more than 50
shops and service units. Medical facilities for any kind of emergency health issues are also
available in the airport. The Airport consists of lounge around 808 rooms and 9 playgrounds.

Page 5
 [Innovations & up-gradations]

2. Innovations & up-gradations

Article in Forbes by (Cook, 2010)said “those airports that successfully rise to the
challenge will become “Airports of the Future” and will exhibit three key characteristics that
distinguish the successful from all others:

 Lower-cost operating costs

 Faster and more efficient passenger flows

 New revenue streams, driven by increased retail and services opportunities

Improving passenger experience is one of the main drivers of our growth strategy.
Airports that are designed to be able to manage and coordinate individual travelers' needs
and demands. Taking account of the passenger experience during the airport process has led
to an increasing segmentation, offering passengers in transit, business, recreational and low-
cost services adapted to each type of passenger. Author (Scheler, 2011) mention that from
the empirical study of German’s airport, it is shown non-aviation sector like shopping, and
restaurants, mall, entertainment, etc becomes a central driver of innovations.

Some of the Innovations and Up-gradations at airport are:

2.1 The micro-brewery "Airbräu"

In 1999 it started Micro-brewery "Airbräu" but due to innovation it is only the
airport brewery which is very unique than it used to be. For over 16 years now, passengers
from all around the world and local residents have enjoyed its traditional Bavarian dishes
and freshly brewed beer. The main thing about “Airbräu” which attracts customer towards
drinking it is that people can observe the brewing process which takes place in the main
restaurant, where about 350 people can sit around the brew kettles and enjoy the brewing

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 [Innovations & up-gradations]

process. In 2012 the DLG Test Centre for Food honored the "Airbräu" with a gold medal for
the "Jetstream Pilsener" beers for its outstanding consistency” (Munich Airport, 2017).

Source: (MunichAirport, 2019)

Figure 6:‘Airbrau’ beer in making

2.2 Conceptual Store: My Corner

“Munich Airport, with a view of customer convenience and the shopping experience
started the new concept of the store. The first “My corner” store was opened on 27th May.
The store's interior design offers a simple layout, which makes the shopping experience very
easy with fast pay for purchases. It has different segments with variety of goods and
searching for in very less time: magazines and newspapers, books, souvenirs, food, luxury
items, and travel articles. For easy access and customer convenience, every corner of the
shop has entry and exit doors. With the new store concept, Munich Airport is adapting to the
increasing expectations of demanding customers and further enhance the airport shopping
experience. Passengers can enjoy Munich’s culture and lifestyle in the cozy Bavarian decor,
making them stops an inviting spot to take a moment to shop and explore. Whoever just
travels via Munich’s airport they miss the best part” (MunichAirport,2019).

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 [Innovations & up-gradations]

Source: (Munich, 2019)

Figure 7: MyCorner

2.3 Five-Star Airport

In 2013, the airport launched a quality offensive in the areas of 'first-class
atmosphere and high comfort,' 'service spectrum and facilities,' 'effective procedures,' 'ease
of transit via airport,' and 'exceptional friendliness. ‘The continued efforts by the airport to
improve all customer services were finally rewarded in 2015: Skytrax has honored Bavaria's
Hub with the title "Five-Star Airport". Munich Airport has proved its efforts by winning the
award for a seamless, high-quality experience along the entire travel chain. The prestigious
title is considered as the aviation industry's Oscar.

Source: (MunichAirport, 2019)

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 [Innovations & up-gradations]

Figure 8: Winner of the Oscar of the aviation industry

2.4 Napcabs
The new conceptual waiting rooms which have given most of travellers a best place
to take a nap or can be said as a quiet and private spot for some uninterrupted works in
between their waiting hours. This all got possible with NAPCABS, the place where one can
wait before their connection flights by paying few Euros. They are furnished with a bed, a
desk and music to match your tastes. “The sleeping pods include a dedicated work area and
free internet access. Napcabs are the perfect way to find some privacy and beat jetlag.”
(Munich Airport,).

Source: (Telegraph, 2019)

Figure 9: Sleeping quarters in Munich Airport
2.5 Meeting Cab
“Like as Napcab, Munich airport came up with new concept in early 2019. The’
MeetingCab’ concept was developed by the company behind the familiar ‘Napcabs’ sleep
cabins, and will be tested for a one-year pilot phase. This cabin can be used for making
private calls and doing business meeting or confidential discussion before flight departure in
order to save the precious time of their valuable passengers. The space is easily accessed
with credit card. It is 8 Sq. Meter sound proof cabin where four people can sit around a
round meeting table and users can use wi-fi connection and power cables” (Munich Airport,
2019).

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 [Innovations & up-gradations]

Source: (Munich, 2019)

Figure 10 MeetingCab

2.6 Heating, cooling, lighting and latest building technologies

Reduction of CO2 emission by 40% than those emitted by the existing old terminals,
are only possible due to the latest lighting technologies “The new satellite terminal”.
Another technological aspect which is contributing to minimization of CO2 level is ‘Climate
facades’ which is made up of a new type of glass having a special coating that keeps out
heat and solar radiation.

The air conditioning of the satellite terminal is done by airport’s own CHP
(combined heat and power plant) heating and cooling systems. With CHP the airports
generates around 60% of the power for its use and waste energy is used for heating during
cold seasons and vice-versa.

Similarly, innovative concepts of LED lamps has supported more in energy saving.
At the satellite terminal, climate protection does not stop only up to the outer walls: all
aircraft are positioned such that it can be equipped with so-called ‘pre-conditioned air’
(PCA) for heating and cooling purposes. Therefore, the use of the aircraft's own kerosene-
powered auxiliary power generator is superfluous, results in lowering of both noise and CO2
emissions” (Munich Airport, 2015).

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 [Innovations & up-gradations]

2.7 Importance of Innovation in Airport business

Failure of renowned companies like Nokia mobile phone, Blackberry mobile phone,
Kodak and many more due to the delayed in adaption of newer technology. Munich airport
always keeps them updated in terms of technology. The New satellite terminal is the
example of it with the vision of saving energy and reducing CO2 level in the airports.
Certain steps that Munich Airport took in its push for the title were the renovation of
Terminal 2 sections as recreation areas. Furthermore, all terminal and satellite departure
areas are entirely fitted with electric outlets and USB ports. In line with state-of-the-art
technology, Munich Airport provides all travelers free wireless internet access.
Similarly, as per security concerned Munich airport with collaboration with Federal
Police of Germany installed the EasyPASS identity screening system at the airport. This
allows passport management, and thus passenger entry and exit at Munich Airport.
Airport management is always concerned with the customer opinions and
satisfactions. Keeping in mind the same, Feedbacks machine are installed all over the
terminals” (Munich Airport, 2017).
The early arrival is never been a disappointment to the passengers at Munich airport.
There are lot of thing to do at airport like entertainments, shopping, art galleries, cafe any
many more. By paying few Euros one can use Netcabs for taking rest in between their flight
departure. As we all know ‘time is money’, Business personnel can use their leisure time for
meeting or private calls at airport with facilities like Meetingcabs.
This are few innovations which helped directly or indirectly to get listed in top 5
international Airport by SkyTrax in rating 2020.

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 [Factors affecting airport]

3. External Factors affecting airport

"An external environment is made up of all the external factors or influences that
affect the business operations. The company has to act or response to maintain its
operational flow" (Study.com, 2015).The external environment plays an important role in
shaping the future of industries as a whole and of private firms. The four factors affecting
the Munich international airport are listed below.

3.1.1 Political and Legal

Political factors includes government policy, political stability or instability,
corruption, foreign trade policy, fiscal policy, labor law, environmental law and restrictions
on trade. (Business-To-You, 2016). The planned third runway cannot now be continued
following last autumn's agreement between the ruling CSU and Freien Wahler coalition
parties. However, the coalition stated that it will work to develop an enhanced Bavarian
airport concept, promote Bavaria as a business location and the role of Munich Airport as a
leading European aviation hub, and focus on environmental issues including airport noise
pollution and CO2 emissions " (The Blue Swan, 2018).

"Although legal factors that correlate with political factors, they include more basic
laws such as legislation on discrimination, antitrust laws, employment laws, consumer
protection laws, copyright and patent laws, and laws on health and safety" (Business-To-
You, 2016).

Some of the provisional legal acts of Munich airport (Munchen, 2010).

 Violations of the rules and regulations

 Approved recipient
 Amendments
 German Equal Treatment Act

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 [Factors affecting airport]

3.1.2 Economic
“Economic factors are determinants of the success of a given economy. It includes
economic growth, exchange rates, inflation rates, interest rates, household disposable
income, and jobless rates. It also affects the price of companies' products and services"
(Business-To-You, 2016).

Munich Airport has a number of different levels of regional economic influence. The
value-added effects generated by operations at airports can be classified into direct, indirect
and induced effects.

 Direct effects: All value created by Munich Airport's economic activities. The direct
value created is used to pay salaries and wages.
 Indirect effects: The sum of all effects in a region that are created by the Munich
Airport companies' supplier and service relationships.
 Induced effects: In the region, economic activities with a value-added effect are
generated via Munich Airport purchases made using income.

The results of using the Munich Airport are known as location results. Those have
positive economic impacts, such as productivity gains and investments, plus a high degree
of creativity. Airport proximity is seen as a significant criterion for the companies that
decide to settle in the city. The airport also offers tourism industry benefit" (Shaping The
Future, 2018).

3.1.3 Socio-culture
“This general environment aspect reflects the demographic patterns, standards,
practices, and citizen values under which the organization works. Which include
demographic patterns such as population growth rate, age distribution, income distribution,
job attitudes, safety focus, health knowledge , attitudes to lifestyles and cultural barriers"
(Business-To-You, 2016).

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 [Factors affecting airport]

3.1.3.1Engagement within the Munich International Airport Group

"Munich airport still aims to be a good neighbor and is well aware of its social
obligation within the city. Over the past few years, funds and resources have been allocated
to over 750 initiatives, which can be linked to the airports five sponsorship pillars, namely
education, social affairs, sport, culture and nature.

In 2019, Munich airport lent it supports too many projects aimed at promoting the
personal development and talents of children and young people, and helping them in their
choice of career, and making number of anonymous donations. Also, the airport's charitable
association supports local adults, senior citizens, and refugees as well regularly taking part
in project outside Germany.

3.1.3.2Employment Opportunity.
Munich the airport generates one in four of all jobs and represents Munich airport's
tremendous significance for the regional labor market.

The airport hires 10,000 people from over 100 countries, from chefs to engineers,
firefighters to retail clerks. This involves the 280 trained workers of the future employed in
20 separate professions as apprentices and trainees.

3.1.3.3Acceptance of Workforce Diversity

Being such a globally partnered agency, the Munich Airport profits from its people's
heterogeneity with its growing mindsets and cultural backgrounds. Given the great
importance of mutual acceptance and appreciation in this regard, all management staff and
employees are familiar with each other. Around 24 per cent of company workers come from
over 100 countries" (Shaping The Future, 2018).

3.1.4 Technology
"IT includes such technical advances that can favorably or unfavorably impact the
operations of the industry and the market. It applies to technology opportunities, the degree
of innovation, automation, R&D operation, technological transition and the amount of
technical knowledge a company has." (Business-To-You, 2016).

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 [Factors affecting airport]

Munich Airport aims to protect the future of its business model through its
digitization plan. FMG sees digital technologies as the key to a smooth customer journey:
timeliness of departure and arrival, good navigation and route guidance, as well as suitable
guest shopping options

The risk of cyber-crime and attacks on IT systems also increases as the digital
transformation progresses. FMG is partnering with experienced IT security firms in the ISH
project which aims to counter those risks. (Shaping The Future, 2018).

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 [Future Innovation]

4. Future Innovation

4.1 Carbon-neutrality by 2030

“Munich airport aimed to become Germany’s first CO2 neutral airports by 2030.
Airport plans to invest about 150 million Euros for the reduction of CO2 emission by 60%
and compensating the 40%.The following measures are planned by Munich Airport in order
to succeed in carbon-neutrality:

Sourc
e: (MunichAirport, 2020)

Figure 11: Reducing Munich Airport's CO2 emissions

4.2 Third Runway

The company plans to make the third runway because air traffic has increased. The
planned third runway cannot now be continued following last autumn's agreement between
the ruling CSU and Freien Wahler coalition parties. A 5-year moratorium must be imposed.
It will therefore be difficult for airlines to provide additional flights from and to Munich and

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 [Future Innovation]

to satisfy the rising demand for mobility from the public and business sectors in
Bavaria(Airport, 2018).

4.3 LabCampus – a Global Platform for Pioneering Innovation

Munich Airport is moving towards the future with the establishment of LabCampus.
And it's a gigantic step. On a site with an area of 70 soccer fields, precisely 500 000m2,
"destination innovation" takes shape. Fresh and intelligent ways of working together
between companies and industry will begin to take shape here in the next few years(Airport,
2018).

Page 17
 [Conclusion]

5. Conclusion

Munich Airport is the main gateway to Munich and one of the largest airports in
Germany. It is a hub for Star Alliance, OneWorld and Sky Team and hosts over 100
passenger and cargo airlines. Time and again Munich Airport is taking several steps in the
direction of the future. Carbon neutrality by 2030 is one of the significant aims among them.
Experts have prepared specific road map to succeed in carbon neutrality. These experts
know better than any, how to coach companies around establishing in innovation processes
from ideation through to execution and marketing.

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 [References]

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 [References]

APPENDICES

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