Why Ethiopian Airlines Becomes Successful and What are the Lessons for other Public Companies

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Addis Ababa University


This research has been done to solve the relatively poor performance problem of different public companies and enhance economic growth of Ethiopian economy through public sector capacity building. Accordingly, this study examined the success of Ethiopian Airlines, its determinant factors as well as lessons that can be taken by other public companies from its experience. In doing that, descriptive as well as econometric analysis based on performance indicators and endogenous growth model are respectively used. -------'lThe-resttlts--etf--tleseripti-ve--ltf\ftlys-is-itlciieale Ihftl ...... Ethitlpiftft--Ait>lines-is-a-sl:leeessfu-l-------'enterprise. This is mainly because the airline is a profitable, with a culture of continuous improvement, paramount productivity growth, higher market share etc. In this regard, several factors have contributed for the success of thc airline: its working standard, overall system, dedication of workforce, safety trend, best practice, current and recurrent trainings, formation history, state art teclmology, autonomous management, its market strategy, visionary leadership style etc. Similarly, the results of econometric analysis reveal that the major determinants for the growth/success of Ethiopian Airlines are physical capital accumulation and human capital creation. Therefore, it is the combination of the earlier qualitative determinants with both physical and human capital that has played a significant role for its success. Finally, based on the findings, government and different public enterprises can take the aforementioned success leading factors as a lesson. Provided that different public enterprises have different character of their own that they should apply everything based on the type of their business.



Ethiopian Airlines