Airborne Express: Strategy & Sustainability

This assignment examines Airborne Express's strategic approach, focusing on its divisional organizational structure and implementation of the Six Sigma quality improvement strategy. It further explores the company's commitment to sustainability, analyzing how it balances environmental responsibility with efficient resource utilization and employee well-being.

Management

Q1
Explain airborne external environmental analysis, special focus on PESTEL in addition to
Threats and Opportunities from SWOT Analysis (as they are considered as external strategic
factors), justify your answer.
PESTEL Analysis
These are some of the external environment factors that affect the working of the Airborne
express (Reeves, Haanaes, & Sinha, 2015).
Political factors- In the case study it is shown that Airborne Company wants to form a
connection with the international cities so that company can easily perform delivery activity
internationally. Airborne had joint venture operations with Japan, Thailand, Malaysia, and South
Africa. For maintaining this joint venture company needs to monitor the rules and regulations.
Economic factors- Company hire employees for both full time (115,300) and part time (7,200)
employees. Though, the business is large so a company needs more of the employees which help

in coordinating, managing and controlling the activity. Airborne company pays to the employees
for the performance in terms of incentive systems.
Social factors- With the change in the lifestyle of the people, they have started adopting new
things by paying money for the products. There are rare customers who directly visit Airborne
for delivery. Hence, the company is having the tie up with the airlines that provide cargo space
so that delivery can be done.
Technological factors- The FOCUS system of the company includes freight, on-line control,
and update system. The first of information system used by the airborne company was the
LIBRA II system. LIBRA II equipment includes a metering device and PC computer software
that is used by company for sending mails to the clients. There is a need to the technology, for
tracking the delivery, for controlling, contacting, etc. (Clayton, Spinardi, & Williams, 2014). The
system of electronic data interchange is also used by the company.
Environmental factors- The Company needs to consider environmental factors such as waste
disposal, climate, recycling procedure. Airborne demand increases with the change in the climate
or vice versa. Most of the people travel considering the climate (McKay, 2014).
Legal factors- Airborne’s international operations was the creation as its Wilmington hub, this is
the only privately certified FTZ (Foreign Trade Zone). Company is having alliances in Japan,
Malaysia, and Thailand along with South Africa. To keep the alliances working smooth company
need to take care of legal factors.
Porter’s forces

Porter’s forces are the external analysis which helps the company in analyzing the factors which
affect the working for the company (Rothaermel, 2015).
Bargaining power
of supplier - LOW
The bargaining power of the airborne express is quite low because a
company is having their own airport, thus the supplier power will be low.
Bargaining power
of buyer - HIGH
The buyers have the power and they can easily switch to the other delivery
company who can offer the customers relatively better services. UPS and
FedEx are competing companies; these companies can attract the
customer by promising them on time delivery. Apart from the price
differences customer get attracted towards the product differentiation.
Threat of new
entrants
Currently, there is a situation of the oligopoly of 86% shared by FedEx,
USP, and Airborne. Apart from this, there is a need of the huge capital for
setting the business and competing with the strong competitors.
Threat of
substitute – HIGH
The threat of substitute of airborne is high due to the availability of the
several alternatives. Express mail offers a customer the convenient

services.
Intensity of
Rivalry- Moderate
The rivals of the airborne company are FedEx and UPS so company faces
tough competition. As all the companies provide similar services there is
no difference in the services.
Relative power of
other
stakeholders-
MODERATE
Airborne Stakeholder who invests in the company, trade associates are
neither high nor low. If there will be a change in the policy or government
rules and regulation, then there will impact on the working of the
company.
SWOT Analysis
The SWOT Analysis includes opportunity & threat which is part of the external analysis and
strength and weakness which is the part of the internal analysis.
Opportunity  The company is having an opportunity to expand the
business in the international markets and can provide the
facility of the global shipping to the customers.
 Airborne can try to create an effective and strong
relationship in roadway packaging systems. The growth of
the deferred and ground based delivery services.
Threats  The company has threats from the rival's (FedEx and UPS)
pricing strategy. If rival offers same or fewer prices than a
customer can switch to the other companies.
 Airborne express has threats from its competitors that

include FedEx and UPS. Apart from the rivals, the prices of
the fuel are one of the concern issues.
Q2
Explain airborne internal environmental analysis, including Resources, Capabilities, Competitive
Advantage, Sustainable Competitive Advantage, in addition to Strengths
and Weaknesses from SWOT analysis (as they are considered as internal
strategic factors) justify your answer.
Strength  Airborne, 71% packages were transported by air and rest
29% by trucking hubs in domestic areas.
 The company offers two international products freight
products and express products.
 Airborne generally deliver products in afternoon or on the
second day. The company is having flexible cost structure.
Weakness  Delivery time of airborne get success 96%, on the other
hand, rivals 99% or higher on time delivery.
 The company only guarantees overnight deliveries that
mean by night or next day, rivals of the company
guaranteed by 10:30.
Resources

The most important resources of the company are intangible resources, as the company is well
known so that a company can easily get financial help from investors. But company need to
search these intangible resources. The human and technology resources are proven as most costly
expenditure done by the airborne (Azeveo, et.al., 2015). The company has about 50-55 drivers
plus staff; these drivers collect the parcel from the clients.
Capabilities
Airborne should have the capabilities to make the effective and productive use of the resources
(Abramovitz, Rodriguez, & Arendt, 2014). The company has 14,900 radio-dispatch deliveries for
that company follows secure communication and radio communication facility so that privacy
related to the customer details can be maintained by the company. The company has the
capabilities of making a huge future investment as the brand value of the company helps in
financing. The company has the capabilities to manage the distribution system across the world.
The talent of the driver is utilized by the airborne company.
Competitive advantage
A competitive advantage refers to as the advantage company is going to get over the competitors
by offering consumers greater value, either by offering a lower price or by providing greater
benefits (Wagner III, & Hollenbeck, 2014). The airborne company uses cost leadership method
with the help of which company tries to deliver packages at the same designation all together
which reduces the cost of the delivering the product again and again. To create a differentiation
from the competitor's company target the market and tries to understand the requirement of the
customers.
Sustainability competitive advantage

Sustainability competitive advantage refers to the abilities, attributes of the company which
makes it different from the competitors. These attributes helps in the survival of the company
(West, Ford, & Ibrahim, 2015). Airborne increased the quality and reliability in the delivery
timing. Company offered its customer a program Quick link; this program reduced the
programming timings and helps in linkage.
Q3
Explain airborne business strategies (cost leadership, differentiation, or focus), justify your
answer.
Business strategies followed by the Airborne Company
Cost leadership- The objective of this business strategy is to produce the goods at the low cost
(Kurt, & Zehir, 2016). Similarly, the airborne company tries to deliver a maximum of packages
altogether at the same destination so that company needs to pay less price for the same.
Technology will help the company in delivering the documents and package effectively and
collectively.
Differentiation focus- The objective of this business strategy is to bring differentiation in the
products that airborne company is offering, this will help company to compete with the
competitors (Ibrahim, 2015). Airborne needs to understand the demands and needs of the
customers by targeting the market company. This will help the company to take the step forward
to introduce something diverse from USP and FedEx.
Q4

Read and Study chapter 7, 8, 9 & sustainability documents 1 & 2 and explore your personal
opinion on the case overall based on these chapters and files.
Chapter 7 shows the corporate strategy which refers to as the direction chosen by the company,
the corporate strategy includes the directional strategy, portfolio analysis, and parenting strategy
(Wheelen, & Hunger, 2017). The case study shows that the company is following geographic
market diversification. The company is having dominant business as the company can make 70-
90% profit out of this business. The company is having horizontal growth, as a company is
increasing the number of a market in which they can offer the services. Airborne did synergy
with the other company so that both the companies can earn money together. Portfolio analysis
helps the airborne in analyzing whether to invest or not, a company will be able to expect a
profitable return. Corporate parenting is taken by the company as a company is taking care of the
control of different resources with the capabilities.
Chapter 8 talks about the strategy formulation, in the case study airborne, follow different
strategies. Function strategy is followed by the company by making effective utilization of the
resources (Hill, Jones, & Schilling, 2014). A company is a well-known company and that is the
reason company offers attractive prices to the customers. Apart from this company should make
proper strategies to expand the business across the world. Push and pull strategy is the best
strategy can be followed by the company for creating the awareness among the market. A
company should keep the proper management of the dividends and stock price; this is part of a
financial strategy. A company tries to add innovation in the existing products and brings
improvement as well. The company maintains good operational strategy by forming strong
relationships. HRM strategy is must for the airborne and most important strategy as for the
smooth working company need to appoint employees in every process (Purce, 2014).

Chapter 9 talks about how the formed strategies can be implemented by the company. For
implementing Strategy Company need to make programs, budgets, and procedure. Airborne need
to form the program to take action, a budget is maintained for implementing the action along
with the procedure which shows the way of implementing the strategy. Each and every company
follow organizational structure, talking about airborne company follows divisional organizational
structure. Airborne express can implement the six sigma strategy for bringing improvement in
the quality of the products.
Sustainability chapter 1 & 2 says that each and every business needs to manage sustainability
for the future generation because for manufacturing goods, resources are must (Bebbington,
Unerman, & O'Dwyer, 2014). Airborne needs to maintain sustainability by working smarter with
efficiency. Effective working will help airborne in reducing the excessive use of the resources.
For sustaining in the business there is a need to maintain the healthy environment. Airborne can
adopt new technology which reduces the hurdles in communicating, tracking the delivery and
company can do conferences and meeting with the help of technologies. Natural resources play
an important role in living and working. As per the McKinsey survey, there are many companies
who are maintaining the principles related to the sustainability such as developing green
products, saving energy, motivating and retaining employees. That is the reason airborne is
offering high salaries to the employees along with incentives.

References
Abramovitz, S., Rodriguez, O., & Arendt, G. (2014). The effectiveness of US military
intervention on Ebola depends on the government’s will and vision to direct vast military
resources towards a public health response. LSE American Politics and Policy.
Azevedo, C. L., Iacob, M. E., Almeida, J. P. A., van Sinderen, M., Pires, L. F., & Guizzardi, G.
(2015). Modeling resources and capabilities in enterprise architecture: a well-founded
ontology-based proposal for ArchiMate. Information Systems, 54, 235-262.
Bebbington, J., Unerman, J., & O'Dwyer, B. (Eds.). (2014). Sustainability accounting and
accountability. Routledge.
Clayton, T., Spinardi, G., & Williams, R. (2014). Policies for cleaner technology: a new agenda
for government and industry. Routledge.
Hill, C. W., Jones, G. R., & Schilling, M. A. (2014). Strategic management: theory: an
integrated approach. Cengage Learning.
Ibrahim, A. B. (2015). Strategy types and small firms' performance an empirical investigation.
Journal of Small Business Strategy, 4(1), 13-22.
Kurt, A., & Zehir, C. (2016). The relationship between cost leadership strategy, total quality
management applications and financial performance.
McKay, C. W. (2014). The Regional Economic Analysis of Clinton County Ohio.
Purce, J. (2014). The impact of corporate strategy on human resource management. New
Perspectives on Human Resource Management (Routledge Revivals), 67.