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MGMT10002 - Management - Airborne Company

   

Added on  2020-03-07

11 Pages2626 Words606 Views
Management

Q1Explain 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). Thesystem 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 climateor 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 isthe 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 companyneed 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 - LOWThe 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 deliverycompany 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 entrantsCurrently, 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- ModerateThe 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 governmentrules and regulation, then there will impact on the working of the company.SWOT Analysis

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