Porter’s Five Forces Analysis of Qantas Airlines

Strategic Management 1
Table of contents
Introduction......................................................................................................................................1
Summary of Porter’s five forces model...........................................................................................1
Application of the model.................................................................................................................1
Usefulness and limitations...............................................................................................................2
Conclusion.......................................................................................................................................3
References........................................................................................................................................4

Strategic Management 2
Introduction
Qantas airways is a principal airlines in Western Australia since it was founded back in 1921.
Airline business, just like any other business is largely impacted by the external environment
within which the organization functions. This essay highlights upon the external environment
forces that impact QANTAS airlines. In order the achieve that, I would be discussing about a
strategic management tool, Porter’s five forces model and apply the same on Qantas airline in
order to understand the macro-environment of the organization better. In the last part of the
report before the conclusion, I have shared my learnings from the project, the usefulness of the
tool as well as its limitations.
Summary of Porter’s five forces model
Porter’s five forces model is a holistic and strategic tool that helps businesses in understanding
their environment better (Dobbs, 2014). This in turn assists in building strategies unique to the
business that would help the business in gaining a competitive advantage over others. There are
several stakeholders of the business including customers, suppliers and competitors. This model
helps in identifying the power of these stakeholders over the business. Along with that, the
model looks at a business from a long term perspective and helps in identifying possible threats
from new entrants or substitutes that could adversely impact the business. Thereby the
application of the tool on a business helps marketers in being prepared for such unforeseen
scenarios. A section of the tool also throws light on the competitive rivalry that already exists in
the industry hence helping the business in devising strategies to combat the same.
Application of the model
Threat from new entrants: The threat of new entrants reflects upon how the easy or difficult is
it for a new player to enter the industry and create competition. Airline industry is a fairly
expensive industry to get into. Even though the industry has recently witnessed an influx of new
low cost carriers, the threat from new entrants to Qantas Airline is fairly moderate (not too high)
(Alexander & Merkert, 2017). This is because of the immense cost involved in the airline
business as well as the immense number of complicated laws and regulations that govern the
industry making it difficult for new comers to enter.