Business Strategy Analysis and Development: A case study of QANTAS Airways

Business Strategy Analysis and Development
A case study of QANTAS Airways
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Table of Contents
Introduction...........................................................................................................................................3
Background and Business Details of QANTAS Airways..................................................................3
Review of the past 5-year Business Strategies...................................................................................4
Statement of Current Strategy............................................................................................................6
Recommended Business strategy.......................................................................................................9
Justifications for the recommended strategy....................................................................................10
Conclusion...........................................................................................................................................10
References...........................................................................................................................................11
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Introduction
Business strategies bundle into several tactics which are relevant to business and its
operational success. This writeup is an analytical report based on strategies related to the
case study of Qantas Airways. Strategies are relevant in connection to forthcoming business
planning which shapes strategic thinking for achieving success in a competitive industry such
as aviation. Therefore case study of Qantas Airways is a chosen basis of analysis concerning
some aspects of the analysis in this essay. Firstly the organization Qantas airway is
introduced in this analysis. Previous five years’ strategies have been discussed and evaluated
in this report. Present strategies of the firm hold importance and have been also discussed
here. Moreover, some strategies have been recommended for the case study firm and the
recommendation have been justified in the line of environmental concerns expressed by the
Royal Commission (Teece, 2010). Business firms can never put aside its concerns for the
environment. The strategies for protecting environment and practices which are sustainable in
nature aim for the protection of brand value and image. Strategies related to these domains
are often becoming a regular feature of overall business planning. In connection with the case
study, these all have been discussed in this report which has taken an evaluative form.
Background and Business Details of QANTAS Airways
QANTAS Airways came into being in the year 1920 and ever since emerged to be the largest
international as well as a domestic airline in Australia. QANTAS is a short name while the
full name stands as Queensland And Northern Territory Aerial Services Limited. This airline
has a strong brand value and is considered the most important airline in the world covering
long distance travel. The brand has focuses on some domains to maintain its strong brand
value and these are safety related excellence, engineering and its maintenance, operational
credibility and finally customer service. These are all set to achieve a higher level of
customers’ satisfaction in the aviation industry. The main business of the brand is based on
transportation of customers through flights through two brands under the main operational
brand Montgomery, (2011). These supplementary brands are Jetstar and Qantas. Alongside
this brand is also operational to manage the subsidiary business of some other airlines.
Qantas provides transportation services to its customers who are local, domestic as well as
international. This brand has subsidiary businesses and these are Qantas Frequent Flyer and
Qantas Freight Enterprises. This brand recruits more than thirty thousand people to serve its
business and its customers. Maximum employees of this organization are from Australia.
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Qantas considers that customers have reason to select the service of this airline brand if two
important aspects are taken care of and these are service excellence and great value combined
into the service offered by the airline. This airline company has won many awards and this
has improved the possibility of brand acceptance among domestic and international
customers. The company has high priority for ensuring sustainable practices which denote the
overall focus of business to think for the environment as well as society (Bharadwaj et al,
2013).
Review of the past 5-year Business Strategies
The airline discovered market volatility and economic uncertainty are the main causes
which expedite the adoption of strategies.
Cost reduction worth $2 billion
Across the entire part of Qantas group, cost reductions on a permanent basis were the
foremost focused part of business strategy to ensure improvement in productivity,
fortification of business-related activities, adoption of new and innovative technology along
with savings related to procurement. Reduction of capital expenditure was also part of overall
cost reduction move of the brand. This strategy of cost reduction is highly notable if the firm
to cut on unnecessary expenses in nonproductive fields in its business in a given market
situation which is marked by uncertainty and financial instability. Campbell, Edgar, and
Stonehouse, (2011), opined that cost reduction is not a complete strategy but plays supportive
to some major strategies when market situations undergo structural financial shift along with
deteriorated operating field such as uneven playing context even to a big name like Qantas
Airways. However, if complete action is needed, the cost-cutting option cannot be demeaned.
The pace with competition and modernization bid
Competitors of Qantas improved their capacity in the Australian market by a whopping forty
six percent during this decade and this recorded over double than the average of the world.
Qantas found this significant even at the time of financial uncertainty as well as a higher level
of the price of fuel. But for Qantas, there had been no stop in devising away strategy by
focusing on transformation. The company introduced new aircraft and technology,
modernized services and work practices. As per Meskendahl (2010), modernization of
services is part of service revitalization move they may not adequately back up a plunging
business in sinking economy. This holds the truth from the perspective of the airlines as
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