Strategic Management Assessment: Blue Air Case Study

This assessment discusses the strategic analysis of Blue Air, including PESTLE and SWOT analysis, competitive analysis, and Porter's five forces. It also provides recommendations for the company.

STRATEGIC MANAGEMENT
ASSESSMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Strategic analysis with use of PESTLE and SWOT....................................................................3
Competitive analysis....................................................................................................................7
Porter's five forces.......................................................................................................................9
CONCLUSION................................................................................................................................9
RECOMMENDATIONS...............................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Strategic management is a process to analyse, monitor, plan as well as it is a assessment
which is very much crucial for company in order to achieve its guests requests. Essential changes
in the environment of business require company to access completely and constantly their
strategies for achievement of success (Aguinis, Edwards and Bradley, 2017). Thus, in this report
it has been discussed about the origin and its several approaches of strategies.
The present report is based on the business activities of the Bluer air company. It is
Romanian airline that headquarter in Bucharest.
This report addresses about the international or global strategic relations followed by the
understanding of the applications of the strategic approaches in practice. Moreover, in the report
it has been discussed about the ability to analyse the complexities of the organization as well as
their environment, followed by the ability to synthesis earlier, diverse and possible piecemeal
studies of the company by assimilating new theoretical model and offer solution in relation with
strategic issue. In addition to this, report will outline the strategic analysis with help of SWOT
and Pestle analysis to analysis the working conditions of the enterprise. Also, recommendation
will be given in order to render the quality services to customers.
MAIN BODY
Blue air case study
Blueair is innovative company that highly focus on the designing and manufacturing.
Thus, firm products are of top quality and this entity also looking over to render the excellent
services to customers (Ansoff and et.al, 2018). Therefore, the issues founds as lack of
standardised call handling process that kept the customers on waiting. In this firm, the one of the
major issue was that services to the customer are so suffocating. So, entity is struggled to deliver
the top quality customer service.
Strategic analysis with use of PESTLE and SWOT
The ability to study the complexities of Blue Air Company & its environment could be
done through PESTEL and SWOT.
The changing business environment in Blue Air Company
The PESTEL analysis, the macro environment is really waste is and in this there are
various factor to be concerned by the managers of the company. For example, trade barriers,
demographic changes, tax changes. For all these PESTEL analysis is carried out.

Political environment
The political environment of this airline operates is highly regulated and this affected the
working industry in huge aspect. This factor refers to government strategies and changing of
rules (Ansoff and et.al, 2018). Blue air company is bound to follow the certain political factors.
Thus, the nature of the airline industry is quite sensitive. Terrorism can affect the services of the
enterprise in huge aspect and due to this firm might have face the wars and terrorism. In addition
to this, it can be stated that airline industry operates highly regulated political environment in
which passengers are highly favoured over the airlines. In addition to this, the aviation industry
is directly affected with the unstable political changes.
Economical environment-
The country’s economic health describes the economic environment of the organization.
Therefore, the economical components as recession, fluctuation and changed in the prices of oil
can affect the growth of airline sector in the huge context. Hence, the economical impacts the
profit margin, availability of capital and profit margin of the enterprise. Blue air company can
able to grow and make the maximum investment if the business earn the high amount of
profitability due to favourable stable economic conditions (David and David, 2019). Thus, it can
be stated that economic component can be termed out as crucial for success. Airline sector needs
to overcome with the certain challenges such as declining passengers, high fuel prices and
enhanced competition from low cost airlines, demands of labour and cost of maintenance etc.
Social environment
To appreciate the cultural values of the society, the social and cultural environment
factors are carried out. Social components is inclusive of the demand and taste of people. These
are the changes that impact the working of enterprise in the huge aspect. In order to meet the
increasing demand of this segment the airlines have to stabilise their cost (Ethiraj, Gambardella
and Helfat 2016). At the time, when it comes to business class passengers, there is needs to
undertake the measures that can positive undertake the communication facilities that have
reduced the need to fly down form meetings. Thus, rise in population has directly impact and this
can enhance the profitability of airline sector.
Technological environment
Every organization needs technology advancement in order to remain technically up to
date in the market sector. The requirement of advancement and innovation in technologies must

be well recognised by the airlines. Thus, emergence of services of IT affects the working of
industry in huge context ( Bryce, 2017). Technical advancement has made the security system of
the airports more effective and powerful. They have undertake the varied steps that aids to bring
ease in e-booking system. With intense competition in the aviation sector, the entity must use the
latest technologies by the airlines in terms to survive within the tough environment.
Environmental factor
The weather and climate change play as very important role in an organizations
environmental factor (Bryce, 2017). The major concerns of the airline sector is changes in
environmental conditions. In addition to this, the immediate changes in weather and climate
conditions highly influence the service credibility of airline sector. In order to cope up with it,
Blue air company needs to undertake the strategies that can aids to render the excellent services
to customers. Thus, components of airline and changes in climate conditions can highly affect
the working of the enterprise and profitability of the firm can also get reduced.
Legal environment
Every organization needs to follow legal aspects of the country. Thus, the legal
environment factor of micro environment is very much essential. Thus, frequent changes in laws
and legislation directly impact the working of the industry in the huge context. Thus, outlined
framework of the policies makes the company working more cautious (Hill, 2017).
Hence, this can be concluded that micro environment generally concerns with
organizations internal factors. It includes general trends and forces, and may affect the customer,
supplier or intermediaries. Thus, these factors are hard to control.
SWOT analysis
This is defined as the strategical analytical tools that aids to aids to facilitates the analysis
of the strengths, weakness, opportunities and threats. Therefore, these are defined in the
following manner as are-
Strength-
 Focus on innovation through IT and E-commerce- Blue air company combined its
services with travel packages and this also offers customers with end to end customer
experience. This firm has launched the smart phone airline application that assist the
users to book their online tickets in very ease mode ( Hitt, Ireland and Hoskisson, 2016).

Such are the efforts taken by the firm in order to operational performance of the
enterprise.
 Strong network portfolio- The quoted enterprise has a strong based in the market. Thus,
this entity has almost 110 aircraft and 20 internation and 48 local destination. This assist
the firm to bring improvement in the operational margins of the enterprise.
 Vertically integrated operations- This is enterprise that offers their customers the cargo
services and also leases the aircraft. It is the enterprise that has operated in many parts of
the world and also has integrated operational working that is very affective in terms to
cater the needs of wide range of customers. It aids to gain high level of competitive
advancement.
Weakness-
 This is the enterprise that is facing the high server amount of the competition from other
leading airlines on all the routes. It is situation that highly impacts the profitability and
productivity of the quoted firm.
 Limited market share- Blue air company competes with number of the private and
public airlines at the domestic and internally level. Thus, the market share of the quoted
firm gets limited and enhancement in the market share that becomes very difficult.
Opportunities-
 Expansion market- the emergence of developing economies and growing demand of the
interconnectivity, investment in the travel infrastructure and expansion in middle class,
foreign tourism and rising in the international business creates the significant
opportunities to develop their airlines route (Lasserre, 2017). Thus, increment in the
demand of customers groups will enhance the demand of the services of this sector.
 Pressure on small players- The intervention of the government highly affects the
operational working of airlines. Therefore, the number of the competitors are forced to
exit the market due to high cost of competition and struggle due to global economy.
Threats-
 Competition in the market- The discount offers by the number of the airline services
has huge negative effect on the working of Blue air. Thus, quoted enterprise needs to
responds to competitors in order to maintain the passenger traffic. Therefore, some of the

enterprise has lower cost structure than the quoted enterprise. This might affect the
operational working of the firm.
 Government regulations- The aviation industry is highly regulated. Henceforth, the
number of the environmental factor highly affect the working of enterprise.
 Improvement and transportation- The improvement within the infrastructure of the
developed and developing world has lot of alternatives modes of transportation.
Additionally, undergoing metros has serious threats to airline industry (Meyer, Neck and
Meeks, 2017).
Competitive analysis
Blue Air is considered as low cost airline firm; it gives services to over 5 million passengers
every year. As compare to last year there are 40% increment in number of passengers. It is
providing services to wide range of travellers in around 57 destinations (Morschett, Schramm-
Klein and Zentes, 2015). Company is having huge competition in market and to sustain in
market for longer duration it is essential for business that to implement effective tactics that may
help organisation in gaining competitive advantage in market. Competitors of Blue Air firm are
as Bmibaby limited, TUIfly Gmbh, Avro plc, Jet2.com, Air India express, fastjet Plc etc. These
are low cost airlines that are performing well in market.
Blue Air Fastjet Plc Jet2.com
Revenue In the year 2018
revenue of company
was 495 million, its
operating income in
the same year was
32.5 million
Fastjet has generated
around 1.1 billion
revenues last year.
Firm has earned the
revenue of 16 million
in the year 2018 and
it is performing well
in market. It ensures
to serve immediate
services to travellers
so that they take more
interest in its products
in near future as well.
Employees Firm has hired
around 1250
employees those who
Company has
employed 2550
employees in
Company has
employed 1200
seasonal employees

are providing services
to wide range of
consumers.
Employees are well
trained and they are
getting high salaries
to perform their job
well.
business, its
recruitment process is
much more based on
experience and
capabilities of
candidate. It evaluate
performance of each
person and then make
them permanent
employee of
company (Moutinho
and Vargas-Sanchez,
2018).
and all these
employees are
dedicated towards
work. Firm is giving
rewards, incentives to
them so that they
retain in business for
longer duration.
Location Company is operating
into 57 destinations
and serve many
travellers daily.
Firm serves in around
4 destination and all
these destinations
belong to African
countries. It has its
head office in
Johnanesburg South
Africa.
It operates in around
72 locations and it is
popular for its low
cost services.
From the above analyses it is analysed that Blue air is the popular firm that serve
consumers well. It ensures to offer them quick services which help business unit in gaining
success in the market. Customers are highly satisfied with its performance hence they give
positive reviews to others and on its official sites as well. In order to sustain in market for longer
duration company has ensure implementing most appropriate strategies that may support
organisation in gaining competitive advantage (Rothaermel, 2017). But if it fails to make good
plan then it can not be able to sustain in market for longer duration. Blue Air airline firm always
ensure to serve consumers well, it improves its quality of services after reviewing views of
consumers. It conducts market research so that it can understands needs of consumers and can
serve them accordingly. It is helpful tool which supports organisation in analysing issues or risk

and making contingency plan so that it can survive in such competitive market successfully. In
order to develop global strategies, it is very much essential to differentiate between the 3 form of
international expansions which arises through company’s current international position,
organization's capabilities as well as the organisation’s resources. One common decision in
global strategies begin by the consideration that how much general variations are available in the
market.
Porter's five forces
This is model that aids to analyse the external forces that act on the certain company and
this also affecting the operational working of the enterprise. Therefore, these are defined in the
following manner as-:
Threat of new entrants- There are huge barriers to entry in the airline industry and to cope up
with firm has to involved in investment (Zhao and et.al, 2017). Thus, airline sector has very little
product differentiation and it is one of the components that becomes difficult to build
competitive advancement.
Threat of substitutes- There are number of the substitutes that are available to the airline sector.
If customers are looking for the low price then there is chances of selecting the other mode of
transport than the airline. Henceforth, there is moderate level of threat of substitute to Blueair.
Bargaining power of buyer- The maximum number of the customers are price sensitive and
consumer are aware of their rights. Thus, consumer who are travel in the groups want to have the
best deal for travelling and this leaves the high power on the travel agents. So, this can be stated
that there is high level of bargaining power of buyers.
Bargaining power of suppliers- There are very few supplier that supply the fuel as well as
labourers. Thus, firm cannot survive without the fuel and crew and this way they needs to
maintains the good relationship with supplier as well.
Industry rivalries- This is the enterprise that face the huge competition on different levels and
this also include with the competition as local as well international airlines. At the international
level the competition is quite high on differ terms and this is inclusive of price, services and
quality aspect to maintain values in market. Thus, British airways face the high level of the
industry rivalries.

CONCLUSION
This report could be concluded as, Strategic management is the ongoing planning,
monitoring, analysis as well as it is assessments which are very much crucial for company to
meet their guests requests. Necessary changes in the environment of business require company to
completely as well as constantly access their strategy for achieving their success. Thus, in this
report it has been discussed about the origin and its several approach to strategies.
Followed by the knowledge of complexities of the relations between company within
environment and its business. This report addresses about the international or global strategic
thinking followed by the evaluation of the application of the strategic idea in practice. Moreover,
in this report it has been discussed about the capabilities to find the complexities of the
organization and their environment, followed by the possibility to synthesis earlier, diverse and
possible piecemeal studies of the organization by assimilating new theoretical models and offer
solutions relative to strategic issue. Lastly, in this report it has been discussed about the
possibility to evaluate existing model & methodology against observation of practice of the
actual organization. Therefore, the report has covered the strategic analysis with help of SWOT
and Pestle analysis in terms to analyse the internal and external working of the enterprise. Lastly
recommendation has been given in terms to bring out quality services to the customer care.
RECOMMENDATIONS
There are various aspects which affect performance of an airline and increasing
competition in the airline industry requires that all the aspects of the performance requires close
inspection. Henceforth, the recommendation are outlined as are-:
Presently market have become consumer and customer oriented in which Blue Airline
needs to ensure that customer are given most significant place while making strategies. For
customers being given most important place what Blue Air needs to conduct research about its
customers and target its target customers and identify and understand their needs and
requirements. Companies when give proper attention to their customers and their requirements
enables itself to create its customer base and later by continuing it can sustain that too.
Later it is recommended that Blue Air should work on its technology. The reason behind
this is that technological aspect have become significant for growth and competitive advantage.
This requires that Blue Air spend a major amount on its technology and technological up-
gradation. Proper research of its competitors and their technology and specially considering

leaders of the industry is important for getting the knowledge of latest technology. This can be
added value if Blue Air's research and development team design and develop its technology
which can help them in achieving competitive advantage.
Another recommendation is that Airline should consider its interior and looks because
this have become a major concern for customers. Improved and unique stylish interior and
exterior of flight shows its standard. This also requires that Blue Air utilize a significant amount
on this improvement.

REFERENCES
Books and journals
Aguinis, H., Edwards, J.R. and Bradley, K.J., 2017. Improving our understanding of moderation
and mediation in strategic management research. Organizational Research Methods. 20(4).
pp.665-685.
Ansoff and et.al, 2018. Implanting strategic management. Springer.
Bryce, H.J., 2017. Financial and strategic management for nonprofit organizations. Walter de
Gruyter GmbH & Co KG.
David, F.R. and David, F.R., 2019. Strategic management: A competitive advantage approach,
concepts and cases. Pearson.
Ethiraj, S.K., Gambardella, A. and Helfat, C.E., 2016. Replication in strategic
management. Strategic Management Journal. 37(11). pp.2191-2192.
Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function.
Macmillan International Higher Education.
Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2016. Strategic management: Concepts and
cases: Competitiveness and globalization. Cengage Learning.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Meyer, G.D., Neck, H.M. and Meeks, M.D., 2017. The entrepreneurship‐strategic management
interface. Strategic entrepreneurship: Creating a new mindset, pp.17-44.
Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international management (pp.
978-3658078836). Springer.
Moutinho, L. and Vargas-Sanchez, A. eds., 2018. Strategic Management in Tourism, CABI
Tourism Texts. Cabi.
Rothaermel, F.T., 2017. Strategic management. New York, NY: McGraw-Hill Education.
Zhao and et.al, 2017. Optimal distinctiveness: Broadening the interface between institutional
theory and strategic management. Strategic Management Journal. 38(1). pp.93-113.
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