Business Strategy of Qantas: Analysis and Recommendations

Running Head: BUSINESS STRATEGY 0
Qantas
Strategic management workshop

BUSINESS STRATEGY 1
Contents
Introduction...........................................................................................................................................3
Business strategy of Woolworths through porter’s five forces analysis................................................3
Critical success factors...........................................................................................................................4
Strategic capabilities..............................................................................................................................5
VRIO/ VRIN Matrix.............................................................................................................................5
SWOT analysis of Qantas...................................................................................................................7
Strategy of Qantas.............................................................................................................................8
Recommended business strategy for Qantas to adopt for future.........................................................9
Conclusion.............................................................................................................................................9
References...........................................................................................................................................11

BUSINESS STRATEGY 2
Introduction
Qantas is one of the biggest company in the aviation industry that provides its services over
the 1000 destinations all over the world. In 1920, it has launched its first aircraft. After the
first launch of its aircraft, it started growing and becoming a leading branch. It tends to
provide the best employment opportunities to more than 30,000 people all over the globe.
The main vision of Qantas is to provide the airline services at low cost (O’Neill, 2016).
Besides this, it also provides the facilities to middle class people through its new segment
“Jetstar.” Therefore, it operates in two different names: Qantas and Jet Star. In this report, the
discussion is carried on the business strategies of Qantas through various tools such as
porter’s five forces, VRIO matrix, and critical success factors. The discussion ends by
carrying out recommendations for better and smooth functioning of Qantas.
Business strategy of Qantas through porter’s five forces analysis
Several benefits and limitations are attached with the porter’s five forces. The main advantage is its
best applicability in analysing of the market structures. As compare to this, this model only assumes
the classic perfect market. In addition, various people use this model in such a way it was never
envisioned. People tend to apply Porter’s five forces to specific company rather than on the industry.
It is one of the most common mistakes.
1. Bargaining power of supplier- it is one of the major porter’s five forces that can help
in analysing the business strategy. Being, Airbus and Bombardier are the main suppliers in
the aviation industry. Taking into consideration the example of Qantas Airlines, it has approx.
250 aircrafts such as Airbus A330s, A380s, A320s, Bombardier Q400s, Bombardier dash 8s
and Boeing 767s, 747s, 717s & 737s. In this way, it is clear that bargaining power of
suppliers is high in aviation industry (Qantas Airways, 2016).
2. Bargaining power of buyers- it is true that airline industry has either buyers from
business side or the individual who are from middle class. In Qantas airways, bargaining
power of buyer is high as customers can easily switch to any new airway who is providing
better services in low cost. In recent time, passengers have various options from where they
can avail the airline services. In order to attract the large customer base for availing its
services, it has adopted the low cost strategy in order to increase its customer base.
3. Threat of substitute- the major and topmost substitute of airline is train, car, or bus.
However, airline industry provides the several benefits such as taking very less time to reach
on their respective locations (Graham, and Vowles, 2016). Besides this, it also provides the

BUSINESS STRATEGY 3
comfort and memorable journey to passengers that attract them to always avail these types of
services. The differentiation strategy and low cost strategy of Qantas helps the firm in
retaining and sustaining its customers for long time. In this way, Qantas has less threat of
substitute.
4. Competitive rivalry- It is true that Qantas is one of the major market leaders in
various countries. However, it also faces threat of substitute from various other competitors.
In the annual report 2009 of Qantas, it is founded that Qantas is operating Jet star for
competing with the Virgin Blue (Halpern, 2018). This company is providing the airline
services in low cost. In order to beat the competition, Qantas has adopted the differentiation
strategy. This helps the company in differentiating its services from the other competitors that
other firms are offering. It is one of the best porter’s generic strategies that firm has adopted
in order to beat competition. It has differentiated its firm in terms of product as well as price.
5. Threat of new entrant- due to several barriers in the airline industry, it is required by
the firm to initiate its business with huge cost. Besides this, there is high threat of competition
in the market. Large amount of investment is required that puts difficulty for competitors in
this sector (Sarina and Wright, 2015). Qantas can also create the barrier for new entrant by
adopting the pricing strategy. Besides this, alliance strategy can also be adopted by the
Qantas for building difficulty for the new entrants in order to enter into this sector. It is best
strategy that will help the Qantas to create its brand reputation and create positive feeling for
the customers.
Critical success factors
It helps in describing the major parts regarding the performance of Qantas. Some of the
critical success factors of Qantas airways are:
1. Non-stop flights- it is true that for the success of airways, flights should be non-stop in order
to delight customers. It is presented in the annual report of Qantas that Jet Star has started the
long haul flights. In this flight it covers various destinations such as Sydney to Bali,
Melbourne to Bangkok, Melbourne to Bali, Cairns to Tokyo, and Cairns to Osaka. Due to its
innovative features, it is one of the leading and best airline in several countries.
2. Strong management- Qantas has better control over the management in its organization. Due
to its better business strategies, it is serving the customers in better way. However, all the
management staff believes in providing innovative customer service all over the world. It is