Business Strategy Research Paper 2022

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Running head: BUSINESS STRATEGY
BUSINESS STRATEGY
Name of the Student
Name of the University
Author Note

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1BUSINESS STRATEGY
Executive summary
This paper is a brief business report for the senior management of the company about the
company Qantas Airways and the issues that the company currently has been focusing. This
paper will provide the existing issues in details. This aim of this paper is to give an insight about
the serious issues that has been affecting Qantas Airways lately and provide suitable business
strategies that the company may consider in order to make suitable decisions for the betterment
of the company. Few recommendations have been proposed which the organization can
incorporate in their business which will help the company in resolving the existing issues. gain
back their positive position ad reputation in the market and also help them in gaining fruitful
revenues which will help Qantas become one of the best airlines in the market once again.
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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Issues in Qantas Airways.............................................................................................................3
Environmental issues...............................................................................................................3
Increase in cost........................................................................................................................4
Rise in competition..................................................................................................................4
Management issues..................................................................................................................5
Strategy formulation....................................................................................................................5
Recommendation.........................................................................................................................7
Conclusion.......................................................................................................................................7
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3BUSINESS STRATEGY
Introduction
Qantas Airways Limited is the largest airline by international flights, international
destinations and their fleet sized. Qantas is said to be the third oldest airline not only in the
country but in the world (Whyte & Lohmann, 2015). It has been serving the people of Australia
since the year 1920 and has been a favourite among the people of Australia. However, it has
been seen that lately Qantas has been facing issues which is having negative impacts on the
organization. This paper is will reflect on the issues that Qantas is currently facing and will
propose effective strategies that will help Qantas Airways to overcome the issues and pave for
the growth and development of the organization.
Discussion
Issues in Qantas Airways
Qantas Airways has been one of the most popular airlines in Australia and has been a
favourite among the passengers. Qantas has always been the first choice of the people of
Australia because of their impeccable cost and services. However, there are some issues that
have cropped up which has been negatively impacting Qantas. The issues are the following:
Environmental issues
There is an increase in the numbers of global passengers every year which has led to
more infrastructures, aircraft and services. Qantas since its inception has been growing because
of their huge demand in the market and this has led to the company carrying about 570 flights
every week and serving about six million passengers (Investor.qantas.com, 2019). The aviation
industry relies strongly on fossil fuels that leave a large carbon footprint that has become a
matter of concern for the world (Chakraborty & Roy, 2013). Global warming is currently one of
the most important environmental issues that have a negative impact on the world and the large
carbon footprints contribute to the rise of this detrimental issue.
In the year 2017on April 10, fire fighting foams of around 22,000 litres spilled from a hangar of
Qantas in Brisbane. Around one quarter leaked in the water systems surrounding the place and
the environment. The foam that has got spilled had already been banned in the country,
Queensland after it was discovered that it contains harmful chemical contents. Qantas, when
questioned said that, the foam they used in Brisbane met their requirements under the federal
safety regulations and they were working through the process to find a replacement that would
meet the safety standards of the government of Queensland. The company has since then been
issued with a notice for investigation by the Department of Environment Heritage and Protection
(EHP) for the toxic spill of the foam (Chang et al, 2014).
This issue has led to people having negative perceptions about the company and also
paved way for the bad reputation of the country. This has made people question their corporate

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4BUSINESS STRATEGY
social responsibility activities and the existence of ethics in their company calling them an
unethical company.
Increase in cost
Qantas Airways has been increasing their price of the tickets because of the rise in price
of the key resources that are essential for the aviation industry. According to (), there are no
organizations that have the capacity to predict their profits accurately. The major reason for this
is the main financial exposures of the airlines that are the exchange rate, interest rates, the
economy, the oil prices and many more. Qantas had claimed to have increased their prices
because of the hike in the price of the jet fuels that had affected their business and had resulted in
the poor sales of the company (BBC News, 2019)
According to scholars, the rise in the cost of the jet fuels is not the sole reason for Qantas to face
issues in the market but their poor decisions of continuously expanding their supply at a rapid
pace had resulted them in facing this issue (Webber, 2019). The company was focusing on the
expansion especially in the global market however did not assess and consider the necessary
things like the increase in cost or other factors that are important. The increase in cost had led
passengers to choose different alternatives that would offer flight tickets at cheaper rates in
comparison to the price of Qantas. This has led the company to go through a financial crunch
which has been affecting the company negatively.
Rise in competition
Aviation is said to be one of the most global industries in comparison to other industries.
One of the major and detrimental issues that Qantas is currently facing is due to the rise in
competition in the market. The emergence of airline companies like Virgin Australia has become
a huge problem for the company. Virgin Australia is now considered to be one of the largest
airlines that are operating from Australia. The airline started to provide their services from the
year 2000. Virgin Australia has a comparatively lower staff cost in comparison to Qantas
however greater and better productivity in the premium domestic market. The company has been
enjoying monopoly for the past almost two decades. Virgin Australia has very strong backup
from foreign airlines that are currently operating in the market. On the contrary Qantas has been
struggling to retain their investors and attract the interest of the investors.
The other and new threat that Qantas is currently facing is the catalyst for lobbying the
government of Australia for help after the airline, Virgin Australia generated around $350
million through their foreign partner airlines.
For the past few years most Australian travellers have been refraining themselves from
travelling in Qantas because of the unjustified high cost of the flights as they do not provide any
extra facility or some different services that are different from other airlines that are currently
operating in the market.
There are many other airlines that are low cost and provide flights at a reasonable cost
that are emerging in the Australian market like Middle-East giants like Etihad, Qatar and
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Emirates. Other airlines that are currently emerging in the market are China Southern and
AirAsia X with very low prices but better product ((Mncube, 2014).
People put more focus on the expenditure these days and with the emergence of low cost flights
that provide premium services thus people have started considering the low cost airlines and
have started availing their services rather than travelling and considering Qantas.
Management issues
Qantas Airways has been facing difficulties because of the strained relationship between
the company and their employees and also due to their industrial disputes (Mules, 2013). People
have complained about Qantas because of their poor services. Inefficiency in Qantas runs in
varying degrees from the pilots who are high profile to the people who handle baggage (Sarina &
Wright, 2015). The work culture of Qantas is not very favorable because of the way they operate
where the employees are not provided with sufficient amount of perks and rewards like holidays
and leaves. This has made many employees leave the organization and also has led to the
inefficiency of the organization that has affected the sales of the company.
Strategy formulation
Qantas Airways has been suffering from issues that are having negative impacts on the
organizations and has resulted in the poor sales of the company. In order to overcome these
issues that currently exist in the company it is necessary to formulate a strategy that will help the
organization to improve their condition.
Qantas Airways can use a unique business strategy that will help the organization in
gaining a competitive advantage over the market and also help the company in making sure that
they overcome all the issues and can gain back their positive reputation in the market which they
lost because of these issues. The issues that Qantas has been facing are mainly due to their
internal environment and management and thus it is important for Qantas to make various
business strategies that will help in mitigating the issues. Business strategy is considered to be
competitive actions and moves which a business uses in order to strengthen performance, attract
customers, compete successfully in the market and achieve the desired goals of an organization
(Pisano, 2015). Thus it is important for the company to formulate various strategies keeping all
the issues in mind and coming up with suitable strategies that will not only be able to overcome
the issues but will also help in the smooth operations of the business.
All the issues that have arised in Qantas Airways are different and needs individual
attention and different strategies to resolve the issues in an ethical manner which will help in
giving Qantas a competitive advantage in the market.
The biggest problem that Qantas is currently facing is losing their existing and potential
passengers because of the rise in the cost and also because of the immense competition in the
market that are low in cost that has attracted the passengers. According to research, it has been
seen that the perception of the customers have changed and the mainly focus on low expenditure
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in order to save money thus Qantas needs to come up with a low cost strategy that will help in
fulfilling the needs of the customers (Rani, 2014). Qantas needs to formulate a low cost strategy
that will help the organization to attract customers and make them use their services which will
help in fulfilling the current needs and demands of the customers and will help Qantas in
achieving their desire to return back to the market. This strategy will help in mitigating two
issues at the same time that the company is facing which is the increase in the cost and the
increase in competition in the market.
Social responsibility is becoming important to organizations especially over the few
years. Whether it’s supporting women and helping in empowering them, trying to curb other
social issues like poverty or helping the nature, most companies are seen to incorporate social
responsibility in their business strategy. Porter & Kramer, (2019) opines, CSR has helped many
organizations in boosting their business and has also helped in building a positive relationship
with their customers in the market. It has been seen that Qantas has been facing issues because
of the spilling of fire fighting foams which contained harmful chemical elements that was
detrimental to the environment. Thus Qantas needs to focus on environmental issues and
incorporate social activities that will contribute to the betterment of the environment. Qantas
needs to make sure that the claims they made about meeting the safety standards correct and
maintain a transparency between the company and the passengers which will help in avoiding
misinterpretation of certain situations. According to scholars, transparency is a key element that
helps organizations overcome disastrous situations and builds a positive and a healthy
relationship among the organization and their customers which is essential in these days
(Schnackenberg & Tomlinson, 2016). Chernev & Blair, (2015) states a good corporate social
responsibility helps in the reputation of the company. According to scholars, most people want to
associate themselves with companies or organizations that have a positive reputation in the
market or who engage in social responsibilities which make them feel that they are also
contributing to the betterment of the society (Elving, 2013). Thus incorporating social
responsibilities will help Qantas in improving their reputation in the market, help them improve
their situation and also help them improving their sales.
Qantas Airways has been receiving complaints due to mismanagement thus the company
needs to make a paradigm change management. Paradigm change management is considered to
be a proper change. This often takes place when the work or tasks, behaviors and the information
are re-integrated and pave way for the emergence of new value system within the organization
(Linkov et al, 2014). In this type of management the change is internalized fully and the attitudes
and the future performance of the organization can be predicted with full accuracy. Urry, (2015)
states the society is constantly evolving and so is the perception of the people thus it is important
for a business to make necessary changes aligning with the values and the needs of the customers
in the market. It has been seen that Qantas currently lacks a good and competent leader that
manages and ensures the fruitful productivity of the organization thus the employees of the
organization have a casual attitude towards their clients which has become a detrimental issue in

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7BUSINESS STRATEGY
terms of their services. The organization needs to make an effective paradigm change
management that will lay out ground rules for the staffs and hire staffs that will monitor whether
the rules are followed by the staff and also make necessary rules that will satisfy the needs of the
customers. They will also incorporate certain steps that look into the interest of the employees
within the organization. This will be extremely beneficial for the company in order to make their
performance more enhanced and professional and will also help in motivating the employees to
produce fruitful outcomes and reduce the customer complaints that the company has been
receiving currently.
Recommendation
Qantas Airways needs to incorporate the following measures in their business which might
help the organization in overcoming the issues that has been affecting the organization.
Qantas Airways needs to revise their price structure and provide fights at a cheap rate.
They need to check their flights that were in controversy because of the spill of harmful
chemical elements and need to maintain a transparency in order to let people know about
the measures they are taking to solve the issue
The company can partner up with non-profit organizations and work for the betterment of
the environment
The company can come up with suitable campaigns that support and promote the
betterment of the environment.
The company needs can offer discounts to the customers to attract them.
Qantas needs to make new company policies and create an organizational value in order
to make the employees understand the rules and regulations and work maintaining those
for better performance
The company needs to create a new organizational goal and communicate these goals
clearly to their employees.
Qantas needs to focus on their most important stakeholder, their employees and see to
their benefits and make new policies about their leaves and week off structure.
The company needs to provide their employees with certain perks like flying for free with
family, discounts on the items available in the airports and many more.
The company needs to come up with new routes in order to make the trips shorter and
more convenient for the passengers.
Conclusion
Qantas Airways has been a successful airline from its inception however the company
has been facing issues that have been affecting the organization negatively. However by
implementing certain changes and using certain business strategies the company can make a
comeback in the market and successfully operate in the market.
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Reference
BBC News. (2019). Can Qantas fix its financial troubles?. Retrieved 26 August 2019, from
https://www.bbc.com/news/business-28948747
Chakraborty, D., & Roy, J. (2013). Energy and carbon footprint: numbers matter in low energy
and low carbon choices. Current Opinion in Environmental Sustainability, 5(2), 237-243.
Chang, Y. T., Park, H. S., Jeong, J. B., & Lee, J. W. (2014). Evaluating economic and
environmental efficiency of global airlines: A SBM-DEA approach. Transportation
Research Part D: Transport and Environment, 27, 46-50.
Chernev, A., & Blair, S. (2015). Doing well by doing good: The benevolent halo of corporate
social responsibility. Journal of Consumer Research, 41(6), 1412-1425.
Elving, W. J. (2013). Scepticism and corporate social responsibility communications: the
influence of fit and reputation. Journal of Marketing Communications, 19(4), 277-292.
Investor.qantas.com. (2019). Retrieved 26 August 2019, from
https://investor.qantas.com/FormBuilder/_Resource/_module/doLLG5ufYkCyEPjF1tpgy
w/file/data-book/2016qantasdatabook.pdf
Linkov, I., Bridges, T., Creutzig, F., Decker, J., Fox-Lent, C., Kröger, W., ... & Nyer, R. (2014).
Changing the resilience paradigm. Nature Climate Change, 4(6), 407.
Mncube, L. (2014, November). Competition and regulatory issues in the civil aviation sector. In
Aviation Industry Growth and Safety Conference. Retrieved from http://www. compcom.
co. za/wp-content/uploads/2014/09/Remarks-on-competition-andregulatory-issues-in-the-
civil-aviation-sector-4-11-2014-LM. pdf.
Mules, R. (2013). The Qantas disputes and the toll/coles dispute. Busidate, 21(4), 2.
Pisano, G. P. (2015). You need an innovation strategy. Harvard Business Review, 93(6), 44-54.
Porter, M. E., & Kramer, M. R. (2019). Creating shared value. In Managing sustainable business
(pp. 323-346). Springer, Dordrecht.
Rani, P. (2014). Factors influencing consumer behaviour. International journal of current
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Sarina, T., & Wright, C. F. (2015). Mutual gains or mutual losses? Organisational fragmentation
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57(5), 686-706.
Schnackenberg, A. K., & Tomlinson, E. C. (2016). Organizational transparency: A new
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https://www.smh.com.au/business/the-quandaries-facing-qantas-20111128-1o335.html
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