Competitive Strategy Analysis: Success of Singapore Airlines and UMG

This report provides a detailed analysis of the competitive strategies employed by two successful companies: Singapore Airlines and Universal Music Group (UMG). It begins with a brief background of each company, tracing their historical development and key milestones. The core of the report focus...Read More

Competitive Strategy 1
Competitive Strategy
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Introduction
A business strategy competitive success is determined on how well it relates to the
environment it operates in A company has therefore to determine the position where it can cope
with the forces of competition or be able to influence them to its advantage. Some companies
have managed to position themselves competitively and thus succeeded while others have failed
(Porter, and Strategy, 1980 p1). This paper will discuss two companies that have been
regarded as excellent in their industry namely Singapore Airlines and Universal Music Group
and the sources of their excellence.
Singapore Airlines: Background
Singapore Airlines was founded in 1947 as Malayan Airlines with the name changing to
Malaysian Airlines in 1963 and again to Malaysia-Singapore Airlines. In 1972, there was
separation of Singapore Airlines and formation Malaysian Airlines System (Singaporeair.com).
In the airline industry that experienced underperformance, competitive rivalry, and other
environmental factors that have adversely affected profits, the company has consistently
outperformed the competition. The company has been outstanding in performance due to the
strategy of service excellence achieved through innovation and cost leadership strategy
compared to competitors in this industry (Heracleous and Wirtz, 2012 p 479). It is for this reason
that the company has been selected as a success in this field.
How Singapore Airlines has achieved its Success in the Market
One of the strategies the company has adopted is high innovation. The company aims at
being better in all of its product offerings and functions that the competitors. The company

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believes in total innovation and also continuous innovation. One of the innovations includes the
on demand entertainment system for all customers. Another innovation was the phone check in
and internet for customers in all classes. The company also invested $1m in a simulator that
mimics humidity, air pressure and humidity which affects the taste buds and thus influences the
taste of food in these conditions with the aim of reducing food spices. The company has
pioneered innovations in some areas like the ability for a customer to order their preferred dish in
advance and the in-flight entertainment which improves customer experience. The company has
also taken advantage of being a fast follower in areas like use of CRM systems thus adopting
proven technology and thus reduces on risks of implementation while taking advantage of
appropriate functionalities (Heracleous and Wirtz, 2012 p 480).
The company also supports the idea of cost effectiveness with all innovations being
weighed against the costs and the customer benefits arising from it. All employees understand
the need to balance customer satisfaction and the cost effectiveness of their decisions. Employees
are empowered to questions decisions or actions that are wasteful. The productivity of the
employees is very high ranked second in this industry globally (Heracleous and Wirtz, 2012 p
481). Due to these factors discussed, Singapore Airlines has been a success story in the Airlines
industry with competitors trying to catch up on both efficiency and customer service excellence.
Another strategy is focused service design and development which is structured and taken
as a serious component of the strategy. The company is always improving on its products and
service offering and does not shy away from getting rid of those that do not offer them
competitive differentiation in the market or those that cannot be improved and offered in the best
way. The company does not get comfortable but is always looking for a way to improve
especially in an industry where every other airline is doing the same thing. Singapore Airlines is

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always looking for new ways to meet customers’ high expectations (Heracleous and Wirtz, 2012
p 480).
Universal Music Group (UMG): Background
Universal Music Group (UMG) was formed as Music Corporation of America in 1924. It
was publicly listed and renamed MCA Inc in 1959. It bought Decca records in1962 and formed
a merger with Universal (Rackmil, 1964). UMG bought DreamWorks records rights and
established Universal Music Store with eBay in 2003. Vivendi the French media company
bought in 2006 (Adegoke, 2007). In 2012, it bought EMI to become among the three highest
revenues earners in the music industry. In an industry that is currently faced by stiff competition
and innovations that allow artists to record music on their own, the company has managed to
curve its niche and attract and retain some of the best artists.
How UMG has achieved its Current Success in the Market
UMG operates in an industry that is heavily influenced by innovation in media and
technology. The industry has greatly revolutionized in the past few years that artists can now
record and distribute their music without the help of a recording company. In this kind of
industry, the company that remains successful has to be continuously innovative for it to survive.
One of the recent innovations is that the company partnered with Vevo to develop a site where
customers can access music and stream videos for free while supporting the business with ads
and offer better quality than YouTube (Sinnott, 2008).
In their plan, the company hopes to expand in digital delivery of music and form
partnerships with different platforms that will carry its music and video content. This will also

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help the company save on costs as physical copies of music become less popular while earning
more from different outlets of the content. The company also plans to expand to other viable
markets in the developing countries in Africa and Asia. This is part of the efforts to earn more
profits and remain among the top companies in the industry by expanding to other regions that
show potential for new business (Vivendi, 2015). With new talent coming up across these
regions, the company can only hope to go far by tapping and growing this talent to international
stage and thus gain more business and profits.
Conclusion
A good business strategy guides the business in becoming successful even in industries
with high competitiveness. This paper has discussed two companies that are successful in their
industries namely Singapore Airlines and UMG. The paper has given a brief background of each
of these companies and discussed how each has gained success in the industry they operate.

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References
Adegoke, Y. (2007). Universal Music closes on BMG. Reuters
Heracleous, L. and Wirtz, J., 2012. Strategy and organisation at Singapore Airlines: achieving
sustainable advantage through dual strategy. In Energy, Transport, & the Environment (pp. 479-
493). Springer London.
Porter, M.E. and Strategy, C., 1980. Techniques for Analyzing Industries and
Competitors. Competitive Strategy. New York: Free.
Rackmil, M. (1964). Pioneers' Dream Becomes Reality With Decca. The Billboard.
Singaporeair.com. Retrieved August 23, 2017 from:
http://www.singaporeair.com/en_UK/sg/flying-withus/our-story/our-heritage/
Sinnott, S. (2008). Universal to Create Hulu-like Music Video Site. Exclaim. Retrieved August
23, 2017 from: http://exclaim.ca/music/article/universal_to_create_hulu-like_music_video
Vivendi Website. Retrieved August 23, 2017 via: http://www.vivendi.com.