HI6006 Competitive Strategy Analysis: Strategy Models and Application

This essay provides a comprehensive analysis of competitive strategy, focusing on the application of various strategic models to the case of Qantas Airways. The essay begins with an introduction to the PESTEL framework, outlining its components and their relevance to Qantas's operations, considering political, economic, social, technological, environmental, and legal factors. The subsequent section applies the SWOT analysis, evaluating Qantas's strengths, weaknesses, opportunities, and threats. Further, the essay delves into Porter's five forces framework, assessing the competitive landscape of the airline industry, including competitive rivalry, buyer and supplier power, and the threats of substitutes and new entrants. The final section explores Porter's generic strategies, highlighting Qantas's adoption of a cost leadership approach. The essay references multiple sources to support its analysis.

Running head: COMPETITIVE STRATEGY ANALYSIS
COMPETITIVE STRATEGY ANALYSIS
Name of the Student
Name of the University
Author Note

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Strategy 1
I. Introduction and explanation of PESTEL framework
PESTEL framework can be defined as a tool that is used by the marketers in order to
analyse as well as monitor the exterior macro environment based aspects that are able to
affect the organization. This tool is considered to be useful in the proper analysis of the
external situation of an organization (Daspit et al. 2017). The PESTEL structure can be used
in order to study the exterior environment when the organizations plan to expand their
operations in a new country. The different factors that are considered in the PESTEL analysis
based framework mainly include, political aspects, economic aspects, social aspects,
technological aspects, legal aspects and the environmental aspects (Durand, Grant and
Madsen 2017).
II. Application of strategy
Political factors – The different types of regulations are managed by Qantas Airways
in various markets or countries. The regulations in Australia and all other emerging
economies have changed in the last few years. This has an influence on the prices of services
presented by Qantas (Frynas and Mellahi 2015).
Economic factors – The exchange rates in Australia and the economic performance of
the country has a major impact on operations of Qantas in a short term and long term basis as
well. The stability in economic performance will be able to play a key part in the
improvement of revenues of Qantas (Hanson et al. 2016).
Social factors – The evolving gender based roles in Australia are considered to be
extremely significant factors for the operations of Qantas. Hierarchy and the societal norms
are able to play a key part in the growth of future processes of the organization (Jenkins and
Williamson 2015).

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Technological factors – The supply chain of Qantas Airways is getting disrupted fast
by the technological developments that are taking place. Production based costs are also
getting reduced due to the implementation of modern technologies (Hitt and Duane Ireland
2017).
Environmental factors – The priorities based on product innovation are affected in a
huge way by development of environmental norms. The extreme weather conditions also
have an influence on the processes of the business (Qantas.com 2019).
Legal factors – The legal protection of rights based on intellectual property,
copyrights and patents are considered to be important for development of the policies of
Qantas in an effective manner (Lasserre 2017).
Strategy 2
I. Introduction and explanation of SWOT framework
SWOT analysis framework can be defined as a strategic analysis based tool or
technique that is used to support the organization in order to identify the strengths,
weaknesses within the internal operations and the opportunities and threats that are provided
by the external environment as well. The analysis related to the factors are mainly based on
the project planning based process or the objectives that have been developed by the business
venture (Morschett, Schramm-Klein and Zentes 2015). The levels of favourability of the
factors are considered to be important in order to analyse the ways by which different
strategies can be developed by the organization. The strengths and the weaknesses of the firm
are related to the internal factors and environment and on the other hand, opportunities and
threats are mainly related to the external environment based factors (Wheelen et al. 2017).

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II. Application of strategy
Strengths – The high brand value and reputation of Qantas Airways is considered to
be a key strength of the business. The company has also gained a leadership position in the
industry (Qantas.com 2019).
Weaknesses – The failure that has been experienced in the performance of Qantas
Airways is able to affect its revenues in a huge manner (Frynas and Mellahi 2015).
Opportunities – Qantas has a huge opportunity to bring changes in its strategies in
order to tap the growth levels in different countries.
Threats – The high stages of rivalry provided by Virgin Airlines is a key weakness of
Qantas Airways (Hitt and Duane Ireland 2017).
Strategy 3
I. Introduction and explanation of Porter’s five forces framework
Porter’s five forces framework is considered to be a powerful and simple tool that is
used for the purpose of understanding the levels of competitiveness of an organization. The
organization is able to understand the forces that exist in the environment in order to analyse
the levels up to which these forces are able to influence the effectiveness levels (Durand,
Grant and Madsen 2017). The five major forces that have been defined by Porter in order to
facilitate the proper analysis of exterior environment and the industry of a company include,
competitive rivalry levels, bargaining power of the buyers, bargaining power of the suppliers,
threats of the substitutes and threats of the new entrants. The framework is used in order to
analyse the ways by which different organizations can develop their strategies based on the
development of their future operations in the industry (Morschett, Schramm-Klein and Zentes
2015).

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II. Application of strategy
Competitive rivalry levels – The rivalry levels in airlines industry have increased due
to the upsurge in rivalry that has been delivered by Virgin Airlines in the domestic market in
Australia (Qantas.com 2019).
Bargaining power of the buyers – The buyers in the industry have high levels of
bargaining power as they are provided with many options for the purpose of making
selections from the premium and the low cost services (Daspit et al. 2017).
Bargaining power of the suppliers – The suppliers have low negotiating power in the
airlines based industry. Qantas Airways has developed a strong supply chain further reducing
their power.
Threats of the substitutes – The travel by air is considered to be fastest mode of
travelling for the customers and this is able to reduce the threats based on substitutes
(Durand, Grant and Madsen 2017).
Threats based on new entrants – The threats related to entrance of new companies in
the market are affected in a negative manner due to the requirement of huge capital, further
reducing their threats levels (Daspit et al. 2017).
Strategy 4
I. Introduction and explanation of Porter’s Generic Strategies
Porter’s generic strategies are used in order to describe the methods by which a
company is able to pursue the competitive advantage across a chosen market scope. The
organizations aim at implementing particular generic approaches in order to gain an
advantage in comparison to the competitors in the industry. The three different types of
generic strategies that have been suggested by Porter include, cost leadership strategy,

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differentiation strategy, focus strategy. The modern organizations choose to implement one or
two of the generic strategies in order to ensure effective growth in the particular industries
(Frynas and Mellahi 2015).
II. Application of strategy
The generic approach that has been applied by Qantas Airways in order to develop a
competitive benefit in the market is the cost leadership strategy. The organization has
implemented the cost leadership strategy in order to offer its services to the consumers at the
lowest possible prices (Qantas.com 2019). The company has ensured high stages of growth in
the market with the help of proper implementation of this strategy in its operations (Hitt and
Duane Ireland 2017). The competition that is provided by Virgin Airlines is also faced and
mitigated by Qantas with the proper implementation of the cost leadership based generic
strategy. The company has been highly successful in maintaining its leadership place in the
market with the help of proper application of this strategy (Wheelen et al. 2017).

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References
Daspit, J.J., Chrisman, J.J., Sharma, P., Pearson, A.W. and Long, R.G., 2017. A Strategic
Management Perspective of the Family Firm: Past Trends, New Insights, and Future
Directions. Journal of Managerial Issues, 29(1).
Durand, R., Grant, R.M. and Madsen, T.L., 2017. The expanding domain of strategic
management research and the quest for integration. Strategic Management Journal, 38(1),
pp.4-16.
Frynas, J.G. and Mellahi, K., 2015. Global strategic management. Oxford University Press,
USA.
Hanson, D., Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2016. Strategic management:
Competitiveness and globalisation. Cengage AU.
Hitt, M. and Duane Ireland, R., 2017. The intersection of entrepreneurship and strategic
management research. The Blackwell handbook of entrepreneurship, pp.45-63.
Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2016. Strategic management: Concepts and
cases: Competitiveness and globalization. Cengage Learning.
Jenkins, W. and Williamson, D., 2015. Strategic management and business analysis.
Routledge.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international
management (pp. 978-3658078836). Springer.
Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic
management and business policy (p. 55). Boston: pearson.

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Qantas.com 2019. Fly with one of the world’s most experienced airlines | Qantas IN. [online]
Qantas.com. Available at: https://www.qantas.com/in/en.html [Accessed 25 Apr. 2019].