Strategic Management Report: Emirates Airlines Competitive Analysis

This report offers a comprehensive strategic analysis of Emirates Airlines, a leading global airline based in Dubai. It begins with an executive summary and table of contents, followed by an introduction to Emirates Airlines, its vision, mission, and objectives. The report delves into the external environment through PESTEL analysis, examining political, economic, social, technological, environmental, and legal factors. It assesses the competitive landscape using a Competitive Profile Matrix (CPM) and evaluates external and internal factors with EFE and IFE matrices. Internal strengths and weaknesses are evaluated. Recommended objectives and strategies are presented, supported by a SWOT matrix and a Boston Consulting Group (BCG) matrix. The report concludes with implementation suggestions and procedures for strategic review and evaluation, providing a holistic understanding of Emirates Airlines' strategic positioning and future prospects.

Running head: STRATEGIC MANAGEMENT: EMIRATES AIRLINES
STRATEGIC MANAGEMENT: EMIRATES AIRLINES
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Executive Summary:
The purpose of this assignment is to analyse a strategic market report of the Emirates airlines.
The factors to be considered in this discussion are the PESTEL analysis and the internal and
external factors of the company. Moreover a Competitive Profile Matrix (CPM), External Factor
Evaluation (EFE), Internal Factor Matrix (IFE), SWOT analysis and a Boston Consulting Group
(BCG) matrix are to be constructed for the better analysis of the factors influencing the business.
Stragetic objective and evaluation plans are to be developed according to the data gained from
the discussion. Eventually, a conclusion is to be drawn from the above analysis which
summarises the overall discussion.

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Table of Contents
Introduction:................................................................................................................................................3
Vision and values:.......................................................................................................................................3
Mission:.......................................................................................................................................................3
Objectives:...................................................................................................................................................4
Vision and Mission statements:...................................................................................................................4
External opportunities:................................................................................................................................4
External threats:...........................................................................................................................................5
PESTEL analysis:........................................................................................................................................6
Competitive Profile Matrix:.........................................................................................................................8
The External Factor Evaluation (EFE) Matrix:............................................................................................9
Evaluation of internal strengths and weaknesses:........................................................................................9
The Internal Factor Evaluation Matrix:.....................................................................................................11
Recommended objectives and strategies:..................................................................................................11
SWOT matrix:...........................................................................................................................................12
Boston Consulting Group (BCG) matrix:..................................................................................................13
How the recommendations can be implemented:......................................................................................13
Procedures for strategic review and evaluation:........................................................................................14
Conclusion:................................................................................................................................................14
Reference:..................................................................................................................................................16

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Introduction:
Emirates airlines is a Dubai based airline, which is a part of the government owned
organisation, The Emirates Group. Emirates is the fourth largest airlines in the world, with a fleet
size of 265 and 155 destinations. The Emirates airlines was formed in 1985 under the royal
family of Dubai’s patronage (emirates.com 2018). The airlines is headed by Ahmed bin Saeed Al
Maktoum who is still now the chairman and CEO of the company. Emirates operates a fleet of
wide body aircrafts, particularly Boeing and Airbus. The Emirates was formed as a result of Gulf
Air’s cutting off services to Dubai. Pakistan International Airlines leased them a Boeing 737-300
and an Airbus A300B4-200 for the operations to begin in 1985 with additional technical and
administrative assistance (emirates.com 2018). The Emirates airlines has now become an
inseparable part of the UAE identity. It also operates in the cargo airlines sector in the name of
Emirates Skycargo. It has been one of the largest cargo carriers in the world.
Vision and values:
The vision of the Emirates airlines is to inspire travellers all around the world to travel
with ease. The growing popularity and worldwide network promises best in class in flight
experience, accompanied with international cuisine and service. Moreover, the company also
believes in managing a profitable growth by developing an enhanced and world class global
distribution network (Skycargo.com 2018). This will lead to the addition of value to the
customers’ needs with a relentless focus on innovative solutions and sustainable cost cutting
services.

4STRATEGIC MANAGEMENT: EMIRATES AIRLINES
Mission:
The mission of the Emirates airlines is to develop the most efficient airline system in the
world with the largest and efficient fleet of wide body aircrafts. The company also aims to
deliver the best standards when it comes to customer satisfaction. Maintaining the best product
quality and also support business logistics through innovation and enhanced services
(Skycargo.com 2018).
Objectives:
The main objective of the Emirates airlines is to increase their profits and annual benefits.
The enhanced services aims at attracting more customers and business cargo. The objectives of
the Emirates include increasing market shares at a considerable rate without compromising the
quality of services and reputation. Expansion of fleet and increasing frequencies between travel
destinations aims at expanding the market. Moreover, the cargo sector also requires considerable
growth for increasing the market share. Increasing the cargo capacity by certain percent every
year is another objective of the Emirates airlines.
Vision and Mission statements:
The company should aim at increasing the market share and aim at preserving its
reputation. This can be done by increasing the business by adding more aircrafts to the fleet and
developing more world class services.
External opportunities:
The opportunities are the factors which highlight positive potentials of the company
which can help the company to develop in future.

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One of the opportunities that the Emirates airlines has is its large number of subsidiaries.
The subsidiaries provide additional profit for the parent company and by providing different
services for the satisfaction of a large number of customer needs. Some of the subsidiaries of the
Emirates airlines are, Emirates SkyCargo, Skywards and Emirates Aviation College. These
subsidiaries provide a number of services in the different growing markets and have the potential
of increasing benefits to a larger percentage in the future (Nataraja and Al-Aali 2011).
Moreover, development of better entertainment services such as TV and music system in
every seats for the benefits of the customers can help them draw more travellers towards them
who want to avail a luxurious journey.
External threats:
The threats are the factors that analyses the negative aspects that can place the company
in potential risk in the future. The threats that face Emirates airlines as potential risk are Market
demand, competitor behaviour and rising fuel prices.
Market demand in the aviation industry is the prime concern for airline companies.
Empty seats in regular flights are a major concern for the flight operators as it seriously affects
the costing and operations financial management of the company. Emirates provides the best
services and quality and regularly checks market demands for avoiding these sort of problems.
However, this problem is always a major threat concerning the aviation industry.
Competitor behaviour is another potential threat for a big company like Emirates airlines.
The highly competitive market always makes the competitors aware of each other’s strategies
and adopt accordingly. These does not allow the company to adopt a long term marketing

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strategy. The competitor behaviour hence, is a major concern for the industry where they have to
be regularly monitored and developed accordingly.
Rising fuel prices are a major threat to the Emirates airlines (Wadud 2015). Increasing
fares to maintain an expenditure and profit balance can pose a severe threat to the growth of the
aviation industry. This can draw away the customers towards airlines who provide cheaper fares.
PESTEL analysis:
Political factors: The political factors are a direct influence on the aviation industry. It is always
easy to target the aviation industry as it is a sensitive business concerning hundreds of lives.
Wars and terrorist activities are always a major threat for the aviation industry (van Niekerk and
Pizam 2015). Emirates airlines are similarly affected by political factors. Global aviation
companies like the Emirates are always affected by the global political factors. Moreover, there
are air space agreements due to different political turmoil all over the world. These affect the
industry’s growth where their market share is directly affected by these regulations.
Economic factors: The economic factors are the direct influences on the profit of the company.
Moreover, these factors help to analyse and forecast the potential economic development of the
company and the future capital and profit analysis. The Emirates airlines is a subsidiary of the
UAE government which provides huge capital support to the company (Kotsi and Michael
2015). This has resulted in the massive development of the infrastructure and facilities that are
provided by the company. These developments has in turn resulted in larger profits and increased
market benefits. It is evident from the analysis that the economic factors play a very important
role in determining the success of the company.

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Social factors: The social factors such as the customer demands play a huge role in the aviation
industry. The customers look for customized services that can provide them with luxurious
comfort during their travels. The airline companies should hence adhere to these factors to
maintain a good customer relationship which can directly provide them greater market share and
profits. The Emirates airlines provide customized solutions for the customers according to
demographic changes (Shaw 2016). The regional services according to country specific needs,
regional cuisine, and greater number of comfortable flights according to the growing population
are some of the factors that allow the Emirates to maximize their profits. However, the huge
infrastructure can pose a threat if there is a sudden drop in customers in the future and the
company should be ready to deal with such situations.
Technological factors: The aviation industry should always be aware of the technological
developments of the modern society and ready to adapt to them to provide quality services to the
customers. The latest technologies can attract more people who are mainly drawn towards the
technologically advanced services (Venkatraman 2016). The better security systems and the in-
flight safety due to the technological advances has the potential to draw more people towards air
travel who earlier used to consider the safety issue as a major hindrance for air travels. However,
technological advances can also prove to be a negative aspect for the airline industry as the
present scenario has seen decreasing number of business travels to conferences which are now
primarily held in video conferences.
Legal factors: The policies of the aviation companies are directly affected by the laws and
regulations of different countries in which they operate (Klophaus 2016). The legal issues vary in
different countries and hence the companies like the Emirates airlines has to be always cautious

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in dealing with local and international legal regulations. Different policies according to different
regional laws can influence the company’s profits accordingly.
Environmental factors: The constant environmental changes is a global issue and the airline
companies are also affected. The environmental factors which can affect the Emirates airlines are
weather changes and climate issues (Arjomandi and Seufert 2014). The home country UAE has a
dry warm climate, but the destinations to which they travel have a variety of climates. The
company should have strategic plans to tackle these sudden emergency situations in order to
provide better and quality service to its customers.
Competitive Profile Matrix:
The competitive profile matrix (CPM) is determined by considering the different critical
success factors which are important in the aviation industry. The factors which are to be
considered are Advertising, Quality of Services, Price Competitiveness, Management, Financial
Position, Global Expansion, Customer Loyalty and Market Share (Bhattacharjee and Dey 2015).
These factors are to be compared with two main competitors of the Emirates airlines to
understand the sector which is to be focused for further development.
Emirates Airlines Qatar Airways Singapore
Airlines
Critical Success
Factors
Weight Rating Score Rating Score Rating Score
Advertising 0.20 4 0.80 4 0.80 3 0.60
Quality of Services 0.10 4 0.60 4 0.60 4 0.60
Price
Competitiveness 0.10 3 0.15 4 0.20 4 0.20
Management 0.10 4 0.40 4 0.40 4 0.40
Financial Position 0.15 4 0.60 4 0.60 4 0.60
Global Expansion 0.20 4 0.80 4 0.80 4 0.80
Customer Loyalty 0.10 4 0.40 4 0.40 4 0.40

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Market Share 0.05 4 0.20 3 0.15 3 0.15
1.00 3.95 3.95 3.75
Scorecard: 4=Major Strength, 3=Minor Strength, 2=Minor Weakness, 4=Major Weakness

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The External Factor Evaluation (EFE) Matrix:
Key External Factors Weight Rating Weighted
Score
Opportunities
1. Developing according to market demands 0.20 3 0.60
2. Developing and investing in new markets
with new subsidiaries and new services
0.15 4 0.60
3. Developing better in-flight services 0.05 3 0.15
4. Developing and increasing flights to new
destinations
0.10 4 0.40
Threats
1. Threats of fall in market demand 0.05 3 0.15
2. Strategic competitor behaviour 0.20 4 0.80
3. Rising fuel prices 0.15 2 0.30
4. Legal and political threats 0.10 4 0.40
Total 1.00 3.40
Scorecard:
4= Very good response
3= Good response
2= Average response
1= Poor response
Evaluation of internal strengths and weaknesses:
Emirates airlines has some major strengths with which it develops its business operations and
secures its existing and potential markets (Hill Jones and Schilling 2014). Some of the internal
strengths are:
 Successful management of product development and new services for gaining new
market.
 Introducing subsidiary firms and investing on new markets to channelize its operational
structure.

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 Maintaining a successful customer satisfaction rate and development of loyalty among
customers.
 Strong capital investment from the government of UAE helps Emirates airlines invest in
robust development of infrastructure (Abeyratne 2016).
 Strong global presence and market share.
 Operational flights to a large number of destinations and presence in five continents.
 Strong promotional and sponsorship activities make Emirates a global name.
However, Emirates airlines has to face certain internal weaknesses which need to addressed
for the better development of the company’s business in the future. Some of the weaknesses are:
 The company’s rapid expansion and aggressive marketing should be balanced with its
infrastructural development.
 The company still has to improve on developing product range. Though the company is
investing in research and development, compared to some of the other companies,
Emirates has to go a long way.
 Emirates airlines faces a higher attrition damage in the work force which can be a major
threat in running the huge operational business (Mumtaz 2017).
 The management structure of the Emirates airlines requires development as they face
problems in managing different work cultures in regional markets (Cline 2016).