MAN302 - Flight Centre's Offshore Strategy: A Strategic Analysis

This e-portfolio provides a strategic analysis of Flight Centre, an Australian public firm, focusing on its decision to move organizational activities offshore. It examines the external and internal issues driving this strategy, including the impact of technology on the value chain, the availability of cheaper labor offshore, and the challenges posed by market segmentation and fluctuating labor costs in Australia. The analysis also identifies key stakeholders, assesses the competitive advantages and risks associated with the offshore strategy, and evaluates the implementation of the strategy using metrics such as wage rate differences and supplier bargaining power. The portfolio references the Blue Ocean Strategy and Salim Ismail's framework to explain Flight Centre's approach to creating uncontested market space and leveraging globalization. Desklib provides similar resources for students.

Running head: MANAGEMENT
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Table of Contents
Week 9.............................................................................................................................................3
Impact of technology on the value chain.....................................................................................3
Disruptive impact of technology on the industry.........................................................................3
Specific impacts of technical implementations on the company and industry............................3
Benefits of the implementation of Salim Ismail framework........................................................3
Future sustenance of the current business model.........................................................................4
Week 10...........................................................................................................................................4
Identification of two business level strategies.............................................................................4
Developmental brief outline and strategy Canvas map based on Blue Ocean Strategy..............5
Week 11...........................................................................................................................................6
Evaluation of the corporate level strategy....................................................................................6
Development and assimilation of newly identified strategy........................................................6
Week 12...........................................................................................................................................7
Evaluation tools assessing the KRS and PPI KPI........................................................................7
Reference List..................................................................................................................................8

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Week 9
Impact of technology on the value chain
The organisation outsourcers their Technology based activities through promoting and
organising them by means of digital platforms. However enrichment of digital media going to
world by technological growth, help them to get the tasks done in cheap Nations where there is
less demand of the technology based activities. This is how the cost of promotional as well as
service organizational activities are minimised.
Disruptive impact of technology on the industry
Cheap labour for technology based activities that the employees of companies like this
do, is easily available easily offshore. That is why many of such companies are forced to
Offshore a major part of the operational activities because of which many of the employees using
the jobs (Robinson et al. 2016).

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Specific impacts of technical implementations on the company and industry
As discussed earlier, the businesses have forced to lay off, father, parts of the activities
offshore. This because there is ample availability of labours skilled in technology, in the other
countries (Laterza 2016). As an impact the existing employees in the organisation as well as the
industry are losing their jobs. However, the products, as an impact of being produced under
highly specific and disruptive Technology, becomes better adaptable for the market. This is good
for the company as by means of these they would be able to face the cut throat competition.
Benefits of the implementation of Salim Ismail framework
And the Framework implemented by Salim Ismail lays down that exponential
Technologies as well as globalisation has high level of impact of an organisations. This is
severely true for Flight Centre Company. Firstly, owing to the lack of skilled technological
labourers and the high manufacturing cost of Technology based products forced them to
Offshore a significant part of their production to countries where technological labours are

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available but demands of Technology based activities are very less (Tunçalp 2018). Hereby we
can see how technological encroachment is impacting the production line as well as a mode of
operations of organisation. Similarly, is highlighted Salim Ismail framework, this is bringing
about globalisation also and all these are helping the company as we see in the airport to develop
a simple framework of production that is ultimate helping them to achieve higher review (Ismail
2015).
Future sustenance of the current business model
Other than some minimal risks like changes in the trade policy as well as taxation as also
in trading fluctuation of economy in the Nations where the production line is observed, the
overall business environment of the company stable and sustainable. There able to reduce the
cost of operation which has helped to create a balance in the productivity. Other than that, by
means of shifting the operational activities offshore, the brand image of that company is
developed in a different economy also (Mebert and Lowe 2017). All these factors suggest that

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there will be a gradual enhancement in the clientele in the upcoming 5 years. There is hardly any
chance of Economic set back as it seems now.
Week 10
Identification of two business level strategies
The two business level strategies that the external business atmosphere on the industry
has forced the organisation to adopt are as follows
1. Moving a significant part of the production line, Offshore
2. Appointment of regional highly skilled technological work force from the off-shore
domain

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Developmental brief outline and strategy Canvas map based on Blue Ocean Strategy
The political environment in Australia is unstable that affect fluctuates trade regulations.
As an impact travel agencies as well as service providers have to shuffle their liver prices.
Operating expenses on stable and so revenue line for the organisations also not fixed. On top of
that, to take the advantage of this competitive business atmosphere small level supply Agencies
including small hotels, Cafe and others provide cheaper options to the customers. The Blue
Ocean Strategy recommends that organisations should take up innovative as well as destructive
options that might help them to shift the opposition to absolutely new level so that the
competition can be nullified. The flight Centre has done so by shifting a significant part of the
operations, Offshore.
Moving a significant
part of the production
line, Offshore
Appointment of regional
highly skilled
technological work force
from the off-shore
domain

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Again the emergence of a number of suppliers like aviation companies, hospitality
Agencies and others in the same sector the supply line is getting divorced and the relation of
suppliers to the organisations becoming fragile. Hands with the organisation steps in a new
market with the line of production, the bargaining power of suppliers become automatically low
(Agnihotri 2016). Along with that the production cost which was fluctuating for the company
because of constant in negotiating with the wage level for the workers will now be leisure as well
as stable also. This is going to the availability of cheap Technology based labourers in the new
Economies where the company is shifting its domain.

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Canvas Map based on Blue Ocean Strategy
(Source: Developed by the researcher)
Week 11
Evaluation of the corporate level strategy
The two main challenges for the organisation while operating in the Australian economy
were fragility of the supply line going to large level of market segmentation and fluctuating
labour cost into implementation of new regulations by the government constantly. These issues
were mitigated by the company by adopting a corporate strategic decision of shifting a
significant part of Technology related manufacturing line, Offshore.
Development and assimilation of newly identified strategy
The company is attempting to explore a different economy where the attention to shift
their manufacturing line partially. However, the selected country where the company is shifting

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its production line was chosen because the lack of Technology related activities naturally keeps
the demand of technological labourers low there. Naturally this implies that the number of
similar organisations providing the same service that this company provides, is also negligible
there. Since the business prospect in that economy is also high. On one hand where there is
substantial competition developing in Australia, It is worthwhile to explode the business
prospects in the new economy where they are shifting their production line since an alternative
market will be available to the company as of then.
Week 12
Evaluation tools assessing the KRS and KPI
The first evaluation metric that is to be implemented here is the difference in the wage
rate, skill level and organisational adaptivity of the workers in the new atmosphere compared to
that in Australia. This will help the company in finalising and determining the production cost.

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The second evaluation metric will be the level of bargaining power of the suppliers after
starting production in the new country. The fragility of suppliers was hampering the production a
lot. Hence the rigidness of the suppliers Framework is necessary to be assessed if the
organisation wants to develop a stable revenue standard by operating overseas.
The first evaluation metric that is to be
implemented here is the difference in the
wage rate, skill level and organisational
adaptivity of the workers in the new
atmosphere compared to that in Australia.
This will help the company in finalising and
determining the production cost
The second evaluation metric will be the
level of bargaining power of the suppliers
after starting production in the new country.
The fragility of suppliers was hampering the
production a lot. Hence the rigidness of the
suppliers Framework is necessary to be
assessed if the organisation wants to develop
a stable revenue standard by operating
overseas

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Reference List
Agnihotri, A., 2016. Extending boundaries of blue ocean strategy. Journal of Strategic
Marketing, 24(6), pp.519-528.
Ismail, S., 2015. Exponential Organizations: il futuro del business mondiale. Marsilio Editori
spa.
Laterza, V., 2016. Resilient labour: workplace regimes, globalisation and enclave development
in Swaziland. The Journal of Development Studies, 52(4), pp.576-590.
Mebert, A. and Lowe, S., 2017. Blue Ocean Strategy: How to Create Uncontested Market Space.
Macat Library.
Robinson, P., Fallon, P., Cameron, H. and Crotts, J.C. eds., 2016. Operations management in the
travel industry. CABI.
Tunçalp, D., 2018. Book Review: Waves of change: Globalisation and seafaring labour markets.