MGT302A Assessment 1: Reflective Essay on Qantas' Strategy

This reflective essay analyzes the effectiveness of Porter's Five Forces model as a strategic tool for Qantas Airlines. The essay begins with an introduction and a brief overview of Porter's Five Forces, followed by an application of the model to Qantas, examining the threats of new entrants, substitution, supplier power, buyer power, and rivalry among competitors. The analysis highlights the competitive environment within which Qantas operates. The essay further discusses the usefulness and limitations of the model, providing a balanced view of its strengths and weaknesses. The analysis uses academic journal articles to support the evaluation of Qantas's strategic position. The conclusion summarizes the findings and reflects on the insights gained from applying Porter's Five Forces to Qantas Airlines.

Reflective Essay

Contents
Introduction................................................................................................................................3
Porter’s Five Force Model.........................................................................................................3
Application of model..................................................................................................................4
Usefulness and limitations.........................................................................................................5
Conclusion..................................................................................................................................6
References..................................................................................................................................7

Introduction
This report is a reflective essay to analyse effectiveness of strategic or competitive
tool i.e. Porter’s Five Forces in chosen company i.e. Qantas Airlines. In this report I will
cover a brief summary on porter’s five model with its application to chosen company.
Further, several usefulness and limitations are also being described with a conclusion to
present better and clear understanding of this reflective essay (Alanezi and Al-Zahrani, 2020).
Porter’s Five Force Model
As per article published in World of work project, 2021, the classic model of Michael
Porter evaluates the competitive environment within which a company is operating. This is
done by capturing the major elements on the market that impact a company's profitability. It
takes into account both the number of units a company sells and how far a company benefits
from every item it sells (Porter’s Five Forces: A Simple Summary, 2021).
To utilise Porter's five forces as a means for analysing your company, your division or
the product you're reviewing, you have to examine each of the five factors. Porter's approach
concentrates on what he terms a "micro-environment," near to the firm and makes it apparent
that there are other macro-factories which influence profitability, but which he has decided to

overlook, for example social political and regulatory developments. Porter's five-point model
is an easy and comprehensive means of taking into account the attraction of a company and a
useful method for individuals to think about the influence of the sales volume and rate. It's a
little restricted because it does not take macro variables into into account, but if
individual combine it with PESTLE, they get a decent perspective of their whole
surroundings at a high level (Albers and et. al., 2020).
Application of model
An examination of Qantas aviation firm shows that it was Australia-based flagship
airline and provides its clients with flying services. Qantas operates on both domestic and
international markets and the airline is a major player in the Australian aviation sector. With
almost 65% of the industry's market share, Qantas is now the market leader. It has strategic
relationships with several foreign airlines that allow it to offer international air transport
services (Ambrose and Waguespack, 2021). The company's degree of performance in the
recent past showed that the competitive environment throughout the industry is not good.
Porter’s Five Force Model of Qantas Airlines are as follows;
Threats of new Entrance: Emerging transport entrants provide additional innovation,
methods and pressures to Qantas Airways Limited through reduced price, reduced costs and
provide customers with new value proposals. All these problems are managed and effective
barriers are created to protect its competitive edge.
Threat of substitution: Unless a new product or service responds in different ways to a
comparable customer's demands, industrial profitability is affected. Services such as Dropbox
and Google Drive replace physical storage discs. The danger of a replacement product or
service is significant if it delivers a value proposition that is distinctly different from current
industry offers.
Supplier power: Most of the transport firms purchase their raw material from several
vendors. The Qantas Airways Limited margins might be lowered in the market by suppliers
in a dominating position. Powerful transportation providers take use of their bargaining
strength to extract greater rates from transportation companies. The overall consequence of
increased supplier negotiating strength is that it reduces transport's total profitability.
Buyer power: Often purchasers are a tough bunch. By paying the minimum amount,
individual wish to acquire the greatest available offers. The pressure was put on Qantas

Airways Limited long-term profitability. The smaller and stronger the client base, the more
consumers are able to negotiate and seek more and more discounts and services.
Rivalry amongst existing competitors: If there is severe rivalry among current
participants in a sector, prices will fall and the total profitability of the industry would
decline. In a highly competitive transportation market, Qantas Airports Limited operates. The
entire long-term profitability of the company is affected by this rivalry (Losa and et. al.,
2020).
By evaluating all five competing factors, strategists at Qantas Airways Limited will
be able to see fully how the organization's profitability in the transport sector influences.
Manager can quickly detect game-changing patterns and react to the developing chance. The
managers of the Porter Five Forces can mould those forces in their favour, by knowing the
Porter Five Forces with great depth.
Usefulness and limitations
Five Forces Analysis by Michael Porter continues one step further, asking
managers to examine very closely at certain market elements, so that more strategic business
decisions may be made. Managers at chosen company may better discover and take
advantage of the strengths of their firm by knowing the profitability of an industry and any
potentially risks to its success or establish their shortcomings and how they may be improve.
Some of its advantages are;
 Better decision-making
 Best use of resources
 Competitive advantage
Disadvantages of model
 Too general: A major shortcoming of the Forces Model is that it only gives an
advantageous or unfavourable list of elements for an organisation. This tool provides
as a beginning point for deeper organisational research, similar to other analysis
frameworks, such as a Swot Analysis Model.
 One-dimension framework: The instrument also takes account of cooperation between
suppliers, rivals and purchasers; strategic alliances and/or competition dynamics. The

Five Forces Model is limited in that it represents a basic and one-dimensional
framework that does not take complexity into account.
Conclusion
From the evaluation of above report document wherein, I made relevant application of
model with operational working of chosen company. It can be said that the reflective essay
provides a clear image of advantages and disadvantages of using the model to the given
company. In the report I also included article which helped in increasing relevancy of the
report and by collection of all the relevant data and information I was able to present the
essay that is descriptive and fits within the word count.

References
Books and Journals
Alanezi, F. & Al-Zahrani, R., (2020, January). Strategic Management of Emirates Airlines.
In Proceedings of the 2020 2nd Asia Pacific Information Technology Conference (pp. 172-
177).
Albers, S., Daft, J., Stabenow, S. & Rundshagen, V., (2020). The long-haul low-cost airline
business model: A disruptive innovation perspective. Journal of Air Transport
Management, 89, p.101878.
Ambrose, S. & Waguespack, B., (2021). Fundamentals of Airline Marketing. Routledge.
Losa, E.T., Arjom&i, A., Dakpo, K.H. & Bloomfield, J., (2020). Efficiency comparison of
airline groups in Annex 1 & non-Annex 1 countries: A dynamic network DEA
approach. Transport Policy, 99, pp.163-174.
Online
Porter’s Five Forces: A Simple Summary, (2021). [Online]. Available through:
<https://worldofwork.io/2019/07/porters-five-forces/>