Strategic Analysis, Planning, and Control for Royal Brunei Airlines

This report provides a comprehensive strategic management analysis of Royal Brunei Airlines (RBA). It begins with an introduction to strategic management, followed by a detailed strategic analysis of organizational data and information, including business-level and corporate strategies, environmental analysis using PEST analysis, and resource and competence analysis using VRIO analysis. The report then develops a strategic plan for RBA, including its mission, strategic direction, objectives, and key performance indicators (KPIs). Finally, the report evaluates strategic control, outlining implementation plans, communication methods for internal and external stakeholders, and monitoring and evaluation systems. The analysis incorporates strategic management frameworks and academic literature to provide a thorough understanding of RBA's strategic position and recommendations for future development.

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
1. Strategic analysis of organisational information that supports decision making....................1
2. Strategic Plan for Royal Brunei Airlines...............................................................................4
3. Strategic control......................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES...............................................................................................................................7

INTRODUCTION
Strategic management is referred as the set of managerial decision and actions that
determine long run performance of the corporation. It mainly includes the environment analysis
which includes both external as well as internal analysis, strategy formulation, strategy
implementation, evaluation and control. Strategic management is the way of defining the
uniqueness of company from its competitors by identifying its strength in order to provide better
values to consumers in terms of both products and services. Strategic management is used for
identifying the needs and desires of customers for creating a plan to reach out to them to
accomplish satisfaction among customers(Barney, 2012)Strategic management is study that
allows to emphasizes the monitoring and evaluating the external opportunities and threats in
order to work on both organisation's strengths and weaknesses. Strategic marketing is generally
is used to identify the desires of customers for developing appropriate plan in order to
accomplish customer's loyalty. This company that is considered in this report is Royal Brunei
Airlines one of the national flag carrier airlines of Brunei Darussalam that is headquartered in
Bandar Seri Begawan. This report mainly covers about the strategic analysis of organisational
data and information, business level strategy, corporate strategy, environmental analysis,
resources and competence analysis. This report also covers about the strategic plan and strategic
control through which developed strategy plan is implemented.
1. Strategic analysis of organisational information that supports decision making
Every organisation wants to achieve competitive advantage in order to develop brand
image in the market. In order to achieve organisational goals it is very essential to implement
proper strategic analysis by using all the organisational data and information. Through strategic
analysis Royal Brunei Airlines are able to make and take appropriate decision making in order to
achieve competitive advantage. Strategic analysis mainly emphasis on the business level
strategy, corporate strategy, environment analysis along with resources and competence analysis.
Business Level strategy and Cooperate strategy in Royal Brunei Airlines
In context with the business level strategy, Royal Brunei Airlines uses Porter's Five Force
to identify rivalry among existing competitors, bargaining power of suppliers, bargaining power
of buyers, threats of new entrants and threat of substitute product or services. Porter's Five Force
1

analysis is considered as framework for analysing the overall level of competition within
business strategy development and industry.
Threat of new entrants
Royal Brunei Airlines requires high investment in order to enter in airline industry.
Royal Brunei Airlines is facing many barrier in order to be competitive in comparison to other
airlines. Some issues that is faced by Royal Brunei Airlines are implementation of government
policies, cost disadvantage of independent of size, sunk costs, economics of scale. Threat of
entry is very low due to high saturation, high cost and government controls.
Threat of Substitutes
There are many substitutes that are already available to customers when compared with
Royal Brunei Airlines. There are many substitute available in context with Royal Brunei Airlines
which includes trains, cabs, buses, ships. Threat of substitute is consider medium for Royal
Brunei Airlines.
Bargaining Power of Buyers
Customers nowadays are very price sensitive and they know very well about their rights
and have many choices when they need to choose airlines. There are several alternative airlines
available in marketing due to this bargaining power of the buyers increases automatically.
Bargaining Power of Buyers is low(Hill, 2017).
Bargaining Power of Suppliers
There are very suppliers of air plane as it becomes very difficult tasks to do that as high
amount of investment is required. The supplier of Royal Brunei Airlines mainly includes all
those suppliers that supplies fuel, air planes. This leads to increase in bargaining power of
suppliers. Bargaining power for the suppliers is low suppliers are very less for airways.
Industry Rivalry
Royal Brunei Airlines is having high competition in market at different level. It is facing
high competition which mainly involves with international airlines. The competition is very
intense at national as well as international level which involves different terms convenience,
price and services. Industry Rivalry for Royal Brunei Airlines is high due to fare comparison and
different services(Greco, Cricelli and Grimaldi, 2013).
Environmental analysis of Royal Brunei Airlines
2

Pest analysis is used for the identification and analysis of environmental factors that are
directly or indirectly responsible for the growth and development of an organisations. This
factors creates different impact on different sectors of a economy. For environmental analysis
Royal Brunei Airlines uses PEST that is discussed below:
Political: Political factors mainly involves with the intervention of government which
generally involves with taxation policy, environmental laws, labour laws. Royal Brunei Airlines
faces different political issues which mainly includes bilateral agreements, deregulations and
open sky issues. Moreover, terrorism fear and political instability affects the performance of the
Royal Brunei Airlines.
Economical: Economical factor creates an significant influence on the organisations
profitability. The factors that mainly involves in this are economy growth, exchange rate,
inflation, rate of interest. Demand for air travel highly depends upon the world economy growth
or fluctuation(Hill, 2017).
Social: Social analysis includes change in the demographics, lifestyle and cultural needs.
This social factors affects Royal Brunei Airlines as its creates direct impact on them in order to
interpret customers needs.
Technology: It involves with the change in technology trends and innovation that affects
the performance of Royal Brunei Airlines. Some advance technology used by the Royal Brunei
Airlines are video conferencing, satellite based navigation system, online ticket booking etc. This
helps in enhancing customer engagement.
Resources and competence analysis
VRIO analysis is adopted by Royal Brunei Airlines in order evaluated the resources of
the organisation. VRIO analysis for Royal Brunei Airlines is mentioned below:
Resources Valuable Rare Inimitable Organized to
Exploit
Impact on
organisations
1. In- Flight
Entertainment
Yes Yes Yes Yes Long term
competitive
advantage
2. Seating
comforts
Yes Yes No Yes Unused
competitive
3

advantage
3. The
customer Bill
of Rights
Yes Yes No Temporary
competitive
advantage
As In flight entertainment for Royal Brunei Airlines is valuable, rare, difficult to imitate and is
well organised. This allows to achieve long term competitive advantage. As seating arrangement
for the Royal Brunei Airlines is valuable, rare but easy to imitate. This allows Royal Brunei
Airlines to gain unused competitive advantage.
Royal Brunei Airlines should use five force porter model in order to develop and
implement appropriate business strategy to achieve competitive advantage. PEST analysis allows
Royal Brunei to analysis overall macro environment analysis to improve performance. VIRO
analysis helps to focus on those resources that gives long term competitive advantage.
2. Strategic Plan for Royal Brunei Airlines
Strategic Planning acts as an organisation's continuous process in order to develop
appropriate strategy so that specific goals and objectives of the organisation can be attained.
Strategic planning can be used on large scale for making planning for further growth and
development of the organisations. It can be also used on small scale in order to determine
marketing planning and developing strategy for attaining goals and objectives of one department
within organisations.
The main benefit of strategic planning is that it allows to provide clear communication to
clients, customers, team members and stakeholder. It also provides clarification to deal with
internal and environmental changes. Royal Brunei Airlines prepare its strategic planning based
on their environmental analysis through PEST, business level analysis and resources analysis.
Strategic plan for Royal Brunei Airlines are mentioned and discussed below:
Introducing statement: This strategic plan was mainly developed in order to enhance
customer engagement of the Royal Brunei Airlines as the bargaining power of buyers is low due
to availability of cabs, trains, railways etc. within 3 years.
Background statement: Royal Brunei Airlines is the carrier airline of Brunei
Darussalam and it is owned by government of Brunei. Organisation structure of Royal Brunei
4

Airlines includes various departments such as cabin crew, managers, fight operations and
maintenance, pilots, engineer. Royal Brunei Airlines manages everything under the guidance of
chief executive officer and board of directors. Royal Brunei Airlines follows code share
agreements with various airlines which mainly involves China Eastern Airlines, Hong Kong
Airlines, Malaysia Airlines, Myanmar Airways international etc.
Vision: Royal Brunei Airlines mainly aims to become most competent among several
airlines and become first choice for each passenger along with renowned for service excellence.
Mission: Royal Brunei Airlines mission is to generate high profits by providing
excellent and comfortable air services to customers along with high customer engagement.
Strategic direction: In order to enhance and achieve high customer engagement it is
very essential to follow and emphasis on all the environmental analysis factors which includes
political, social, economical and technological factors. All this factors allows to identify the
requirement and desires of the customer. Porter's Five Force model allows to analysis the threats
new arrivals in order to maintain the businesses. It is important to analysis about the bargaining
power of buyers and supplier in order to modify strategic planning according the requirement.
Resources analysis allows Royal Brunei Airlines to focus on those resources that are giving long
term competitive advantage and to work on those resources that are considered as unused
competitive advantage(Hill, 2017).
Key performance Indicators: The main key performance indicators for Royal Brunei
Airlines mainly includes with safety, flights ops, environmental and financial. It is duty of Royal
Brunei Airlines to maintain proper fatality, record and report dangerous occurrences in order to
maintain proper safety. It is crucial to maintain fight ops information that includes available
flying time, number of Pax, number of flights. In order to achieve high profitability by serving
excellent and comfortable services to customer, it is essential to focus on operating margin along
with revenue per available seat.
3. Strategic control
Strategic controls mainly focuses more on achievement of future goals rather than the
evaluations of past performance. It is concerned with the tracking of a strategy as it is being
implemented for detecting problems or changes in its underlying premises and make necessary
adjustments for future strategic planning along with decision making.
5

The main characteristics of strategic control is continuous process and it is
implementation at each level of organisational hierarchy. Royal Brunei Airlines uses following
strategic control methods in order to achieve organisational goals and objectives along with
competitive advantage
Premise Control: Premise control allows to serve the purpose of continually testing the
factors and assumption in order to find out whether the strategies adopted is valid or not. It helps
the Royal Brunei Airline strategists to take corrective actions at right time to make appropriate
modification in the strategies.
Implantation Control: This strategic control method aims at evaluating that whether the
plans, projects and programs are implemented and guiding the department in right way for
determining predetermined objectives and goals. Royal Brunei Airline uses implantation control
method in order to follow right direction of strategic planning to perform well and achieve
competitive advantage (Hitt, and Duane, 2017).
Strategic surveillance: It mainly aims to design to monitor a wide range of events both
internal as well as external in order to identify the threats of the organisational and make
modification according to the requirements.
Special alert control: This strategic control method is s totally based on the trigger
mechanism for achieving rapid response and get immediate reassessment of strategy in light of
unexpected events. Royal Brunei Airline uses this strategic control method when unexpected
changes in the environment occurs and affect the profitability of the organisations.
CONCLUSION
From the above assignment report, It has been concluded that in order to provide
excellent and comfortable services to customer Royal Brunei Airline has to implement various
business strategy analysis, environment analysis and resource analysis to determine needs of
customers. From pestle analysis, an firm gets the idea about the various factors where
improvements are required. Also from pestle, organisations can point out their strengths and can
improve weakness factors so that the company will get positive response from the customers of
targeted economy. It is conducted that both strategic plan and control method is important to
modify strategies according to future requirement and needs.
6

REFERENCES
Books & Journals
Barney, J. B., 2012. Purchasing, supply chain management and sustained competitive advantage:
The relevance of resource‐based theory. Journal of supply chain management. 48(2).
pp.3-6.
Bryce, H.J., 2017. Financial and strategic management for nonprofit organizations. Walter de
Gruyter GmbH & Co KG.
Greco, M., Cricelli, L. and Grimaldi, M., 2013. A strategic management framework of tangible
and intangible assets. European Management Journal. 31(1). pp.55-66.
Hahn, R., 2013. ISO 26000 and the standardization of strategic management processes for
sustainability and corporate social responsibility. Business Strategy and the
Environment. 22(7). pp.442-455.
Hair, J. F. and et. al., 2012. The use of partial least squares structural equation modeling in
strategic management research: a review of past practices and recommendations for
future applications. Long range planning. 45(5-6). pp.320-340.
Hill, C. W., Jones, G. R. and Schilling, M. A., 2014. Strategic management: theory: an
integrated approach. Cengage Learning.
Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function.
Macmillan International Higher Education.
Hitt, M. A., Ireland, R. D. and Hoskisson, R. E., 2012. Strategic management cases:
competitiveness and globalization. Cengage Learning.
Hitt, M. and Duane Ireland, R., 2017. The intersection of entrepreneurship and strategic
management research. The Blackwell handbook of entrepreneurship, pp.45-63.
7