Strategic Analysis of Singapore Airlines (BUS3005)

This report provides a comprehensive strategic analysis of Singapore Airlines (SIA), examining its competitive advantages, strategic capabilities, and core competencies within the airline industry. It delves into SIA's market position, industry structure, and global presence, highlighting its strengths, weaknesses, opportunities, and threats through TOWS matrix analysis. The report further explores SIA's strategic planning using the Ansoff matrix, evaluating market penetration, product development, and diversification strategies. It also discusses SIA's business strategy, focusing on niche marketing, cost-focused strategies, and differentiation. The report analyzes SIA's strategic alliances, including Star Alliance and cargo partnerships, and evaluates its corporate social responsibility (CSR) initiatives. Finally, it concludes with a personal reflection on the analysis.

Running head: BUSINESS ENVIRONMENT ANALYSIS
BUSINESS ENVIRONMENT ANALYSIS
Student’s Name
University Name
Author note

1BUSINESS ENVIRONMENT ANALYSIS
Introduction
Singapore Airlines is a well reputed flag carrier of Singapore. The airlines company is
known for its long history of accomplishment and advancement. The company is well reputed
and known for its quality and safety. Singapore Airlines continues to outperform its competitors
and holds a strong presence in the global market (Singaporeair.com. 2020). The business
organization was incorporated in the year 1947 as a wholly owned subsidiary. It is the motto of
the business organization to be a responsible citizen of the world and have strong commitments.
It is the objective and goal of the business organization to offer finest airline services to the
passengers and cater to various needs and requirements of the customers. The culture of
Singapore Airlines is entirely based on targeting the global market and promoting quality
services by the employees (Singaporeair.com. 2020). The company seeks to provide new ways to
provide high quality services to the customers. The report analyzes the performance of the
business organization and determines its strategic plan for further improvement.
PART A
Competitive advantage of Singapore airlines
The skills and capabilities of the business organization are one of the primary competitive
advantages of the business organization. It enables the business organization to increase its value
over time. The company’s resources are major advantage to the business organization. The
company’s human resource management is valuable; it provides quality services and training to

2BUSINESS ENVIRONMENT ANALYSIS
the employees (Rothaermel 2016). The cost effective service excellence, is also one of their
competitive advantage. The corporate service skills of the business organization are highly
valuable, rare and provide organizational support. It is a sustainable competitive advantage of the
business organization. The company offers innovation in flight entertainment, which provides
temporary competitive advantage to the business organization. However, it is imitable by the
consumers; therefore, it needs to continue innovating its services. Further, the company has
strong partnership and alliances with other companies. The company’s networks with Asiana
Airlines in the airline industry benefits the companies (Low and Ang 2013). It is able to attract
Asiana Airlines customers through partnerships. The company provides unique services to the
customers such as television shows, films, and audios to the customers. This is one of their
competitive advantages. Most importantly, the company has strong corporate governance
ensuring compliance and control risks to attain their goals (Low and Ang 2013). This provides
additional competitive advantage to the business organization.
TOWS Matrix (Kapoor and Kaur 2017)
Strengths Weakness

3BUSINESS ENVIRONMENT ANALYSIS
Opportunity Strength – Effective strategies,
excellent service
Opportunity- Tourism is
booming and growing at a rapid
rate
Weakness: expensive services ,
luxurious offerings
Opportunities: Tourism is
increasing, increase in demand.
Threats Threat: Stiff competition in the
market
Strength- Effective strategic and
strong business strategy.
Weakness: Fuel prices and
other operational cost is
increasing
Threat: Increase in competition
S-O: There has been an increase in the tourism among countries. Tourism sector is booming and
growing at a rapid rate, which increase the opportunity for company. The company can focus on
implementing effective strategies and offer excellent services to the customers.
W-O
There has been an increase in the tourism among countries. Tourism sector is booming and
growing at a rapid rate, which increase the opportunity for company. The company can focus on
implementing effective strategies and offer excellent services to the customers.
S-T
The company can overcome stiff competition in the market by offering premium services to the
customers and offering them quality services. This will enable the business organization to
overcome the threats.
W-T

4BUSINESS ENVIRONMENT ANALYSIS
Singapore Airlines is facing problems of hiring locals. The fuel prices and other operational cost
is increasing, therefore, the company has to reduce other costs such as wages of the staffs and
employees.
Areas in which it requires improvement
As per the VIRO analysis and TOWS analysis, it has been identified that the company
might face fluctuations in demands. With the increase in low cost airlines, luxury airlines
profitability suffers. Henceforth, this is an area which Singapore Airlines require improvement.
The costs of the services are going beyond control, these needs to be taken into consideration by
the management (Brouthers, Nakos and Dimitratos 2015). Furthermore, it has been identified
that in comparison to other competitors in the market, Singapore Airlines face issues of low
capacity and fluctuations in demand. Moreover, Singapore Airlines is perceived to be one of the
most expensive airlines among the consumers (Hussain et al. 2014). The consumers reconsider
SIA as prospective option for travelling. This needs to be improved through marketing and
effective campaigns.

Market development
5BUSINESS ENVIRONMENT ANALYSIS
PART B
Strategic plan for Singapore Airlines
Ansoff Matrix (Team, F.M.E. 2018)
Market penetration Product Development
Risk: LOW
Business focuses on selling
existing products in the existing
markets and takes initiative to
attract new customers.
RISK: MEDIUM
Business focuses on offering
innovative services to the existing
markets. Company implements
product expansion strategy and
new service innovations.
Risk: MEDIUM
Offers existing products and
services to new market segment.
SIA can renew product and service
offering by innovating its services.
Risk: HIGH
Company markets new innovative
services in the new market. This
enables the business to share its
risks.

6BUSINESS ENVIRONMENT ANALYSIS
Market development: It involves products offerings of Singapore Airlines to new market
segments and new geographies. Singapore Airlines applies strategies to open new international
routes. This is not used by either of the competitors (Hussain et al. 2014). This is the best
strategic direction to compete with the other competitors in the market. The product development
and innovations offered by the company becomes a service standard. Further, the company offers
different family friendly services to increase satisfaction rate among the consumers.
Product diversification strategy: Singapore Airlines looks forward to diversify its portfolio and
expand its business operations. The company has been targeting China to pursue an investment
and seek to further diversify its portfolio (Team, F.M.E. 2018). The company’s partnership with
Jeju might be an opportunity for the company to expand its operations in new regions.
Market penetration: This strategy is used by Singapore Airlines to increase their market share.
They focus on the existing markets and the product range (Team, F.M.E. 2018). Singapore
Airlines implements various international branding and marketing strategies to penetrate the
market. The company promotes its services and design variety of loyalty programs for the
customers (Hussain et al. 2014). This will enable the business organization to promote their
brand position among the customers.
Product development: The Singapore Airlines brings in new innovations in their services and
replace the old ones. The company implements newly innovated technologies to improve their
customer services (Team, F.M.E. 2018). The company adapts to new and advanced technology
such as internet services, Free WI-FI. Further, it provides complimentary services such as car
rentals, hotels, and comfortable sitting areas.
Diversification
Existing products New products
Existing
Markets
New Markets

7BUSINESS ENVIRONMENT ANALYSIS
 Business strategy of Singapore Airlines
Singapore Airlines must focus on specific niche marketing and offer specialized services to
the target customers. The marketing and promotional strategies of the business organization must
be relevant and informative to the specific consumer groups. Singapore Airlines currently target
the high income earners and offer premium services (Rothaermel 2016). They offer luxurious
services to the customers. Furthermore, they offer other facilities to the customers such as food
services, car hire firms, and hotels. Hence they implement a cost focused strategy, focus on
increasing profits, and increased rate of customer satisfaction.
It is recommended that the products and services offered by Singapore Airlines must
focus on differentiation strategy (Rothaermel 2016). It implies that Singapore Airlines must
focus on differentiating its services from its competitor’s products and services. They must offer
wide range of travel classes, club class, and business class. It is suggested that Singapore Airlines
must provide options for lower cost such as economy class so as to make its affordable to wide
range of customers. The company must focus on market penetration strategy and concentrate on
new pricing policies along with bigger promotional campaigns (Rothaermel 2016). Singapore
Airlines is a well reputed company delivering high quality service. They are well established in
the global market. This is one of the major competitive advantages of Singapore Airlines. They
have invested in many regions, which the competitors lack. The knowledge of Singapore
Airlines about the potential competitors is also a competitive advantage (Brouthers, Nakos and
Dimitratos 2015). They can focus on improving other aspects and areas of business operations. It
is recommended that the company can reduce the costs and focus on delivering high standards at
a competitive price (Team, F.M.E. 2018). The can focus on targeting wide range of flight
products including flights hotel and car hires discount.

8BUSINESS ENVIRONMENT ANALYSIS
 Strategic methods
Singapore Airlines considered strategic alliances as a part of their strategic plan. It implies an
agreement or partnership between one or more than one parties over a set of goals and objectives
(Team, F.M.E. 2018). However, both the parties remain independent.
Star alliance
Singapore Airlines is an alliance of Singapore Airlines along with other 15 airlines including
Lufthansa and United airlines. Star alliance develops and improves the overall operations and
process of the airlines company (Team, F.M.E. 2018). The contractual linkages are implemented
to meet particular needs of the companies in expanding in the global market through marketing
linkages.
Cargo alliance with Lufthansa
Singapore Airlines has formed new partnership with Lufthansa and SAS cargo. Their operations
are marked under the name “WOW”. This alliance enables the airline companies to expand their
business operations in the global market (Singaporeair.com. 2020).
United airlines
The companies have an alliance with the united alliance, it operates under bankruptcy protection,
and this might face difficulties in the future. There are big giants who are merging, which can be
a threat to the company.
 Social impact - Engagement of corporate social responsibilities

9BUSINESS ENVIRONMENT ANALYSIS
Singapore Airlines contributes to the society by offering global airfreight service provider.
The employees of the organization support their Corporate Citizenship Programme and volunteer
activities in different corporate social activities organized through the year (Singaporeair.com.
2020). Singapore Airlines also partners with the local and overseas museums and initiates
international exhibitions to destinations (Low and Ang 2013). The museum professionals
consider the company as a valuable partner. Furthermore, the company is proud to be a part of
inaugural SIA Charity Run and supports Singapore Children’s Society, through charity,
corporate funding, and employee volunteerism. The company supports disaster relief efforts by
offering critical aid shipments such as medicines, tents, blankets, food supplies in disaster
affected areas. Singapore Airlines is a global airfreight service provider, it believes in partnering
with the international humanitarian organizations in order to support its cause. It engages in other
good will projects (Low and Ang 2013). Further, the company has a fleet renewal policy,
improvements in flight operations and minimized usage of fuel without compromising safety of
the passengers. Singapore Airlines undertakes other initiates such as engine performance
improvements, utilization of lightweight cargo containers and crockery and increased usage of
mobile ground power units (Singaporeair.com. 2020). They have taken initiative to reduce
emissions. The company utilizes sustainable fuel and focus on the development of lower carbon
and other renewable aviation fuels from social sustainable sources and environmentally
sustainable sources.

10BUSINESS ENVIRONMENT ANALYSIS
Conclusion
Therefore, from the above analysis, it can be concluded that Singapore Airlines have a
strong reputation and global presence in the international market, which is a competitive
advantage for the business organization. The report has identified that strengths, weakness,
opportunity, and threats of the business organization. It identifies the TOWS matrix and
determines the ways in which it can overcome the threats and weakness by utilizing its strengths
and opportunities. Further the report, formulates strategic plan for Singapore Airlines. It
identifies the strategies and plans of Singapore Airlines with the help of Ansoff matrix. The
report identified the business strategy and suggests strategy for the business organization. It
identifies the competitive advantage of the business organization. It determines the strategic
methods implemented by Singapore Airlines and its engagement with CSR strategies.
PART C: Personal reflection on the module
The module has helped me to increase my knowledge and understanding of the strategic
management tools and models learned. It has widened my understanding of the business
strategies and models about strategy change after taking the module. By analyzing and
researching on real business Singapore Airlines, I have been able to understand the ways in
which the theories and models are actually applied in the real scenario. I have been able to gain
knowledge about the airlines industry, the ways in which the companies form strategic alliance
with other companies to mutually benefit and work towards the achievement of common goals
and objectives. The alliances are able to work in collaboration and cooperation in an
environment of uncertainty. I have learned about the strategic implementation of Singapore

11BUSINESS ENVIRONMENT ANALYSIS
Airlines with the help of Ansoff matrix and other models like TOWS, which has helped me to
identify the company’s competitive advantage. At first I found it different to get relevant
information about the company and the ways in which the company actually implement the
theory in practice. However, later I was able to overcome the challenge by continuous searching
through their company websites and other journeys. This assignment has truly helped me to
increase my knowledge and understanding about the strategies and plans, which will help me to
implement in the future career.