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Criterion Research and analysis of company information Considerations of constraints impacting organisational strategy Application of relevant theories of strategy

Development of argument and applied critical thought Written communication & referencing

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4.0 3.75 3.75 4.0 3.25 18.75

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COMMENT ! "ood research and lucidly argued# $o%ever& language %as pro'lematic in parts# ee ( ) 'efore handing in a report# *t could improve your mar+# ,lease see individual comments# -ery good %or+ overall#

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EXECUTIVE SUMMARY
The report has discussesd and appliesd theoretical concepts and principles of strategic management into analyzing the environment context where to Qantas Airways Limited operates. It shows that, Qantas has a long history and sustainable development but needs to evolve in the global world. ization context, the company has to continue to participate in international activities to grab development opportunities. challenges the corporation. In order to be successful and ta!e competitive advantages, strategy is the !ey element for every enterprise including Qantas. y researching and applying strategy analysis theoretical into Qantas case study, its current strategies are outlined and reviewed and some others are suggested. It approves the roles of strategies in create competitive advantages through cost leadership, differentiation and focusing. . esides that, the increasing competitive also

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Table of contents
EXECUTIVE SUMMARY..................................................................................................................ii Table of contents.................................................................................................................................iii Table of Figures...................................................................................................................................iv 1. . I!TR"#UCTI"!.........................................................................................................................1 1.1 Background................................................................................................................... 1 1.2 Aims.............................................................................................................................. 1 Scope.................................................................................................................................. 1 $. . I!TER!A% A!A%YSIS...............................................................................................................$ &. . EXTER!A% A!# I!#USTRYIA% A!A%YSIS........................................................................' (. . STRATE)Y T" CREATE C"M*ETITIVE A#VA!TA)E ..........................................11 4.2.1. Tangible differentiation ........................................................................................13 4.2.2. !ntangible differentiation ..................................................................................13 +. . C"!C%USI"! A!# REC"MME!#ATI"!..........................................................................1+ ,. . REFERE!CES ........................................................................................................................1, -. . A**E!#IX ..............................................................................................................................1'

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Table of Figures
Figure 1. To/ 1 international airlines in Australia..........................................................................$ Figure $. 0antas1s resources fro2 $ '3$ 1$ ................................................................................&

Figure &. 0antas Air4a5s ratio anal5sis.............................................................................................( Figure (. 0antas S6are /rice fro2 $ '3$ 1$ ................................................................................+

Figure +. 0antas strategic /riorities ..............................................................................................., Figure ,. 0antas1s e7/en8iture in $ 113$ 1$ ..............................................................................11 Figure -. Fuel cost of 0antas ........................................................................................................11

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1. . I!TR"#UCTI"!
1.1 9ac:groun8 In the globalized and integrated world economy, enterprises have spread their operations into other countries and become multinational corporations. Qantas Airways Limited is the Australia"s oldest and largest airline also ta!es part in international activities very early since #$%&. The international operations create for the group a great opportunity to expand and grow but also challenge Qantas Airways with inherent ris!s and competitions in international mar!et. In order to sustainably develop and remain the largest airways not only in Australia but also in the world, the 'roup should implement strategies to create comparative advantaged. 1.$ Ai2s ( To analyse the company)s information* ( To analyse the internal and external context where the corporation operating* ( To analyse the resources and capacities of Qantas Airways Limited* ( To analyse and discuss strategies the corporation using and recommendation to improve them. Sco/e +ata and information are mainly collected from ,Q- online module, databases, academic articles, the corporation)s website and textboo!s. The report is based on the operations of Qantas Airways in five recently years and focus on two recent years.

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$. . I!TER!A% A!A%YSIS $.1. 0antas Air4a5s %i2ite8


Qantas is Australia)s largest airline and the second oldest airline in the world carrying billions passengers in more than ./ countries such as Australia, Asia, 0orth and 1outh America, 0ew 2ealand, Africa and 3urope. Qantas 'roup is one of the strongest brands in Australia. The 'roup"s main operation is the transportation of customers in two complementary airline brands ( Qantas and 4etstar 5low cost carrier6. The 'roup"s broad portfolio of subsidiary businesses ranges from Qantas 7reight 3nterprises to Qantas 7re8uent 7lyer. Qantas has strong networ! all over the world. 7ounding member of oneworld alliance, until now Qantas has .9 bilateral partners extending the networ! and offer passengers a global networ!. In ./#., Qantas carries a ::.;< shares of the Australian domestic mar!et and #=< of all passengers travelling in and out of Australia while the respective mar!et segments for 4etstar are ./,9< and =<. The chart below compares the top #/ international airlines.

Figure 1. To/ 1 international airlines in Australia

51ource> A00A( Airlines Network News and Analysis, ./#/6

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$.$. Resources an8 ca/abilities


- Tangible resources: 3stablisheding in #$./, Qantas 'roup has grown gradually and remain one of the largest and strongest in Australian airways industry. +uring the last & recently years, Qantas has steadily expanded its operations by increasing number of aircrafts, passengers, employees and destinations all over the world. Its development can be demonstrated as data below>

Figure $. 0antas1s resources fro2 $


0antas Air4a5s 0umber of employees 5at year end6 0umber of destinations 5including 4etstar6 0umber of passengers 0umber of aircraft 5at year end6 Total asset @A ?/// Unit $ ' %%,;9/ #:; %=,;.# ..: #$,9//

'3$ 1$
$ ; %%,$;; #&# %=,:%= ..$ ./,/:$ $ 1 %.,:=$ #=: :#,:.= .&: #$,$#/ $ 11 %%,#;$ ./# ::,:&; .=% ./,=&= $ 1$ %%,&=: .%% :;,9/= %/= .#,#9=

(Adopted from Qantas data book 2012 see Appendi!" Qantas)s total asset increased from @#$.9 billion in .//= to @.#.# billion in ./#.. Aore than half of its assets are from property, plant and e8uipment which boo! value at @#:.#%m at the end of 7B./#.. Intangible assets values at @;#/,///. At the end of 7B./#., the corporation had a cash balance of @%.: billion, and %/= aircrafts from three main suppliers Airbus, oeing and ombardiers. The 'roup has #. Airbus A%=/, %/ Airbus A%%/, ;/ oeing 9%9, %; oeing 9:9 and :; ombardiers. - #ntangible resources: Qantas has a strong reputation for long history with a huge number of customers, larger segment in the Australian mar!et. Qantas is the world)s second oldest airline and since its inception, Qantas has remained one of the largest and strongest brands in Australia. Qantas 7re8uent 7lyer has grown steadily growth, more than 9&/,/// new members Coining the fre8uent program during ./#.. And increase the total member to =.; million. 5Qantas data boo! ./#.6. Aany Australians regard Qantas Airways Limited as a national icon and pride of Australia. Another intangible resource of Qantas is its networ!s with large corporations. Qantas started the Dneworld Alliance with American Airlines,
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ritish Airways, ,anadian Airlines and

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,athay Eacific in #$$=, and with 7innair and Iberia one year later. Dneworld is an arrangement among airlines to share departure lounges, fre8uent flyer points and Coint boo!ing of flights for travellers to go wherever they want. 5+allas, F ./#/6. Qantas fre8uent 7lyer has partnerships with many large corporations in and outside Australia, such as Dptus, Goolworths, ,altex, 1afaris, etc.

$.&. *erfor2ance anal5sis


According to Aail usiness 1taff ./#., Qantas Airways reported @./: million annual loss in 7B./#., the first loss since #9 year period. It was impacted from the increasing fuel prices, intense competition, industrial disputes and its struggling international division and a series of stri!es that temporarily grounded its fleet. y analyzing data from the corporation)s annual report, profitability index can be calculated as shown bellowed>

Figure &. 0antas Air4a5s ratio anal5sis


0antas Air4a5s Turnover Erofit after tax Heturn on e8uity 5HD36 Heturn on Asset 5HDA6 +ebtI38uity ,urrent ratio Quic! ratio Unit @A @A < < $ ' $ ; $ 1 $ 11 $ 1$

#&,;.9 #:,&&. #%,99. #:,=$: #&,9.: $9/ #;.$ ;.$ :;I&: /.$/ /.:. #.% ..# #./ &/I&/ /.$; /.&= ##; #.$ #.% &#I:$ /.$: /.&$ .:$ :./ ..# &%I:9 /.$. /.&9 5.::6 5:.#6 5/.=6 &;I:: /.99 /.:=

(Adopted from Qantas data book 2012" As can be seen, the Qantas performs ineffectively in recently. Its turnover, profit and HDA, HD3 have reduced considerably particularly a loss of @.:: million in ./#.. Fowever, the group still has strong financial capability. Its debtIe8uity ratio slightly increased but can be acceptable and its create leverage to encourage managers improve the corporation)s performance. Qantas has 8uic! ratio around /.&, that help 'roup has ability to pay current debt. esides that, the current ratios were less than # and continuously decreased. It faces the 'roup to ris! of li8uidity that means Qantas may not have enough resources to pay its debts over the next #. months in case of li8uidity.
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According to 'rant, ./#% the goal of a firm is value maximization that means maximizing the shareholders) wealth. It was measures via the share)s price and profitability. The corporation recorded an decline in share)s price and mar!et capitalization from .//$ to ./#. after a bounce in .//= to reach the highest price of @;./ per share. The earnings per share dropped significantly and in ./#. and the shareholders received no dividend due to the loss of @.::m. The changing in Qantas)s share price is illustrated as below>

Figure (. 0antas S6are /rice fro2 $

'3$ 1$

0antas Air4a5s Aar!et capitalization 3arnings per share 1hare price at %/ 4une

Unit @A ,ents @

$ ' &,9&$ :$ %./:

$ ; :,&&% &.; ../#

$ 1 :,$=% :.$ ...

$ 11 :,#;= ## #.=:

$ 1$ .,:%& 5##6 #./=

($ource: Qantas data book 2012 p%&&" Hesearches show that, loss is result of high fuel price and changing in foreign currency exchanges as well as competition with other low cost airlines in international activities 5D"1ullivan, A ./#.6. The researchers re8uire Qantas implement strategies to hedge fuel cost and manage foreign exchange ris!s to increase its competitive advantages.

$.&. )enertic strateg5 an8 connection to t6e internal value c6ain


Qantas Airways aim at maintaining its position as the leading Australian domestic carrier and one of the world)s premier sustainable long(haul airlines through two dual airline brands,
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Qantas and 4etstar that endeavour at two different strategies. Ghile 4etstar focus on low cost Airline, Qantas aims to provide safety, highest 8uality services and more JAusieeK airline. It see! to deliver sustainable, long term returns to the shareholders. The Qantas 'roup strategic priorities are illustrated below.

Figure +. 0antas strategic /riorities

($ource: Qantas data book 2012 p%'" Qantas)s strategies have connection to the firm)s internal value chain. According to 'rant ./#%, a value chain analysis describes a se8uential chain of the main activities that the firm underta!es. Aichael Eorter)s Lalue ,hain has been used as a tool to analyse competitive advantages. It is divided to two parts, primary activities and support activities. First of all, primary activities include five main activities which are Inbound logistics, Dperations, Dutbound logistics, Aar!eting and sales and ,ustomer service 5'rant, ./#%6. #nbound logistics is a part of the ?supply chain) and involve distribution. Inbound logistics) activities describe the receiving and storing of materials 5Eorter, #$=&6. Qantas has three maCor Cet suppliers which are Airbus, oeing and ombardier. 3ach supplier has different 9=9 that is lighter, smaller and competitive advantage with others. 7or example, Airbus has A%=/ that is larger, longer and can deliver more passengers than others while to oil, gas and food. oeing has faster than others. In addition, Qantas also has others suppliers who provide products related

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(perations are activities to transfer inputs into the final product 5Eorter, #$=&6. The operation of Qantas group includes airports, catering, engineering, flight operations, operations planning, control and aviation services 5Qantas 7actfile, ./#/6. 7or example, Qantas aviation services are applied through several processes such as customers can boo! tic!et through travel agent or boo!ing online, chec!(in online, and baggage claim. (utbound logistics is the process related to collect, store and distribute the final products to customers 5Eorter, #$=&6. The general activity of airline industry is transportation goods and services from one area to others all over the world. Therefore, most of airlines implement their transactions though travel agent and online and Qantas is not an exception. these ways, Qantas achieves the most cost effective, while satisfying customers. )arketing and sales are activities to provide the places which customers can buy the products 5Eorter, #$=&6. In order to advertise product, Qantas has created many media advertisements on television, radio, newspapers, posters in travel agents and billboards. Qantas announced @:: million for advertising campaign with Tourism Australia in ./#/ 5Qantas, annual report ./#/6. 7or example, Qantas used oeing 9:9 aircraft to paint the words ?,ome play) in 7re8uently 7lyer program and 1ponsorship 7ootball 7ederation Australia 5Gorld football insider, ./#/6. Fowever, Qantas is trying to use more direct mar!eting than blan!et advertising because blan!et advertising is more expensive and less targeted especially to corporations than direct mar!eting. Aoreover, Qantas also uses global mar!eting strategies which are standardization, customization and global branding. Through these mar!eting, Qantas has implemented successful strategies to ensure its reputation for high 8uality goods and services. In addition, Qantas also has sales promotions in particularly periods. An example of this is Qantas launched a two M for one tic!et sale, it means that a second passenger is allowed to fly for the cost of taxes and charges. Another is that Qantas first launched to issue #//,/// tic!ets at @:$. Secondly, Support activities consist of 7irm infrastructure, Fuman resources 5FH6 management, Technology and Erocurement 5'rant, ./#%6. 1upport activities can help primary activities to wor! more effectively. *irm infrastructure relates to structure of the industry. Qantas)s infrastructure includes functional departments such as accounting department, financial department, mar!eting department, customer service department or engineering department. y using

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Qantas+s ,- strategy focuses to ensure a flexible, adaptable and safer wor!force, improve labour unit costs and productivity, develop management and leadership capabilities as one of the largest employers in Australia, approximately %9,/// people 5Qantas, ./#.6. Qantas)s FH concentrates on four areas> corporate, business segments, shared services, and learning and development. 3ach area has own responsibilities to help deliver the human resource strategy. esides that, Qantas group is also !nown as the Australia)s largest aviation trainer. There are many training courses to help the Qantas employees to improve their !nowledge and s!ills. 7or example, in ./##I./#., Qantas invested @;& million in training approximately .,%// pilots 5Qantas, annual report ./#.6. 7urthermore, in the past four years, #.. young people graduated through the Qantas program. Their training enables them to experience with various aspects of airline management and they may provide the next generation of aviation executives. -egarding tec.nology development, technology has an important role in supporting Qantas business to deliver enhanced value. Technology development of Qantas focuses on main five areas which are proCect and program management, business system analysis, testing and 8uality assurance, services and relationship management, and architecture 5Qantas, ./#.6. Qantas is also investing in new technology for customers* Qantas is the first airline to offer iEads as an option entertainment for passengers to access to the latest entertainment. These activities can support for main purposes to enhance the 8uality and create reputation for Qantas group. T.e purpose of Qantas+s procurement is maximizing the shareholders) value from all supplier relationships 5Qantas, annual report ./#.6. This is implemented through a chain process such as disciplined, systematic and ongoing process. All procurement activities are ensured through Qantas) procurement policy. Dne of the important procurement activities is that goods and services meet specification and are transferred on time at competitive prices from stable suppliers. Dthers procurement activities are also applied such as financial ris!, total cost basic must be reduced and supplier relationship management is focused on win(win outcome.

&. . EXTER!A% A!# I!#USTRYIA% A!A%YSIS &.1. Macro econo25


Qantas as a part in the global airline industry has continued to benefit from globalization where growth trade and tourism increase demands for travelling. According to the Gorld Tourism Drganization, throughout ./##, international tourist arrivals went up by :.:< to $=/
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million, from $%$m in ./#/. The context also creates corporative opportunities for Qantas. 7or example, in early ./##, Qantas ac8uired 0etwor! Aviation, a Gest Australian charter airline that contributed around @#$ million in revenue and other income 5Aar!etline ./#.6. Fowever, globalizations with the participation of many airline industries also threat Qantas in provide good service at reasonable price. international operation. esides that, the increasing and unpredicted fuel price and foreign currency exposure also challenges the 'roup when participate in

&.$. Five forces anal5sis


Eorter)s 7ive 7orces is a most widely used framewor! in practice to determine intensity of competition and the level of profitability for companies 5'rant ./#%6. Eorter 5.//=6 stated that five forces shape the structure of industries and launch the basement for competition and profitability within industry. These include threats of new entrants and substitutes, bargaining power of substitutes and buyers, and rivalry among existing competitors. According to +obbs 5./#.6, five forces assessments of threats and opportunities are powerful responses of managers to challenging environment where they must to compete with rivals and increase profits. T.e first important element is t.reat of substitutes. 1ubstitute productsIservices perform a similar function as an industry product by a different means and at times at a cheaper price. This ma!es the competitions become more violent for all. It corresponds to industry profitability suffers. Therefore, companies have to reinvest themselves such as their services, product and event low price and restructure their organizations in order to survive in challenging environment. They have estimated what threats coming from substitutes whose product are similar to that of a companyIbrand that is established within the industry and give some strategies for themselves. The aviation business now tries to boost up diverse options and promotions trip with low price to persuade the customers. -nder pressure of substitutes li!e Lirgin, +elta, Tiger Airlines, especially coaches or trains, Qantas have to plan some strategies not only in Airline industry but Transportation industry T.e second of fi/e forces is t.reats of new entrants. Ghen new entrants have launched in an industry, the proportion of industrial profits has changed. They bring new capacity and desire to share a mar!et with the others, and simultaneously put pressures on old rivals about prices, 8ualities of services and goods, cost and rate of necessary investment. Ghen threats are high, managers must implement a number of methods into the mar!eting mix in order to deter new
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entrants. According to 'rant 5./#%6, there are some principal sources of barriers to entry> ,apital re8uirements, economies of scale, absolute cost advantages, and product differentiations, access to channels of distribution, governmental and legal barriers, and retaliation. The effectiveness of barriers to entry depends on the resources and capabilities that potential entrants possess. The new entrants, Lirgin Airlines or Tiger Airline, become competitors to Qantas with new full service airline and cheap tic!ets. In order to compete, Qantas is focused on business mar!et which does not have a strong mar!et competitor. The group also try to control the budget airlines through introducing of 4et 1tar 5Heference for business, .//;6. In addition, although 3mirates airline is a international competitor, Qantas has corporation with 3mirates to enhancing their shared networ! across the Tasman. This hit the competition in Australia and 0ew 2ealand 5,ornwell ./#%6. T.e t.ird is ri/alry among e!isting competitors . According to 'rant 5./#%6, in some industries companies compete aggressively, sometimes the prices are under the value of output and leading definitely loss incurred. In the others, they focus on the innovation, advertising and non price dimensions. The intensity of competition of companies base on some factors> concentration, diversity of competitors, product differentiation, excess capacity and exit barriers, cost condition. 1imultaneously Qantas operates 4etstart to compete the other companies by cheap tic!ets, Qantas also cooperate with Goolworths in 7re8uent 7lyer program to maintain loyal customer 5Qantas 7act7iles, ./#/6 . T.e ne!t is bargaining power of suppliers> suppliers are also described as the mar!et of inputs> ability of suppliers to put the buyers under pressure. There are two factor effected on aviation industry including aircraft manufactures and fuel supplier. According to Qantas annual report, .//$, 1uppliers of Qantas are potential to turn into competitors. 0astly bargaining power of buyers> ,ustomers are described as the mar!et of outputs and put the firm under pressure of low prices and 8uality of services. Therefore, Qantas have to cooperate with the other airline such as 3mirates, Lietnam airline to rival the others. Qantas also has to impulse its sale with 8uality product and cheap price in several channels such as travel agency and website to deal with others. Ghat is your conclusion from the & 7orces AnalysisN
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oeing, Airbus, and

ombardier. They have

strong power to deal with Qantas because they determine cost and delivery times and can be

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(. . STRATE)Y T" CREATE C"M*ETITIVE A#VA!TA)E


In the competitive environment, enterprises have to create competitive advantages or they will be died. 'rant 5./#%6 says that a firm can achieve a higher rate of profit over a rival in two ways> supplying an identical product or service at a lower cost, or providing a uni8ue product or service that is differentiated with others in order to persuade customer pay a price premium that exceeds the additional cost of the differentiation.

(.1. Cost lea8ers6i/


In order to ta!e advantages in cost, the corporation has to structure and effectively exploit resources, apply some drivers of cost advantages such as economics of scale, product design, technology and inputs cost 5'rant ./#%6.

Figure ,. 0antas1s e7/en8iture in $ 113$ 1$

5$ource: Qantas data book 2012 p%116 As can be seen, there are three main parts from Qantas)s expenditure in both ./## and ./#.. They are fuel cost, labour cost and aircraft operating aviation.

Figure -. Fuel cost of 0antas

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($ource: Qantas 2ata 3ook 2012 p%14" 7uel cost is the highest expense of Qantas, accounting for more than .&< of total expenses. In ./#., the fuel ma!es a new record at .9< of total costs at @:... billion in compare with @&$%million in ./##. The 'roup uses several strategies to reduce the influence of fuel prices. They are hedging* passing fuel surcharges to tic!ets* shortening the Cet fuel supply chain fuel conservation* investment in new fuel(economic aircraft* improvement managing air traffic and enhanced technology in flying techni8ues and navigation approach. 5Qantas data boo! ./#.6. Aircraft operating variable spent @% billion in costs in 7B./#.. It includes route navigation charges, landing fees are charged by the relevant airport company or authority, maintenance cost and passenger expenses 5in(flight consumables and amenities, entertainment6. ThereforeO.N Aoving to cost leadership strategy can be applied by 4etstar that focus on low cost airline to gain mar!et share in difference target customer than with the main brand. +ue to nowadays, there are many low cost airways emerge worldwide. Thus, the firms that can offer the cheaper price will be gain the customers. 4etstar want to reach the lower price than others fare airlines so the company designs to adapt another strategy such as partnership strategy to deal with the main competitors. In current years, almost aviations industries have considered about how to the firms getting the customer faster than competitors. Also, 4etstar recognizes about low price with fast sale so the firm tries to create new promotion to attract and gain the customers 8uic!ly than another firm. The firm can ta!e advantages in cost by increasing passenger load factor 5promotion6, reduce fuel cost, in(flight consumption and entertainment of customers.

(.$. #ifferentiation
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According to 'rant 5./#%6, differentiation is not Cust about the product, it embraces the whole relationship between the supplier and customer. +ifferentiation can be categorised into two types as tangible differentiation and intangible differentiation. 4.2.1. Tangible differentiation: 5omplementary ser/ice: According to Qantas 7act7iles 5./#/6, Qantas has provided In(flight entertainment with full(option in all Qantas international flights such as A%=/, 9:9 and A%%/ aircrafts. 1imultaneously, Qantas ,lub lounges with full of necessary facilities are provided to the Qantas)s members at more than #%/ lounges worldwide. As 'roup route networ!, the Qantas 'roup have operated numerous flights to cover #9% destinations in :. countries together with partner airways. According to Qantas annual report 5.//$6, Qantas provides premier price with full service option to serve the customers. 7or example, Qantas creates uni8ue experiences to Qantas) members li!e bringing ,hef Feston lumenthal to meet food and wine 5QA0TA1 ./#.6. As the result, customers can feel superior when perceive the product or service. This strategy offers uni8ue can enhance value of the product to the customers. The other point is that Qantas designs multi(brand model such as Qantas, 7re8uent flyers, and 4etstar which give customers the experience they desire. 1pecifically, Qantas provides the clear choice for business and premium leisure travellers. 7re8uent flyer builds the world)s best loyalty business while 4etstar brings the clear choice for price sensitive travellers 5QA0TA1 ./##6. 'rant 5./#%6 states a low(price* no(frills offering is associated with a uni8ue brand image. ,ub airports: Qantas has developed Airport terminal consolidation proCect. This reduces in minimum connection times, underpins 1ydney as Qantas) main hub, and supports the international networ! alliance strategy, long term price and infrastructure surety. This strategy also increases product differentiation and seamless end(to(end customer experience 5QA0TA1 ./##6. 4.2.2. Intangible differentiation: 1afety is always the first priority of Qantas aviation firm. Qantas is the leader of safety aviation industry 5QA0TA1 .//=6. Qantas is rigorously subCected to the International Air Transport Association)s 5IATA6 and Dperational 1afety Audit ,ertification, which is an internationally recognised safety audit program, once every two years. Aoreover, Qantas is regularly scrutinised additional external audits by around 9& external organisations. This

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capability combined with constant prudence and proactive prevention is fundamental to Qantas maintaining its leading safety record and reputation.

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+. . C"!C%USI"! A!# REC"MME!#ATI"!


In conclusion, Jstrategy is winK 5'rant ./#%6. 3nterprises with efficiency strategies and successful implementation will generate advantages in the competitive environment. Qantas Airlines Limited, the report has indentified the group)s strategies. ase on the analysis, some strategies has been recommended for the corporation to create competitive advantages by two strategies, cost leadership and differentiation> 6!peditionary )arketing: Travel agent can be an important channel to distribute the product and service. Therefore, the Qantas should conduct a plan to consolidate its business activities with the travel agents and sometime the firm has to create a monopoly with those travel agents to decrease competitors. The corporation should also offer promotion to reduce free seat in flight. 7ni8ue $er/ice $tyle: The price of tic!et that should included the price of baggage may set up little bit expensive than others low cost airlines without luggage price. It can be attract the customers* especially, women. +ue to almost women need space for their clothes and cosmetic that is often li8uid may be banned to carry in a passenger area. *uel .edging: Qantas should continue research for new technology and invest in low(fuel consume aircrafts. ,harging fuel surcharges to passengers is better than fuel hedging. *oreign e!c.ange risk .edging: ,ontinue hedging foreign currency to reduce ris! by using other derivative financial instruments such as option or forward contracts. 0abour cost: Qantas can expand to other countries where labour willing to wor! for lower payment than in Australia, meanwhile reduces intermediates or agencies, directly or online sell tic!ets to customers. y applying several strategic analysis methods in analysing the internal and external context of

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,. . REFERE!CES Airlines network news and Analysis, ./#., ?Australian international traffic growing strongly but Qantas is losing mar!et share* -1 and Indonesia see biggest gains), viewed #& nd August ./#%< http>IIwww.anna.aeroI./#/I/:I./Iaustralian(international(traffic(growing(strongly. Allayannis, ', Geston, ' .//#, ?The -se of 7oreign ,urrency +erivatives and 7irm Aar!et Lalue), T.e -e/iew of *inancial $tudies Lol. #:, 0o. #, pp. .:%(.9;. ,ornwell, A ./#%, 6mirates and Qantas to .it competition in Australia and New 9ealand viewed #&th August ./#%, .ttp:::gulfnews%com:business:a/iation:emirates-and-8antas-to-.itcompetition-in-australia-and-new-;ealand-1%1221&42. +allas, F ./#/, ?Qantas in the global airline industry), $trategic management: competiti/eness and globalisation (<t. Asia-=acific ed" pp. :%:(::/. +ennis, A ./#., ?Is Qantas the dying !angarooN), Ferald 1un, viewed #&rd August ./#%, http>IIwww.heraldsun.com.auItravelIaustraliaIis(8antas(the(dying(!angarooIstory(e;frfhbf( #..;%$.;#::&9 +obbs A 3, ./#., +obbs, Aichael 3, ./#., =orter>s *i/e *orces in =ractice: Templates for *irm and 5ase Analysis, ,ompetition 7orum ./#., Lol. #/ Issue #, p... 'rant, H.A ./#%, 5ontemporary $trategy Analysis, =th edn, 4ohn Giley P 1ons, 0ewBor!. 7ic!ling, +PGang, 4 ./#. ?Qantas, ,hina 3astern Elan ,heap 7lights for Asia Aiddle), loomberg, viewed #&rd August, http>IIwww.bloomberg.comInewsI./#.(/%(.&I8antas(plans( hong(!ong(budget(airline(with(china(eastern.html International Air Transport Association ./#%, ?Figh cost environment to continue), *inancial *orecast, viewed #&rd August ./#%, http>IIwww.iata.orgIwhatwedoI+ocumentsIeconomicsIindustry(outloo!(financial(forecast( march(./#%.pdf Aail usiness 1taff ./#., ?Qantas posts Q./:m loss as its fuel bill hits Q%.;bn), 2aily )ail, p.:;. Aar!etline ./#., ?Qantas Airways Limited ( 1GDT Analysis), viewed #& th August ./#%, http>IIwww.mar!etresearch.comIAar!etLine(v%==%IQantas(Airways(Limited(1GDT( ;$;%/&$ Aorrell, E, 1wan, G .//;, ?Airline 4et 7uel Fedging> Theory and Eractice), Transport -e/iew, Lol. .;, 0o. ;, pp. 9#%(9%/. D"1ullivan, A ./#., ?Qantas cancels Cet orders as it posts first loss), risbanetimes, viewed #&th August ./#%, http>IIwww.brisbanetimes.com.auIbusinessIearnings(seasonI8antas(cancels( Cet(orders(as(it(posts(first(loss(./#./=.%(.:ngx.html
Group 2 1!

MGMT20112

Assignment 2

T213

Eorter, A. 3. .//=, The five competitive forces that shape strategy. ,ar/ard 3usiness -e/iew /ol%=;, issue #, p.9=($%. Qantas Annual Heport .//=, .//$, ./#/, ./## and ./#.. Liewed & th August ./#%, http>IIwww.8antas.com.auItravelIairlinesIinvestors(annual(reportsIglobalIen. QA0TA1 .//=, ?Qantas sustaining the spirit> 1ustainability report .//=), viewed #&th August ./#%, http>IIwww.8antas.com.auIinfodetailIaboutIinvestorsIsustainability.//=.pdf QA0TA1 ./##, ?Qantas airways limited ./## strategy day), viewed #&th August ./#%, http>IIwww.8antas.com.auIinfodetailIaboutIinvestorsI8antas(strategy(day(presentation( ./##.pdf QA0TA1 ./#., ?Qantas in transformation), viewed #& th August http>IIwww.8antas.com.auItravelIairlinesImedia(releasesIaug(./#.I#IglobalIen Qantas ./#., Qantas 2ata 3ook 2012, viewed #&th August http>IIwww.8antas.com.auIinfodetailIaboutIinvestorsI8antas(data(boo!(./#..pdf. Qantas 7actfile ./#/, T.e Qantas group at a glance http>IIwww.8antas.com.auIinfodetailIaboutI7act7iles.pdf. ./#%, ./#%,

viewed #&th August ./#%,

Heference for usiness .//;, ?EDHT3H"1 &(7DH,31 AD+3L), viewed #&th August ./#%, http>IIwww.referenceforbusiness.comImanagementIDr(ErIEorter(s(&(7orces(Aodel.html.

Group 2 1"

MGMT20112

Assignment 2

T213

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MGMT20112

Assignment 2

T213

Group 2

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MGMT20112

Assignment 2

T213

Group 2

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