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QANTAS AIRLINE

August 2, 2012

Qantas Airline

Introduction

Qantas Airline is a company that was founded in Queensland about 90 years ago. It is ranked among the largest airlines in the world and concentrates mainly on air transport services. It is best known for its long-distance services. The airline operates in the low-cost section at both international and domestic levels. The company is also involved in other services that include catering, maintenance services, domestic holiday tours, and ground handling. Qantas airline has had a successful run in the business due to the customer value they create by offering world-class service experiences to their customers before, during and after using any of their services (Unisys, 2008).

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Strategic analysis

Strategic analysis of an organization is the process through which a research is conducted on the business’s internal and external environment within which an organization is run (Kotler, Brown, Adam, Burton, & Armstrong, 2007). This research is executed in order for the management to comprehend the environment, its interaction with the organization’s activities, and formulate a realistic and feasible strategy (Kotler et.al., 2007). The following are the PESTLE and SWOT analysis of the Qantas Airline.

PESTEL analysis

The PESTLE analysis is a research carried out on the micro-environment of an organization and the impact of its factors to their activities. PESTLE analysis concentrates on the Political, Economic, Social, Technological, and Legal factors (Waldersee & Tywoniak, 2007). Qantas Airline runs its business in fairly stable political atmosphere in all its destinations. Furthermore, the Australian government takes the initiative to consider and make crucial decisions that regard the Airways Company. For instance, the government has been taking measures to help Qantas Airways towards a potential merger with British Airways. Under economic factors, there have been various hitches in the Airlines operations due to the financial crisis that resulted to the economic crisis. In such cases, Qantas were forced to reduce business travel and their spending in other areas (Maurya, 2012). Under social factors, the Australia population is developed and enjoys high standards of living. Therefore, Qantas enjoys the capability of the societies it operates in terms of utilizing their services. Finally, technological development enables Qantas to achieve positive economies of scale. This is as a result of their adoption of the latest technological advances in their services to ensure improved efficiency and effectiveness in their activities, in the market.

SWOT analysis

The SWOT analysis seeks to identify the Strengths, Weaknesses, Opportunities, and Threats facing the Qantas Airline (Waldersee & Tywoniak, 2007). The two main strengths of Qantas are the support, and strong backing the company enjoys from the Australia government. This makes the company stable and ensures continued operation over the years. It also enjoys its operations as a monopoly in the Australian market. Therefore, it maximizes on profitability. The main weaknesses are the issues that loom amongst the stakeholders. This drags the airline’s growth and expansion strategies implementation. Qantas major opportunity is the fact that the Australia market has been less exploited by other airline companies; thus, it possesses a large market share (Bukisa, 2012). Any competitor in this market cannot gain any substantial market share to compete against Qantas in Australia. The key threats facing Qantas are the rising fuel and labor costs, and the potential competition in their market. The rising fuel and labor costs have led to a drastic fall in profits and increased costs of running the business.

Competitive position in market

The competitive position in a market is the product position, and the perspective the product is viewed by customers and position the product or service inhabits in a customer’s mind in relation to competing products (Kotler et al., 2007). Qantas Airline has had a large market share due to its identification and the exploitation of their competitive advantages. This has been done through offering superior services and friendly prices than their competitors in the market. Furthermore, the Qantas product and service differentiation has enabled them to have an edge over their competitors. They have also exploited their reputation and brand that is highly associated with safety, quality services, foods, soft drinks and convenient flight booking services. Their positioning also relies on their brand image that is highly linked to the Australian culture (Maurya, 2012).