Case Study: Aviation Strategy

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¶ … Alternative Actions

Synthesis

The Implementation of this Strategy

Levels of Business Strategy

Five Forces

Environmental change

Need for Global expansion

Timeframe for strategy implementation

The Cost of Implementing this Strategy

Anticipated Outcomes

Clearsky airways is under a great deal of pressure and is facing an issue that many firms face as it pertains to global expansion.

At the current time the company is successful and competitive. However, to remain competitive Clearsky Airways must embrace a new strategy. This new strategy involves offering customers in-flight access to the internet. Clearsky airways is in a vulnerable position because its chief competitor, Darksword Air has intentions to purchase the production and business interest of Surfshop LCC . Surfshop is the vender that is supposed to supply Clearsky Airways with a new in-flight entertainment package.

The problem

The Problem is Clearsky no longer has a WiFi vendor which is necessary for carrying out the proposed strategy. Not only is the initial vendor now unavailable but there are no vendors who can offer the quality of product and service that Surfshop offers. This leaves Clearsky at a crossroads and desperate to develop a strategy that will offer a solution to this problem.

Critical Factors

Clearsky's clientele is primarily composed of First Class and Business Class passengers. In fact 80% of the company's revenue is from first class and business class passengers. This type of clientele is also more likely to expect and need in-flight access to the internet. If Clearsky does not provide such access this clientele may abandon Clearsky and move to Darksword Air instead. A mass exodus of Clearsky's clientele is one of the most likely outcomes if Clearsky fails to solve the aforementioned problem. If a large portion of these premium passengers decide to leave Clearsky the results would be devastating for the company's bottom line. In fact if Clearsky does not solve this problem it may result in the complete demise of the company.

Development of Alternative Actions

One alternative action may be to use another vendor that can offer in-flight internet access. The other vendors include Wildwifi company and BruceLeeSurfers LTD. This alternative seems to resolve the problem of being able to provide passengers with the services that they need to make their in-flight time more productive and enjoyable. Business class passengers would find access to such service to be particularly useful as they travel from city to city. This alternative is also logical because the company has already created a strategy and planned the implementation of this new service. It would prove to be detrimental to the morale of employees if this plan has to be completed scrapped. However, if the company simply goes with another vendor a great deal of the planning and implementation of the service can simply be modified.

The advantages of choosing this alternative is that is provides consumers with the service that they expect and it allows Clearsky to remain competitive in the midst of a changing landscape within the industry. Clearskyhas conducted market research and found that nearly 60% of its customers want the company to offer in-flight internet service. It would therefore be advantageous of the company to provide such a service. In addition, this alternative strategy would allow the company to remain competitive by offering the same type of product that Darksword Air is offering. One of disadvantages of this strategy are that the vendors that exist provide products that are inferior to those provided by Surfshop and Darksword may still have a competitive advantage over Clearsky simply because it will be able to offer a superior experience as it pertains to in-flight internet access. Another disadvantage is that the bids from the other vendors are higher than the bid that Surfshop offered. It is likely that because of the higher costs associated with working with the other vendors will be passed on to passengers.

Another alternative is to wait until the two-year freeze is over.

One of the advantages of this is that Clearsky will once again have access to the high quality products and services offered by Surfshop. Another advantage of embracing this strategy is that it will also allow Clearsky to evaluate any of the problems that may exist with the in-flight entertainment package. When new technology is introduced into an environment it is often the case the glitches and problems exist with the technology. The disadvantages of this strategy are that Clearsky will likely lose some customers and Clearsky will also lose some of its competitive advantage because it will not have access to the products and services that Darksword will have.

Synthesis

The Senior Vice President of On-Board services at Clearsky Airways faces a quandary as to how to handle the globalization of the firm. This decision involves whether or not the company should embrace a strategy that involves the implementation of a . The decision is complicated by the fact that the company's chief rival Darksword Air has announced that it will be purchasing the production and business interest of Surfshop LLC. Surfshop is unique in that it is superior to other firms in the industry because of service, speed and the quality of the products offered. In addition, in purchasing Surfshop Darkword has declared that Surfshop products can only be used by Darksword for the first two years following the acquisition.

To remedy this issue it is recommended that Clearsky simply choose another vendor. A great deal of energy has been placed into the development of a strategy that would provide customers with in-flight internet access. This recommendation is based on the current condition of the company and the vulnerability that the company will be faced with if it chooses to wait for the two-year period before offering internet service. By the time the two-year period is over Clearsky may lose so much money that it cannot recover.

In addition such a service is not only convenient but in demand. Clearsky cannot afford to not have this technology for a two-year period while Darksword and other competitors are offering their clientele this type of service. Not having access to the service will lead to a decrease in the number of customers that choose to fly with Clearsky. In addition the customers that are lost might not return to clear sky once the two-year period is over. In other words, once these customers are lost, they may never return. If clear sky air wants to exist in the future they must be willing to acquire services from one of the other companies.

Although there are disadvantages associated with this strategy the advantages of such a strategy far outweigh the disadvantages. The primary advantage is simply the demand for such services in-flight. According to a book entitled Advances in Semantic Media Adaptation and Personalization

"Traveling by air, especially long distance, is not a natural activity for humans.

The combination of long flight duration, limited space and an unusual cabin environment in terms of air pressure, humidity, and continuous noise causes physical and psychological discomfort…Airlines commonly install in-light

entertainment systems…to improve passenger's comfort levels. Ussually,

entertainment services are delivered via high-speed communications tools and state of the art entertainment systems, which include audio/video on demand,

games, in-flight email, internet access, and ever increasing digital entertainment options.

Indeed Clearsky Air must adopt a strategy that is consistent with the demand that consumers have for in-flight internet access. Failure to do so will result in the loss of competitive advantage and the company will have a difficult time recovering if such service is not made available on flights.

The Implementation of this Strategy

Levels of business strategy

Prior to making this recommendation this resolution was examined at all levels of business strategy: corporate, business and operational. Corporate level strategy involves evaluating the "commonalities of various business units and work to add value to the whole system besides individual growth of participating business units. In other words, corporate level strategy takes a view at the overall scope of an organization and how to enhance stakeholder value. Issues concerning the introduction of new products or expansion into new markets or segments are all a part of this strategic level."

By adopting a strategy that takes into consideration the overall scope of the organization, it is revealed that Clersky could benefit greatly from a strategy that makes provisions for ensuring that consumers have in-flight access to the internet. Adopting such a strategy adds value to the overall company and is designed to ensure that the company will continue to excel well into the future.

Evaluating the strategy at the corporate level is important because such an evaluation serves as the foundation for the strategies that are adopted at the business and operational levels. This simply means that the strategies adapted at the corporate level must be considered carefully because it can have a positive or negative on the strategies implemented at other levels. Such interaction was considered when recommending that Clearsky choose to implement internet access using a different vendor.… [END OF PREVIEW]

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Aviation Strategy.  (2010, March 27).  Retrieved July 19, 2019, from https://www.essaytown.com/subjects/paper/aviation-strategy/28859

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