Summary The Strategic Position Of Sia example essay topic

Industry Analysis o Five Forces Model. o Potential entrants have significant barriers including a requirement of large capital, access to routes and terminals and cost of meeting regulations. o Low threat of substitutes for business customers from technologies such as video conferencing or networking. o High threat of substitutes for recreational and discretionary customers including alternative locations, pursuits and industries. o Power of customers significant as customers can change the airlines with elative ease. o Power of suppliers is also significant due to limited sources of large passenger aircraft and also dependence on airports and schedules for products such as airline fuel. o Competitive rivalry is strong due to a significant number of medium to large competitors, high exit barriers, similar products and market turbulence. In particular Malaysian and Thai airlines imitating SIA's example. o The underlying forces demonstrated by the five forces model are the high costs of the airline industry and the importance of meeting airline customer requirements. Two basic approaches could be to target volume (low margin) and / or quality (high margin). o The Star Alliance has achieved successful survey results in the global market and was voted number 1 airline alliance for 2003. Benefits to SIA could reduce due to the size of the alliance and potential for lost of reputation. In summary the strategic position of SIA is as a strong global player with a sound national and regional base. Key factors are: o Very strong brand in the airline industry o Dominant location in Asia. o Strong support from Singapore government. o Member of a successful airline alliance. o The airline industry is very competitive.

THE STRATEGIC CAPABILITY Internal Analysis o Measurement of Performance o Financial Position. SIA is experiencing steady growth in revenue and loads which has resulted in attractive financial returns. o Customers. Ranked number 3 out of 170 in passenger survey; also one of the only two airlines with a five star rating. web o Internal operations. On going employment of technology and innovation to improve operations. o Resources.

High priority of effort allocated to managing training, aircraft and other resources. o Strengths and Successes o Leads the industry in service delivery and innovation. o Demonstrated capability to learning and reorganise in response to change. o Maintain lowest average fleet age to maintain for quality and reliability. o Drawing on diverse customer requirements but building both cargo and passenger operations. o Active pursuit of technology for aircraft and service delivery. o Strong and successful image with 'Singapore Girl'. o Weaknesses and Problems o Dependence of limited supply of skilled labour. o Technology and resources are stretched. o Emerging regional competition. o Management of cultural diversity with new additions to the group. o Core Competences and areas of effectiveness o Customer convenience and level of service. o Capability to deliver high level of service and innovation. o Competence in marketing and advertising. o Major Competitive Advantages o Principal advantage is the delivery of high quality service. o Location in Asia. o Image and association with Singapore as a whole..