The paper "Management Report on Qantas Airlines" is a perfect example of a management case study. The aviation sector has been affected by numerous factors like the overcapacity and stiff competition resulted in the entry of several low-cost airlines and irregular times of devastating under-performance. Just like many of the market players, Qantas Airlines have faced tough times embodied with macroeconomic and social factors like the fluctuating oil prices, the rising terrorism, the emergence of bird flu menace and SARS crisis, slow rate of economic recovery, the Asian tsunami, and rising terrorism which have affected profitability negatively (IBISWorld 2014).
Therefore, managers have been faced with a management crisis which needs quick management strategies to halt the situation and return the company to profitability. In a nutshell, the company ought to come up with new strategies and tactics to counter the challenges. Prior to these strategies, Qantas managers must first understand the internal and external capabilities of the company to guide them in implementation (Gillen & Feldman 2010, p. 43). Therefore, this report will conduct the internal and external audit of the company using the SWOT Analysis and Porters competitive five-force Analysis as a basic foundation to developing new goals, strategies and tactics used in attaining competitive advantage. The SWOT analysis evaluates the strengths of the Qantas including being a strong brand, government backing, reward program and safety and performance.
On the other hand, Weaknesses will include price sensitivity and industrial disputes. Opportunities that will be discussed comprise of an increase in disposable income and partnerships. This report will discuss threat such as fierce competition in both international and domestic markets, fluctuating fuel prices cost and regulatory conditions.
The opportunities will consist of the improving domestic market, economic improvement in the Asian market and technology. The report will recommend a new goal including increasing profits, reviewing Qantas use of assets and reducing of operation costs. These recommendations can be attained through various strategies including improving ancillary revenues and raising the number of airport terminals among others. 2.0 Qantas’ Current Situation Qantas Airways is the Australia national carrier which was established in 1920 and has its headquarters in Sydney (Qantas 2015). Qantas has the largest fleet in the world based on size and the 3rd oldest company globally.
IBISWorld (2014) states after 95 years of operation, the company has grown significantly and commands a domestic market share of 65% and transport 18.8% of the passengers getting into and out of the country. Qantas owns and operates Jetstar, as a low-cost both at domestic and international level (Jones 2012). In recent years, the company has faced a number of challenges such as high competition from Emirates, Singapore and Qatar airlines in various international routes. As a result, it experienced financial losses in 2011, 2012, and 2013, and in the first quarter of the 2014 financial year which led to a drop in the market.
Abc (2015) reported that in the first quarter of the 2014 financial year, the company made a loss of appositely A$236 million. Pearl (2011, p. 54) stated that in 2011, Qantas stated that will consider conducting structural change including cutting jobs and creating new partnerships. Cost-cutting strategy through lay-offs is expected to save the company up to A$2 billion. The whole process will be guided by the company mission statement which is to build a profitable company, restore their reputation, and operate sustainably.