Air New Zealand essay

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1. Internal Analysis•Current resources, resource capabilities and/or resources potential to provide sustainable competitive advantage for the company. •Distinctive competencies and deficiencies and core competencies. •Key areas of competitive advantageThe VRIO analysis from the appendix suggests Air NZ (Air New Zealand) have only one resource that will provide them with sustainable competitive advantage and is a distinctive competency, this is the intangible resource of Air NZ being the national flag carrier of New Zealand along with their relationship with the government. Other resources which have been identified as having competitive parity include Technology and Buildings with other physical assets, such as airline equipment. Temporary competitive advantage includes resources such as the Air NZ brand name and their labour resources. The only possible deficiency identified in the Value Chain tool was the organisation’s culture. The Value Chain analysis in the appendix also indicates all areas in the primary function of Air NZ including research and development in bio-fuel, production with highly skilled and experience workforce specialising in high quality items, marketing and sales function which focuses on the company’s advertising and customer loyalty strategies and service function with their wide range of aftersales service and support appear to create value and is vital in developing a competitive advantage. Support activities in the Value Chain also show potential to develop competitive advantage and are mainly linked with the Air NZ organisation infrastructure, resulting in efficiency gain and cost effectiveness.  2. External Analysis•Key industry dynamics/drivers/forces•Key trends from the macro-environment that are likely to influence company•Key competitors and competitive intensityThe five forces model from the appendix identifies key dynamics, drivers and forces as this model suggests there are very few threats in this airline industry. Risk of new entrants entering the industry is extremely low and this provides Air NZ with opportunities for maximising profits, rivalry among established companies show only one major competitor and suggests it will be tough for either of the companies to force one out reducing threat, there are also no bargaining power of buyers (threat free), however, the model does indicate a threat from bargaining power of fuel suppliers and because of a limited substitute there is again no threat in this area. Complementors show they have a clear threat of affecting the demand for Air NZ. The PESTEL tool from the appendix further identifies key dynamics, drivers and forces and also key trends from the macro-environment likely to influence Air NZ. Political forces involving the protection and support gained from government will deliver more opportunities to Air NZ and is a key influence, economic forces will directly influence the company such as oil prices and also minor roles played by inflation rates, unemployment levels and disposable income. Sociocultural forces through rise in the number of women in the workforce has also influenced Air NZ in relation to labour, technological forces will extremely influence the company by further creating more opportunities, environmental forces has influenced the company through global warming and legal forces has had a great influence with the way the organisation runs itself. Using both these tools a key competitor identified is the Qantas airline and the competitive intensity is very strong as suggested in the five forces model, because of only two main competitors in the New Zealand airline industry. 3. Two strategic issues facing Air NZ1)From the external analysis it is clear one of the issues Air NZ is facing is fuel issues, whether it be a threat from suppliers, threat to the environment or threat from the economy as oil prices increase this issue makes forecasting unpredictable and therefore affecting the company in terms of both profit and...
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