Singapore Airlines’ strategy
Singapore Airlines is positioned as a premium carrier with high levels of innovation and excellent levels of service, and has made a strategic choice of giving priority to proﬁtability over size. The internal organizational practices outlined in this paper, such as continuous people development and rigorous service design are key aspects of operationalizing and sustaining this positioning and strategic choice.
At the corporate level, SIA follows a strategy of related diversi- ﬁcation. The Singapore Airlines Group has 36 direct subsidiaries and associated companies (Singapore Airlines, 2008). SIA Group subsidiaries include Singapore Airport Terminal Services (80.8%), Singapore Engineering Company (81%), and Singapore Airlines
Cargo (100%) (Singapore Airlines, 2008).
Its airline subsidiaries which include 100% ownership of
regional carrier Silk Air, budget carrier Tiger Airways (49%), and Virgin Atlantic (49%) cover the key customer segments within the industry. According to CEO Chew Choon Seng ‘‘we intend to play in all the segments – SIA at the high end, Silk Air on middle ground and Tiger Airways at the low end’’ (Outlook, 2004). The shareholders in Tiger Airways include Temasek (the Singapore government’s investment arm as well as SIA’s majority owner) and Irelandia Investments, the private family investment vehicle of Anthony Ryan, the founder of Ryanair, one of the world’s leading budget carriers.
As part of its international strategy, in April 2000 SIA joined the Star Alliance, one of the three major airline alliances (the other two being Oneworld and Skyteam). In the meantime various divisions of the SIA Group have been investing in China and India through strategic alliances with local organizations (cargo division, airport services, engineering services and catering).
Use of information technology is an essential feature of SIA’s strategy both in enhancing customer service as well as increasing efﬁciency. SIA’s web site...
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