| dc.description.abstract | Background
The global aviation industry is undergoing a fundamental structural shift. Aviation Industry
Survey Results (2008) states that the aviation industry is faced with excess capacity, rising
costs, competition and deteriorating economic climate, therefore airlines must innovate to
ensure continued survival and profitability. For many airlines, survival depends on their ability
to develop new business models to enable them adapt to the ever changing environment. The
globalization of the worldwide economy, coupled with airline deregulation and trade
expansion, has caused a boom in the air travel. This rapid growth has not been paralleled by a
similar expansion in the national airspace infrastructure, resulting in congestion, delays and
widespread frustrations (Ochieng, 2006).
The purpose of strategy according to Ramaswamy and Namakumari (1996) is to exploit the
unique advantages of the organization in facing the challenges of the environment. A strategy
begins with a concern and a burden of how best to use the limited resources of the
organization. The successful corporations make their strategic priority to build their core
competencies and long term competitive advantages, so that they will serve the real back up for
the business level strategies of the business units of the corporation. To acquire competitive
advantage in any market, a firm needs to be able to deliver a given set of customer benefits at
lower costs than competitors, or provide customers with a bundle of benefits its rivals cannot
match. To realize the potential that core competencies create, a company must also have the
imagination to envision markets that do not yet exist and the ability to stake them out ahead of
competition (Hamel and Prahalad 1991; Porter 1980). Chaudhary (1979) asserts that the process of strategy formulation involves matching of
opportunities and corporate capabilities, which results in the generation of economically
feasible strategic alternatives. There must be a strategic fit between what the environment
wants and what the firm has to offer, as well as between the firm needs and what the
environment can provide (Wheelen and Hunger, 1995). Businesses become successful when
they posses some advantage relative to their competitors (Pearce and Robinson, 1997).Cole
(1995) observes that some firms change in response to external forces (reactive change), while
others change principally because they have to implement change (proactive change).
Businesses all over the world are faced with the challenges posed with the ever changing and
turbulent environment. Institutionalizing strategies, allocation of adequate resources, visionary
leadership, and good corporate culture, amongst others are necessary ingredients for successful business strategies. This is the essence of environmental analysis, the process by which
strategists monitor the environmental sector to determine opportunities and threats to their
firms (Jauch and Glueck, 1998).
This paper seeks to examine the various competitive strategies being employed by Fly540
airline to remain competitive in the airline industry which has seen tremendous changes in the
recent past. The organization's competitive advantage potential depends on the value, rareness,
and imitability of its resources and capabilities (Barney, 1992). The increasing global nature of
competition requires that the firm utilizes all of its valuable resources in order to survive and
succeed. Therefore, Fly540 as an airline needs to identify and build these competitive strategies
that are sustainable and will set it above other airlines in the industry as competition intensifies. | en |
