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This is an executive report on Virgin Atlantic Airways, which contains an External and internal analysis of the companys current competitiveness and concludes with a recommendations on the future strategic direction

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UNIVERSITY OF SURREY FACULTY OF MANAGEMENT AND LAW School of Management MSc Programmes Module Leader: Dr. Laura A. Costanzo Academic Year: 2010-2011 Industry European Airline Industry Company Virgin Atlantic Airways STRATEGY MODULE COURSEWORK Student URN MSc Programme Surname & First Name 6098320 Management Information Systems Hargley Ikechukwu 6142620 International Hotel management Lu Chenyao 6116950 International Hotel management Markan Abhilasha 6141001 International Business management Zhang Mansheng "Your airline's either got it or it hasn't" Contents 1.0 Introduction 2 1.1 Company Overview 2 2.0 The Analysis of the External of Environment 3 2.1 The Macro-environment 3 2.2 The Competitive Environment 6 2.3 Strategic Groups 8 3.0 The Internal Environment 9 3.1 Swot Analysis 9 3.2 Resource-Based View of Virgin Atlantic 10 3.3 Value Chain Analysis 11 4.0 Recommendation for the Future 13 4.1 Analysing the current strategy 13 4.2 Future Strategic Direction 14 5.0 Conclusion 16 References 17 APPENDIX 1 20 SWOT ANALYSIS 20 Appendix 2 24 Value chain Analysis 24 APPENDIX 3 27 Table of Figures Figure 1 UK Airline Industry value 4 Figure 2 Strategic Groups 8 Figure 3 SWOT Analysis 9 Figure 4 Virgin Atlantic SWOT analysis 9 Figure 5 Value Chain Analysis 11 Figure 6 Generic Strategies 13 Table 1 UK GDP 5 Table 2 UK Consumer Price Index 6 Table 3 Resource based View 11 Table 4: Strategic Implications of the resources 12 1.0 Introduction This is an executive report on Virgin Atlantic Airways, which contains an External and internal analysis of the company's current competitiveness and concludes with a recommendations on the future strategic direction of the company. 1.1 Company Overview Virgin Atlantic Airways Limited (Virgin Atlantic) a part of Sir Richard Branson's Virgin group is one of Britain's largest airlines and Europe largest transatlantic airline. It is 51% owned by The Virgin group and 49% owned by Singapore airlines. In the first quarter of 2010, the revenue went up by 10% to �532 million (The Virgin Atlantic Press Office, 2010). ...read more.


The differentiation strategy means that there is an obvious distinction between product from the company and the others product from the competitors, which is viewed by the customer as unique and valuable (Dess et al., 2010). As a pioneer of visible customer innovation, being first seems to have become a trademark of the Virgin Atlantic approach. The long list of firsts some of which include being the first airline to have individual TVs in all classes, to have no smoking flights, to have drive-thru check-in, to have an arrivals lounge, to allow mobile connectivity and SMS texting on board, the first to have at-seat podcasting the first to fly one of its planes using biofuels and most recently the first airline to introduce Limousines service for the upper class at both ends, the theme of their current marketing campaign, "Your airline's either got it or it hasn't. (Innovation Leaders, 2008) The Virgin state of art clubhouse at Heathrow has consistently won best clubhouse from numerous bodies. Virgin Atlantic has been a leader in sustained innovation in this industry. (Innovation Leaders, 2008). All these have made the company enjoy a fair amount of first-mover advantage in the industry. Also closely related to its strategy of differentiation, virgin Atlantic also uses a focus strategy. This means narrowing down the market for a particular buyer group, to a particular segment (Dess et al., 2010). Much of Virgin Atlantic differentiation strategy is targeted to the upper class passengers. In fact the �10million marketing campaign is targeted to build its upper class passengers. (Marketing week, 2010). �Having changed the perception of business class travel with the introduction of its Upper Class service, which provided 'first class experience at a business class price', Virgin Atlantic soon caught the target market's imagination. As competitors responded with similar products, Virgin Atlantic then followed up with the introduction of the Upper Class Suite in 2003. ...read more.


Procurement Virgin Atlantic suppliers are audited based on a Sustainable Procurement Policy; this This policy sets out a range of conditions, from ensuring that no child labour is used in the manufacture of the products they buy, to reducing the environmental impact of their supply chain. So far, over �100million of Virgin's Atlantic spends has been covered by suppliers signing up this policy. (Virgin Atlantic, 2010) Furthermore, with last month's implementation of a global e-invoicing solution, virgin has created a win-win relationship with suppliers where virgin benefits from a tax compliant invoice receipt and suppliers benefits from enhanced service delivery. Technology Development Virgin Atlantic has a culture of that enhances creativity and innovation. Technological innovation has permeated every aspect of their business, this include the RFID tagging technology at the warehouse, an e-invoicing solutions, an airline decision support solutions, etc. APPENDIX 3 Competitor Analysis Virgin Atlantic airways British airways Lufthansa BMI Air - France KLM FOUNDED 1984 1974 1954 1949 1933 PARENT COMPANY Virgin group British Airways plc Deustche Lufthansa British midland airways limited Air france, S.A OWNER Sir Richard Branson's (51%) Singapore Airlines (49%) Airways Aero Association Limited n/a UAL co- operation Societe air france HEAD OFFICE West Sussex, UK Harmonds, England Duets, cologne Houston, Texas Atremblay - france HUBS LONDON GATWICK, LONDON HEATHROW LONDON GATWICK, LONDON HEATHROW Munich airport & many more GUM, CLE, IAH, EWR Paris Charles de airport ALLIANCE N/A ONEWORLD STAR ALLIANCE STAR ALLIANCE SKY TEAM NO. OF AIRCRAFTS 39 233 722 336 112 DESTINATIONS 35 300 410 262 249 MANAGEMENT Stephen Murphy (Chairman) Steve Ridgway (CEO) Julie (CCO) Steve griffin (COO) Keith wolliams (CEO) Martin Broynon (Chairman) Christoph franz (CEO) Jeffery smisak (CEO & Chairman) Jean cyrl spitella (CEO & chairman) EMPLOYEMENT 7478 35867 105261 41061 104,720 FISCAL YEAR END MARCH MARCH DECEMBER DECEMBER DECEMBER SCHEDULED PASSENGERS SERVICE OFFERED OFFERED OFFERED OFFERED OFFERED CARGO HANDLING OFFERED OFFERED OFFERED OFFERED OFFERED AIRCRAFT MAINTAINANCE OFFERED OFFERED OFFERED OFFERED OFFERED LEISURE TRAVEL SERVICES OFFERED OFFERED OFFERED OFFERED OFFERED ?? ?? ?? ?? Virgin Atlantic | 2.0 The Analysis of the External of Environment 10 ...read more.

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