“ EXTERNAL ANALYSIS”.

| December 19, 2015

“ EXTERNAL ANALYSIS”.

This is a portion of an entire report. There is no need for Introduction or conclusion.
Just work on the “ EXTERNAL ANALYSIS”.
Please look at the Referencing Guide before you begin, it is SPECIFICALLY Chicago (Author-date) 16th Edition.

Question: What are the key success factors of the Australian airline industry? What is the difference between different segments of this industry? Which resources and capabilities of companies are critically important for successful performance in this industry?
Which strategies are most successful in addressing the competitive forces in the airline industry? ‘Will Qantas become Jetstar’ (Grant et. al., 2014: 4)

External Analysis
In this section you should outline what you think are the main opportunities and threats facing the organisation. You should analyse the general, industry and competitors’ environment of the company. Do not attempt to analyse all elements of the external environment equally: it is important that you concentrate on a few main elements and explain why they are significant. You have to support the most significant elements of the external environment by references from the business media, industry publications and other relevant websites.

The external analysis should consist of Final.
Choose 2 Maximum 3 factors from PESTED, and focus on it.
Example: Singapore Airlines.
Technological -> First Class & Business Class, Wireless
? Phone Apps booking system.
Political -> Airports, Security

Apply the Porter 5 forces model to the analysis
Lecture Notes
The process of strategic formulation involves 4 areas
1. Analysis -> Involves both External & Internal Analysis
2. Planning -> Developing a mission, vision, objectives , strategies & options
3. Implementation -> Tactical, recommendation, timetable, budget.
4. Control -> Monitor the effectiveness, take corrective actions.

The first step in analysis is External Environmental Analysis, which involves 3 Levels.
A) General Environment -> This involves the uncontrollable factors that firms needs to monitor and evaluate constantly based on the PESTED or PESTLE factors including:
1) Political -> Government, Laws, Regulations, statutory board.
2) Economic -> Growth, incoming, PPP(Purchasing Power Parity),demand, supply, inflation.
3) Social Cultural -> Religion, Habits, Lifestyle, Custom, Taboos, Language, Education.
4) Technological -> New product, service, internet, robotic , telecommunication
5) Ecological -> Recycle, Reuse, Reduce, Solar Energy, Sustainability
6) Demographic -> Age structure, population, density, size, literacy rate.

Examples of application of the external analysis.
(Demographic -> Asia Aging Populations, Health Conscious)
(Economic -> Affordability, Increase in Income & Wealth)
(Technology -> New Products, New Medicine, New Robotics)
Raffles Hospital Singapore.

B) Industry Environment -> is the analysis of the level of threat or competition involves based on 5 variable as stated by Michael E. Porter 5 Force Model.
This model needs to look at the threats of LMH (Low, Medium, High)
based on
1) Threats of New Entrants -> New players and overseas competition coming into the market
2) Threat of substitute -> available and hybrid substitutes that consumers can use
3) Bargaining power of buyers -> The choice, switching cost, price, barriers to entry
4) Bargaining powers of supplies -> The strength, site, level of competition, barriers of entry
Rivalry within the industry -> the strength of the competitors an numbers of direct competitors

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