Essay Example: Internal Analysis for Cathay Pacific Airways Essay

The internal analysis of the company is vital for helping asses the internal potential, operations, and strengths of the company to uncover the opportunities that the airline firm may have in the future together with the threats that it may have to confront in the course of its development (Schmitt, 2001). Therefore, the internal analysis of the company will use the SWOT analysis. SWOT analysis is essential because of its applicability in providing information and insights on the competitive position and potential opportunities that the business may exploit in the future. In reality, the internal strengths and weaknesses of the airline will be manifested by the SWOT analysis, which will be crucial; in the identification of the opportunities as well as the threats that the airline may have to confront in the future.

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Strengths

Fleet management

One of the key advantages of the airline is the management of its fleets. It has acquired some of the best airlines in the name of the Airbus 330-900 that allows it to maintain its brilliant marketing performance through the provision of excellent passenger and cargo freight services on a regular basis. The airline boasts of having a huge fleet of modern aircraft, including those from the contemporary Airbus and Boeing, that are the leading manufacturers of airplanes around the globe. The acquisition of modern fleets is essential because it adds to the value of high reliability and safety of the flights that are provided by the airline service provider. This is because modern aircraft are safe and require fewer cases of repair because of the minimal wear and tear, thus reducing their costs of maintenance in comparison to airlines that run the old types of aircraft. This has helped the airline derive a competitive advantage over its competitors because of its reduced costs of maintenance. This is because the large fleet base enables the airline to complement its robust route network. In 2011, for example, the airline was operating a fleet of about 175 crafts.

Well experienced human resource

The airline has a well qualified and acquainted social resource management team that comprises of an excellent team of marketers that adds marketing value to the airline's operations. Human resource management plays a crucial role in the competitive struggles of organizations, especially in the airline industry, where they play a vital role in boosting the development of the airline industry. The human resource of the industry has been known to introduce innovations that have gone along to improve the performance of the airline to boost its environment. The human resource plays a crucial role in accelerating the business development of the airline by improving their performance even without the airline's management projecting in investments.

While the technical innovations and other significant changes in the firm require extra financial input for improvement, the improvements in human resource management can occur without the investment of money. This is usually done through the use of both monetary and non-monetary motivators. Positive feedback from the airline's managers is a critical internal environment factor that has played a crucial role in helping promote the performance of human resources. Therefore, such motivations often improve the production of the human resources within the company, thereby acting as a motivator for both the staff to work harder, thus promoting the efficiency and performance of the airline in the long run.

Cathay Pacific Airways has managed to gain several vital strengths in the years it has been in existence that have all enabled the airline to improve its competitive standing about the other competing airlines. Besides, these key strengths have also allowed the airline to improve its marketing performance in the area of its operations. For instance, the brand name is one of the critical marketing strengths that the airline has managed to gain over the years. It has a good reputation because of its renowned brand services that have facilitated its brand positioning in its existing markets like Hong Kong. However, it is also essential to notice that a brand image is also a valuable tool that the airline may use to gain access or penetrate new markets that it has not operated in. Therefore, the airline has consistently been using its brand image to exploit its full potential in doing its market operations. The airline's customers have high regard for the airline and appreciate the services that are offered by it because of its brand image and reputation. This has made the airline to become the most reliable airline companies around the Hong Kong market.

Weaknesses

Cultural background

Notwithstanding then strengths highlighted above, the internal analysis of the airline reveals that the company has some inherent weaknesses within its internal environment that must be dealt with for optimal performance. This is because these weaknesses may have a significant effect on the airline's marketing performance in the long run. To begin with, Cathay Airlines was established in Hong Kong and has remained to be an Asian company in Hong Kong that maintains the cultural and traditional norms of the area despite the historical strong western influences in the region. The cultural and traditional norms affect the organizational structure and the relations in the company.

In reality, the cultural background of the organization should not be seen as a potential cause for its weakness except for the fact that the processes of internationalization and globalization of the market experience that are raising the problems that relate to the cultural diversity that the company finds itself in. The company must deal with the issue of cultural diversity in its organizational structure. This raises a concern majorly because the organization has been operational as a local Hong Kong-based airline industry. Still, it must now operate as a multinational company in a multicultural environment as it plans to enter into new market territories.

The managing style that is currently in place is not up to the task of handling these issues. Therefore, the airline must adapt its management style to the existing new and dynamic cultural norms, customs, and traditions of the local employees. However, the adoption of such a strategy may cause more problems than solutions as such situations often involve the risks of causing misunderstandings and sometimes even conflicts between and among the different representatives from the diverse set of cultures because of some cultural clashes. This possesses a weakness in the company since it may result in the collapse of the new markets that have just been ventured into. Consequently, the airline should put in place adequate measures and guidelines that are to be followed if it adopts a multicultural need. These measures will be critical, especially if the company has to reduce disputes and improve on the chances of successful and effective multicultural management.

Expansion of the airline's fleet

The other weakness that can be seen in the airline's operations is in the fleet management system. There is a need to renew and expand the fleet management system of the company. This is because the recent expansions in the operations of the company have forced it to buy additional aircraft like the Airbus 350-900 and Boeing aircraft. These expansions have been extremely costly to the company, mainly because they have consumed many financial resources. This has been problematic because such developments have eaten out a lot of support to the extent that the airline has been left without sufficient resources of funding its policies on renewal and even at times, strategies. When resources are depleted, and the airline is unable to acquire additional aircraft in replacement of the old models, it can go through the way of steadily decreasing its service quality delivery because of a hectic and problematic old plane. Besides, the shortage of aircraft may also force passengers to wait for long hours because of the inability of planes to board. This may cause prolonged delays in flights that lead to late delivery of cargo or new arrival of the involved passengers. As a result, passengers may grow increasingly frustrated by the deteriorating service delivery and seek for better service providers.

Opportunities

Despite the common weaknesses that then airline suffers from, as has been outlined above, the airline industry also has several potential opportunities that it may exploit to develop and enhance its business operations to success. This may include strategies such as enhancement of the market operations through the elimination of the weaknesses and strengthening of the opportunities. The airline can eliminate its gap, as they are not too many nor too heavy for it. Therefore, the internal analysis of the business revealed that the airline has the opportunity to implement efficient marketing strategies as a means of realizing its full potential and using its available opportunities. It is only through such means that the airline would be able to fully exploit the market and gain a competitive advantage over the rival firms that exist in the market.

Opportunity to lead the market

The first opportunity that is evident in the internal analysis of the airline industry is that the firm has the chance to take a leading role in the market. Statistics reveal that the company is the leading airline service provider around the Asia Pacific region. Moreover, the internal analysis has also indicated the expansions of operations and development of business activities have been successfully managed and implemented, thereby indicating that the airline has the opportunity to take the leading position in the Asia Pacific market. Moreover, the statistics reveal that the airline is the largest carrier of cargo and passengers in the Asia Pacific area.

Furthermore, studies also indicate that the business expansions that have currently been implemented by the airline are bearing fruits, as many customers like the service provider; hence, the increases are enhancing its position in the other markets that it is expanding to as well. While the Asia Pacific is the primary market for the airline firm, the company has been diversifying and expanding its operations to other markets in recent periods. Therefore, it has been operating in both the Hong Kong area and international across the globe, offering flights around the world. Therefore, there are massive opportunities in the European and American markets that the company can grab or attempt to challenge the positions of the other leading service providers in those markets (Calder, 2002).

Nonetheless, the airline firm still enjoys a considerable share of the global market, thus allowing it to maintain the leading position in the globalized markets. However, it is also essential for the airline to consider the impact of the Chinese and Asian markets from which the company is the leading freight service provider. For instance, the Chinese market is known to be the most dynamic global market that has maintained its trajectory of growth despite the current worldwide meltdown and financial crisis. This is not to downplay the relevance of some of the southeastern markets like India that have demonstrated considerable growth potential in the past (Howard, 2004). Consequently, should the airline maintain its leading position in the market of its operations, it can easily enhance its positioning in the global markets because of the tremendous growth rates that are being experienced in its main markets in Asia.