Research Articles Base: Cathay Pacific Case Studies

Strategic Knowledge Case Study Paper on Cathay Pacific

The Airline An airline provides air transport services for passengers or freight, generally with a recognized operating certificate or license. Airlines lease or own their aircraft with which to supply these services and may form partnerships or alliances with other airlines for mutual benefit. Airlines vary from those with a single airplane carrying mail or cargo, through full-service international airlines operating hundreds of airplanes. Airline services can be categorized as being intercontinental, intra continental, domestic, or international and may be operated as scheduled services or charters.1 The Cathay Pacific Airlines The Cathay Pacific enjoyed dominating the Hong Kong aviation market from 1959 as the sole Hong Kong based carrier after rival Hong Kong Airways merged with Cathay Pacific. Thus, the airline continues to be one of the world’s leading airlines and awarded with a Five-Star Airline ranking.2 The Analysis The Political aspect is involved in the study of the airline’s nature and business. Since every airline considers individual liberty and equality, there are suggested key lessons for the Airline Industry.3 1. Liberalizing markets over different timescales or removing restrictions on operations without removing those on ownership can create distortions and reduce the potential benefits that are available. 2. The structure of the airline industry means that removing operational restrictions can lower barriers to entry to the industry. But it will not maximize the potential benefits to customers, airlines and the wider economy unless ownership restrictions are also removed. 3. Further operational and ownership liberalization can protect and enhance the consumer benefits, in terms of greater choice and lower fares, already obtained from liberalization so far in the airline industry. 4. Liberalization can create the freedom for airlines to operate on a fully commercial basis. This will allow them to allocate capital more efficiently, to respond better to changes in demand in markets and to improve productivity. 5. In a fully liberalized market, the key for an airline is to recognize where its competitive advantage lies and to focus on it. Liberalization provides opportunities for expanding into new markets as well as threats to existing markets. 6. A multilateral approach to liberalization is preferable.             Most of the countries allowed the government to put its power above the industry. The effects are both good and bad. Good in terms, that the governments give advisory to the industry where there is an outbreak like the deadly influenza, and the banning of some person that sometimes forced to self-exile. On the other, it is bad in the business that sometimes the government over power its shares in the industry and controlling the tax burden.             The Environmental aspect also affects upon the operation and even during the construction of these airline. The Aircraft engines emit noise pollution, gases and particulate emissions, and contribute to global warming and global dimming, even though it is one of the least-polluting forms of travel in the world. The airline industry is responsible for about 11 percent of greenhouse gases emitted by the U.S. transportation sector.4             When the Social aspect enters, the question for unemployment can be answered by this kind of industry for the airlines needs more than a hundred of employee. But definitely, there are some positions in this industry that needs license, especially in pilot and mechanical engineering.             The target market, although limited, the industry can create their travel experience in different ambience. They can choose from different classes of passenger’s seat that will be affordable to their tight budget. The travel industry is fully equipped, together with its different travel partners such as the travel agency, which they can offer to their clients. The Technology line of the Industry is perfectly assured for their clients’ security and safety. Many accidents already happened from the past years, and the declining of the clients’ interest in boarding to an airline is alarming in the business’s part. Some sort of these accidents is blame to the malfunctions of the engine and other parts of the plane. The reliable technology is really needed and the efforts for the continuance progress can lead an airline to recollect the trust from the clients. The industry fully relied in the specialty of the new acquired machines. The choice of this analysis is based on the PEST Analysis which means Political, Environmental, Social, and Technological aspects which measures the capacity of a business not only in serving the target market but also in the environment that surrounds it. Economic Overview Although many countries continue to operate state-owned or parastatal airlines, many large airlines today are privately owned and are therefore governed by microeconomic principles in order to maximize shareholder profit.5             The rise and downfall of an industry is based upon the performance of the business in the past years or how it currently performing. The economy of a country that relied on the tourism industry is also partnered by the travel industry. At some point they are different for the reason that tourism promotes the country’s beautiful sceneries that some presents as a reverie, while the travel industry is the one line to reach a destination. The partnership of two different kind of business are good for they are often comes together. A wise traveler usually booked the place through the use of an agent and the travel agent will do the rest.             The growing industry of tourism is positively affecting the main driver, the travel agents as well as the airlines. And together they will help each other to reach their goals individually.       References: 1.      Airlines [Online] Available at: http://en.wikipedia.org/wiki/Airline [Accessed 31 July 2009]. 2.      The Cathay Pacific [Online] Available at: http://en.wikipedia.org/wiki/Cathay_Pacific [Accessed 31 July 2009]. 3.      Smyth, M., & Pearce, B. (2007). Airline Liberalization IATA Economics Briefing No.7 [Online] Available at: http://www.iata.org/NR/rdonlyres/C3216440-783D-438E-AF51-7AEC69119B1A/0/IATA_AirlineLiberalisation.pdf [Accessed 31 July 2009]. 4.      Environmental Impact [Online] Available at: http://en.wikipedia.org/wiki/Airline#Environmental_Impacts [Accessed 31 July 2009]. 5.      Economic Considerations [Online} Available at: http://en.wikipedia.org/wiki/Airline#Economic_considerations [Accessed 31 July 2009].     Credit:ivythesis.typepad.com

Strategic Knowledge Case Study Paper on Cathay Pacific

The Airline An airline provides air transport services for passengers or freight, generally with a recognized operating certificate or l...

Select a company of your choice to enter Viet Nam market

Contents 1.      Introduction 2.      Background of the organization 3.      Main Body of the Report 3.1.  External Analysis 3.2.  Internal Analysis 3.3.  Analysis of the country 3.4.  Possible strategic alternatives 4.      Recommendations 5.      References                           Introduction The airline industry presents a paradox. For the last fifty years it has been characterized by continued and rapid growth in demand for its services. Yet it has remained only marginally profitable. Inevitably growth was much faster in the 1950s and 1960s when aviation was a new industry than it is today when it is reaching maturity. But growth rates are still impressive. In the 1950s and 1960s the world’s air traffic grew on average at around 14-15 per cent each year ( 2002).  In the decade 1970-79 the annual growth was close to 10 per cent. This still meant that air traffic, and the airlines with it, doubled in size every seven years or so. In the following ten years to 1989 growth declined to around 6 per cent annually and in the decade up to 1999 growth was down slightly at 5.2 per cent. In absolute terms, because of the much higher base, a 5 per cent jump in recent years represents a much greater surge in demand than a 10 per cent annual growth thirty years ago ( 2002).   The airline industry appears to be cyclical and this inevitably impacts on growth rates from year to year. Nevertheless the underlying trend has been one of declining but consistently good growth in demand. Most industries or businesses faced with continued and high growth of demand for their products or services would be basking in substantial profits. Not so the airlines. This is the paradox. The financial performance of the world’s airlines taken as a whole has been very marginal, even in the years when the industry was highly regulated and largely protected from internal competition. The traditional measure of profitability, namely the rate of return on assets employed, cannot be applied to the airline industry as a whole ( 2002). Another measure of profitability commonly used among airlines is the operating ratio, which is the annual operating or net profit or loss expressed as a percentage of the total annual revenue. Four to five years of poor or bad performance are generally followed by an upturn and five or six years of improving results ( 2002).   The airline industry is has its own share of problems over the years, this does not mean that companies in this industry should be affected by such situation. To conquer the problems, the industry influences companies belonging to it alter their strategies and relate it to strategies used by other industries. One company trying to succeed in the industry is Cathay Pacific. This company has changed its strategies in accordance to the changes in its environment and the industry it belongs to. It has gone through various barriers and problems but it managed to survive up to this very day. The paper will discuss about the company, its strategies, the trends and issues in its business environment.  The paper will conduct an external analysis of the company using the 5 forces analysis The paper will conduct an Internal analysis that will determine the strength of the company, its weakness, the company’s organization structure and culture, and the company’s human resources. The paper will perform an analysis of the country in terms of PEST analysis. The paper will include the possible strategic alternatives and the best strategic option/s to use over the next five to ten years. Main Body Cathay Pacific  Cathay Pacific was generally seen as a quality airline, but one strongly associated with Hong Kong’s colonial past. A major challenge for the future was for Cathay Pacific to be perceived as more Asian rather than British/Asian in order to strengthen its market abilities in Asia including attracting a wider Asian customer base, as well as to reflect the changed political realities in Hong Kong. In short, the company needed to align its Conceived Identity with its new Identity. Cathay Pacific chose to undertake this identity realignment through a massive coordinated set of initiatives intended to transform the reality of the company to achieve the new perceptions that would reflect the new strategy and permit communications based on the substantive changes ( &  2003). Among the initiatives were: adding aircraft capable of operating in medium-sized airports in Asian markets previously underserved by Cathay Pacific, appointing an increased proportion of Asian nationals, and changing the on-board food and service to reflect more closely the wider Asian customer base ( &  2003).   Cathay pacific is one of the most well known airline company in the world. It competes with different airline companies for prestige and notoriety in the airline industry. Recently the company underwent a change in image and strategies to counter the problems its industry has. It shifted the focus of its strategy into making sure that their will be an increase of clients who demanded their services, it also made sure that the services and technologies they use can be competitive to other airlines company.   In 2006 the company was acquired by Dragon air but it still continues to operate in its own brand. This does not hamper it from continuously trying to provide the best service to its clients.  This shows that with proper strategies used, a company can stay in the industry for a longer period of time.   Step 1 External analysis Potential Entrants             The company has been around for a quite some time and the company is not greatly affected by the new entrants. The influence of potential entrants to the company is weak. But to ensure that no other problem arise the company maintains low cost for the different expenses they make, this helps in making sure that the new entrant will not have advantage over them and it makes sure that the company cannot be outrun by this new competitor.   Competitive rivalry             Competitive rivalry highly influences the company. Different things are done by the company to ensure that they have advantage over their competitors one is a strategy wherein they give the best kind of service to clients. This kind of strategy gives the company a better relationship with the clients. The company also offers unique flying experience to the clients thus giving the company’s rivals additional worries. Substitutes  Substitutes give high influence to the company since substitutes can make a company lose the clients it has. The company makes sure that the substitutes won’t give them much problem. They do this by proving that the service they offer and the technologies they use to provide the service are the best quality and are better than substitutes.   Bargaining power of buyers   The bargaining power of buyers highly influences the company and the industry. It shows how good the company and industry is doing in serving the clients. It also helps in determining how known the company is. The company makes sure that the bargaining power of buyers is high. They do this by making sure that buyers are concentrated and there are few buyers in a significant market share.   Bargaining power of sellers  The bargaining power of sellers highly influences the company and the industry. The company and the industry make sure that their suppliers have high bargaining power through helping them show their importance in the industry.  The company makes sure that the suppliers of the product to be put up on the site will be convinced that the products they intend to sell are the best they can offer and these products are highly competitive, it also makes sure that the products will be highly buyable. Step 2 Internal analysis Strengths A strength of the company is the cutting edge quality service they offer. Cathay pacific constantly checks for new technologies that the suppliers can provide to them, this is done for the company to meet the needs of their clients. The company makes sure that the technologies they use to provide the service are updated. Employees are an important part of a company. They should be well taken care of. In relation to such one of the strengths of the company is the way it treats its employees. The company gives special recognition to those who did well and served the consumers well. Recognition boosts the employees’ confidence and makes the employees work harder and it brings a sense of competition between the employees.   Cathay pacific strength with regards to its employees is the way their workers are selected and trained. The company makes sure that the employees are well selected and trained for them to produce well and achieve the goals of the company. These employees passed certain entrance tests and meet certain requirements, these test are used to know the capabilities of the people. A strength of the company is being in the top position in international airline surveys. These surveys have different aspects like in comfort, service, food and overall service.  Lastly a strength of the company is the modernized and big in size fleet of plane it has. They have an considerable number of aircraft fleet that are maintained properly and replaced abruptly when there is a need for it.    Weakness The main weakness Cathay pacific has is they tend to dispose aircraft while such aircraft has still high resale value. The company fails to see the use of the aircraft that they may not need but can be sold to other organizations. The company is not able to see the capabilities of other things that the company deems as unusable.   This weakness if not given proper attention and immediate action can lead to the downfall of the company.   Organizational structure The company‘s top man is the Chairman . The CEO of the company is . The finance director is . They are the ones that lead the company; underneath them are department heads, sector managers and other personnel that work in different locations. This structure of the company intends to promote teamwork and camaraderie amongst the members of the organization. The people responsible for decisions on strategies the company intends to use include the Chairman and the CEO.   Organizational culture Organizational culture instills in the organization a common sense of identity. This kind of culture helps in aligning the values and norms of the employees to the values and norms of the organization. Organizational culture instructs a company to work as a social system. Moreover this kind of culture serves as a reference for employees whenever they have to undertake productive activities and this will help to behave better in doing the productive activities.  Organizational culture gives guidance for the employees to act accordingly in various situations in the company.  The organizational culture of Cathay Pacific is concentrated on making sure that their missions will be attainable. The missions include providing service straight from the heart, make sure that clients are safe whenever they are using the transportation services of the company,  encourage to their employees product leadership, make sure financial returns are made and provide beneficial career opportunities to willing and acceptable employees.   Human resources of the company To have competitive advantage over competitors means that a company must have a good relationship with the personnel. To maintain good relationship with employees means that the company makes sure that the welfare of the employees are protected.  Employees who are properly cared for can be competitive with employees of rival firms. Cathay Pacific makes sure that the employees they hire will be an asset to the company. They hire the best people for a specific job. This people are trained well by the company so that each employee will have an important role to play in the company. The company provides various financial and compensation packages to their employees. This ensures that for every effective service the employees do they are greatly rewarded.  The company also recognizes and gives awards to employees who perform above standards. Step 3 Analysis of the country Political The company will not get any good reputation, trust and success if it will not be aware of what is happening in the political sector of the country. The company and the airline industry make sure they are aware of the political situation of the country and the company has its position with regards to political issues. The company is prepared for any problems concerning the political sector.  Viet Nam’s politics concentrate on the framework of single party socialist republic.  The communist party of Vietnam has the central role in the politics of the country and its societal issues. The new constitution reaffirms the country’s goal of reorganization in the government and increased economic reforms.  The economic reforms have become the primary concern for the country rather than ideological orthodoxy. This is a good thing for Cathay pacific because they will have lesser problems in entering such market.   Economic The Vietnam War is said to be one of the causes of the economic problems the company is facing.  The economy of Viet Nam was plagued with problems such as inefficiency, corruption, poor products, underproduction and various restrictions on economic activities and trade.   After some time the sixth party congress started to introduce reforms. Private ownership was started to be encouraged in industries, commerce and agriculture.  The annual Gross Domestic Product (GDP) of the country started to grow and this made the county be recognized as the second fastest growing economy. During such time the country’s foreign investment became threefold and the domestic savings grew 4 times faster. Industries that concentrate on Manufacturing, Internet technologies and other high tech industries suddenly grew and became an important part of the country’s economy.  Vietnam has changed from a country that has no idea about the Oil business into the third largest Oil producer in Southeast Asia.  The country has made use of the economic growth to lower poverty rates and it made the unemployment rate one of the lowest in the world. Although the country is experiencing such economic growth; it remains a relatively poor country.  The economy of Vietnam is a promising one, Cathay pacific should take a chance at taking a risk in investing in the country because the economic changes done by Vietnam can greatly affect and benefit the company.   Social Vietnam’s population as of 2006 is said to reach 84,402, 966, most of the people live near rivers and deltas. Kinship plays a role in the rural areas of the country. Amongst the different religion found in the country, Buddhism is the most popular to the people.  The society of Viet Nam was influenced in culture by its neighboring country China. The main characteristic of the culture of the country is financial duty.  Other characteristics of the culture of the country are education and betterment of oneself.  Currently the country has exposure to the cultures of different regions. The country has a special garment that should be used on special occasions. The cuisine of the country makes use of less oil and majority of the dishes use higher volume of vegetables. Soccer is the most popular sport in the country. Other popular sports in the country include badminton, tennis, ping pong, chess and volleyball.  Cathay pacific can help in merging the culture of Vietnam with other cultures. This would slowly help the country in adjusting to the global changes.    Technological The country is slowly allowing innovations in its technological aspect and introduced new concepts that the different industries in the country may use. Since technology rapidly changes the country has been more open to gaining updates to what is happening in the technological sector. Vietnam wants to makes sure that the industries located in their country provide services that make use of new and useable technologies. Vietnam also wants to make sure that if other companies in other countries use new technologies to provide services, the companies in the country have the technology capable of competing with such technologies.  Cathay pacific can make use of the innovation in technologies to provide alternative transportation services to the citizens of the country. The company can also use the technology to speed up the delivery of Vietnam products domestically and internationally.     Step 4 Possible Strategic alternatives A key challenge for any organization in the twenty-first century is to seek to maintain and improve its performance in an increasingly complex and competitive global operating environment, where change pressures appear to offer the only certainty ( 2000).The challenge presented here is to move to define such assets, particularly in relation to a public sector context, and through an investigation of the benefits which can accrue from the successful management of information and knowledge, to dispel much of the disquiet and cynicism surrounding this potentially important area of organizational improvement ( 2000).Companies cannot survive without an effective competitive strategy; an effective competitive strategy gives a company an easier chance of attaining its goal with lesser focus on the problems they have. A company that is wiling to use a competitive strategy must create changes in its internal environment. In doing this every aspect of the business can be checked before the strategies can be used for success in the firm. The service strategies will depend on the situation in the environment and the different barriers that may hinder the delivery of an effective strategy. The service strategy may go into waste if there are still certain barriers and environmental condition left unsolved since the effect of the strategy may not be felt by clients.    Cathay Pacific makes use of the best service strategies that intends to make an identity separate from the competitors. It concentrates on providing excellent service to clients. It intends to use the best service strategies so that they will have advantage over the competitors. The company has a code of service that the company and its employees use whenever they are having conversations with their clients.  There are other strategic alternatives for the company one of which is the further improvement of technologies used in delivering the services.  The technologies used by the industry may be better and more adaptable to the needs of the clients. The technologies may be so advanced that travel time from one country to another may be lessened. Another strategic alternative for the company is better security measures that will ensure the safety for both clients and personnel of the company. The future may be a time for safer skies and lesser concerns for terrorist attacks.   Recommendations The first thing the company should do is continue to improve the services they have by doing so they can have advantage against competitors. The company can also find ways to lower its prices without having some financial problems. By doing this more clients can be attracted to avail the company’s service. Moreover the company should provide additional knowledge to their employees regarding how to deal with clients. Customer service involves the relationship between the employees and the clients. A healthy relationship between the two helps in giving the company success.   The company should focus on the strategic alternative of further improvement to the technologies they use. By doing so the company can make sure that the clients will be have comfort while availing the service and they will be safer as they travel.   The advancement in technology will not only make the company competitive, it will make the clients avail the company’s services more often since the travel time will be shorter and more relaxing. References Credit:ivythesis.typepad.com

Select a company of your choice to enter Viet Nam market

Contents 1. Introduction 2. Background of the organization 3. Main Body of the Report 3.1. External Analysis 3.2. ...

Cathay Pacific Airlines : IT the next five years

Task 1: Introduction  Competitive advantage can come from a focus upon key competencies. Capabilities, meanwhile, reflect an organization’s ability to use its competencies (Lowson 2002). Capabilities represent the firm’s ‘collective tacit knowledge of how to initiate or respond to change that is built into an organization’s processes, procedures and systems, and that is embedded in models of behavior, informal networks and personal relationships. It is noted that capabilities and competencies are dynamic and constantly changing. The pattern of decisions tends to be of a medium to long-term nature and supports both the core capabilities and competencies of the company, and how it uses resources and technologies to provide sustainable competitive advantage in the future. There have been many historic changes in organizational theory over the twentieth century. Some can be directly assimilated as changes in operations strategy (Lowson 2002).     It is the unique architecture of each operations strategy that provides an essential strategic contribution to achieve sustainable competitive advantage. From this people can speculate that organizations will have not one, but many operations strategies. Each may have common components, but each has a unique and individual emphasis that is dictated by a number of factors such as trading partners, supply system configuration and demand behaviors. The building blocks of an operations strategy can be viewed as forming a composition matrix that fuses them together as a reaction to the demand and supply system circumstances. The operations strategy is then contingent upon its particular circumstances. It is a factor that has considerable benefits to its subsequent implementation. The mission of an operations strategy will outline and define its overall direction. The mission must also proclaim those areas of excellence and core competencies that are capable of securing competitive advantage (Lowson 2002).    Companies cannot survive without an effective competitive strategy; an effective competitive strategy gives a company an easier chance of attaining its goal with lesser focus on the problems they have. A company that is wiling to use a competitive strategy must create changes in technologies. Businesses undergo various changes depending on the situation in the industry and the demand for change by the internal and external environment. One change is the use of information technology and its related technologies. These technologies make business transaction be done with faster and with lesser errors. Business improves their technologies so that they can create better products, improve their competitiveness against other firms and provide better service to clients. They also improve their technologies to correct any things not working well for the company’s operations. The improvements in the technologies can make the business and the employees perform better or it can create more problems for the company. It can also help the company reach its goals. The paper will discuss about Cathay Pacific, its ticketing system and how it was impacted by the use of Information technologies. Aims and objectives The aims help the study have a specific direction and can help the study in enclosing itself to reasonable boundaries and limits.  The aims and objectives will provide the guide on what topics will be needed in the study. Thru the objectives the study will be able to attain the necessary information that can help derive conclusions on the study. The objectives of the study include. The aims and objectives of the study include determining how information technologies helped various airline companies and their respective ticketing system over the years; Determine whether information technologies created an impact to Cathay Pacific Airlines particularly its ticketing and booking systems; Know the barriers that have prevented Cathay Pacific from realizing the benefits of information technology .Know what were the risk Cathay Pacific Airlines, its ticketing system and other businesses in the Airline industry was forced to take when they decided to make use of information technologies.   Sources of data The data will come from research through the internet; books, journals, related studies and other sources of information. Acquiring these various kinds of data is more convenient to use because they are already condensed and organized. Moreover, analysis and interpretation are done more easily. These additional data and information will also be used to support as well as contradict the findings of the study depending on the credibility of the authors and the journals where they were found published. Background of the company Cathay Pacific was generally seen as a quality airline, but one strongly associated with Hong Kong’s colonial past. A major challenge for the future was for Cathay Pacific to be perceived as more Asian rather than British/Asian in order to strengthen its market abilities in Asia including attracting a wider Asian customer base, as well as to reflect the changed political realities in Hong Kong. In short, the company needed to align its Conceived Identity with its new Identity. Cathay Pacific chose to undertake this identity realignment through a massive coordinated set of initiatives intended to transform the reality of the company to achieve the new perceptions that would reflect the new strategy and permit communications based on the substantive changes (Balmer & Greyser 2003). Cathay pacific is one of the most well known airline company in the world. It competes with different airline companies for prestige and notoriety in the airline industry. Recently the company underwent a change in image and strategies to counter the problems its industry has. It shifted the focus of its strategy into making sure that their will be an increase of clients who demanded their services, it also made sure that the services and technologies they use can be competitive to other airlines company.   The company has taken advantage of the information technology revolution and updated it with their ticketing system and booking system. The company makes sure that whenever someone wants to have his/her flight booked the data they will share can be available within minutes and information can be easily found.  The company’s system also makes it easier for a client to transact for tickets and acquire that ticket that will be used for the flight. Task 2: External Analysis How the industry affects the organizational strategy The situation in the airline industry is different from the situation in the manufacturing industry, fast food industry, retailing industry or other kinds of industry. The airline industry needs to make sure that the best service can be given to the clients. It also has to make sure that the best technologies will be used to serve the clients. To avail the services of airline companies, clients have to pay more. The payment of the clients should be replaced with the equivalent service. Therefore the strategies of Cathay aim to provide the same worth as the prices of accommodating their services. Cathay is forced to make sure that their services and the technologies they use will be in the same level as the payments made by the clients. Their strategy on their service and the technologies they use will then be improved further to meet clients’ expectations. Another way for the type of industry to affect the organizational strategy of the company is through responsibility of the industry to its clients. The airline industry has a responsibility to make sure that the welfare of the clients is being taken care of thus Cathay makes sure that they have strategies that pertain to the responsibility of the industry to take care of its clients. Whenever there are untoward incidents or situations while the service is being rendered, Cathay has a different set of strategies that will make sure that nothing will happen to the clients under an unexpected situation. Businesses can succeed in a certain industry that for them looks unpromising. With proper strategies they can survive in an industry that no one wants to engage business in and no one wants to be a part of.  Building market share should not be priority of business rather the company should have a strong competitive advantage before they can have market shares. Resources should not be always a concern for the company since success can be achieved if there are limited resources.   How does IT impact the industry’s positioning for competitive advantage The airline industry made use of Information technology as an alternative tool to provide service to its clients. The members of the airline industry made use of websites to interact with clients and help them transport information they need when it comes to flights and ticketing. The web site offered solutions to improve the different booking and ticketing processes; improve customer service and reduce cost for both the company and the clients.  The different services offered by the web site includes tracking flight routes and destinations, information for rates for each transportation or flight travel, and schedules for each flight. Information technology helped the industry introduce newer means for them to provide service to the clients; this helped the industry put itself in a position that has a distinct competitive advantage.   Likely impact of IT on the organization Information technologies are something that is constantly evolving and being improved over the course of time. It grows and adapts to the changes in the society. As time goes by IT is changing its different techniques in providing service to the clients and in making business transactions be done in the shortest time possible. Cathay Pacific’s use of IT can help it to have better internal and external communications. Cathay Pacific’s use of IT leads to better communication with different departments and divisions in the firm. The company’s use of IT also leads to better procedures in delivering funds, goods and information. The major change in IT that can trigger a major change in the industry is when IT cannot provide support towards newer and complicated problems that give the industry and firms within it difficulty to achieve each of their goals.   PESTLE analysis Political The company will not get any good reputation, trust and success if it will not be aware of what is happening in the political sector of the country. The company and the airline industry have made sure that they were aware of the political situation of every country they have operated in and the company has its position with regards to political issues. Cathay Pacific and the airlines industry is continuously prepared for any problems concerning the political sector.   Economic Cathay pacific and the Airline industry can be said to be economically stable for the past years. Its economic stature is doing well that’s why they try to improve their products to give the best to their clients. It is not only the internal economic situation of the company should be taken note of but also the economy of the country, the company and other airline companies checks first the economic status of the country they are operating in before making decisions because making decisions during a difficult time on the economy of another country may cause catastrophe for the company.   Social Cathay Pacific and the Airline industry make sure that the service they offer and the technology they use to tender their services will be accepted by the public. The company and the Airline industry do not authorize the delivery of some services they know will cause outbursts or complains from different group in the society. The entertainment provided in flights will not contain anything that will cause problems with the passengers. The company and the industry make sure that they have a very good relationship with different sector in the society. They make sure that ethical practices are part of their strategies.  The industry and the company also engage in social activities that tend to develop a better relationship between them and the clients.   Technological Cathay Pacific and the airline industry offered new innovations in its technological aspect and introduced new concepts with regards to its industry. Since technology rapidly changes the company and the airline industry makes sure they are updated to what is happening and they can adjust to these changes. Cathay Pacific and the airline industry make sure that the services they offer are updated with regards to what technology is used to tender their services.  If other companies use new technologies to provide services, the company has the technology capable of competing with such technologies.   Legal             In any country there are laws that need to be followed. These laws restrict or allow any action to be done. The laws make sure that the people do what is right and just. It prevents any arguments or differences. Cathay Pacific and the airline industry make sure that it follows the different laws of a country they engage transaction in. The company and the industry also make sure that the different local and international transportation laws are followed in any trips made by the company. The company doesn’t want to risk their client’s welfare by breaking local and international transportation laws.  Cathay Pacific and the airline industry follows the international air travel laws that provides laws on different things like the route allowed for every flight.   Environmental The world is starting to be more conscious of building a better future for the children. Every possible way to ensure a better future is used. Different organizations are doing things to ensure that the future will be a bright one. Cathay Pacific and the airline industry make sure that the technology they use to tender services to their clients will cause minimal problems to the environment. The airline industry puts up certain regulations on the gases and other equipments used on the air transport devices. The industry makes sure that the gases and the equipment will not be the source of more environmental problems. The Airline industry has also introduced better waste management strategies that aim to reduce pollutants and create a cleaner environment for the future.   Optimistic future scenarios for the industry One optimistic scenario for the industry is the further improvement of technologies used in delivering the services.  The technologies used by the industry may be better and more adaptable to the needs of the clients. The technologies may be so advanced that travel time from one country to another may be lessened. Another optimistic scenario for the industry is better security measures that will ensure the safety for both clients and personnel of the company.  This security measure is to counter terrorist attacks.   Pessimistic future scenarios for the industry One pessimistic scenario for the future is an alternative source of transportation that will ensure lesser traveling time will be used by the clients. People might discover a newer and faster means for traveling that costs less and takes them to their destination faster. This may mean loss of clients and probable extinction of the industry. Another pessimistic scenario for the industry is higher cost of operations for the firm. Due to rising cost of materials and supplies to operate business, the company might be forced to raise their fees. Not all clients can afford the change in fees thus the firms in the industry will lose more clients.  Task 3: Internal Analysis of the company Strengths A strength of the company is the cutting edge quality service they offer. Cathay pacific constantly checks for new technologies that the suppliers can provide to them, this is done for the company to meet the needs of their clients. The company makes sure that the technologies they use to provide the service are updated. Employees are an important part of a company. They should be well taken care of. In relation to such one of the strengths of the company is the way it treats its employees. The company gives special recognition to those who did well and served the consumers well. Recognition boosts the employees’ confidence and makes the employees work harder and it brings a sense of competition between the employees.   Cathay pacific strength with regards to its employees is the way their workers are selected and trained. The company makes sure that the employees are well selected and trained for them to produce well and achieve the goals of the company. These employees passed certain entrance tests and meet certain requirements, these test are used to know the capabilities of the people. A strength of the company is being in the top position in international airline surveys. These surveys have different aspects like in comfort, service, food and overall service.  Lastly a strength of the company is the modernized and big in size fleet of plane it has. They have an considerable number of aircraft fleet that are maintained properly and replaced abruptly when there is a need for it.    Weakness The main weakness Cathay pacific has is they tend to dispose aircraft while such aircraft has still high resale value. The company fails to see the use of the aircraft that they may not need but can be sold to other organizations. The company is not able to see the capabilities of other things that the company deems as unusable.   This weakness if not given proper attention and immediate action can lead to wastage of finances and eventual downfall of the company   Organizational structure The company‘s top man is the Chairman Christopher Dale. The CEO of the company is Anthony Tyler. The finance director is Robert Atkinson. They are the ones that lead the company; underneath them are department heads, sector managers and other personnel that work in different locations. This structure of the company intends to promote teamwork and camaraderie amongst the members of the organization. The people responsible for decisions on strategies the company intends to use include the Chairman and the CEO.   Organizational culture Organizational culture instills in the organization a common sense of identity. This kind of culture helps in aligning the values and norms of the employees to the values and norms of the organization. Organizational culture instructs a company to work as a social system. Moreover this kind of culture serves as a reference for employees whenever they have to undertake productive activities and this will help to behave better in doing the productive activities.  Organizational culture gives guidance for the employees to act accordingly in various situations in the company.  The organizational culture of Cathay Pacific is concentrated on making sure that their missions will be attainable. The missions include providing service straight from the heart, make sure that clients are safe whenever they are using the transportation services of the company,  encourage to their employees product leadership, make sure financial returns are made and provide beneficial career opportunities to willing and acceptable employees.   Human resources of the company To have competitive advantage over competitors means that a company must have a good relationship with the personnel. To maintain good relationship with employees means that the company makes sure that the welfare of the employees are protected.  Employees who are properly cared for can be competitive with employees of rival firms. Cathay Pacific makes sure that the employees they hire will be an asset to the company. They hire the best people for a specific job. This people are trained well by the company so that each employee will have an important role to play in the company. The company provides various financial and compensation packages to their employees. This ensures that for every effective service the employees do they are greatly rewarded.  The company also recognizes and gives awards to employees who perform above standards and do things that exceed what is expected of them. Effective organizational strategy A key challenge for any organization in the twenty-first century is to seek to maintain and improve its performance in an increasingly complex and competitive global operating environment, where change pressures appear to offer the only certainty (Milner 2000)Cathay Pacific makes use of the best service strategies that intends to make an identity separate from the competitors. It concentrates on providing excellent service to clients.  That is the reason why the company made use of information systems. The company introduced the information technology systems on the belief that it will help them provide a different kind of travel experience. The company saw the potential of information technologies and how it benefited other firms.  The company tries to know the newer advancements in information technology that can help them provide a better service to their clients.   Porter’s five forces Potential Entrants             Cathay Pacific has been around for a quite some time and the company is not greatly affected by the new entrants. The influence of potential entrants to the company is weak. But to ensure that no other problem arise the company and the ticketing and booking system used by Cathay pacific maintains low cost for the different expenses they make, this helps in making sure that the new entrant will not have advantage over them and it makes sure that the company and the different departments within it cannot be outrun by this new competitor. Competitive rivalry             Competitive rivalry highly influences the company. Different things are done by the company and the ticketing and booking system used by Cathay pacific to ensure that they have advantage over their competitors one is a strategy wherein they give the best kind of service to clients. This kind of strategy gives the company a better relationship with the clients. The company and their members also offer unique flying experience to the clients thus giving the company’s rivals additional worries and concern for each of their future.   Substitutes  Substitutes exist when a certain market has a situation of high prices. In this market clients look for a company that can offer lower prices for their products or services. Substitutes can also be in the form of alternative services that a client deems appropriate for his/her need and capabilities. Substitutes give high influence to the company and its different departments since substitutes can make a company lose the clients it has. The company and its different departments make sure that the substitutes won’t give them much problem. They do this by proving that the service they offer and the technologies they use to provide the service are the best quality and are better than substitutes.   Bargaining power of buyers and sellers  The bargaining power of buyers is a standard of how the client can put the business in a tight spot wherein the client dictates the price of a product. The bargaining power of buyers highly influences the company its different departments. It shows how the company tries to create good relationships with clients. As much as possible the company maintains reasonable prices for their fares, they also have promos and discounts that intend to make the clients have second thoughts on purchasing tickets from other companies. When the clients try to dictate lower prices the company tries to know whether it is reasonable and it isn’t it has no choice but let the client go. The bargaining power of sellers is a measure of how suppliers can dictate the price of materials needed by the company. The bargaining power of sellers highly influences the company. The company makes sure that their suppliers have high bargaining power through helping them show their importance in the industry.  The company makes sure that the price being asked for a material has the same value as the same materials’ quality and durability. This will ensure that budgets will not be wasted.   Effect/probability action grid   Effect Probability Information Technology Improved service through better communication. Technology not used well can cause problems. Internet systems Faster and efficient way to deliver information to different sources. Security and privacy will always be a concerned. Competitive systems Have advantage over the firm’s rivals. Must be properly used to achieve desired results.   Task 4 Key issues related to systems development Many systems developers tend to view methods as precise directions to be followed rather than guidelines to be adapted to the situation. When methods must be adjusted or cannot be applied, common reactions are often that the method is inadequate, or that failure occurred because the method was not followed closely enough. Although systems developers in their daily work often adapt methods according to their needs, such adaptations are usually talked about with an air of apology; people feel they did not do things right, and thus, adaptations are conceived of as faults or deviations. It takes a fair amount of project experience, reflection, and self-confidence to be able to distinguish between the methods itself and the practical use of the method. Systems developers’ attitudes to the use of methods are related to questions of participatory design in several ways. When people are faced with new dimensions in their practical work, they tend to deal with them in the same way as they deal with other aspects of their work (Namioka & Schuler 1993).    Their preconceptions of what systems development is about may shape the way they understand what participatory design is about. If they look upon methods as rules to be followed, it is likely that much effort will go into formulating rules for participation too and less effort into finding out how to make participation successful. Also, if the rules are used ritualistically, the mutual benefits from participation may be reduced. This will undoubtedly confirm the belief of many systems developers that user participation is merely a nuisance and should be kept to a minimum (Namioka & Schuler 1993).In a soft systems methodology different aspects are considered this includes analyzing the HAS, Information modeling, social and technical requirements, Human/Computer interface and technical solution. The human activity system (HAS) is composed of three core items. The first, the rich picture, is devised to show the principal human, social and cultural activities at work in the perceived environment. The rich picture usually includes the structures and processes at work in an organization. The second element is the root definition, which, by identifying the key clients, actors, things to be done, assumptions, problem owners and environments, attempts to structure the results of the rich-picture analysis into a common perception by analyst and clients (Bell 1996).   The second stage of the analysis is information modeling. In this stage the analyst adopts a more hard and technical approach. The aim of this stage is to develop the conceptual model into a workable system. Information modeling attempts to draw together the major entities, the functions of these entities, the events which trigger the functions and the attributes of the entities. This stage is necessary in order to translate the key points identified in the conceptual model into a set of human and computer-related functions and entities which can be designed into a new system (Bell 1996).The third stage requires the analyst to attempt to bring together the optimum mix of social and technical aspects, taking into account costs and constraints. This stage should provide the appropriate mix of technology and person power to implement the system. The fourth stage deals with the human/ computer interface (HCI). This involves designing the means by which the two aspects of the proposed information system can best communicate with each other (Bell 1996). This stage is usually concerned primarily with the technical interface operating through screen dialogues, but the social impact of technology in the workplace and issues of data security can also be included here. The fifth and last stage involves the design of the necessary technical aspects which combine to produce the overall technical structure. These aspects include management and control, database, retrieval and application (Bell 1996).   For every company putting up an information technology system is a rigorous but beneficial task. Setting up an information system requires a well thought out plan of action that intends to make sure that order is maintained as the information system is built. There are many things that should be considered before the system can be put into the company. The things that has to be considered in creating an information technology system is the budget for the project, the timeline for the creation of the information technology system, the focus of the information technology system and the probable effects of the information technology and its system. In creating an information technology system, the budget has to be known so that all the materials that will be needed can be minimized or maximized according to the system. The timeline will provide instructions on the step by step process of creating the system.  The information system should have a focus. It can either be an internal agenda or an external change.   How the environment influence system development Many organizations are dependent on information technology and information systems in running the business. These information systems are often very complex and very expensive to develop, therefore organizations need a way to develop such systems in order that they can realize the benefits expected of them. The information systems must deliver the requirements of the business plan or strategy (Tansey 2002). The internal and external environment of Cathay pacific plays a big part in the creation and improvement of its information technology systems.  The internal and external environment of Cathay pacific helps in analyzing whether the information technology system used by the company still fits the need of the environment. The internal and external environment dictates what information technology system needs to be used by the company.   In changing or altering its information technology systems Cathay Pacific considers different factors that will affect the process of changing the system. Cathay Pacific considers first its internal capacities and fixes its internal conflicts before knowing means on how to improve the information technology systems. The company then knows the situation in the industry and what changes have been done by the industry in terms of their own information technology strategy. The company also sees to it that economic indicators are doing well before doing any changes in the information technology systems.   The company then checks the need of the clients how it relates to the IT system.   References Anderson, RH, Bikson, TK, Hundley, RQ & Neu, CR      2003, The global course of the information revolution: recurring themes and regional variations, Rand, Santa Monica, CA.   Balmer, JM & Greyser, SA 2003, Revealing the corporation: perspectives on identity, image, reputation, corporate branding, and corporate-level marketing an anthology, Routledge, New York.   Bell, S 1996, Learning with information systems: learning cycles in information systems development, Routledge, New York.   Blenkhorn, D.L. & Fleisher, C.S. (Eds.). (2003). Controversies in competitive intelligence: the enduring issues. Westport, CT: Praeger.   Boyd, G & Sletmo, GK (eds.) 1993, Pacific service enterprises and pacific cooperation, Westview Press, Boulder, CO.   Cathay Pacific Airways 2005, Company profile, viewed 22 January, 2008, <www.cathaypacific.com>.   Chen, TP, Flowers, EB & Shyu, JP (eds.) 1999, Interlocking global business systems: the restructuring of industries, economies and capital markets, Quorum Books, Westport, CT.   Currie, W & Galliers, B (eds.) 1999, Rethinking management information systems: an interdisciplinary perspective, Oxford University Press, Oxford.   Doganis, R 2002, Flying off course: the economics of international airlines, Routledge, London.   Doganis, R 2001, The airline business in the twenty-first century, Routledge, London.   Hart, JA & Prakash, A (eds.) 2000, Coping with globalization, Routledge, London.   Jacko, JA & Sears, A (eds.) 2003, The human-computer interaction handbook: fundamentals, evolving technologies, and emerging applications, Lawrence Erlbaum Associates, Mahwah, NJ.   Lafferty, WM & Rosenstein, E (eds.) 1993, The challenge of new technology and macro-political change, Oxford University Press, Oxford.    Laurila, J & Preece, D (eds.) 2003, Technological change and organizational action, Routledge, New York.   Lowson, RH 2002, Strategic operations management: the new competitive advantage, Routledge, New York.   Mansell, R & Wehn, U (eds.) 1998, Knowledge societies: information technology for sustainable development, Oxford University Press, Oxford.   Milner, EM 2000, Managing information and knowledge in the public sector, Routledge, London.    O’Connor, WE 1995, An introduction to airline economics, Praeger Publishers, Westport, CT.    Namioka, A & Schuler, D (eds.) 1993, Participatory design: principles and practices, Lawrence Erlbaum Associates, Hillsdale, NJ.   Tansey, SD 2002, Business, information technology and society, Routledge, New York.   Thierauf, RJ 2001, Effective business intelligence systems, Quorum Books, Westport, CT.     Credit:ivythesis.typepad.com

Cathay Pacific Airlines : IT the next five years

Task 1: Introduction Competitive advantage can come from a focus upon key competencies. Capabilities, meanwhile, reflect an organization...