Virgin Group

 

 

 

The External environment is the forces and events outside a company that have the potential to influence or affect it (William and McWilliams 2010). There are 2 types of external environment: General Environment and Specific Environment (William and McWilliams 2010). General Environment is forces that are indirectly affecting the organizational environment, there are 4 elements in General Environment such as The Economy, Technological trends, socio-cultural trends and political/legal trends.  Meanwhile the Specific Environment directly affects the way a company conducts its business, customers, competitors, suppliers, and advocacy groups are the example of Specific Environment(William and McWilliams 2010).

 

General Environment
 

 

The Economy

Economy influences basic business decision. Virgin Australia purchased the remaining 40 per cent stake in Tiger Air Australia for A$1.00 in October 2014, “This proposed transaction marks an important milestone for Tiger air Australia and forms part of the Virgin Australia Group’s Virgin Vision strategy to 2017” said Virgin Australia Chief Executive Officer, John Borghetti.  Borghetti also said “Given the ongoing subdued consumer demand in the Australian domestic market, the growth of the Tiger air Australia domestic fleet is likely to be reduced. Under this proposed transaction, we will benefit from the economies of scale and achieve profitability ahead of schedule by the end of 2016, by leveraging the resources of the wider Virgin Australia Group”. Tiger Air Australia will retain its brand and could potentially launch short haul international services from Australia. Virgin Australia will be looking to turn around the airline’s profitability, with the airline largely being unprofitable since it launched services in 2007.

 

Technological

Technology is the knowledge, tools and techniques used to transform input (raw material, information and so on). Virgin Australia today heralded a new standard for domestic air travel in Australia, revealing the contemporary design of its new Airbus 330-200 aircraft.

The airline will receive the first two new aircraft direct from the manufacturer Airbus this month and a third later in the year, creating a fleet of five Airbus 330 aircraft by the end of 2012. Airbus A330-200 will bring increased fuel efficiency thanks to wing aerodynamic refinements and enhancements to the engines, it mean that the company could save some fuel expanses and allocated the budget more to improve the service.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Socio Cultural

The Socio Cultural components of the general environment refer to the demographic characteristic, General Behavior, Attitude and Beliefs of people in a particular society (William and McWilliams 2010). Nowadays many people choose to study overseas, stay and work in Australia, they have variety of reason for it, and this will affect the demand of flight ticket to go to Australia increasing. It is good news for Virgin Australia; they can make more profit from it.

 

Political/Legal component

The political/Legal component includes the legislation, regulation and court decision (William and McWilliams 2010). Virgin Australia needs to obey International Aviation Legislation, International flight safety procedure and Airport Regulation to make sure that their flight is safe and legal.

 

 

Specific environment
 

Competitors

Competitors are companies in the same industry that sell similar product (William and McWilliams 2010). Virgin Australia strongest competitors based on Richard Branson (Virgin owner) is Qantas airways. They have been competing each other since the first time Virgin Australia established in 2000.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Customers

A customer is a party that receives or consumes product d and service and has the ability to choose between different products and suppliers (William and McWilliams 2010). In the beginning, Virgin Australia was known as low cost carrier airline.  They targeted as much customers as they can in order to expand their flight route. After several years operating as a low-cost carrier it improved its services to become a  "New World Carrier" essentially a business model which offers the customers choice of purchasing a ticket with aspects of the "no frills" approach of low-cost carriers or paying a little more to receive services more in line with full-service airlines. In 2012 Virgin launched business class, at that time the airline has evolved from low-cost roots to roll out a world-class product and service superior to its competition, bringing competition to the corporate sector for the first time in over a decade. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advocacy Group

Advocacy Group

Advocacy Group is a group of concerned people who band together to try to influence the business practices of specific industry, business and profession. Virgin Australia cooperates with local airport around Australia to make sure that their costumers feel cozy while waiting for the flight (boarding) or known as lounges, they also build office inside the airport, open 6 check-in counter in every airport around Australia and open ticket counter around the airport in case that their customers have some problem/ issue, they need emergency ticket or they want a refund their ticket.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplier

Supplier is company that provides material, human, financial and informational resources to other companies (William and McWilliams 2010). Alliance Catering corporate with Virgin Australia Chef Luke Mangan (menu design) in providing food and beverage service to Virgin Australia’s six lounges across Australia. For Fuel, Virgin Australia is collaborating with the Future Farm Industries CRC, GE and Airbus on developing the supply chain to produce jet fuel from mallee eucalypts that grow across southern Australia and particularly in the wheat belt of Western Australia. 

 

 

 

 

 

Reference list:

 Branson, R. (2013). Why competition is good for Australia -  Retrieved 1 May 2015, from http://www.virgin.com/richard-branson/why-competition-is-good-for-australia

 

Australian Business Traveller,. (2012). Virgin Atlantic to join Star Alliance or SkyTeam? Richard Branson keeps 'em guessing.... Retrieved 5 May 2015, from http://www.ausbt.com.au/virgin-atlantic-to-join-star-alliance-or-skyteam-richard-branson-keeps-em-guessing

 

Wikipedia,. (2015). Virgin Australia. Retrieved 2 May 2015, from http://en.wikipedia.org/wiki/Virgin_Australia

 

Rose, G. (2015). Mallee harvester brings renewable jet fuel a step closer for Virgin Australia -  Retrieved 2 May 2015, from http://www.virgin.com/unite/business-innovation/mallee-harvester-brings-renewable-jet-fuel-step-closer-virgin-australia

Williams,C. and  McWilliams,A. ( 2013) MGMT: (2nd Asia Pacific Edition), South Melbourne   Vic.: Cengage Learning