Virgin Group

PLANNING

 

 

 

 

 

 

 

 

Planning is bringing the future into the present so that you can do something about it now. By another way, planning can also mean “Choosing a goal and developing a method of strategy to achieve that goal.” (Williams and McWilliams, 2010, pp85)

There are two types of planning: General planning and Strategic planning.

 

General planning is to set a goal and do the best to achieve it, followed by 5 steps:
1. Set the goal.

2. Develop goal commitment.

3. Develop effective action plans.

4. Track progress toward goal achievement.
5. Maintain flexibility.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    As mentioned, general planning is: “Choosing a goal and developing a method of strategy to achieve that goal.” (Williams and McWilliams, 2010, pp85). However, strategic planning shows a different way to define planning: “Overall company plans that clarify how the company will serve customers and position itself against competitors over the next two to five years.”. The steps of Strategic planning are: Mission statement, SWOT analysis, formulate strategy, implement strategy and evaluate strategy.

 

    In this case, Virgin Airline had chosen the Strategic plan, in order to achieve that, they have to follow the steps in the strategic plan. The very first step of a strategic plan is setting the mission statement. The concept for the Mission statement is a statement of a company’s overall goal that unifies company-wide efforts towards its visions, stretches and challenges the organization, and possesses a finish line and a time frame. (ref) Virgin’ unique mission is: “Our mission statement is simple, yet the foundation of everything we do here at Virgin Atlantic Airways…to embrace the human spirit and let it fly”. This could be explained as encouraging customer spirit with quality, hospitality service through every flight.
 

 

    After creating the mission statement, Virgin need to complete their SWOT analysis. SWOT analysis is a method of measuring Strengths, Weaknesses, Opportunities and Thread, of which Strengths and Weaknesses are internal factors, controlled by the business, yet Opportunities and Threats are external factors, which can’t be controlled by the business.

    Virgin's Strength is their wall of awards. So far, Virgin is proud of achieving many awards for their services and customer service. In July 2014: Virgin Australia has been awarded with ‘Best Airline Staff Service’ in the Australia/Pacific region at the 2014 Skytrax World Airline Awards for the fourth consecutive year. One added factor to their famous is Virgin Founder, sir Richard Branson, world famous influencer, as through his celebrity, many people get know Virgin Airlines. Also, their flights have a cheaper price compared with others, one of the main concerns of customers.

    Even so, Virgin still has some weaknesses.Virgin airlines mainly relies on Domestic flights. Thiis means they are more vulnerable when there is a  weak domestic market. For instance, In August 2013, Virgin Australia announced an underlying loss of $72.8 million for 2013, which is down from the $82.5 million profit recorded in 2012. This result included a reduction in domestic and international EBIT of about $170 million and $32 million respectively.

    Due to the rise in demand for flights due to the comfort and time saving nature of flying vs driving, Virgin could catch the opportunity to expand their business. As an illustration, in 2014, Virgin has taken total control of Tigerair Australia under plans to buy the remaining 40% of the loss-making low-cost airline.

    However, there are lots of threats their business is facing. One of those is their Competitors. Virgin is not a unique airline, beside them are Emirates, Quantas and Jetstar,  those competitors are taking the chance to attract their customers every single day. That is truly a major threat to Virgin in this case.

 

 

After having analyzed their SWOT, the third step is to formulate strategy. To maintain a low cost strategy, as mentioned above, Virgin could take some actions. Eradicate in-flight meals. Eradicate printed tickets for flight bookings, use telephones and internet instead. This means that  foods are sold on board in the flight. Limiting the number of airports which are used. By doing that, they can guarantee  the low cost flight but also maintain the balance and make profit for their business.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    After formulating strategy, Virgin starts implementing their strategy. To generate more profit, they should not only target lower costs but also improve their customer service. They could provide more facilities, magazines, free drink; improve customer service. In addition they should think about introducing Frequent Flyer programs for its repeat customers.

 

 

    The very last step is evaluating strategy. They might evaluate their results and if anything goes wrong, they might go back to their process, find out the problem. In this case, if the negative feedback about the quality of services increases, they need to think about providing free meals to customers, also implementing better service inflight. The most important thing is to evaluate the results, to see if the business is still on-track, to guarantee if the business can accomplish their goals.

 

 

    In other words, planning could be explained: “ A management function that involves defining goals, establishing strategies for achieving those goals and developing plans integrate and coordinate activities” (Robbins et al, 2009, p.246). After all, what a company could be if they doesn’t have anything to achieve. Planning is like the very first step to commit to a goal, from that, managers could develop their strategy then acquire goal achievement, and finally generate profit.

 

 

 

 

Reference list

Virgin-atlantic.com, (2015). About us | Virgin Atlantic. Retrieved 2 May 2015, from http://www.virgin-atlantic.com/au/en/footer/about-us.html

 

Samples & Case Study Review Sample, (2013). COMPARATIVE AND STRATEGIC ANALYSIS OF QUANTAS AND VIRGIN BLUE AIRWAYS. Retrieved 2 May 2015, from http://myassignmenthelp.info/assignments/comparative-and-strategic-analysis-of-quantas-and-virgin-blue-airways/

 

market, V. (2013). Virgin more vulnerable to weak domestic market. The Sydney Morning Herald. Retrieved 2 May 2015, from http://www.smh.com.au/business/aviation/virgin-more-vulnerable-to-weak-domestic-market-20130830-2svd0.html

 

Australian Business Traveller,.(2014). Virgin Australia buys all of TigerAir Australia – for $1!. Retrieved 2 May 2015, from http://www.ausbt.com.au/virgin-australia-to-buy-all-of-tigerair

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