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Virgin Atlantic Strategic Analysis
Analysis of Strategic Factors:
Current mission is on tract for future growth of Virgin Atlantic. “Over the years Virgin Holidays has become the biggest tour operator to Florida and in a few short years operating to the Caribbean is already closing in on the number one spot in that region as well” (www.virgin.com) Virgin Atlantics goal is to achieve 10% growth per year over the next few years. New routes will be announced including new routes to Sydney, Havana and Nassau. In addition, the growth will require recruitment of many thousands of staff and the nearly doubling of the fleet over the next decade.
Strategic Alternatives
All companies must ask several questions to play a pro-active part in a competitive environment.
When and why change
What step to change
How and how fast to change
Virgin Atlantic has taken several steps to insure their future in the world; one step is attempting to construct their own refineries. Mr. Branson was quoted as saying “If we dont start now to get more refineries built then fuel prices could literally rocket to $US100-$US200 and the world economy would come to a screeching halt.
Weve already taken action with Virgin Atlantic: Weve reduced capacity. Weve grounded fuel-guzzling, expensive planes. Now, weremuch more fuel-efficient. We need to see ourselves through to the good times again.”
Advantages of growth strategy will give Virgin Atlantic the competitive advantage being able to control their own crude prices, and moving to a more fuel efficient airplane.
Disadvantages of this growth strategy are the loss of focus on the airline.
Pause strategy:
Virgin Atlantic needs to take one step at a time; continue to work on Virgin Holiday prior to trying to revamp the airlines.
Advantages would include not spreading themselves so thin.
Disadvantages would include loss of the overall future picture.
Recommendations
Virgin Atlantic should maintain their initial vision and proceed with Virgin Holiday in the Caribbean to increase their net profits, while changing