Cyprus International University

Faculty of Economics and Administrative Sciences

BUSN204 – Case studies in Business
Assignments and Final Sample
Spring 2021

Student Number Name & Surname

1. Framing:

Key Questions: Flipping and Skimming:

 Should SIA invest in Virgin Atlantic?  16 page case with 10 exhibits and a
 Should SIA pursue a low-cost strategy? glossary
 Should SIA stay in the Star Alliance?  Lots of data provided – not all will be
relevant
 The organization of the case is:
(i) introduction;
(ii) industry;
(iii) markets – NA, Europe, Asia;
(iv) alliances;
(v) Singapore – country and company;
(vi) Issues moving forward.

Beginning of Case: Ending of Case:

 The timetable is the beginning of the 21st  An important fact is that even though the
Century (1999) airline industry
 A major strategic issue is the possible  is increasingly global, there are very few
investment in VA true global
 Other strategic issues include:  players
(i) increasing competition;  The alliance decision is critically
(ii) labor costs are rising; important
(iii) customers are moving toward lower  SIA leaders seem to be in support of the
fares; VA investment
(iv) Alliances.

2. Labeling: Please label in your case paper and submit the case with this paper to the invigilator.
3. Summarizing:

General Environment:
 Globalization is increasing demand for international
air travel (esp. to Asia)
 Political changes include the increase of free trade
markets (like Singapore)
 Economic conditions are important as recessions
cause price sensitivity

Industry:
 Consolidation in the airline industry is increasing to
enhance scale and scope
 Alliances are the hottest strategy tool as companies
seek global connections
 Customers are increasingly price sensitive but
business segments are loyal
 There are little to no substitutes for international air
travel

Competition:
.....External.....  Key domestic competitors are Japan Airlines, Thai
Airways, and Cathay
 Key international competitors are United, KLM, and
British Airways
What is really  SIA has the best cost structure for premium level
service but losing ground
important?

Strengths:
 Reputation and brand image of the “Singapore Girl”
 Young fleet and excellent training facilities and
.....Internal..... programs
 Extensive regional and international route network

Weaknesses:
 Increasing difficulty supplying high quality labor at
low costs (esp. Singapore)
 “Buttoned Down” image may not be attractive to
younger demographic
 High cost structure needed for high quality service is
difficult to change
4. Synthesizing:

Question Option/Hypothesis Decision Criteria Pros Cons

Invest in VA?
Low Cost (rather than
Overall Strategy?
Differentiation)
Stay in Star Alliance?
• Enables a lower • Competes with Star
cost product Alliance
offering • Limited resources/
Yes Return on Investment • Access to younger opportunity cost
demographic • May affect
• Complimentary reputation
routes
• Head to head with • Lose reputation as
new competitors high quality
• Seems to be the provider
trend in the U.S. • Goes against
Long Term Profitability
• Fuel costs are rising infrastructure
• Differentiation may
be the only way to
win
• Cross-selling • Lose control of
opportunities to scheduling
new customers • May compromise
Yes Market Share Growth • Access to the consistent
additional routes quality of service
quickly
 5. Concluding:

Overall Recommendation

SIA should set a strategic Vision to be the

leading global premier service airline.

Implem

entatio Risks

 Alliances don’t
 Invest in VA (but go Key Supporting Facts deliver
high end)  This is a critical time as technology and global reach  Costs get too high
 Stay in Alliance  require a high-end international access airline
 Other airlines act
 Expand high quality  SIA’s best strengths are high end service and global first
labour pool routes
 Going low-cost will damage long-term profit potential