CASE STUDY OF PAL VICE PRESIDENT OF MARKETING

Philippine Airlines
Pioneering in end-to-end airline operations that constitute an industry of its
own, Philippine Airlines, Inc. (PAL) lives on with its original name and the
national colors, shining through for almost eight decades. PAL stemmed
from the Philippine Aerial Taxi Company established in 1931 by co-founder
Andres Soriano, who shut it down in 1939 and replaced it with Philippine
Air Lines two years later. Braving the imminence of war, PAL had its
inaugural flight with only five passengers from Makati to Baguio on March
15, 1941.
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Purpose
To know the financial performance of a business entity for a given period
also to recognize the total income and expenses, showing separately the
total amounts attributable to equity holders of the parent company and to
minority interest of a corporation.

Challenges
The Covid-19 outbreak caused disturbance on business and economic
activities, which is continue to evolve in these times. In consequence, the
company's passenger operation was also disrupted; causing both domestic
and international flights will be suspended until the quarantine period is
lifted. As Philippine Airlines continue to develop their new routes, the
company itself also maintains the rapid growth of revenue in year 2019 as
they sustained the capacity of passengers. The PAL Group has been
dealing with the devastating impact of COVID-19 on demand and liquidity
which the operating expenses of the company dropped mainly due to the
reduction of flying costs that was suffered in very limited operations causing
the group to endure the tremendous decline of profit, which amounted only
PHP 55.3 billion in year 2020. Simultaneously, the reduced operations
caused the company to have a problem in liquidity to take drastic measures
affecting the stakeholders, employees, industry partners, lessors and
lenders.

Solutions
Data analysis is the tool that PAL Group used amidst of Covid-19 to extract
insights to develop a plan or process the rationale of digitalization, and to
create a better organizational structure. As the company faced the problem
through business and economic activities, the airline managed to employed
cost containment efforts to raise additional funds from the stakeholders and
in the sale of assets.

Results
Through the strategy of the PAL Group, they control the expenses to
reduce the measures in which consisted of executive pay cuts and 50%
leave without pay for all employees every month since April 2020,
reductions in staffing with skeletal operations, and elimination of almost all
marketing and discretionary expenditures. Even though the revenue of
airlines dropped, the Management of PAL bear the crisis and pay the
employees’ salaries, operating expenses, and remit taxes of the
government which the Group’s market share stays strong despite the
pandemic and the tough competition within the market.
Financial Reports
According to Statista Research Department, in year 2020, the revenue of
PAL Holdings Incorporated in the Philippines amounted to approximately
55.52 billion Philippine pesos, reflecting a 64 percent decrease from the
previous year's total. PAL Holdings Inc., with its parent company Philippine
Airlines, is primarily engaged in air transport in the country. Net loss surged
to 73 billion pesos from 9.7 billion pesos in 2019, while revenues shrank
64% to 55.3 billion pesos. Its capital deficit stood at 74 billion pesos at the
end of the year, from 3.5 billion pesos in 2019.

Practices
For employees, managers are compensated for making hiring and firing
decisions based on objective criteria to ensure that if employees work hard,
they will be given a chance to succeed. Managers should also be taught
how to give constructive feedback and conduct fair performance
assessments. As for customers, they continue to strive for providing the
best quality travel experience and to enhance the policies and systems.
They offer a lower fare which suits for the budget of every customer and
the customers’ essential needs during lengthy tarmac delays are met by
providing adequate food and water, also the adequate medical attention.
MEMBERS:

Brozas, Sybel
Bunag, Nicole
Calimlim, Mark Joseph
Galan, John Andrei
Natividad, Kyla Gacula
Tanael, Adrian