Organisational Strategy at Flybe

3383 Words Mar 4th, 2011 14 Pages
Introduction
For the purposes of this report I have chosen Flybe as my main focus of discussion in the UK and European airline industry. Flybe is Europe’s largest regional airline with 162 routes, operating from a total of 53 departure points. In this report I will analyse why it has made sense for Flybe to build on their strengths of being a regional operator and how they have managed to find a niche in the crowded airline marketplace. I will also discuss their strategy for future growth and how they have chosen their battleground carefully. I will discuss in detail how Flybe is attempting to fulfil its mission statements of “Low Cost, But not at any cost” and “To give you safe, efficient and friendly service”(Flybe, 2008).

Eye For
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The acquisition made Flybe one of the largest European LCC (Done, 2007, Annual Report, 2007). This fitted well with his strategy of competition with its established airlines. However, acquisitions carry their own risks such as human relations problems (that can arise after the acquisition), not easy to dispose of unwanted parts of the company, problems of clash of national cultures particularly where target if foreign and high risks if a wrong company is targeted (Lynch, 2003).

Re-branding
Flybe has been reframed into a recognisable product on the market. The Flybe brand has continued to grow with passenger volumes up from 4.7million to 7million in 2006 and 2007 respectively (Done, 2007). The forecast for year 2008 was predicted to an annual turnover in excess of £500 million and passenger volumes of 10 million (Done, 2007).

It is debatable that Flybe’s initial plan was to establish itself on the market as phase one of the programme. Against a background of heavy losses, Jim French took a risk that paid off by sustaining Flybe into existence considering the intensity of competition on the market against established brands like Ryanair and Easyjet. Sustaining Flybe on the market would have been the second phase. Flybe adopted a strictly no-frills strategy between 2002 and 2006. However, a shift in strategy has been noted from 2006 onwards. This strategy is that of differentiation.

The Differentiation Strategy
Examining Bowman’s Strategic Clock