Virgin Australia Airline: Management Report

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Virgin Australia Airline Report
Report on external environment and management functions
Taffy Ghozali, Hafizhah Chandra

Executive Summary

The purpose of this report is to examine Virgin Blue’s external environment followed by its impacts to the organization as well as how management functions could help overcome the external environment for the organization to compete properly in the domestic airline market.
Virgin Australia is Australia’s second largest domestic airline, commenced in operations back in 2000 as a low-cost carrier (LCC) and has successfully survived in the market. Major shareholders include Air New Zealand, Singapore Airline and Etihad Airways. The airline rebranded in 2011 as a part of their 5-year turnaround
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In continuation, Duncan’s framework for assessing environmental uncertainty, which examines the environment from environmental change and complexity perspective, will be used to further analyze the type of external environment and thus methods to overcome and adapt to it. All resources from external environment will be adopted to Fayol’s 4 management functions starting from planning, organizing, leading and controlling. The aftermath of this adoption would result in completing best performance for the organization and thus compete effectively. The model is shown at the figure below: | External Environment | Task (specific):Industry sectorAirline rivals Virgin Australia and Qantas are intensifying their competition in domestic market – Qantas developed Jetstar to enter LCC while Virgin aims to go up market (Robbins, Bergman, Stagg & Coulter,2011)..Raw materials sectorAviation fuel price has increased over the period of 2004 to 2013 in the domestic market, from $AUD41.5 to $AUD140 per barrel (O’Sullivan, 2012).market sectorDomestic airfares decreased since mid 2011 to 2012 period while number of passengers increase by 4.5% from 2011 to 2013 (Aspire Aviation, 2013).human resources sectorCashed-up miners are taking top IT talents to their businesses, leaving Virgin Australia in search for staff to complete major
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