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Strategic Management Scenario Project (GEA 2)  Strategic Management Scenario: Assume you work for the Chief Executive Officer (CEO) of a  moderate size US airline with strong balance sheet

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Strategic Management Scenario Project (GEA 2) 
Strategic Management Scenario: Assume you work for the Chief Executive Officer (CEO) of a 
moderate size US airline with strong balance sheet. As a strategic analyst, you have been assigned the 
task of assessing a new market. Currently your company utilizes a best-cost competitive strategy 
utilizing moderate-to-low airfare pricing while still providing some of the basics not included with all 
airlines (one free checked bag, free snack and non-alcoholic beverage, etc.). As part of your firm's 
growth strategy, the CEO would like you to assess expanding into the charter airline industry based on the 
seemingly popular trend of private air travel. Because this is a potential new market for your company, 
you will need to consider many strategic issues. For example, is this an attractive market to enter? If you 
enter the new market, what competitive strategy should your company use to compete in this new 
industry? Related to that, you will need to consider whether a new brand name is needed for this potential 
product division. Also, how would you market and sell the service? These and many other factors will 
require research and consideration. 
Pre Report Analysis 
1) 
Using cross discipline knowledge you have gained from prior courses, analyze the charter 
airline industry and describe what is required to compete successfully. This should include 
discussing the overall growth of the market, the varying segments of the market (based on 
sales or volume), top companies and strategies used, and if available, the demographics of 
the buyers in the passenger segment, etc.. 

Keep in mind the non bolded question are general Gen Ed 
questions for university curriculum assessment. The bolded question are specific to the scenario for this project and that is what you should address and answer. In other words, by answering the bold questions you are answering the more general question but with more specificity relative to the given scenario. So you only need to address the bolded part of the questions. 
1) 

What do you see as plausible decision alternatives to the business scenario you have been 
provided? Describe at least three alternatives; each should be discussed in detail and address 
different stakeholder perspectives. 
 

Specifically, in this scenario, is entry into the charter market a viable alternative? If so 
what competitive strategies (see Ch 5) are plausible for entering the charter airline 
market? Discuss two possible competitive strategies and defend why each would be viable. 

2) 

What would be the implications of each decision alternative? Describe any ethical implications 
associated with each of the decision alternatives. 

Explain the implications of each plausible scenario. Specifically, consider the following. 
How would entry into the market impact supply decisions (ex. source of supplies such as 
aircraft, pilots, fuel, etc.)? How would the choice of competitive strategy (low-cost, best-
cost, or differentiation) for the potential new charter company impact forward channel 
activities such as bookings/reservations, branding, advertising, etc.? Are there any ethical 
implications associated with these decisions? Consider factors such as safety or impact on 
the natural environment (there could be others as well). 
3) 

What should the strategy be so that the company is best positioned under each decision 
alternative? 


Which decision alternative do you recommend and why? In other words, should the 
company expand into a charter business, and if so, what competitive strategy should be 
used? Regardless of your recommendation to diversify or not, make sure you fully describe 
your choice of competitive strategy and explain why it would be the optimal solution if the 
firm does decide to diversify. Make sure you defend your decision to expand (or not to 
expand) and your choice of competitive strategy that would work the best (regardless of 
your expansion recommendation). 

4) 

As implications of your recommended decision, what are the actions needed in the next year for 
each function in the company: Marketing, Finance, Human Resource, Technology, Operations, 
etc.? 

Describe the impact of your recommended competitive strategy on how various functional 
area strategies should be performed. For example, how would operations/maintenance be 
dealt with? Would new employees be needed to staff the aircraft? Would 
marketing/advertising strategies need to be adjusted for the new product relative to the 
existing airline? Could the company rely on current operations technology to manage the 
logistics of reservations and flight scheduling?