Delta Airlines

Competitor Analysis

In order for a company to be able to beat its competitors, it needs to analyse the strategies used by its competitors thus being able to perform its objectives in a very unique way (Rapajic, 2009). Competitor analysis is a very essential tool and it has two principle activities which are: gaining information concerning significant competitors and utilizing that information in order to predict the behaviour of the competitor (Hax, 2010). The following are the things that the company should be looking for from its competitors: current strategy of the competitor, the objectives of the competitor, the assumptions of the competitor, the resources and capabilities of the competitor, and the response profile of the competitor (Warkentin, 2015). Through competitor analysis, the company can be able to discover the weaknesses of its competitors and thus being able to perfect its services hence emerging as the winner. Moreover the company can be able to predict the future trends of its competitors and thus being able to prepare for such trends earlier enough.

Delta Airlines has three main competitors which are: American Airlines Group, Southwest Airlines and United Continental Holdings (Rapajic, 2009). Due to the stiff competition that the company faces, up to May in the year 2015, it had a market share of $34.4 billion and its sales had reached $40.32 billion, thus becoming the best performer in the airline industry for a period of 5 years.

Resources

                Delta Airlines has different resources which help it to be able to beat other companies in the competitive market. These resources include: technical resources, financial resources, physical resources and Organizational resources (Warkentin, 2015). The company’s technical resource is the use of the new technology, thus making the services provided by the company to be smooth and efficient.

Technical Resources

Delta Airline introduced a $50 million investment on technology in order to safeguard passengers’ luggage.  The company holds over 120 million bags every year, and this investment is aimed at reducing loss of bags by passengers while at the airport. Delta Airlines will therefore be tracking passengers’ bags using Radio Frequency Identification, (RFID) (Warkentin, 2015). The RFID chips will be mounted on the bag tags thus the movement of the bags will be monitored. Moreover, the chips will help in updating real time location of the bags and hence lost bags can be easily traced. The RFID is also passenger friendly since it will allow the passengers to monitor the movement of their bags using an application on their phones (Hax, 2010). Delta Airlines will therefore be able to cater for bag problems in the company since it costs the company $100 in case a passenger losses his or her bag while at the airport.

Financial Resources

                Delta Airlines as of 2015, received a net income of $1.22 billion, compared to $1.48 in the year 2014. This has been attributed by the fall in the earnings per share which reduced from $1.83 to $1.49 due to the change in the market trends. The company’s generated a revenue of $10.5 which is less compared to the previous year which was $10.7 billion (Warkentin, 2015). This fall has also been attributed to changing in the market trends and stiff competition from other airline companies in the world. Currency pressure in the world has also been a problem which has led to the drop in the profits realized. Recently the company offered more seats to passengers at a cheaper price in order to be able to cater for the currency pressure in the world. Despite of the change in market trends, currency pressure in the world and increase in fuel prices, the company was able to avoid any losses. This therefore led to the realization of low profits by the company in the year 2015.

The company which serves approximately 180 million customers each and every year, was named by Fortune magazine to be among top 50 most admired companies in the world (Rapajic, 2009). The company also has the best travel network in the world and it was ranked as the number one in the field of airline industries all over the world (Hax, 2010). The company offers high quality customer services and its prices are fair compared to other airline companies in the world.

Physical Resources

                Delta Airlines owns the best aeroplanes ranging from Boeing 747 to Boeing 777. These aeroplanes are designed to carry passengers and luggage. The aeroplanes are fitted with good very comfortable seats and its staff is passenger friendly (Warkentin, 2015). Moreover, the company transports cargo to different parts of the world and in case of any losses, the company will be held liable. Passengers are offered with a large baggage space and thus they can be able to carry luggage of up to 30 kilograms.

Organizational Resources

                Delta Airlines merged with Northwest airlines which was a way of increasing profits and reducing costs. The company was however later faced with financial challenges due to a drop in business demand. The company was however been able to recover this problem and this was after the collapse of fuel prices in the world (Warkentin, 2015). This saw the company saving lots of money and increasing its profits. The company was therefore able to realize $1.2 billion from fuel prices hence it was able to increase profits and cover financial problems that it had earlier experienced (Rapajic, 2009). The human resource management of the company makes sure passengers are taken good care of, and this is usually done through allowing passengers to rate their flight attendants (Hax, 2010). The employees in the company therefore do their best thus making Delta Airlines to remain as the leading company in the field of airlines.

Capabilities

                Delta Airline has different capabilities which can enable the company to take over the international market for a long period of time (Hax, 2010). These capabilities gyrate around service production and quality management. The company has the capacity to provide its clients with the best services due to the strategies that it has put in place (Warkentin, 2015). Moreover, the management of the company has the required finances to be able to cater or any problems associated with poor services delivery. Therefore, the company is able to retain its position as the market leader in the whole world.

                The management of the company has the capability of entering into another business in order to safeguard the company in case of poor performance in the market. Moreover, the management can also adopt outsourcing which is a method that would see the company reducing costs and increasing profits (Hax, 2010).

Core Competencies

                The strategies put in place and the resources that Delta Airline has put it in the front line thus, it is able to beat its competitors (Warkentin, 2015). The company has future plans which cannot be compared to that of its competitors, this is so because it invests in projects which are going to affect the company positively. Delta Airlines has been in market for almost 80 years and this acts as an advantage since the company has been able to understand the changes in the market. The company has therefore been able to put measures in place thus safeguarding t from experiencing any losses.

Reference

In Warkentin, M., & Decision Science Institute,. (2015). Trends and research in the decision sciences: Best papers from the 2014 annual conference.

Hax, A. C. (2010). The delta model: Reinventing your business strategy. New York: Springer.

Rapajic, J. (2009). Beyond airline disruptions. Farnham, England: Ashgate.