Airborne Express Present Strategy Airborne Express, Inc. is as an air express company and global airfreight forwarder. Airborne Express provides door-to-door express as well as deferred delivery of any packages and documents throughout the US and Canada and virtually any other foreign country. Airborne is an international and domestic freight forwarder for personal and business shipments of any size. Airborne Express, Inc. (AEI) is a subsidiary of the Airborne Inc. that also includes the subsidiaries: ABX Air, Inc.
and Sky Courier, Inc. corporate level Mission statement of Airborne Express is the following. Airborne Express is one of the worlds most trusted shipping companies; We are trying to keep it the best by listening to our customers, understanding their needs, and delivering dependable, cost-efficient solutions for their distribution needs. Financial analysis. Corporate financial is the determinant factor of the companys success because unsuccessful companies cannot boast good financial results and are doomed to failure. Against the industry. Having analyzed the Airbornes performance over 5 years and compared it to the US S&P500 one sees that the Airborne slightly underperforms the general US market, yet if considering the air couriers industry one can see that Airborne is among the top competitors (second after FedEx) in terms of sales and market share growth. (please see the information on http://www.airborne.com/Investor/FundamentalsAll.a sp?nav=AboutAirborne/InvestorRelations/Fundamental s ) Against major competitors.
The Research paper on Airborne Express case study
Airborne Express, an air express transportation company has succeeded to compete with a few big competitors such as Federal Express and United Parcel Service (UPS) even it does not have funding as much as its competitors. In 1996, it held third position in the industry with 9 percent of the market. Even Airborne is smaller size company compared to its main competitors, it still can survive with ...
The Airbornes main competitor is Federal Express and DHL. The Airborne although slightly underperforming the FedEx is certainly over-performing DHL on market capitalization, and dividend growth figures. The Airborne Expresss financial rations (liquidity, profitability, solvency and efficiency) look good and do not show any eminent threat, while at the same time making Airborne an attractive target for takeovers, one of which already occurred when FedEx bought a ground branch from Airborne (www.bloomberg.com, prepaid archive service).
Corporate level strategy Corporate level strategy of Airborne Express is concerned with the selection of businesses in which the company should compete and with the development and coordination of that portfolio of businesses. Corporate level strategy of Airborne is concerned with: Reach – defining the issues that are corporate responsibilities; these include goals of the corporation (remain top aircraft carrier), the types of businesses (fast deliveries around the globe), and the business infrastructure (number of aircraft, flight schedules, customs procedures).
Competitive Contact localization of the competition within the organization. Airborne express takes price in wonderful coordination of it ground and aircraft units, each of them competing successfully with FedEx and other air couriers. Managing Activities and Business Inter-relationships – Airborne strives to coordinate its ground and aircraft units to deliver packages promptly. Management Practices – Corporations decide how business units are to be governed: At airborne Express, all operations are highly centralized despite the fact that the company operates worldwide.
The direct corporate intervention is seen as a key success factor for Airborne express that has tight schedules and requires total coordination between resources. Therefore, Airborne Express pursues single business (air courier ) while some minor attempts are made to organize charter flights for a limited business market. Being a subsidiary on its own. Airborne express is primarily focused on small packages delivery. The corporate structure of Airborne Express is highly centralized yet is multidivisional. This is primarily needed for the companys market success that depends on high coordination between the ground and air units. These units have zero autonomy. 2.1 Business Level (main emphasis) Business unit level Strategy. A strategic business unit of Airborne Inc.
The Research paper on Ryanair’s Business Level Strategy
A company’s business model is management’s model of how the strategies they pursue will allow the company to gain a competitive advantage and achieve superior profitability. Business strategies are the actions management take to execute a business model. At the heart of any business level strategy is the objective of developing a firm-specific business model that will allow a company ...
may be a division, product line, and other profit center that can be planned independently from the other business units of Airborne. At the business unit level of any company, the strategic issues are about developing and sustaining a competitive advantage for the Airborne services that are produced. At the business level, the Airborne strategy formulation phase deals with things like positioning the air currier against rivals (FedEx, DHL, etc.), anticipating changes in supply/demand and other external environment and adjusting the strategy to benefit from such changes. The other thing that is worth noting is Airbornes attempt to influence the nature of its competition through strategic actions (lobbying, Merger & Acquisition activity or vertical integration).
Speaking about the Porters generic strategies (focus, cost leadership, differentiation) that Airborne Express utilizes to fight the Porters 5 forces I would like to say that Airborne uses a combination of focus and cost leadership strategy. The focus strategy is seen in Airborne Express business that derives 99% of its revenues from delivery of small packages, and cargo absolutely neglecting such businesses like people air travel, or aircraft training services.
The cost leadership strategy is certainly seen in the corporate attempt to modernize its infrastructure. Airborne Express deploys a great number of computers to perfectly time the arrival of airplanes and pick up personnel to pass on the package in a relay-run manner. The investment in technology allows Airborne to fill in the airplanes to the maximum to minimize the number of flights and thus reduce the costs that in turn would reflect in lower prices to consumers. 3.1 Functional Level (main emphasis) The functional level of the Airborne is the level of its operating divisions and departments. The business processes and the Airborne value chain are precisely assessed here. Functional level strategies in finance, marketing, and R&D involve the innovative development and coordination of resources to execute the business strategies efficiently and effectively. Functional units of an organization are involved in higher level strategies by providing input into the business unit level and corporate level strategy, such as providing information on resources and capabilities on which the higher level strategies can be based.
The Essay on Strategies and Business Models
The article which is associated with strategic business model is titled Portal Economics and Business Models. The article asserts that strategic business model is all about the nature in which a business works. Business model is normally used in the explanation of the modus operandi. The option will be used in the explanation of marketing, supply, finance, strategies and the operations of the ...
Once the higher-level strategy is developed, the functional units translate it into discrete action-plans that each department or division must accomplish for the strategy to succeed. Airborne deploys responsiveness and quality strategies at the functional level. The responsiveness strategy, which is also mentioned in the corporate mission statement is the airborne attempt to constantly utilize the customers desires and wishes to appear like a good company as well as to build up on the innovative outsider ideas. The Quality strategy is also seen in the corporate attempt to establish perfect delivery timing, synchronization of its resources, and minimization of costs that is possible when the quality is good and customers do not complain.
Bibliography:
www.airborne.com www.finance.yahoo.com (prepaid archive service on air curriers industry) www.bloomberg.com (prepaid archive service on Airborne) www.reuters.com (prepaid archive service on Airborne and its industry) Johnson, Steven, The corporate marketing, NY Random House, 2002. (Analysis of Porters generic strategies).
http://www.airborne.com/Investor/FundamentalsAll.a sp?nav=AboutAirborne/InvestorRelations/Fundamental s Addendum. (Taken from finance.yahoo.com) Airborne Express vs.
S&P 500. http://ichart.yahoo.com/z?s=abf&c=^spx&a=v&p=s&t=5 y&l=on&z=m&q=l.
