Toward a Single European Sky Case Solution

The Harvard Business Review published a case study that primarily focuses on Toward a Single European Sky. The following case solution has been designed to give the reader an overview about the business world along with a clear understanding of its growth dynamics. Recently, Toward a Single European Sky has been subjected to strategic as well as managerial problems that require immediate attention so that they can be resolved to allow future growth, expansion, and competitive edge within the marketplace. This case study solution is being written to provide a strategic solution to Toward a Single European Sky using various appropriate tools and frameworks. Harvard Business Review’s case studies involve a central problem that is faced by a particular company. The problem identified involves strategic and managerial implications for the company. Therefore, it is important for readers to critically identify the problem Toward a Single European Sky faces. Moreover, it is also essential to highlight the key stakeholders that are impacted and influenced by the problem identified.

External Environmental Analysis

The external environment holds significant importance for Toward a Single European Sky to ensure that the company is able to respond to all the changes in the macro-environment. This is because Toward a Single European Sky cannot control the factors and thus can directly influence the company's operations (Indris & Primiana, 2015). The external environment of Toward a Single European Sky will be assessed using PESTLE Analysis.

Political

• A stable political environment provides a favorable market growth trend for Toward a Single European Sky.

• It is important for Toward a Single European Sky to analyze the pressure groups, and social environment activists. The company can make close collaborations with these groups to achieve company goals (Wang, Wang, & Shi, 2022).

• High restrictions on trade and high levels of taxes can contribute to the complex business environment for Toward a Single European Sky by impacting imports and exports.

Economic

• Toward a Single European Sky can benefit from wide-range opportunities in business growth by operating in developing economies (Munro, 2017).

• High GDP can determine the long-term growth strategies of Toward a Single European Sky, signaling the ability of consumers to spend on more products.

• Higher rates of interests can provide Toward a Single European Sky with more investment opportunities.

• The flexibility in the labor market allows Toward a Single European Sky to take advantage of higher workforce productivity.

Social

• The selection of appropriate demographic segments has allowed Toward a Single European Sky to select the right segments of the market that have high growth potential.

• The research on gender roles has helped Toward a Single European Sky to develop and align communication as well as marketing strategies accordingly.

• Toward a Single European Sky has been successful in understanding the norms and cultures of different countries by developing local teams and partnerships (Hueske, Endrikat, & Guenther, 2015).

Technological

• The adoption of innovative marketing techniques that involves communication technologies has allowed Toward a Single European Sky to collaborate successfully with consumers.

• The company has stayed ahead in the market, and can significantly increase its market share by placing its major focus on emerging technologies (Akpoviroro & Owotutu, 2018).

• Toward a Single European Sky should maximize its profits by investing in disruptive technologies.

Environmental

• It is crucial for Toward a Single European Sky to adopt effective waste management practices to reduce environmental pollution (J. K, W. J, & D., 2016).

• Toward a Single European Sky should adopt eco-friendly products to establish better relationships with the stakeholders.

• Toward a Single European Sky can take advantage of subsidies offered in renewable technologies to achieve the long-term goal of sustainability.

Legal

• Toward a Single European Sky should follow proper laws concerning employee health and safety, and anti-discrimination laws to effectively develop HRM.

• Consumer protection laws are also important for Toward a Single European Sky as it involves the consumer protection from fraudulent marketing (S. Samusenko, S. Plaskova, & A. Prodanova, 2020).

• Toward a Single European Sky can gain a competitive advantage, and can position itself strongly in the market by protecting intellectual property laws.

Porter’s Five Forces Analysis

Threat of New Entrants

• It is difficult to achieve economies of scale in Toward a Single European Sky’s industry, making it a weaker force for new entrants.

• There are high capital requirements in the industry. This makes it difficult for new businesses to set up their companies, and compete against Toward a Single European Sky.

• The industry has a strong product differentiation, and heavy investment is needed for customer acquisition. Thus, Toward a Single European Sky can focus on innovation to differentiate itself from its competitors (H. Th. Bruijl, 2018).

• There are strict legal requirements to join the industry in which Toward a Single European Sky operates, making it difficult for new entrants to enter the market.

Bargaining Power of Suppliers

• The bargaining power of suppliers in the industry is weak.

• Toward a Single European Sky operates in an industry with a higher number of suppliers. This means that suppliers do not have much control over their prices.

• Standardized products that have low switching costs are provided by suppliers allowing buyers like Toward a Single European Sky to easily switch their suppliers (Fabbri & F.Klapper, 2016).

• Raw materials can be purchased at lower prices by Toward a Single European Sky. The company can also switch suppliers for more reasonable pricing.

• Toward a Single European Sky can benefit from a variety of suppliers as it can have multiple suppliers for its various geographical areas (Cho, Ke, & Han, 2019).

Bargaining Power of Buyers

• The bargaining power of buyers in the Toward a Single European Sky industry is weak.

• There is a high product differentiation in the industry, making it difficult for buyers to switch to alternative firms.

• Toward a Single European Sky can come with differentiated and innovative products to attract more buyers of the industry (Zhao, Zuo, & Wu, 2016).

• Buyers of this industry has low incomes. This means they prefer to purchase items at lower prices, making them more price sensitive. Organizations like Toward a Single European Sky can offer lower prices to attract customers.

Threat of Substitute Products or Services

• There are few substitute products available in the industry in which Toward a Single European Sky operates.

• Expensive substitutes are available in the industry of Toward a Single European Sky, making it difficult for buyers to switch to those substitutes (Aithal, 2016).

Rivalry Among Existing Firms

• The rivalry among existing firms is moderate to weak.

• There are few competitors in the industry in which Toward a Single European Sky operates.

• A large market share is enjoyed by fewer firms in the industry. This means that more competitive actions will be made to become leaders in the market (Seema, 2016).

• The industry in which Toward a Single European Sky operates has highly differentiated products, making it difficult for companies to win each other customers.

• Toward a Single European Sky can focus on making more differentiated products to gain a strong competitive edge in the market (Zhao, Zuo, & Wu, 2016).

Internal Environmental Analysis

Toward a Single European Sky can use internal environmental analysis to identify and evaluate the competitive positioning of a company in the business environment. This involves conducting a SWOT Analysis that can help Toward a Single European Sky to identify the company’s internal strengths, weaknesses, opportunities, and threats (Halmaghi, Iancue, & Băcilă, 2017).

SWOT Analysis

Strengths

• Toward a Single European Sky has a strong distribution network that has allowed it to make its products available to large customers within the given timeframe.

• A strong presence on social media platforms has allowed Toward a Single European Sky to have a high level of customer engagement (Rizaldi, 2015).

• Toward a Single European Sky has been successful in building a large product portfolio, so unique and distinctive products can be offered to consumers.

• Toward a Single European Sky has a strong brand image in the market.

• A low-cost structure of Toward a Single European Sky has allowed it to manufacture products at lower costs, so they become affordable for consumers to purchase.

• The financial position of Toward a Single European Sky is strong as the company has generated higher profits over the past years (Phadermrod, M.Crowder, & B.Wills, 2019).

• Toward a Single European Sky has invested in the training and development of its employees to keep them motivates, leading to higher efficiency and productivity.

Weaknesses

• The expenditure of Toward a Single European Sky on its research and development is comparatively less to other competitors of the market.

• Toward a Single European Sky uses a centralized decision-making process that takes time and reduces operational efficiency (Ahmadi, Dileepan, & K. Wheatley, 2016).

• There are high rental costs because Toward a Single European Sky operates on more of the rental properties rather than purchasing them.

• There is no workforce diversification in Toward a Single European Sky. This makes it difficult for the employees to adjust with the different workers who belong to different backgrounds.

Opportunities

• Since the online shopping has increased significantly, Toward a Single European Sky can take it as an opportunity to expand its online presence.

• Toward a Single European Sky can make use of social media platforms to market its products, with more customers interactions.

• Due to more technological developments, Toward a Single European Sky can make its operations more automated so that overall company costs can be reduced (Ahmadi, Dileepan, & K. Wheatley, 2016).

• Globalization provides an opportunity to Toward a Single European Sky to expand its operations in multiple countries.

• Toward a Single European Sky can enter in a niche market and sell distinctive products to gain a competitive advantage.

• The increase in the demand of environmentally friendly goods, Toward a Single European Sky, can place its major focus on making such products (E.Quezada, A.Reinao, & I.Palominos, 2019).

Threats

• In recent times, there has been an increase in the bargaining power of suppliers, making it difficult for Toward a Single European Sky to buy raw materials at lower costs.

• Numerous players are entering the industry, posing a major threat to Toward a Single European Sky.

• There has been constant pressure on Toward a Single European Sky to conduct frequent research to understand the changing customer tastes and preferences (Kolbina, 2015).

• Technological advancements require workforce training. This adds to the costs of Toward a Single European Sky.

VRIO Analysis

Toward a Single European Sky uses VRIO Analysis to assess and evaluate the company resources to determine the competitiveness, and strategic advantage.

Valuable

• Toward a Single European Sky has a strong brand image and engages in corporate social responsibility.

• Toward a Single European Sky has a high brand recognition because of the quality of products it offers to its customers (Ariyani & Daryanto, 2018).

• The distribution system of Toward a Single European Sky is valued all round the world. The company has been able to successfully establish strong relationships with its suppliers.

• Toward a Single European Sky focuses on continuous innovation in its business. The company has expanded this innovation in its multiple functional areas.

• There are potential growth opportunities in the market, and Toward a Single European Sky has been able to penetrate the market through its ability to raise large funds.

Rare

• Toward a Single European Sky operates globally. This global presence has allowed the company to increase its customer base (Miethlich & G. Oldenburg, 2019).

• Toward a Single European Sky has an organizational culture that promotes more teamwork, innovation, and creativity among its employees, that leads to a competitive advantage.

• Since Toward a Single European Sky has a global presence, it allows the company to easily adapt to different cultures, norms and values.

• The risk-taking ability of Toward a Single European Sky is strong. This provides more opportunities to the company to penetrate different markets.

Inimitable

• The inimitable resource for Toward a Single European Sky is its high-quality products. These products have allowed consumers to make repeat purchases.

• Toward a Single European Sky operates through multiple locations of stores in different companies, allowing easy access to products.

• Strong marketing communications have been used by Toward a Single European Sky to attract more customers.

• Toward a Single European Sky has been using integrated technology that has allowed it to offer competitive pricing to its customers (Ariwibowo, Saputro, & Haryanto, 2021).

• Toward a Single European Sky maintains an excellent customer service that has enabled it to have a high brand engagement.

Organization

• Strong financial position has allowed Toward a Single European Sky to explore more product development opportunities.

• Toward a Single European Sky is successfully maintaining the efficiency and effectiveness of its business operations with the help of more integrated and advanced technology.

• Employees are given both in-house and off-the-job training opportunities by Toward a Single European Sky that allow more skills development (Adnan, Abdulhamid, & Sohail, 2018).

• The strong value chain and distribution network has enabled Toward a Single European Sky to increase its revenue through the sale of its products.

Marketing Mix

Marketing Mix is needed by Toward a Single European Sky to formulate effective strategies to achieve the company objectives.

Product

• Toward a Single European Sky has five product categories. Each of these categories has a product line that involves more variety of products (Išoraitė, 2016).

• Highly differentiated products are offered by Toward a Single European Sky to its customers. These distinctive products are not easily available at competitors.

• The products of Toward a Single European Sky are of higher quality, and thus, customers pay more prices for these products.

• Toward a Single European Sky designs products with traditional designs giving customers more product variety.

• Toward a Single European Sky offers multiple sizes for its every product to make it easy for its customers to select the right product.

• Warranty and same-day delivery option if also provided by Toward a Single European Sky to its customers.

Price

• Toward a Single European Sky follows a competitive pricing strategy.

• To attract more customers, bundle pricing has also been used by the company.

• Little higher prices are charged for products that are sold online because of the delivery costs (Thabit & Raewf, 2018).

• Optional product pricing strategy is also adopted by Toward a Single European Sky for some of its products, such as a base product is offered for a certain price, and there are separate prices for its accessories.

• Regular promotional prices are also offered by Toward a Single European Sky to its customers.

Place

• Toward a Single European Sky uses two channels for its product distribution. This includes online selling and through own stores.

• There are more than multiple stores owned by Toward a Single European Sky globally. This ensures easy product availability to customers (Pogorelova, Yakhneeva, & Agafonova, 2016).

• Toward a Single European Sky has partnered with delivery service companies to distribute its products effectively to consumers.

• Toward a Single European Sky has also adopted an omni-channel distribution system.

Promotion

• Toward a Single European Sky uses a traditional promotional strategy that involves TV advertisements (Fan, Y.K.Lau, & Zhao, 2015).

• Social media advertisements are also adopted by Toward a Single European Sky to increase brand awareness.

• Toward a Single European Sky takes part in various events and exhibitions as a way of promoting its products.

• Large sales force is used to provide the customers with a more personal experience.

• Toward a Single European Sky also makes use of influencer marketing to increase the demand for its products.

• Regular content and deals are posted on the social media pages of Toward a Single European Sky to attract and retain customers.

Value Chain Analysis

Toward a Single European Sky can use Value Chain Analysis to identify and assess inter-relationships as well as interdependencies.

Primary Activities

• Toward a Single European Sky’s primary activities involves the production and selling of products to the final consumers (Mintz, J.Gilbride, & Lenk, 2021).

• Toward a Single European Sky has a strong relationship with the suppliers. This ensures that the product is received, stored, and distributed in a timely manner.

• Operational activities of Toward a Single European Sky are effectively aligned.

• For inbound logistics, after the arrival of raw material, the company processes it to manufacture the final product (Hasan, Nekmahmud, & Yajuan, 2019).

• In terms of outbound logistics, Toward a Single European Sky has been able to set up optimal costs as well as efficient delivery processes to deliver the product on time.

• Toward a Single European Sky invests in its sales and marketing activities to build relationships with customers.

• Marketing funnel approach is used by Toward a Single European Sky to effectively devise and build sales and marketing activities.

• Toward a Single European Sky offers both pre-sale and post-sales services to its customers.

Secondary Activities

• Toward a Single European Sky has an effective infrastructure that has allowed the company to successfully optimize its value chain.

• The competitive pressure in terms of employee skill development, motivation, and commitment is reduced as Toward a Single European Sky has developed a strong HRM (Linkov, Carluccio, Pritchard, & Bhreasail, 2020).

• Toward a Single European Sky uses a cost minimization approach to reduce its costs by analyzing the costs associated with training and hiring the employees.

• Toward a Single European Sky has been using integrated technology in its value chain activities. This includes technological customer support, research and data analytics concerning product design, and automated software.

• The procurement activities of Toward a Single European Sky are effectively optimized with its inbound, outbound, and operational activities (Maheswari, Yudoko, & Adhiutama, 2019).

Market Penetration Strategies

• Toward a Single European Sky can increase the capacity of its production so it can reach more of the customers in its existing market.

• Toward a Single European Sky can focus on controlling the overhead costs so that it can offer competitive pricing that can attract customers of the market (Dawes, 2018).

• Investments can be made by Toward a Single European Sky in marketing and sales activities to increase the chances of successful market penetration.

• Toward a Single European Sky can design and develop a content that increases customer engagement within a particular marketplace.

• Toward a Single European Sky can assess and identify more enhanced distribution networks (Radpour, Mondal, & Kumar, 2017).

• Improved distribution systems and supply chains can improve the product accessibility for the customers, making it easier for Toward a Single European Sky to penetrate the market.

• Toward a Single European Sky can adopt price cuts in its products to compete in the market. This will give a company a competitive edge over its competitors.

• Toward a Single European Sky can plan strategies where it can focus on acquiring the leading players of the market. Such acquisitions will give the company an opportunity to reach more customer segments.

• Strategic partnerships and joint ventures agreements can be signed by Toward a Single European Sky to mitigate the risk factors, and to gain customer groups of the market.

• Toward a Single European Sky can come up with new and innovative features in its already existing product for the market (Daouda, Barth, & T. M. Ingenbleek, 2019).

Market Development Strategies

• It is important for Toward a Single European Sky to invest in the research and development department so potential markets can be identified (Hilman, Bohari, & Abdullah, 2018).

• Regional expansion strategy can be used by Toward a Single European Sky for growth purposes. This will also take into consideration the cultural differences.

• Toward a Single European Sky should also consider to expand its business operations in the international market. This will allow access to a larger customer base.

• New customer groups and segments should be explored by Toward a Single European Sky.

• Toward a Single European Sky should also invest in brand-building activities as it will give an opportunity to reach more potential customers (C. Koks & M. Kilika, 2016).

• Toward a Single European Sky should consider the market education in terms of its product. The company can significantly increase its sales by giving product awareness to new segments.

Product Development Strategies

• Toward a Single European Sky can come up with new improvements and modifications in the existing products to attract the market.

• Toward a Single European Sky should undergo the NPD process, so the company is able to assess and identify new points for its customers.

• Regular investments in the research and development will help Toward a Single European Sky to develop something new and innovative that can give a competitive advantage (Kalogiannidis & Mavratzas, 2020).

• Toward a Single European Sky can develop new products by getting into more strategic partnerships.

Diversification Strategies

• Toward a Single European Sky can adopt vertical diversification to develop business. This can be done by adding more products to the existing portfolio (Kalogiannidis & Mavratzas, 2020).

• Horizontal integration can also be adopted by Toward a Single European Sky, where the company can enter into a completely new product development phase that does not exist in the current product line.

• Toward a Single European Sky can also consider to conglomerate by starting a different business.

Conclusion

Based on all the models and frameworks discussed above, it is concluded that Toward a Single European Sky should focus on widening the existing product portfolio. Moreover, the psychological pricing strategy can be adopted. Toward a Single European Sky should also maintain close relationships with its suppliers to benefit from lower prices. Similarly, Toward a Single European Sky should develop more integrated outbound logistics for its perishable items. It is also important to continue producing quality and innovative products, so Toward a Single European Sky is less affected by the new emerging competition in the industry.

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