Globalization and human resource management - MyAssignmenthelp.com

Question: Discuss about the Globalization and human resource management. Answer: Introduction Airlines industry is one of the growing sectors of todays world due to increasing demand of flight service. The industry has always worked in alliance with the International Air Transport Association. The industry has always formed an alliance because of the fear of staying behind of others. The International Air Transport Association has recently formed association with three big airlines company such as Star Alliance, Oneworld Alliance and the Sky Team Alliance. Sincethe alliance the relation between the partner companies have grown deeper, benefitting the industry (Belobaba, Odoni and Barnhart 2015). The paper analyses the micro and macro factors that affects the industry directly or indirectly. Further, it presents a SWOT analysis to be informed about the strength and weaknesses about the industry. Micro Industry Analysis Micro environmental analysis analyses the factors that affects the industry directly. The factor also affects the internal process of the business (Indiatsy et al. 2014). Some of the factors that are considered in the micro industry analysis are customers, competitors and suppliers. Customers Customers play a vital role in the growth and existence of the industry. The position of the industry in the market largely depends on the competitors in a large way. With the rising dead from the customers, many companies in the industry are forming alliance with each other. This shows the importance customers play in this sector (Grant 2016). The customers of airlines industry are the passengers that fly from one place to others with both commercial and personal purpose. Moreover, the customers have the powers on the industry as they have huge options to choose from. Competitors Competitive nature of the industry is visible in the case study, which shows that with the growing competitive nature, companies in this industry are finally forming alliance with each other with the fear of being left behind others. As the number of airline companies is increasing, the competitive level of the industry is increasing to a large extent (Fleisher and Bensoussan 2015). This is the reason the companies are being encouraged to form alliance and survive in the industry for longer time. Macro Industry Analysis To analyze the macro environment of the industry a Porters Five Forces Analysis is the ideal concept. Threat of substitute The industry faces moderate treat from substitute. The major substitute that poses a threat on the industry is other mode of transports such as land transport and water transport. However, the threat is limited because customers will have options to choose these substitutes within the domestic zone (Iata 2018). While travelling internationally most of them only have the option of choosing air transport. Threat from competitors The industry faces a huge threat from competitors because with the growing demand large number of companies is adding in the industry. This makes the competitive environment much severe. Due to huge competition and threat of being left behind has caused many airlines companies to form an alliance with each other (Aapairlines 2018). This shows the level of competition the industry is facing with growing time. Threat from new entrant The industry faces huge threat from new entrants because huge number of small and medium size airline companies is continuously increasing in the industry. This is because with the improvement in technology new companies are finding easy to enter the industry (Shaw 2016). Moreover, the industry needs one time huge investment, which a new entrant can plan and successfully enter the industry. Bargaining power of suppliers Suppliers of this industry face low bargaining power because the suppliers of this industry do not want to lose business from such big airline companies. Due to no switching cost,the companies can switch from one supplier to the other (Eaton 2017). Thus, this makes the bargaining power of the supplier week in this industry. Bargaining power of buyers In case of bargaining power, the buyers faces high bargaining power in the industry. This is because of availability of large number of competitors in the industry, which makes the buyers choose from one company to the other. Moreover, due to no switching cost in case of the buyers, the buyers can easily switch from one company to the other according to their preference (Eaton 2017). Thus, the airline companies need to maintain their prices and facilities that would be preferential for the customers to hold back the demand. SWOT analysis Thus, the resultof both micro and macro will help to recognize the strength, weakness, opportunities and threat of the industry (Fleisher and Bensoussan 2015). Strength Strength of forming alliance and partnership within companies Partnership help to gain better customer segments Huge control over the suppliers with their competitive position Fast growing industry on a global range Offering huge and advanced facilities to the customers with the flight Strong management power with improving technologies Weakness Huge competition from small and medium size airline companies Huge control from buyers which forces the airline to reduce flight fares Opportunities Huge growth potential in the coming years Increasing chance of alliances with great market leaders of airline industry Improving the position of the company by offering extraordinary facilities to the customers Develop future opportunities due to uncertainties in the external environment Better management with rising computer reservation system that will improve monitoring and controlling power Threat Huge threat from rising competitors with much advanced technologies Elimination of price regulating powers from the hand of the companies Table: SWOT Analysis Source: Authors creation Conclusion From the above analysis,it can be concluded that the airline industry faces huge threats and opportunities both from the customers and from the competitors. The industry has established its position by being one of the fastest growing sectors. The industry is experiencing huge threat from competitors. This has led to the formation of alliance between many airline companies in order to stay ahead of competitors. The growing technological advancement has helped the industry to manage and control their processes such as booking, facility offered and demand in a better way compared to before. Thus, businesses in this industry has to focus on offering extraordinary facility to customers. References Aapairlines.org. 2018.Future Growth of the Airline Industry. [online] Available at: https://www.aapairlines.org/resource_centre/AAPA_SP_Herdman_GenevaForum_22Feb11.pdf [Accessed 12 Jan. 2018]. Belobaba, P., Odoni, A. and Barnhart, C. eds., 2015.The global airline industry. John Wiley Sons. Eaton, J., 2017.Globalization and human resource management in the airline industry. Routledge. Fleisher, C.S. and Bensoussan, B.E., 2015.Business and competitive analysis: effective application of new and classic methods. FT Press. Grant, R.M., 2016.Contemporary strategy analysis: Text and cases edition. John Wiley Sons. Iata.org. 2018.Outlook for airline markets and industry performance [online] Available at: https://www.iata.org/whatwedo/Documents/economics/Economic-Performance-of-the-Airline-Industry-mid-year-2016-forecast-slides.pdf [Accessed 12 Jan. 2018]. Indiatsy, C.M., Mwangi, M.S., Mandere, E.N., Bichanga, J.M. and George, G.E., 2014. The Application of Porters Five Forces Model on Organization Performance: A Case of Cooperative Bank of Kenya Ltd.European Journal of Business and Management,6(16), pp.75-85. Shaw, S., 2016.Airline marketing and management. Routledge.