IBM260 Assignment - 20%

First/Last Name- Harjot singh

Student ID- 0795006

Part I - Critical Thinking

To answer these questions please use your own words and logic.
DO NOT copy and pass the answers from slides or class articles

1. In a few paragraphs explain what is globalization and what are the

implications of globalization for global businesses?

Ans. The phrase globalization is described as when information or items

are marketed all over the world, or when there are no international
boundary restrictions.
Globalization is boosting work prospects, which is good for the
economies of the countries. Anyone can now do business abroad, and
many multinational corporations assist local manufacturers in launching
their products in the international market. This increases work
opportunities and contributes to the nation's economy.

2. In a few paragraphs explain how globalization affects you

personally positively/negatively?

Ans. Positives
1. We can now buy anything that is not created in our country, or we can
say that it is now very easy to buy and sell goods from other countries.
Because of global market competition, we may obtain high-quality
products at lower prices.
Negatives include:
1. globalisation, which causes many local firms to lose market share
since the bulk of buyers are drawn to overseas brands.

1
IBM260 Assignment - 20%

2. The import duty in Pakistan is extremely expensive. So, even if I have

to purchase an item from a company that does not make their product in
their own country, the price is significantly more than that of local
manufacturers.

3. Define what is the market demand and what are the key
determinants that affect the demand function?
Ans. = Market demand occurs when many buyers purchase the same
product on a regular basis. For example, in a mobile shop, they sold an
apple phone indicating that the market demand for Apple products has
increased. The most important factors influencing the demand function

1. Manufacturing flaw = If there is a problem with production or

distribution, it will affect demand.

2. Natural disasters or weather patterns In the summer, the need for air
conditioning increases significantly, and this demand may sometimes
exceed market demand.

4. Define the marketing environment? Explain what is the internal

and external market environment of a company.

Ans. Marketing Situation This is the market's overall assessment.

Traders learn about the market, what their clients' demands are,
market demand, and their preferences. Understand the market
economy when sales are up and when sales are down. The Internal
Market This indicates that anything that occurs within the
organisation, whether favourable or negative, should be regarded
an Internal Market Environment. External market environment
This refers to issues such as customer service, competition with
other companies, and marketing units.
This indicates that anything that happens within the organisation,
whether favourable or negative, should be regarded an Internal
Market Environment. External market context This includes issues
2
IBM260 Assignment - 20%

like as customer service, competition with other businesses, and

marketing units. These are some external market environment
considerations.

5. What is PEST analysis and what are the befits of performing PEST
analysis for a company?

Ans. The PEST Analysis It is a strategy by which a firm can examine or deal with
political issues, the entire economic of the company, the company's social duties,
and technology aspects. All of this encourages the organisation to become more
active and competitive in the market. Benefits
1. No cost In this, we exclusively collect surveys and feedback from employees
and customers. It will simply take time but will not cost the organisation anything.
2. Market Knowledge This allows a corporation to understand the market and the
preferences of its customers.

Part II – Case Study 1

Perform a SWOT analysis for the Emirates Airlines.

DO NOT copy and pass the answers form the cases study. Please use your own
words and logic!

Emirates Airlines

Emirates Airlines originated in 1985 as a regional airport in Dubai with a fleet of two planes but

has expended marginally in the 20 years since. Currently, Emirates Airlines has 197 aircraft with

3
IBM260 Assignment - 20%

new technologies and additional amenities which makes this company unique in its quality and

facility. The company is a subsidiary of the Emirates Group that is owned and totally supported

by Dubai’s Government as the airline industry is a core pillar of growth for the national economy

in Dubai.

Emirates Airlines epitomize an excellent service in every aspect of their business. The

company’s team goals, operations strategies, values, and their business model of operating in the

airline industry classifies Emirates Airlines as a leader in client service in the sky, as well as, on

the ground level.

Through evolution and the revolutionary industry structure of the airline manufacturing,

Emirates Airlines enhanced above and beyond expectations of their clientele.

Goals

Rapid growth
($ 4-5 billion
High standards of invested in
facilities and Terminal 3)
Providing an amnesties
exclusive and
individual
customer service

Strategies

● Global air routes and planning expansion (strategic mega-hub)

● The different market segment in terms of class flight (Individual Business, First, Business

and Economy Class)

4
IBM260 Assignment - 20%

● Affordable low-cost flight to ensure customer loyalty

● Differentiation by providing private suites with doors, bars, dining area, spa and showers

Vision and Values

Emirates Airlines has a strong and stable leadership team that is innovative, with a long-

term mindset, motivated yet planned and calculated in decision-making. Caring for their primary

stakeholders such as employees, passengers, crew, etc. is the Emirates Airline’s primary goal and

concern which play’s a critical role in their decision making when considering opening up a new

destination, hiring a new crew member, or planning a new design of the airplane to differentiate

their business.

Business Model

The internet has had a destructive consequence on numerous businesses, such as Kodak,

Blockbuster, and other alike companies. However, for Emirate Airlines the internet opened new

prospects and destinations to discover, therefore, a higher customer demand. Emirates Airlines

perceived the internet and technology as an opportunity to grow and focused on passenger

demand from the underserved locations (EU to Asia and Africa). The company’s multi-level

customer segmentation and demographics allowed them to capitalize on this new demand flow

of travelers, therefore, this shift allowed for both travelers and fly tickets prices increase and the

business changed rapidly.

Because of the company’s strategic location advantage (EU, Oceania, Asia, Africa),

Emirates Airlines created a global transit route. The core strategies that are driving Emirates

Airlines are their advanced technology in terms of passenger’s high-quality service, the

company’s branding and marketing, workforce skills (multicultural to serve a broad range of

5
IBM260 Assignment - 20%

customers), and specialized personnel. The high operating and profitable business came up also

because of the favorable geographic and weather advantage that Dubai has. To replicate their

business model it would require not only a substantial financial capital but a similar geographic

location.

● No air congestions (24 hour operations)

● Good weather, airport operations are not impacted by rain (occasionally fog)

● Major population base

● Logistics hub

● Strategic route planning

● Strategic investment in the infrastructure that attracted many businesses, high- profile

projects, investments, tourists

● Strategies from the governmental prospective (eliminating visa requirements to facilitate

the entry to Dubai (~ $10.4 billion of passengers arrived and departed via Emirates in

2012)

Cost Structure

6
IBM260 Assignment - 20%

Fuel
(advantage from
cheap fuel)

Tax Incentives

Opperations
(air and ground
level)

Activities Structures

● Passengers Service for six regions (each region increase 30% in overall revenue)1 (Refer

to APPENDIX 1)

● Baggage handing

● Cargo industry $2.6 billion (8.4 % increase from 1012)2

Value Structure

1
2

7
IBM260 Assignment - 20%

● Branding (Marketing)

● Offers (Discounts, Air miles’ cards)

● Low Cost

● Multiple destinations (140 destinations)

Key Partners

777
Boeing,
Airbus A340
A330

Tax
Government incentives
of Dubai
Initial
Capital ($ 10

Dubai
Location
International
Airport
Termianl
3

Emirates Airline fleet consisted of 3 types Boeing 777 (book value $260-315 million), Airbus

A340 (Refer to APPENDIX 2 A), and Airbus A330 ($390 Million) (Refer to APPENDIX 2 B).

The average lifecycle of the airplane is 6.4 years (the youngest in the industry).3

The new double-decker A380 generated high demand, strong market signal, and

confidence in the future growth.

3
8
IBM260 Assignment - 20%

Competition

Emirates Airlines’ major competitors are British Airways, Air France, and Lufthansa

(long routes), however, these companies have regulatory policies that put them at a disadvantage,

such as taxes, fuel price, and visa requirements. Turkish Airlines is another significant player in

the Middle East that benefits from a strategic location.

The industrial technology and the internet is creating a corridor of opportunities for

business. Emirates Airlines is taking full advantage of these trends to create new services where

they can be the first movers such as they already have been in self-check-in, personal suits, spas

and other advanced facilities. About 1,500 flights are departed each week to 140 destinations

from NW to SE and NE to SW and each destination is served based on the individuality of the

clientele.

For Emirates Airlines change is incremental yet a change that will bring not only increased

revenue but prestige in brand and service.

APPENDIX 1

Region Revenue

East Asia & Australia $ 5.7 billion

Europe $ 5.5 billion

America $2.3 billion

W Asia & Indian Ocean $ 2.2 billion

Middle East $1.9 billion

Africa $1.8 billion

9
IBM260 Assignment - 20%

Part II – Case Study 2

Perform a SWOT analysis for the Cirque du Soleil.

DO NOT copy and pass the answers form the cases study. Please use your own
words and logic!

Cirque du Soleil

External Analysis

There have been circuses around the world for thousands of years. In ancient Rome, the circus

was a building for the exhibition of horse and chariot races. In the late 19th many circus

performances began by traveling and taking place under large tents. The traditional circus was

composed of a tent, trained animals such as elephants, lions, and people such as musicians,

jugglers and droopy eyed unhappy clowns which were performing their threadbare routines.

Circuses had become a part of a red ocean industry with limited profit and growth potential. This

business became very costly because of the expenses involved in taking care of animals which

included different food for different animals, medical care and transportation. Since technology

and the internet has become more present in people’s life and they are more interested in

watching shoes on TV’s, computer, iPad’s, these trends decreased people’s interest in going

outside of their homes. There is also increasing sentiment against the use of animals in circuses

by animal rights groups. From the perspective of competition based strategy, the circus industry

appears to be unattractive.

Background

10
IBM260 Assignment - 20%

Cirque du Soleil was founded in 1984 by a group of street performers, based in Montreal. The

circus owner Guy Laliberte is refusing to go public because of the thought that might constrain

the circus creativity. The circus itself grew from 73 to 5000 employees and brings about $1

billion in annual revenue and $ 250 in annual profits. The shows in Las Vegas have a 97% sell

out rate and produce about 60% of Cirque du Soleil revenues. Their show represents a theatrical

blend of circus arts and street performance, with spectacular costumes and wonderland sets and

staged to fascinating music and lighting. There are no animals in a Cirque du Soleil only human

energy is put to work. The metamorphosis of what was formerly see as an event for children has

turned into a multigenerational, multicultural and avant-garde performance experience.

Business model

Cirque du Soleil is a unique organization which reinvented and basically revolutionized the

circus arts by borrowing ideas from Broadway and by applying the Blue Ocean Strategy. This

strategy represents a non-traditional view of the industry and creates demand in an uncontested

market. In applying the blue ocean strategy Cirque du Soleil cut off features that had long been

taken for granted in the traditional circus industry, such as the use of animals, which is also

considered one of the most expensive elements in this industry. These expenses include not only

the cost of animals but also their training, medical care, insurance, and transportation. These

factors cut drastically circus expenses and made their business to be financially sustainable. By

breaking the market boundaries and the stereotypes of a circus, Cirque du Soleil gained a wider

demographic that included the adult customers. Cirque du Soleil created a new market space in

the entertainment sector, therefore generating strong and profitable growth.

11
IBM260 Assignment - 20%

Cirque du Soleil uses several concepts to build their business model:

- Multiple productions which offer the opportunity for multiple visits per customer

(Amaluna Production, Varekai Production, Kurios Production, etc)

- Cost reductions through the use of yearly productions allowing for faster recovery of

fixed costs

- Elimination of big name high cost acts/plays

- Creation of a wide variety of productions with themes that appeal to a wider audience

demographic (not only children which were the target of a traditional circus).

The goal of Cirque du Soleil is to maintain their position as the market leader in the circus

industry through constant innovation, as well as, expand their market by attractive millions of

customers through the magic of their performance. Cirque du Soleil is constantly trying to

combine their commercial success with artistic magnificence and marvelousness of their

performances around the world. Cirque du Soleil key concerns are to identify their competitive

advantages and to utilize those advantages in order to create strategies that would help them to

grow and win the market.

Blue ocean strategy

- Combining the theatre and art show performance- no animals involved

- Price targeting- middle class families $69-$99 (depends on preference, place and

production)

- Market adjustment in terms of price from shift in supply and demand of Cirque du

Soleil performances.

12
IBM260 Assignment - 20%

What makes Cirque du Soleil to have rapid growth is that they created a new demand in a

declining industry in which traditional strategies were limiting the potential for growth. Cirque

du Soleil did not benchmark any other theatre or street show performance rather innovated a new

show by combining and diversifying the interests of their targeted demographics which is the

adult customer. Another compelling aspect of Cirque du Soleil’s success is that it did not win by

taking customers from the already declining circus industry which historically was targeted

toward children audiences. Cirque du Soleil succeeded because the company realized that they

should not compete with other companies which used red oceans strategy, rather they should

create blue oceans of uncontested markets, innovate and make the competition irrelevant.

Competitive Advantages

- First mover advantage (they were the first who eliminated the use of animals in the circus

which also cut their expanses cost and made their business profitable)

- Swapping the traditional circus with a complete new taste for the circus industry

(combination of theatre and art performance, fine costumes, music and light )

- Innovated different styles of art (dance, show illuminations, etc )that no one used before

(these differentiation and innovation captured a vast number of audiences)

Their technical skills and expertise in the field make difficult for their competitors to imitate

their business model. Cirque du Soleil has a unique organizational culture. The company

emphasizes on the employees’ needs ensuring their safety in the performing act. Furthermore,

the housing and training facilities are provided to the performers on a high quality basis,

13
IBM260 Assignment - 20%

therefore, helps to retain their employees and improve their performing skills. Employees are

encouraged to innovate new styles of performing, therefore representing a decentralized work

system. Cirque du Soleil employees are empowered to make decisions based on artistic and

creative principles rather than the industry benchmarks. Competitive positioning Cirque du Soleil

charges a premium price for their tickets justifying this by offering a high quality and unique

features for their shows and productions making themselves unique by differing from the

traditional circus industry. To conclude, Cirque du Soleil has been so far an attractive show that

created demand for a new market where competition is irrelevant. Furthermore, Cirque du Soleil

braked down the stereotypes of a traveling circus which was targeted only for children by

creating shows for a new audience- adult customer. Their business model allows Cirque du

Soleil to create a new market space in the entertainment sector, therefore generating strong and

steady profitable growth. Their organizational cultures differentiate as their employees are

empowered to create and innovate, this strategy allows companies to create, innovate and keep

their employees happy. Successfully used Blue Ocean strategy by Cirque du Soleil made them

worry less about competitors. As per their opportunities, Cirque du Soleil has potential and

capital to expand globally and use different themes and shows for different public taste.

14
IBM260 Assignment - 20%

Part II – Case Study 1

Swot analysis of case study 1

Strength-

The emirate group is supported by the dubai government and also give the funds to support the
airline.The airline have different marketing statigies like how to expand the business like provide
the tickets at affordable price and also the premium facilities in the cabin. Due to weather
condition in dubia make business more profitable and the tax and fuel benefits .
The emirate have 1500 flights and 140 destination to ti depart and have a huge business .
Weaknesses

The cost is higher for the middle class and which who want to spent less money .
Due to the competition with turkey airline and british airline and many other that result to limit
the market share growth

OPPORTUNITIES

The company make alliance with the other international airline to increase the number of
destinations and attract the new customers from different regions .In future double decker a380
have high demand so it’s a bigger opportunities to make a business

Threat

Due to a huge competition with the rival companies so when the other companies reduce the
price of tickets to maintain the position in market the company invest lot of resourses and
decrease the profit value

15
IBM260 Assignment - 20%

Case study part 2

Swot analysis of case study 2

Strength.

The Cirque du Soleil was acient and unique idea in which the trained animals should do different
activities
The progress in grew very fast and the annual revinue was around 1 billion dollerand the sell out
rate of ticket is approximately 100 percent
The circus have borrow ideas and implement in circus dye to that the market increases

Weekness.

To arrage the cremembers for the circus is very difficult some time person have a medical or
other issue. Now there is lot of competition so due to that they have reduce the pricies.

Opportunities

Increase the locations and crue members

Threat

Competion increase

16