PHILIPPIN E A I R LI NE S

(PAL) FEBRUARY – APRIL 2020

SPE C TI VE: CH IE F E X EC UTIVE OFFICER

PER
Strategy case: Philippine Airlines (pal)
• Philippine Airlines (pal) was founded in 1941 and is the first, oldest, and one of the largest airlines in asia. As a big company, pal
is not new to problems, issues, and corporate failures. Back in 1997, pal was severely affected by the asian financial crisis. This
is one of the greatest corporate failures in the Philippines as they are forced to cut their operations in some international routes
completely cutting flights to europe and the middle east and also other domestic flights.

• This year, pal faces a new problem brought by the covid-19 pandemic. This coronavirus adds more burden to the airlines
struggling finances. The implementation of the travel ban causes more problems in the company. On February 28, 2020,
Philippine Airlines terminated 300 workers as pal incurs losses because of the travel ban caused by the disease. The industry
called for financial assistance as they bleed billions of pesos in loss of revenues and expenses. According to inquirer.Net, the
international air transport association estimated losses from air carriers and tourism at $4.48 billion, while job losses could reach
548,300 this year.

• Because of these problems, according to the report from thestar on april 1, 2020, finance secretary Carlos Dominguez iii
informed the reporters via text on march 31 that they are to ask the bsp to support the banks that support their clients including
the airlines. Acap vice-chair roberto lim also said that the 3 major airlines including pal have paid 7 billion pesos for flight
refunds as they were canceled due to travel ban on domestic and international routes. Also, community quarantines forced the
carriers to suspend all flights in april alone and this has prompted the cancellation of 30,000 flights and affecting 5 million
passengers.
CENTRAL ISSUE:
EVEN THOUGH PHILIPPINE AIRLINES (PAL) IS TIME TESTED AND A POWERFUL
COMPANY MANAGED BY COMPETITIVE OFFICIALS AND EMPLOYEES,
UNCONTROLLABLE EVENTS AND ISSUES MAY STILL ARISE. THE MAJOR ISSUE PAL
IS FACING TODAY IS LOW REVENUE AND CONSTANT LOSS OF INCOME DUE TO THE
CANCELLATION OF FLIGHTS AND TRAVEL BANS CAUSED BY THE PANDEMIC
COVID19.
STATEMENT OF OBJECTIVES:

• ENHANCING SALES THROUGH BOOSTING MARKETING STRATEGY.

• UPGRADE OPERATIONS MANAGEMENT TO REDUCE FURTHER CANCELLATION OF
FLIGHTS.
AREAS OF CONSIDERATION:
1. INSUFFICIENT PROMOTIONAL AND MARKETING EFFORT: PHILIPPINE
AIRLINES LACKS IN INNOVATING THEIR PROMOTIONAL ACTIVITIES AND LACKS
OF IMPROVEMENT IN THEIR MARKETING STRATEGY.
2. INCOMPETENT OPERATION MANAGEMENT: PHILIPPINE AIRLINE DOESN’T
HAVE A STRONG FOUNDATION WHEN IT COMES TO THEIR OPERATIONAL
APPROACH.
ALTERNATIVE COURSE OF ACTION:

1. INCREASE PROMOTIONAL ADVERTISEMENT AND PROMO FLIGHTS.

2. CONDUCT OPERATIONS MANAGEMENT TRAINING.
 Decision Matrix
  Alternatives
Variables Increase promotional Operations management
advertisement and promo training
flights

Risks 5 4
Costs 1 3
Benefits 4 3
Ease of Implementation 4 3
Total 14 (highest) 13
CONCLUSION:

THE MAIN PROBLEM OF PHILIPPINE AIRLINES COMPANY IS THEIR INSUFFICIENT

PROMOTIONAL AND MARKETING EFFORT, FOLLOWED BY INCOMPETENT
OPERATION MANAGEMENT.
RECOMMENDATION:
AS OF THE MOMENT, PHILIPPINE AIRLINES SHOULD PRIORITIZE THE INCREASE OF
PROMOTIONAL ADVERTISEMENT AND PROMO FLIGHTS. AN ACTION PLAN OR
GANTT CHART CAN BE PREPARED. SECOND, PHILIPPINE AIRLINES SHOULD
CONDUCT TRAINING FOR ENHANCEMENT OF THE OPERATIONS DEPARTMENT IN
THEIR FUNCTIONS.
Action Plan: Increase Promotional Advertisement and Promo Flights.
Activities Objectives Division Persons Responsibe Cost Time
Determining To know how Marketing Advertising  
the campaign long does it take Departme manager, public
objective and and its nt relation manager 1 week
parameters effectiveness
Setting for To know how Finance Management Estimat
campaign much money is Departme Accountant, Chief ed
3 moths
budget available to nt Operating Manager P xxxx
spend
Review the To form an Finance Chief Financial  
price of affordable price manageme Officer, Estimat
every tickets for each flight nt Management ed 2 months
in every   Accountant P xxxx
route
 
GANTT CHART: YEAR 2020

Activities Jan Feb Mar Ap May June Jul Aug Sept Oct Nov Dec
r
Determining                      
the
campaign   X
objective and
parameters
Setting for                
campaign X X X X X X X X
budget
Review the            
price of
every tickets X X X X        
in every
route