By Stephen Holloway;
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Additional resources for Straight and Level: Practical Airline Economics, 3rd Edition
Strategic management texts generally use the metaphor of a ‘value chain’ to characterise the way in which a ﬁrm’s activities are organised to combine inputs and transform them into outputs valued by customers. A ﬁrm’s value chain is itself part of a wider value system encompassing the value chains of suppliers, partners, distributors, and customers. Porter (1991, p. 104) has put the argument as follows: Competitive advantage results from a ﬁrm’s ability to perform required activities at a collectively lower cost than rivals, or perform some activities in unique ways that create buyer value and hence allow the ﬁrm to command a premium price.
Airlines vary widely with regard to the choices they make.
These dimensions of strategy will be considered brieﬂy in the context of the airline industry. Corporate Strategy: The Industrial Scope Decision The industrial scope decision addresses which businesses a corporation should be investing in. It is the essence of ‘corporate’, as diﬀerent from ‘competitive’, strategy. During the 1970s and early 1980s, portfolio planning matrices such as the Boston Box, the McKinsey 6 STRAIGHT AND LEVEL: PRACTICAL AIRLINE ECONOMICS Directional Policy Matrix, and the Arthur D.
Straight and Level: Practical Airline Economics, 3rd Edition by Stephen Holloway;