Threats are macro environment factors and developments that can derail business model of Cebu Gokongwei. Premium Analysis. - Customer Dissatisfaction – Even though the demand for products have not gone down but there is a simmering sense of dissatisfaction among the customers of Cebu Gokongwei . At one point the government grounded the airline, citing safety concerns. - Strong Balance Sheet and Financial Statement of Cebu Gokongwei can help it to invest in new and diverse projects that can further diversify the revenue stream and increase Return on Sales (RoS) & other metrics. This presents Cebu Gokongwei two big challenges – how to maintain loyal customers and how to cater to the new customers. Weaknesses come from lack or absence of five key resources & capabilities - physical resources such as land, building, activities & processes, past experiences and successes, financial resources, and human resources . Strengths are the Cebu Gokongwei capabilities and resources that it can leverage to build a sustainable competitive advantage in the marketplace. According to Gerry Yemen, James G. Clawson, Marie-Grace U. Ngo of Cebu Pacific Air (A) case study, this has provided Cebu Gokongwei resources to not only thwart competitive pressures but also to invest into research and development.
According to Gerry Yemen, Erika H. James, Marie-Grace U. Ngo , growth in international market can also help Cebu Gokongwei to diversify the risk as it will be less dependent on the domestic market for revenue. More important, the CEO, Lance Gokongwei, received encouragement and support from his employees through their volunteer efforts during the disaster and letters of support, while hundreds took unpaid leaves. The subsequent cases (labeled (A) (B), and (C) describe the events that followed the tragic demise of Flight 5J-387. The airline was barely three years old and just beginning to gain significant market presence in the Philippine domestic airline industry.
At one point the government grounded the airline, citing safety concerns. This approach can lead to poor public relation and customer backlash. However, after initially following a pure LCC model, Cebu Pacific became distracted and adopted more of a hybrid or FSC model. Social media growth can help Cebu Gokongwei to reduce the cost of entering new market and reaching to customers at a significantly lower marketing budget. - Cebu Gokongwei business model can be easily replicated even with the number of patents and copyrights the company possess.
It limits the ability of the firm to build a sustainable competitive advantage. Cebu Pacific is Asia’s oldest LCC, having launched services in 1996 – four years before Lion and five years before AirAsia. According to Gerry Yemen, Erika H. James, Marie-Grace U. Ngo , the organization can increase products and services by leveraging the skills of its suppliers and supply chain partners. Building strategies based on consumer oriented product development and marketing approach. - E-Commerce and Social Media Oriented Business Models – E-commerce business model can help Cebu Gokongwei to tie up with local suppliers and logistics provider in international market. It can also lead to crowd sourcing various services and consumer oriented marketing based on the data and purchase behavior. Although the group’s seat capacity grew by only 7% in 1H2019, given the timing of its neo deliveries it is expecting 14% seat growth in 2H2019. - Project Management is too focused on internal delivery rather than considering all the interests of external stakeholders. Using Cebu Gokongwei strengths to consolidate and expand the market position. - Strong relationship with existing suppliers – As an incumbent in the industry, Cebu Gokongwei has strong relationship with its suppliers and other members of the supply chain. On February 2, 1998, Lance Gokongwei, the 31-year old chief executive officer of Cebu Pacific Air (Cebu), learned that Flight 5J-387 from Manila to Cagayan de Oro failed to arrive at its destination on schedule and was believed to be missing. On February 2, 1998, Lance Gokongwei, the 31-year old chief executive officer of Cebu Pacific Air (Cebu), learned that Flight 5J-387 from Manila to Cagayan de Oro failed to arrive at its destination on schedule and was believed to be missing. According to Gerry Yemen, James G. Clawson, Marie-Grace U. Ngo , growth in international market can also help Cebu Gokongwei to diversify the risk as it will be less dependent on the domestic market for revenue. For more detailed SWOT Matrix strategy please go through the detailed analysis of strengths, weaknesses, opportunities, and threats in next section. You can download Excel Template of SWOT Analysis & Matrix of Cebu Pacific Air (A) Threats can emerge from various factors such as - technological innovations, political developments & policy changes, increase in consumer disposable income, economic growth, and changes in consumer preferences . Philippines’ leading airline. This case provides an international dimension to the study of leadership. Cebu Gokongwei is struggling to restructure processes in light of developments in the field of Artificial Intelligence (AI) and machine learning. Expansion into international market can help Cebu Gokongwei to tap into international talent market.