Value Chain Analysis ******** Diagram ********* The above model demonstrates the principal element of Value Chain Analysis for an organization such as Easyjet. The integration of the above elements ultimately delivers great margin potential and thus the ideal high profitability status. I will provide a detailed analysis of this model to highlight the core capabilities of Easyjet: Infrastructure ?????? Main headquarters based in Luton. ?????? Provides excellent communication with motorways, railway lines and bus access ?????? Low overheads ?????? Paperless office ??????
No ticketing system with posted ticket ?????? Simple distribution channel management (through the Internet or call centers) ?????? Low airport costs (minimal time of aircraft on the ground), thus achieving economies of scale ?????? Financial resource investment initially supported by Haji-loannou HR Management ?????? Haji-loannou, high profile entrepreneur (shipping tycoon background), ?????? Hands-on-approach from Haji-loannou – looking for opportunities to diversify and expand, ?????? Innovative marketing terms for marketing communications to date. Technology Development ????? Booking through the Internet (higher margins, with a more manageable, simplistic system) ?????? Strong reputation for being an airline where bookings are made via the phone or Internet. Procurement ?????? Easy purchase system in place for flight bookings ?????? Negotiated low cost airport fees ?????? Simple staff uniforms ?????? No tedious ticketing system in place Below you will find a commentary on how these key elements are also integrated into the Easyjet business and further, how the strengths can be used to develop and extend the Easyjet brand.
Inbound Logistics ?????? Excellent communication system in place at airports and easy flight booking policy/payment methods convey an image of convenience – a key benefit to consumers Operations and Outbound Logistics ?????? Good marketing strategy – ‘we have the best’ approach ?????? Partnerships and promotional tie-ins with the mass media ?????? High profile PR strategy (for example: the PR stunt against Robert Ayling, Chief Executive of British Airways and its budget airline “GO” – gains cheap PR coverage) ?????? Fine targeting of attractive segments emerging e. . utilization of casual uniforms. However, safety is always a critical concern and is up to par with the standards of other airlines. Service ?????? Convenience and simplicity are of integral importance ?????? Affordable, frequent, reliable, safe slots are offered to an increasing number of new destinations ?????? No frills and/or complications are associated with the travel experience. Conclusion Clearly Easyjet has some attractive core capabilities that have been established in the marketplace and are perceived as ultimately beneficial to the consumer.
The Value Chain Analysis highlights those elements of the business that can be integrated or fine-tuned (through for example ‘just in time’ systems, quality standards and relationship marketing) in order to achieve the overall objectives of high margins, profitability and market share. Perceived superior services or products, market knowledge, industry contacts, legal advantages (patents, copyrights) perceived high value brands, low overheads, economies of scale and an offensive marketing approach are some of the key factors / elements for sustaining a competitive advantage and indeed promoting the Easyjet family of companies.