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Competitive Strategies Adopted by Jetlink Express Limited in the Eastern African Region

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Competitive Strategies Adopted by Jetlink Express Limited in the Eastern African Region COMPETITIVE STRATEGIES ADOPTED BY JETLINK EXPRESS LIMITED IN THE EASTERN A FRICAN REGION BY OCHIENG’ CATHERINE OPEMBI A RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DERGREE OF MASTER OF BUSINESS ADMINISTRATION (MBA), UNIVERSITY OF NAIROBI NOVEMBER 2012 DECLARATION The research project is my original work and has not been submitted for a degree in any other college, institution or university for any academic purpose. Signed. Date. I" I /«' Ochieng’ Catherine Opembi D61/63393/2010 The project has been submitted for examination with my approval as University Supervisor. Signed....... f Professor Martin Ogutu, Department of Business Administration School of Business University of Nairobi l ACKNOWLEDGEMENTS First of all, I would like to express my sincere gratitude to my supervisor Professor Martin Ogutu for his encouragement, advice and valuable suggestions that helped me accomplish my goal of finishing this study. I would also like to thank my colleagues in Jetlink Express and at the University of Nairobi for their precious contribution to this research as this study would not be possible without their contribution. Finally, I am forever grateful to my family for their immense support, patience, advice, and love. n DEDICATION I dedicate this research study to my family, John Patrick (father), Janet (Mother), Fred, Bob, Humphrey, Daphney for their continued support, encouragement and for sticking with me through the thick and thin. To my friends Liya Mango, Nancy Bokesia and Tozay for their immense support. Thank you. iii ABSTRACT The purpose of this study was to determine the competitive strategies adopted by Jetlink Express Limited within the Eastern African Region. A case study was employed as the unit of analysis was one organization. There is no precedent of such a study specific to the airline and the Region thus presenting a significant gap. Through identifying departmental representatives interview guides were administered to gather relevant information to be used for analytical purposes. This enabled the researcher to interpret the results from the study to analyze the respondents’ views about the competitive strategies adopted and the related challenges. The study established that Jetlink adopted competitive strategies that enabled it not only to survive and grow, but to counter the challenges experienced in the East African airline industry. In conclusion strategic management is necessary in a bid to survive and grow, it should be continuous with a keen eye on both internal and external environments looking out for strengths and weaknesses within the company and threats and opportunities in the external environment. The company however has been able to deal with those challenges through the strategies it has put in place which have given it a large market share and has maintained its competitive edge. IV TABLE OF CONTENTS DECLARATION...................................................................................................................... i ACKNOWLEDGEMENTS.................................................................................................. ii DEDICATION........................................................................................................................ iii ABSTRACT.............................................................................................................................iv ABBREVIATIONS AND ACRONYMS...........................................................................vii CHAPTER ONE: INTRODUCTION..................................................................................1 1.1 Background of the Study.................................................................................................... 1 1.1.1 Competitive Strategies.........................................................................................2 1.1.2 Challenges of Competition................................................................................. 3 1.1.3 The Airline Industry in the Eastern African Region......................................... 4 1.1.4 Jetlink Express Limited........................................................................................5 1.2 Research Problem........................................................................................................ 6 1.3 Research Objectives.................................................................................................... 8 1.4 Value of the Study.........................................................................................................8 CHAPTER TWO: LITERATURE REVIEW..................................................................10 2.1 Introduction............................................................................................................... 10 2.2 Concept of Strategy....................................................................................................10 2.3 Competitive Strategies............................................................................................. 11 2.1.1 Market Based Competitive Strategy................................................................. 11 2.1.2 Resource Based View Strategy..........................................................................12 2.4 Strategic Approaches.................................................................................................13 2.5 Challenges of Ccompetition.......................................................................................14 2.5.1 Technological Advancement.............................................................................16 2.5.2 Price Wars...........................................................................................................16 2.5.3 Employee Development..................................................................................... 17 2.5.4 Environmental Concern.....................................................................................19 CHAPTER THREE: RESEARCH METHODOLOGY................................................22 3.1 Introduction...............................................................................................................22 3.2 Research Design........................................................................................................22 3.3 Data Collection.........................................................................................................23 3.4 Data Analysis............................................................................................................24 CHAPTER FOUR: DATA ANALYSIS, RESULTS AND DISCUSSION................ 25 4.1 Introduction...............................................................................................................25 4.2 Challenges of competition........................................................................................ 25 4.2.1 Major Players in the Industry............................................................................ 25 4.2.2 Threat of New Entrants......................................................................................26 4.2.3 Supplier Power................................................................................................... 27 4.2.4 Buyer Power....................................................................................................... 27 4.2.5 Threat of Substitute Goods............................................................................... 28 4.2.6 Information Technology................................................................................... 28 4.2.7 Government Involvement................................................................................. 29 4.3 Competitive Strategies Adopted by Jetlink Express Limited...................................... 29 4.3.1 Incentives and Gaining Passenger Favor.........................................................30 v 4.3.2 Convenient Flight Scheduling and Service Differentiation.......................... 31 4.3.3 Internal Strength................................................................................................ 32 4.3.4 Inter Airline Relationships............................................................................... 32 4.4 Discussions of Findings............................................................................................ 33 CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS.. 37 5.1 Introduction.............................................................................................................. 37 5.2 Summary of Findings............................................................................................... 37 5.3 Conclusions of the Study......................................................................................... 39 5.4 Limitations of the Study........................................................................................... 39 5.5 Suggestions for further research............................................................................... 40 5.6 Recommendations for Policy and Practice............................................................... 41 REFERENCES..................................................................................................................... 43 APPENDICES...................................................................................................................... 48 Appendix 1: Letter of Introduction....................................................................................... 48 Appendix
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