Internal Analysis for Cathay Pacific Airways essay

The analysis of the internal potential, operations, and strengths of the company uncovers
opportunities, which Cathay Pacific Airways will have in the future, as well as threats, which the
company may confront in the course of its business development (Schmitt, 2001). In this regard, it
is possible to use the SWOT analysis, which helps to conduct the internal analysis and gives
insights into the competitive position and potential of the company. In fact, internal strengths and
weaknesses of the company, which may be revealed in the course of the SWOT analysis, will help
to identify opportunities the company has as well as threats, which the company may confront in the
future.
Another strength of the company is the fleet, which allows the company to maintain its marketing
performance and to provide customers with cargo and passenger flights on the regular basis. The
company has a large fleet of modern aircrafts, including aircrafts from Airbus and Boeing, which
are leading manufacturers of aircrafts in the world. The modern fleet contributes to the high
reliability and safety of flights provided by the company since cases of repair required by aircrafts
are quite rare, while costs of maintenance of relatively new aircrafts are lower compared to older
aircrafts.
In addition, the company has experienced and well-qualified human resources, which also comprise
an important marketing value of the company. At this point, it is worth mentioning the fact that
human resources play an extremely important part in the competitive struggle today because human
resources have the potential to boost the development of their organization. For instance, human
resources can introduce innovations that can improve the performance of the company and boost its
business development. In fact, human resources may accelerate the business development of the
company because they can improve their performance, even without financial investments being
made by the company. Unlike technological innovations or other changes, which require substantial
investments, the improvement of the employees performance can occur through the use of nonmaterial motivation. For instance, a positive feedback from the part of managers of the company
can encourage employees to work better. As employees improve their performance, the
organizational performance improves too.
In actuality, Cathay Pacific Airways has a number of strengths, which allow the company to
enhance its competitive position and to improve its marketing performance. In this regard, it is
worth mentioning the brand of the company as one of the major marketing assets of the company.
The reputable and renowned brand facilitates the penetration of new markets and enhances the
position of the company in existing markets. In such a way, the company can improve its marketing
position exploiting the full potential of its brand. For instance, often customers choose the company,
which services they like to use, on the ground of its brand and reputation. In this regard, Cathay
Pacific Airways is one of the strongest companies in the market.
On the other hand, Cathay Pacific Airways has certain weaknesses, which affect its marketing
performance. First, the company is based in Hong Kong and, in spite of historically strong western
impact on their organizational culture, the company still remains oriental company with respective
cultural norms and traditions, which apparently affect its organizational structure and relations
within the organization. In fact, the cultural background of the company could not be viewed as a
weakness, unless the process of globalization and the international market expansion, which raises
the problem of the cultural diversity, which the company has to deal with. In fact, Cathay Pacific
Airways has to operate in the multicultural environment, as the company enters new markets.
Therefore, the company has to adapt its managing style to new cultural norms and traditions of local
employees. In such a situation, the risk of misunderstanding and conflicts between representatives
of different cultures increases. Hence, the company has to elaborate an effective approach to the

successful and effective management in the multicultural environment.

Furthermore, the large fleet of the company needs renewal and expansion. As the company expands
its operations, it has to purchase new aircrafts, while the purchase of new aircrafts requires
substantial funds and is costly for the company. In such a situation, the company can face the
problem of the shortage of financial resources to fund its renewal policies and strategies. At the
same time, if the company fails to purchase new aircrafts and to replace old aircrafts by new ones,
Cathay Pacific Airways can face the problem of the steady deterioration of the quality of its services
and the shortage of aircrafts that can provide services for customers. The lack of aircrafts will lead
to delays of flights and late delivery of cargo and passengers. Hence, the risk of the growing
customer dissatisfaction increases.
In spite of current weaknesses Cathay Pacific Airways is currently facing, the company has large
opportunities to develop its business successfully. The company attempts to enhance its marketing
position through the elimination of its weaknesses. At the same time, the implementation of the
efficient marketing strategy can help the company to realize its full potential and to use available
opportunities.
At this point, it is worth mentioning the fact that the company has an opportunity to take the leading
position in the global market. At any rate, Cathay Pacific Airways holds one of the leading positions
in the Asia Pacific region and, at the moment, expands its business and operations successfully. In
fact, the company is one of the largest carriers of cargo and passengers in Asia, while the further
business expansion enhances its position in other markets as well. The Asia Pacific region is the
major market for Cathay Pacific Airways but the company operates internationally and offers flights
worldwide. In such a situation, the company need to increase its presence in European and
American markets to challenge the position of other leaders in the airline industry (Calder, 2002).
Nevertheless, even the current share of the global market owned by Cathay Pacific Airways is large
and allows the company to maintain one of the leading positions in the global market. In addition, it
is necessary to take into consideration the potential of Chinese and Asian market, where Cathay
holds the leading position so far. China is one of the most dynamic global markets, which keeps
growing in spite of the global financial crisis. Other countries of South East Asia, such as India also
have the huge potential (Howard, 2004). Therefore, if Cathay Pacific Airways maintains the leading
positions in those markets, the company can enhance its leading position in the global market, due
to the growth of its traditional markets.
Therefore, the enhancement of the position of Cathay Pacific Airways in China, as one of the most
dynamic markets, is another important opportunity for the company to realize. In fact, this is the
strategic opportunity for the company because loosing the lead in Chinese market can undermine
the position of Cathay Pacific Airways in the global market since Chinese market is the major target
for the company, which owns a share of China Airways, the major airlines of China. Chinese market
keeps growing, in spite of the global financial crisis of 2008 and deep economic recession in other
countries. Hence, Cathay Pacific Airways can compensate possible losses in other markets due to
the growth of Chinese market. In such a situation, the company should keep increasing its market
share in China raising barriers to entry for potential rivals. In this regard, the support of the
government is very important for the government and Cathay Pacific Airways has such a support so
far.
Moreover, the increase of the customer loyalty and satisfaction through the improvement and
diversification of its services is another opportunity Cathay Pacific Airways can implement
successfully (Pine & Gilmore, 1999). In fact, the company can develop the customer loyalty and
satisfaction using the full potential of its human resources and implementing new technologies. In
addition, the company may offer new pricing policies as well as new flights, which may meet needs

of customers and be more attractive compared to offers of rivals of Cathay Pacific Airways. On the
other hand, the company should come prepared to invest substantial funds in the introduction of
innovations and other changes to attract customers and develop their loyalty and satisfaction.
However, the company can use its human resources to increase the customer loyalty and satisfaction
at low costs since human resources may just need additional training to start working better and
offering services of the higher quality.
At the same time, along with great opportunities, Cathay Pacific Airways still face a number of
threats, which may affect the performance of the company and its competitive position. One of the
major challenges to the future marketing success of Cathay Pacific Airways is the tight competition,
which forces the company to keep progressing on and on but, at the same time, it requires
substantial investments and financial resources to maintain the growth of the company. In fact,
today, Cathay Pacific Airways confronts the competition from renowned leaders of the global
airline industry, such as British Airways, Lufthansa, American Airlines and others. Confronting such
behemoths is extremely challenging for Cathay Pacific Airways because its major rivals have a very
strong position in European and American markets, which are traditionally among the largest global
markets with the high level of capitalization. In such a situation, Cathay Pacific Airways should not
only use its full potential in China and the Asia Pacific region but also enhance its position in
Europe and America consistently. Otherwise, the further competition will be quite difficult. In this
regard, the growth of Chinese and Asian markets may be quite helpful because they provide the
company with essential financial resources, which Cathay Pacific Airways can invest into the
development of its business in Europe and America.
Furthermore, environmental concerns of customers are another threat that can affect the business
development of Cathay Pacific Airways in the future. Today, customers, especially in Europe and
America grow more and more concerned with the environment pollution caused by airlines. This is
why European and American policy makers introduce stricter requirements to aircrafts in terms of
greenhouse gas emissions. As a result, airlines have to modernize their aircrafts or to purchase new
aircrafts to match these environmental requirements. Today, Cathay Pacific Airways has a fleet of
relatively new vehicles and does not confront problems concerning the environmental legislation.
However, in the future, stricter environmental requirements can raise problems in face of the
company and force the company to modernize its fleet to enter European and American markets
(Volti, 2005). In fact, the successful business development of the company may be under a threat, if
environmental requirements will grow stricter because the costs of the company will increase, while
there are no guarantees that customers will stay loyal to the company, especially, if the company is
forced to raise the price of its services because of the increased costs.
Another threat to Cathay Pacific Airways is the uncertainty in the global market and the threat of
the ongoing deterioration of the economic situation in major markets. At the moment, the global
economy has started to recover but the further development of the world economy is still uncertain
because early signs of the recovery may be replaced by a new downturn and further steep decline.
New global financial crises can affect negatively the business development of Cathay Pacific
Airways because of the decline of business activities and, therefore, the drop of cargo transportation
by the companys aircrafts. The global financial crisis of 2008 has had a negative impact on the
marketing development of Cathay Pacific Airways because the company has faced the problem of
the decline of the cargo transportation and the decline of the flow of passengers (Peters, 2007). As a
result, revenues of the company have dropped and the company had to look for options to
compensate its losses through diversification of its operations.