EXTENDING THE EASY BUSINESS MODEL Case Solution
QUESTION 1: What is easyGroup's strategy?
ANSWER:
The comprehensive analysis of the case study reveals that the management of the easyGroup has adopted business diversification strategy for the long term growth and sustainability of the company in the markets it operates.
This long term strategy of the management of the company allows to aggressively target the opportunities and growth options for the business in the markets where it operates by targeting the various industries and fields of life through a diversified product portfolio and offerings for the customers.It also facilitates the management of the company in reducing the risks for the business in terms of dependency of the business on a single product or service for surviving in the markets in which it operates.
The management of the company has developed and implemented a two pronged strategy for the achievement of this diversification approach and long term concept of the business. These two critical elements of the strategy of the senior management of the company are the foundations and corner stone for the achievement of this objective for the business and they are the low-cost and differentiation approaches for the future initiatives of the business.
The low-cost and differentiation strategies of the management of the organization have allowed the management of the company in successfully competing with the established and well expanded multinational business in the markets it operates. They have also served as a competitive advantage and a critical success factor for the performances of the business in the past in terms of the success of the easyJet airlines of the company.
QUESTION 2: How well did the "easy" formula work in airlines, rental cars, and
internet cafes? What features of the industries explain this?
The analysis of the material and facts provided in the case study of the company reveals that the “easy” formula of the management of the company worked quite well with impressive results in the penetration of the aviation industry. The airlines brand of the company was quite successful in penetrating in the markets it operated.
The policies and approaches of the management of the company allowed the business to aggressively compete with rivals in this segment of the business. The critical success factors in such impressive revenues and operating margins of the company were due to the fact that the management of the company understood the needs of the customers and successfully utilized these needs and demands for the benefit of both by addressing the market demands and supplementing the interests of the business.
The low cost and differentiation strategy of the business were the critical success factors for such performances of the business in the aviation industry segment. Most of the competitors of the organization in the industry were high end organizations who failed to capitalize the lower and middle class segments of the population of the markets they operated from.
The major reason for the failure of the competitors in generating revenues and profits from this segment of the market were the high prices for their services which most of the customers under this segment could not afford. The management of the easyGroup penetrated and targeted this segment by offering low priced services with differentiation in terms of no-frills to significantly reduce the costs and prices for the market and this benefitted them a lot against their competitors.
Extending the ‘easy’ business model Case Solution
The rental cars and internet café initiatives of the business however; did not generate the same value towards the business as the airline brand of the company and there are several reasons for it. The most critical reason for the business to generate the same value from these initiatives was due to the failure of the management of the company to effectively enforce the strategy of the business in this segment.................
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