Strategic Management and Lufthansa
Lufthansa:
Going Global, but How to Manage Complexity
Chrissy L. Cash
Professor Barry Adkins
Senior Seminar in Business
September 5, 2010
Describe the type of international strategy the company has chosen.
This international business strategy is considered a combination of multi –domestic and global strategies (Hitt, 2009). A transnational strategy offers the benefits inherent in both global and multi-domestic strategies. Under this strategy each business component of Lufthansa can successfully implement independent innovation. The firm has focused on constructing a shared dream and individual commitment through an integrated network that includes its alliances, partnerships and five business segments. Although this strategy requires global coordination and flexibility, all segments are decentralized and operate in a sovereign form with the assurance to support Lufthansa’s strategic development goals.
Explain what means the company has used to expand internationally.
Lufthansa created a strategic alliance with Star Alliance which serves a global airline network. Lufthansa remained optimistic as this was a common thread with the rest of the airline industry, and they responded to globalization fittingly. Competition, along with snail-like recovery of international travelers, the ever expanding increase in gas prices gave off the continuous tension to shrink pricing in order to remain aggressive, as far as competition, has taken a toll on the complete industry over the last decade.
Identify and describe the elements and objectives of Lufthansa's cooperative strategy.
It is a common understanding that it is moderately unfeasible to stay alive in a global network if not part of an alliance. This cooperative strategy serves as a mechanism for the Aviation Group to enter the market swiftly, and with greater impact with the support of the alliance. The airline industry has historically been a standard –cycle market, the same is true
Going Global, but How to Manage Complexity
Chrissy L. Cash
Professor Barry Adkins
Senior Seminar in Business
September 5, 2010
Describe the type of international strategy the company has chosen.
This international business strategy is considered a combination of multi –domestic and global strategies (Hitt, 2009). A transnational strategy offers the benefits inherent in both global and multi-domestic strategies. Under this strategy each business component of Lufthansa can successfully implement independent innovation. The firm has focused on constructing a shared dream and individual commitment through an integrated network that includes its alliances, partnerships and five business segments. Although this strategy requires global coordination and flexibility, all segments are decentralized and operate in a sovereign form with the assurance to support Lufthansa’s strategic development goals.
Explain what means the company has used to expand internationally.
Lufthansa created a strategic alliance with Star Alliance which serves a global airline network. Lufthansa remained optimistic as this was a common thread with the rest of the airline industry, and they responded to globalization fittingly. Competition, along with snail-like recovery of international travelers, the ever expanding increase in gas prices gave off the continuous tension to shrink pricing in order to remain aggressive, as far as competition, has taken a toll on the complete industry over the last decade.
Identify and describe the elements and objectives of Lufthansa's cooperative strategy.
It is a common understanding that it is moderately unfeasible to stay alive in a global network if not part of an alliance. This cooperative strategy serves as a mechanism for the Aviation Group to enter the market swiftly, and with greater impact with the support of the alliance. The airline industry has historically been a standard –cycle market, the same is true