Assignment on Oman Airways

Oman Air is a well known airline company that operates in Oman and also serves as a national airline in the country. Oman Air has been running successfully in both domestic and international services. Especially, in recent years, Oman Air has witnessed massive growth which has played a significant role in making Muscat as an imperative traffic hub in the Middle East by mainly supporting the key sectors of the region like commercial, industrial and tourism sector and that is the reason why aviation sector plays a unique role in Oman as it contributes a lot to the growth of nation (Oman Air, 2020). It is expected that by the end of 2020, more than 2.2 million tourists will be visiting Oman. The much appreciated and boosted up infrastructure of Oman by necessary measures of the government, has led an increase in tourism to this extent. More than 74% tourists form Arabian Golf countries visit Oman while there are many frequent tourists from United Kingdom, Germany and Italy. The revenue from tourism exceeds by 7% every year (Tripathi & Shahri , 2019)

A very pivotal role of business organizations is to assess the overall business performance of the company’s activities throughout the year depending upon its competitors, its strengths and weaknesses in the business environment. High profit rates are essential for businesses to run smoothly and to attract shareholders. The internal and external analysis of Oman Airways shows various types of resources employed in Oman Air and the core competencies. Oman Air is primarily concentrated into European and Middle East countries also shifting to Asian countries now. The huge success of Oman Air has made the country to plan building new airports and three projects are already in the process. Oman Air is a major driver in country’s economy as per the aviation sector. The profound service has increased the air traffic around Middle East nation and nearby expanding nations as well (Loh, 2020)

Challenges in the aviation industry that Oman Air has to face:

While the on-going tremendous growth, Oman Air also has to face certain challenges because of the industry it belongs to. Few of those challenges are:

Dip in oil prices of Oman Airways:

The low prices of oil in Oman makes it tough for Oman Air to proceed with businesses as it causes cutting down of the cost of travel budget. This factor impacts highly the airline service as well as the agents and the travel companies. This ultimately leads to strong dip in growth of airline industry and affects the overall airways market (Calabrese, 2018)

Increasing competitions of Oman Airways:

Oman Air faces severe competition in the blooming airline industry while the major rivals include Qatar Airways, Emirates and Etihad. Compared to these rivals, Oman Air has yet to be appear up stronger and has small network and operates in only 44 networks internationally which is quite low as compared to the other renowned airways. Also, the brand awareness is low as per other airline brands. Not everyone is aware of the Oman Airways (CAPA, 2015)

Environmental Issues of Oman Airways:

 The massive development of airports leads to postulate environmental hurdles and growing business of Oman Air has to face this challenge as well.

PESTLE ANALYSIS of Oman Airways:

Pestle Analysis is a key component of strategic management. It helps in understanding the business positions of a company and also about its resources and operations as well as market growth and environmental challenges. PESTLE stands for political, economic, social, technological, legal and environmental factors. The pestle analysis for Oman Air is as follows:

Political factors of Oman Airways:

Be it any sector or industry, every business has to face the influence of the country’s politics as it plays a major role in shaping business operations. Any change in the political environment, for instance, change of government or hold of any new party will directly affect Oman Air as a firm. This factor affects the customer’s nature of travel habits as the new political dynamics can change the affordability of airlines for customers. Hence, the unstableness in the political environment not only affects the airline industry but also causes chaos and confusion among the travelers when they’re to choose the airline company to travel with (Mohandoss & Muthuraman, 2019)

Economic Factors of Oman Airways

The demand in low cost of airlines increases with the increase in economic instability. The economic downturn can highly affect the Oman Air in certain ways. At present, whenever there is a low price spell, the airline industry suffers a lot while at the same time there is a huge opportunity to maximize profits (Mohandoss & Muthuraman, 2019)

Social Factors of Oman Airways:

These days, travelling around the world has increased so drastically as compared to the old times, people has made it a social norm to travel in their holidays at new destinations which is emerging as a cultural norm as well so it becomes a positive advantage for airline companies. The advancement of internet has allowed people to be aware of exciting new destinations and also gives awareness about low cost airlines. It not only becomes affordable for most customers who care reluctant to travel at high rates but also increases new trends in the tourism sector to a great extent (Mohandoss & Muthuraman, 2019)

Technological factors of Oman Airways:

Technology is highly rooted in airline industry particularly aided through the advancement of internet technology. It helps customers to book their travelling plans online with the ease of sitting at their homes and also makes them aware of the latest trends in travel destinations and updates related to the changes in air fares and new and advanced packages. Oman Air has a strong place in social media where it allows its customers to get engaged and stay updated and also allows the customers to contact them anytime who lead to smooth relationship between Oman Air and customers. There are many other technologies that assist in safety measures and helps in teaching latest and efficient technologies for less fuel consumption (IATA, 2015)

Environmental factors of Oman Airways:

The awareness about protecting the environment is increasing day by day which is great notion but it also become a challenge for an airline company to run its operations smoothly. It has already been reported that the airline industry contributes to 4% weather change and is expected to progress up-to 16% in upcoming years. So, customers all over the globe, prefer eco-friendly airlines and expect the company to be taking all required measures. Oman Air operates its major operations in accordance to corporate social responsibility which is great factor is attracting new customers.

SWOT ANALYSIS of Oman Airways:

SWOT stands for strengths, weaknesses, opportunities and threats for an organization or a firm. It allows the organization to adapt with the changes and helps in managing with the threats as well as in adopting new opportunities prevailing in the external environment. The opportunities allow the company to develop strategies for expansion and growth which is a plus point. The SWOT analysis for Oman Air has been described as follows:

Strengths of Oman Airways:

Oman Air has this advantage and strength of having direct flights to Europe, Asia, Indian sub-continent and Middle East which allows it to have a big name among these nations. Since it operates as national airline company, it entertains national fuel price and is also a national carrier of Oman. Oman Air also works with full government support for having the national credibility (KenResearch, 2017)

Weaknesses of Oman Airways:

The connectivity flights to United States and far Europe affects the sale revenue and Oman Air has to go through high operational costs due to this reason. It has to work a lot on employee education and growth which is still a weakness of Oman Air.

Opportunities of Oman Airways:

Oman Air has won many awards for its successful growth and operations which allows in better marketing and promotional strategies and also increases the sales during high season as well as low season depending upon the class of travel. Oman Air has many expansion plans for future which when incorporated can make a huge difference in the industry and can impact the overall brand name globally. As the business sector is Oman is also increasing, so there are many chances of future opportunities with both international and local businesses.

Threats of Oman Airways:

Oman Air has yet to comply with the competitors sales strategies as all those rivalry brands have deep rooted names in the market and they offer several sales and promotional rates which Oman Air cannot afford to apply now. One of the biggest threats is the connectivity of flights to certain countries as it decreases the credibility of an airline company and customers prefer the ones with direct flights. The emerging demand for low cost flights is also a major threat to Oman Air (KenResearch, 2017)

References of Oman Airways

Calabrese, J. (2018). Oman’s Transition to a Post-Oil Economy: Arching Toward Asia. Retrieved April 17, 2020, from https://www.mei.edu/publications/omans-transition-post-oil-economy-arching-toward-asia

CAPA. (2015). Oman Air outlook Pt 2: can rapid growth, airport upgrades and transit traffic lead to profitability? Retrieved April 17, 2020, from https://www.matthewteller.com/2010/11/11/oman-air-the-challenge-of-being-first/

IATA. (2015). Fresh ideas: Paul Gregorowitsch, Oman Air. Retrieved April 17, 2020, from https://airlines.iata.org/ceo-interviews/fresh-ideas-paul-gregorowitsch-oman-air

KenResearch. (2017). Oman Air (SAOC)-Strategy, SWOT and Corporate Finance Report. Retrieved April 17, 2020, from https://www.kenresearch.com/blog/2017/03/oman-air-saoc-strategy/

Loh, C. (2020). Oman Air Is Focused Solely On Inbound Tourists, Unlike Its Rivals. Retrieved April 17, 2020, from https://simpleflying.com/oman-air-inbound-passengers/

Mohandoss, K., & Muthuraman, B. (2019). Analysis of Strategic Management and its Impact in Aviation Industry with Special Reference to Oman Air, Sultanate of Oman. International Journal of Management, 6(4).

Oman Air. (2020). Oman Air Profile. Retrieved April 17, 2020, from https://www.omanair.com/pk/en/about-us/corporate-information/oman-air-profile

Tripathi, D., & Shahri , M. A. (2019). New Dimension of Tourism in the Era of New Media in Oman: A Case Study based on Salalah. Global Journal of HUMAN-SOCIAL SCIENCE: A Arts & Humanities - Psychology, 19(1).