Explain the Decision by Virgin Airline to Pull Out of Kenya.

Topics: Strategy, Airline, Aircraft Pages: 2 (332 words) Published: March 11, 2013
Strategic decision-making is an ongoing process that involves creating strategies to achieve goals and altering strategies based on observed outcomes. Strategy is defined as the long-term direction and scope of an organization to achieve competitive advantage through the configuration of resources within a changing environment for the fulfillment of stakeholder’s aspirations and expectations.

The strategic decision by Virgin Atlantic to pull out of Kenya was because of the hard economic environment in Kenya and Europe. The management thought it was strategically fit to exit the market even though the exit meant losing of Jobs of over 32 staff in Kenya. This is a complex decision in nature as it involves a considerable change and affects many functions of the airline both internal and external.

After matching the activities of the organization with the environment, the airline cited increasing costs and challenging environment over the past five years having contributed to their decision to withdraw the services.

External driving forces are those kinds of things, situation, or events that occur outside of the company and are by and large beyond the control of the company. Examples of external driving forces might be, the industry itself, the economy, demographics, competition, political interference, taxes. The external factors that influenced the airlines decision were high price of fuel, increasing taxes and insufficient passenger numbers.

The management of Virgin Atlantic realized that they did not have a competitive advantage in Kenya as the passengers demand levels were low and it was time to re-position the airline. In today’s turbulent environment of organizations, change has become synonymous with standard business practices, as long-term organizational ends have to be reformulated on an ongoing basis.

The airlines long-term direction is/ was to deploy their aircrafts to routes with the right level of demand to be financially viable....
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