Introduction
Although companies can represent the same industry and offer similar services, their development, growth, and strategies can differ dramatically from one another. This paper is aimed at discussing such companies as Delta Air Lines and Great Lakes Airlines. The first one operates at an international level, and it has a long history of acquisitions that enabled them to increase their profitability. In contrast, the operations of Great Lakes Airlines are limited only the United States and one can say that it is a regional carrier. It is vital to examine the work of these organizations and offer strategies that help them improve their performance. These are the main questions that should be discussed in this paper.
The strategy that led to the acquisition
First, it is necessary to look at the strategies of Delta Air Lines. It is possible to say that this company has long tried to increase its share in different markets and become the leading airline company in the United States and in the world. One should bear in mind that they continuously increased their fleet and the number of destinations that they could serve (Delta Air Lines, 2011, unpaged). It should be noted that in the past this organization formed many alliances with many companies such as Air France, AeroMexico, or Korean Air (Delta Air Lines, 2011, unpaged). These partnerships helped Delta Air Lines establish its presence in foreign markets.
This is one of the trends that can be identified. Currently, this organization operates in 247 destinations that are located in different countries, including the United States. Furthermore, the growth of this organization was partly achieved through the acquisition of other companies. For example, in 2008 Delta acquired Northwest Airlines Corporation (Delta Air Lines, 2011, unpaged). In the past Northwest Airlines Corporation was an important rival of Delta Air Lines. However, with time passing, Delta outgrew its competitor and purchased this corporation. This event is an important milestone in the history of this corporation. In this way, the leaders of this company intended to increase its share in the global airline industry.
Overall, this acquisition was quite justified because in this way Delta was able to get access to many Asian countries such as China, Japan, South Koria, Singapore, or Thailand (Zyla, 2009, p. 63). These are the countries with rapidly-growing populations and Delta can find many new customers in these regions and eventually increase their revenues (Zyla, 2009, p. 63). This is one of the goals of this acquisition. Currently, Delta is considered to be the largest airline company according to such criteria the passenger traffic or fleet size (Zyla, 2009, p. 63). Therefore, one can argue that the policies of this corporation are well-developed and they are important for the growth of this organization. By implementing this strategy in the future, Delta will be able to retain its leadership in the market.
Great Lakes Airlines and their possible merger
In contrast, the strategies of Great Lakes Airlines differ dramatically in several ways because this company operates only in the United States. Unlike Delta Airlines, Great Lakes cannot be viewed as an international corporation that targets customers in different countries. Moreover, this organization has never been involved in acquisitions or mergers (Great Lakes Airlines, 2012, unpaged). This is another distinction that should not be overlooked when discussing the work of this organization. Nevertheless, this company can establish partnership with another airline company. This strategy can help Great Lakes strengthen its positions in the U.S. market.
For instance, they can merge with such a company as Cape Air that also operates mostly in the United States. There are several reasons for this decision. First of all, these airline companies have different destinations. It should be noted that Great Lakes operate in Arizona, Kansas, Iowa, Wyoming, Nebraska, and Colorado. In contrast, the destinations of Cape Air include such part of the country as Massachusetts, New Hampshire, Illinois, Kentucky, and Puerto Rico. Provided that they join their efforts, different divisions of this newly-created company will not have to compete with one another. Additionally, these companies can target a greater number of clients if they merge with one another.
This is another benefit that they can derive. Certainly, this merger will not enable them to become a competitor for companies like Delta Air Lines because Great Lakes Airlines will not have sufficient resources for this competition. Nevertheless, they will have more opportunities for growth because they will be able to join their fleets, technologies, and personnel. Certainly, this process will be very time-consuming because organizations will have to align their HR practices, information technologies, and business strategies (Alkhafaji, 2003). Thus, one can say that this task can be challenging. However, in the long-term, this new company will be able to grow and increase their market share in the U.S. market. This is the main rationale for the merger between Great Lakes Airlines and Cape Air. The formation of this alliance can contribute the economic growth of these companies.
Corporate and business-level strategies of Delta Air Lines
It is vital to examine the business-level strategies that Delta Air Lines currently adopts. Overall, business-level strategy can be understood as a set of actions that a business takes in order to gain advantage in a certain industry or market (Alkhafaji, 2003). On the whole, it is possible to argue that business-level strategies of Delta Airlines are quite effective. For example, one can mention that this company adopts a flexible pricing policy so that their services could be afforded by people of various income levels (Zyla, 2009). This is why their services enjoy popularity in different countries. Apart from that, they try to improve the experiences of clients in order to distinguish their services among others.
This is why this company offers various on-flight amenities to their clients. For example, they enable customers to watch videos on demand (Zyla, 2009). Again, in this way, they try to gain the loyalty of clients. Moreover, one should note that the management of Delta strives to increase the number of destinations that the company can reach. They also try to increase their fleet and improve the quality of its aircrafts. This is another aspect that one should not overlook. To a great extent, the combination of these policies enabled them to become a leader in the airline industry. Furthermore, one should pay close attention to the corporate level strategies of corporation. Overall, corporate-level strategies can be described as the selection of industries or markets in which an organization should enter (Alkhafaji, 2003).
This organization has always positioned itself as a passenger carrier. However, this corporation continuously wanted to increase its presence in different countries or regions. Overall, they chose to serve a single need of a very wide audience. This is one of the aspects that should not overlook. It is possible to say that corporate and business-level strategies have enabled Delta Air Lines to become a leading player in the airline industry. Nevertheless, it is possible to make several recommendations to this corporation. In particular, the management should focus on the labor relations within this organization because currently the workers of this company do not have the opportunity to enter trade unions (Belobaba, 2009, p. 284). To some degree, this policy harms the reputation of Delta Air Lines. By enabling the employees to join the unions, the senior management of this company will make the workers more committed to the organizational goals of Delta. This recommendation is mostly related to business-level strategies. In contrast, the corporate-level strategies of this organization can remain unchanged.
Recommendations for Great Lakes Airlines
It is possible to argue that Great Lakes Airlines can also adopt some business and corporate strategies in order to achieve growth. First of all, this organization should increase their fleet. In particular, they should purchase fuel-efficient and capacious aircrafts that they do not currently have. This strategy has several rationales. First of all, it will enable the company to reach a greater number of destinations within the country. Secondly, they will be able to serve more customers and increase their profitability. This strategy can be implemented within the scope of ten years because the company will have to make significant investments into the infrastructure and technologies.
This objective can be better obtained if Great Lakes can join their efforts with another company such as Cape Air. This is another point that can be made. Additionally, one should focus on the corporate-level strategies of Great Lakes Airlines. First of all, this organization should not enter those markets in which it does not have sufficient experience or expertise. For instance, they should not enter cargo delivery services. Such a policy will not enable them to gain more revenues or increase their customer base because they will have to face significant competition from other firms. In contrast, they should focus on passenger transportation and increase the number of its destination within the United States. When they cope with this task, they will be able to enter international markets. So, the corporate-level strategies of Delta should be aimed at improving the main competences of this organization.
Conclusion
On the whole, this discussion shows that airline industry can be represented by companies with different strategies and policies. Furthermore, the objectives of these corporations do not always coincide with one another. Delta Air Lines can be viewed as an example of an international corporation that has always attempted to gain leadership in different countries and regions. In contrast, Great Lakes Airlines have not tried to become a global leader. The management of this business is content with the role of a regional passenger carrier. This comparison indicates that mergers and acquisitions are important for the growth of an organization. The strategies that have been recommended to these companies can help them retain leadership or achieve growth. On the whole, the success of these organizations depends on their relations with clients and ability to exploit their main strengths. Furthermore, they should operate only in those markets where they can best realize their core competencies. This is the main argument that can be put forward.
Reference List
Alkhafaji, A. (2003). Strategic Management: Formulation, Implementation, and Control in a Dynamic Environment. London: Routledge.
Belobaba, P. (2009). The Global Airline Industry. New York: John Wiley & Sons.
Delta Air Lines. (2011). Delta Air Lines: History. Web.
Great Lakes Airlines. (2012). History. Web.
Zyla, M. (2009). Fair Value Measurements: Practical Guidance and Implementation. New York: John Wiley & Sons.