Virgin Australia wasoriginally known as Virgin Blue, and is today ranked as the 2nd largest airline carrying more than 30% of Australia’s market capacity (Knibb, 2011). Virgin Blue started operating way back in 2000 as a low cost airline company catering for low-cost passengers constituting the leisure market segment. However, it faced stiff competition from other service providers including Qantas, Jetstar and Tiger Australia. Whilst Qantas enjoyed a monopolist reign over corporate sector flyers, Jetstar and Tiger gave it stiff competition in low-cost airline market sector (Knibb, 2011). As a means of repositioning itself, Virgin Blue was renamed as Virgin Australia in 2011. This move largely helped in repositioning it as an “emergent world carrier” for business class and leisure travellers alike.
The environment where Virgin Australia flies is substantially dynamic and hence unpredictable. Amongst the major challenges in the sector include fuel price fluctuations, natural disasterssuch as floods and earthquakes, staff union strikes as well as the ever changing global economic fortunes. These are elements known to adversely affect the airline industry and not just Virgin Australia. 2008 world economic recession resulted into a huge reduction in leisure travel volumes. This coupled with the rising domestic competition in terms of pricing made it difficult for Virgin Australia to make any substantive profits as well as other low-cost airlines. Additionally, the increasing market liberation has seen international players also join in competing the market enjoyed by Virgin Australia. Nonetheless, Qantas remains the single largest competitor to Virgin Australia enjoying near monopoly in the business airline sector of the market (Knibb, 2011).
As a game changer, Virgin Australia’s CEO introduced a myriad changes include the revamp of the existing fleet, creating world-class lounges as well as introduction of new staff uniform as a way of attracting the rather choosy corporate travellers. The changes were purely meant to get a share of the rather reserved corporate travel segment believed to make about 20% of the corporate travel sector(Flynn, 2011).
For an organization to be able to sustain itself in a dynamic and extremely competitive environ, there is need for the organization to be able to cope with change. Additionally, there is need for proper planning more especially with respect to the required investments, level of staff involvement/motivation, as well as understanding of the counter-movements by competitors and the outside environs (Shields, 2009). Change is very difficult to predict in an external environment where lots of dynamic things happen. Nonetheless, it is easy to anticipate change if it is to be handled in an effective way. Virgin Australia has made substantive efforts in an effort to market itself and maintain its relevance in the market.
Recent changes at Virgin Australia
There is often a widely held ideal that change is the only constant thing in life. Modern business society have been forced to embrace emerging technologies, ward off increased levels of competition, shed of outdated techniques/business processes and all this are only possible through change. Survival in the modern business world requires continuous re-invention of companies in line with the changing market demands as well as business necessities (Mark, 2005). This is as well applicable to Virgin Australia whose need for change is partly due to arising opportunities and partly due to the necessity for change.