Why is there a lot of imitation in the airlines industry and how does this affect firm performance explain briefly?

There are a few reasons that airlines are subject to imitation. First, there are few suppliers within the airline industry, partially because of the high costs involved with creating aircraft. Second, with such heavy overhead costs, there are fewer options to do things differently and still make a profit.

How important is the resource based model to explain how well firms perform in the airline industry?

Resource-based theory suggests that resources that are valuable, rare, difficult to imitate, and nonsubstitutable best position a firm for long-term success. These strategic resources can provide the foundation to develop firm capabilities that can lead to superior performance over time.

Why airline industry is in loss?

Indian airlines and airports incurred financial losses worth Rs 22,400 crore in the last financial year amid the coronavirus pandemic, according to official data. The minister said that domestic air passenger throughout declined by 0.3 per cent in 2019-20 and by 61.7 per cent in 2021 due to the pandemic.

What are some of the concerns of the airline industry?

Top 8 Challenges of the Aviation Industry: The Pre-COVID Era

• #1 Fuel Efficiency.
• #2 Global Economy.
• #3 Passenger Comfort and Experience.
• #4 Airline Infrastructure.
• #5 Global Congestion.
• #6 Technological Advancements.
• #7 Terrorism.
• #8 Climate Change.

Why do firms imitate each other?

Firms may imitate to avoid falling behind their rivals, or because they believe that others’ actions convey information. The matching of rivals’ actions can intensify competition, or it can have the opposite effect, promoting collusion.

How can strategic leaders be successful in an industry like the airline industry?

Strategic leaders can be successful in an industry like the airline industry by possessing certain qualities that are critical in the airline industry. This leader must possess the skill and competencies to understand and hold the competitive edge of the firm.

Why is resource-based view important?

The resource-based theory or resource-based view helps in determining the resources available within the firm and relates them with the capabilities of the firm in a silent manner. This brings into consideration, the profitability and the value factor associated with the firm (Colbert 2004).

How does the resource-based view of firms help in determining the sustainability of a competitive advantage?

Resource-based theory of competitive advantage argues that innovations achieve sustainable competitive advantage by accumulating and using resources to serve consumer interests in ways that are hard to substitute for or imitate. It states that successful innovations are determined not just by the innovation.

How can airlines improve their profitability?

1. Revenue Maximization by deciding the number of expensive and cheap seats to sell in a setting where consumer demand is uncertain. 2. Aircraft Purchase/Lease decision‐making to use option values to minimize the long term fixed costs.

Which airline is in loss?

Mint had in February reported that Air India is likely to incur a consolidated net loss of ₹9,500-10,000 crore in the year through March, up from a ₹8,000 crore loss recorded in the previous year, quoting a senior official at Air India. This would include losses reported by Air India and its subsidiaries.

How competitive is the airline industry?

In terms of the number of different airlines providing flights for consumers to choose from that’s true in most markets. There’s more competition than ever before. [I]n 2019, there was an average 3.46 competitors on all reported domestic U.S. itineraries, compared to 3.33 in 2000.

How did Covid-19 affect the airline industry?

The COVID-19 pandemic had a profound impact on the U.S. aviation industry. Passenger traffic in April 2020 was 96\% lower than April 2019, and stayed 60\% below 2019 levels in 2020. Effects cascaded across airports, repair shops, and the supply chain.

Why do Airlines imitate each other’s products?

Thus, imitation helps to preserve the status quo among competitors that follow each other, even in industries where strong rivalry is maintained” (Lieberman, 2004). Because many airlines have the same prices and amenities, they are forced to find other ways to attract customers.

Why do Airlines fail to attract customers?

Because many airlines have the same prices and amenities, they are forced to find other ways to attract customers. This includes increasing customer service and care. The airlines performance relies heavily on how they treat employees and in turn their customers.

Why is the resource based model important to the airline industry?

The resource based model is very important to explain how well firms may or may not perform in the airline industry. Take Southwest for example, the have many resources that other airlines can try to emulate but will most likely experience a loss as a result.