A strategic management paper for Pacific Global One Aviation Company, Inc. (PCI) / Rosa Thea de Luna,

Thesis (M.A.)-- Pamantasan ng Lungsod ng Maynila, 2021.

A strategic management paper presented to the College Business Administration-- Graduate Program in partial fulfilment of the requirements for the degree Master in Business Administration.

Pacific Global One Aviation Company , Inc. (PG1) is one of the aviation companies in the Philippines. The Company is a subsidary of PLDT, Inc. that engaged in non-scheduled air transport services for business and leisure. PG1 has three aircraft, namely the bell 429 , Super King Air 350, and Agusta Westland 139, with a passenger capacity of five (5), nine (9), and eight (8), respectively. These aircraft of PG1 can serve flight custom fit to it's clients like corporate travel, aerial tours, medical evacuation, and cargo charter.

The aviation industry where PG1 belongs has 16 competitors streamlined by the researchers with the following criteria: (1) the company is rendering a private air charter solutions as their primary business, (2) the company is located within luzon, Philippines and (3) the company has operated within the years 2016 to 2020. The few prominent players dominate the industry, and only a few companies hold most of the market share. As of 2019, PG1 has a market share of 0.15% regarding the number of passengers carried by the Civil Aeronautics Board (CAB).

The external factor evaluation matrix of PG1, which accounts for the oppportunities and threats of PG1 as identified from the external analysis conducted, shows that the company has above average responsiveness to the posted threats and opportunites as indicated by a total weighted score of 3.18.

Significant threats to PG1 include the business coming to a halt due to an extended economic downturn. The market leaders captured a large portion of the industry in terms of passenger carried, leading to a decrease revenue. On the other hand, significant factors are considered opportunities for PG1 to include possible demand of chapter planes for medical transportation and minimal leisure flight due to government limitations due to the pandemic. There is potential demand for chartered flights due to National Election 2022, and the opening of international airports and renovation of povincial airports will probably increase the revenue.

Based on the internal factors evaluation matrix, PG1 has a total weighted score of 2.72 indicating a solid internal position. The major strenght of PG1 includes increeasing market share from 2017-2019 and declining net loss margin from 2016-2020. Meamwhile, significant weaknesses of the company include unutilized digital marketing assets like website and social media platforms for market advancement and lack of accountable people to perform support functions.\\\\\\\\\\\\\\\\\\\\\\\\\\

The main strategic issues that PG1 faces the impact of COVID-19 that leads to the lockdowns implemetned by Philippine Government and severely affects the company. Operations off differnet companies,including aviation companies are greatly affected by this ppandemic. Other issues inlude the 2022 national ellections, private aircraft problems of security and safety, and environmental threats such as natural calmities.

Based on the analysis of external and internal factors, the EFE and IFE matrices and Quantiative Strategic Plannning Matrix (QSPM) snd the resultsof strategy formulation tools, PG1 should focus on market development. It pertrains to the expanded market share by capturing new market segments like leissure travelers and levaraging digital marketing assets to help achieve its short term and long term strategic and financial objectives.

Establishing a market development strategy seeks to increase market share based on passenger carrier from 3% to 8% in five years, increasing by 1% every year. The market development strategy that PG1 will execute includes increasing the operational efficiency by 10% flying hours per year until 2025, rise to 10% efficiency of obtaining the other support functions, and increase employee efficiency by 15% annualy and achieve a 50% increase by 2025.

The market development strategies will also enable the company to keep pace with the competition in the industry. The proposed approach, PG1, will achieve its financial objectives of improving the working capital from -0.2% in 2023 to 4% in 2024 and 8% in 2025. It also seeks to increase the service revenues by 5% i 2021, 20% in 2022, 10% in 2023, 25% in 2024. Market development strategy will attain a net profit after tax margin of 10% or p14 million by the end of the year 2025. This strategy will also inrease the service revenues of PG1 to P131 million by the end of year 2025.