Institute of Accounts Business and Finance Business Administration Department
Institute of Accounts Business and Finance Business Administration Department
A. Case Abstract--------------------------------------------------------------------------------------------1
B. Vision Statement----------------------------------------------------------------------------------------1
C. Mission Statement--------------------------------------------------------------------------------------2
D. External Audit--------------------------------------------------------------------------------------------3
- Opportunities--------------------------------------------------------------------------------------4
- Threats----------------------------------------------------------------------------------------------4
E. Internal Audit----------------------------------------------------------------------------------------------
- Strengths-------------------------------------------------------------------------------------------7
- Weaknesses---------------------------------------------------------------------------------------7
F. SWOT Strategies--------------------------------------------------------------------------------------10
K. Recommendation--------------------------------------------------------------------------------------22
L. Implementation-----------------------------------------------------------------------------------------25
M. Illustration-----------------------------------------------------------------------------------------------32
N. References----------------------------------------------------------------------------------------------33
A. Case Abstract
Having been known for being a “low cost, great value” airline, Cebu Pacific is one
of the Philippines' largest airlines, operating flights to more than 60 domestic and
1996 and has subsequently expanded its core business to include air freight. The
airline's headquarters is located in Pasay, Metro Manila, and it has expanded its
network of hubs to include Cebu and Clark. Over the course of years, Cebu Pacific
has garnered various awards with the latest being awarded two Silver Anvil Awards
during the 54TH Anvil Awards last January 2019. The awards were to give tribute to
Cebu Pacific for their “The Juan Effect: An Advocacy on Responsible and
Sustainable Tourism” and “Cadet Pilot Program: How Cebu Pacific Helps Filipinos
Soar to Their Dreams”. As of December 31, 2020, the company's net loss after tax
was -22,236,441,976 pesos, down from 9,122,952,680 pesos the previous year, and
the company was operating at less than 20% of pre-pandemic levels. With that,
Cebu Pacific is still thinking about how to recover from the pandemic-related losses.
B. Vision Statement
meaningful relationships are built, and lives are enriched by opportunities and
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C. Mission Statement
Actual:
Cebu Pacific brings people together through safe, affordable, reliable, and fun-
filled air travel. We are committed to innovation and excellence in everything we do.
growth. We have a deep sense of family values through our airline. We enhance the
quality of life of the communities we serve and are an active partner in our nation’s
Proposed:
Cebu Pacific unites passengers (1) through safe, affordable, reliable, and
exciting leisure and business air travel (2). Enriching travel experience around the
employers of choice providing opportunities for professional and personal growth (9).
We enhance the quality of life as we have a deep sense of family value through our
airline (6). We are an active partner in our nation’s progress as well as offering our
Legend: (1) Customers, (2) Products or services, (3) Markets, (4) Technology, (5)
Survival, growth, and profitability, (6) Philosophy, (7) Self-concept. (8) Public image,
(9) Employees
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D. External Audit
o Opportunities
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1. Lifting of lockdown restrictions in the country.
2. Having fewer COVID-19 cases locally and globally so that tourism and
3. Over 27 million Filipinos are fully vaccinated which allows them to travel.
flight experience.
8. Adding more flight routes and destinations to reach more people and
locations.
o Threats
6. Competition pricing
7. Unsatisfied customers.
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Key External Factors Weight Rating Weighted
Score
Opportunities
Threats
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Analysis:
When the data from Cebu Pacific Air was analyzed using the External Factor
Evaluation (EFE) Matrix, it was discovered that the airline's performance was highly
dependent on the current pandemic. As a result of the COVID-19 pandemic, which has
affected everyone, but especially the aviation industry, they have to deal with a smaller
audience as a result of this. In addition to the pandemic, the rising cost of fuel has been
identified as one of the threats the company must contend with within the near future.
Cebu Pacific's advantage lies in the lifting of the lockdown that had been implemented
in the various countries to which they cater, as well as the reduction in COVID-19 cases
both locally and internationally. Other advantages, such as a large number of Filipinos
who are fully vaccinated, the creation of exposure through partnerships and campaigns,
attracting customers with new special offers, and increasing social media engagements
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E. Internal Audit
Strengths
2. User-friendly websites
additional capital.
destinations.
8. “It’s time every Juan flies” - Their tagline uses “Juan” to represent
Filipinos
9. Condition of aircraft
Weaknesses
3. Suffering from net loss and low net income and performance.
7. Separate payment for baggage and in-flight necessities like food and
blankets.
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o Internal Factor Evaluation (IFE) Matrix
Strengths
8. “It’s time every Juan flies” - Their tagline uses 0.06 4 0.24
“Juan” to represent Filipinos.
Weaknesses
12. Suffering from net loss and low net income and 0.08 1 0.08
performance.
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necessities like food and blankets.
Cebu Pacific Air's data analysis of the Internal Factor Evaluation (IFE) Matrix
revealed their strengths in terms of fare rate, catchy taglines and marketing skills in
terms of social media. Additionally, their website is referred to as user-friendly due to its
ease of navigation. Moreover, its strong relationship with suppliers as well as partners
has put the company at an advantage over its competitors. With regards to Cebu
Pacific's weaknesses, it is clear that the company is suffering from net loss and low net
factors such as flight cancellations and delays, unmet refund policy reinforcements, low
customer satisfaction ratings, and poor customer service have been discussed.
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F. SWOT Strategies
STRENGTHS WEAKNESSES
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changes brought by the
pandemic.
“Juan” to represent
Filipinos
9. Condition of aircraft
that tourism and flights can 2. Make the website necessities such as food,
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5. Introduction of modern new destinations to make
improve bookings and flight fun. (O4, O6, O7, S6, S8)
experience.
prospective flyers.
7. Partnerships and
campaigns to create
image.
cases locally and globally. with additional insurance in service through additional
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3. Implementation of 2. Boost advertising 2. Including additional
lockdowns and travel through catchy taglines in fees for baggage and in-
6. Competition pricing and globally. (T1, T3, T5, flights to avoid delays and
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-1 Technological know- +6 Profit potential
how
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SPACE Matrix
Analysis:
Based on the SPACE Matrix, Cebu Pacific Air must pursue aggressive
strategies. The Matrix also shows that the company has a strong competitive
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H. Grand Strategy Matrix (GSM)
Quadrant II Quadrant I
Weak Strong
Competitive Competitive
Analysis:
Based on the position Cebu Pacific Air was in in the SPACE Matrix, it suitably
belongs to Quadrant I of the Grand Strategy Matrix, which means that Cebu Pacific
Air currently has a strong competitive position and has been rapidly growing in the
airline industry.
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Analysis:
The Internal-External (IE) Matrix is based on the results obtained from the EFE
and IFE Matrix. On the x-axis, the total weighted mean of the IFE Matrix was 2.60,
showing an average result in terms of internal situations. On the other hand, the total
weighted score of the EFE Matrix was 3.12 which means high in external situations.
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QSPM (Quantitative Strategic Planning Matrix) for Cebu Pacific
Alternative 1 Alternative 2
Service Development Market Penetration
Strengths
Weaknesses
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Suffering from net loss and low 0.07 3 0.21 0.08 4 0.32
net income and performance.
Opportunities
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people and locations.
Threats
Analysis:
to Alternative 2, Market Penetration, at 6.45. With that, the strategy that will be
K. Recommendation
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Based on the findings of the various matrices, we have decided to concentrate
as this is the best course of action given the company's current circumstances.
According to the matrices, the strategy is appropriate because the problems that have
been identified are centered on poor customer service, ineffective advertising, and
public exposure, and frequently delayed or canceled flight schedules and connections.
schedules.
allows employees and customers to meet halfway is the most effective action strategy.
Employees may use the application as a real-time data monitoring tool to keep track of
the airline's performance, such as the availability of standby crew, the number of
passengers on board, and the utilization of the airport's runway. A notification system is
Notifications are sent to employees immediately through the app. It may also be used to
take place on a regular basis, we believe that incorporating a data collection feature will
be beneficial in the long run. Customers can enter their information and flight details in
this manner, and they will receive specific flight advisories as a result of their input.
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The application can also be used to provide a better customer experience when
booking flights and to view real-time important announcements such as flight status and
advisories specifically for their booked schedule, amongst other things. As a way to
attract more travelers' attention, information about upcoming events and other
promotional activities will also be available on the platform. Cebu Pacific may include a
feature where customers can play a game and earn points that can be redeemed for in-
flight benefits such as bottled water for 1000 points, and so on, in order to increase
The advantage of this mobile app with regards to Cebu Pacific employees is that
they will be constantly updated about the status of flights which makes their activities
and operations more efficient to achieve on-time performance. With these real-time
updates, flight staff and pilots can improve and control the factors that may negatively
influence their performance. For example, the details regarding the number of standby
crew, which would be available in the app, can help other flight staff utilize such
information by calling in more crew to avoid flight delays. When the employees see the
positive effect of their operations thanks to the real-time updates, they will be motivated
to work. Daily airline operations are performed by many people in a big area and not
everybody is monitored properly nor doing their job on time, so this app can help with
As for the advantages to the customers of Cebu Pacific, given that they will be
notified ahead of time if their flight will get canceled or delayed, customers will not have
to worry last minute about changing their scheduled flights. The notification will be
available in the application’s dashboard a week before their flight to give time for the
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passengers to rebook their flights. Moreover, they will also receive the latest flight
leaving the passengers at ease during the day of their flight. During special occasions
such as Cebu Pacific’s anniversary and holidays, customers with existing Cebu Pacific
accounts will be given the opportunity to play a game in the application to obtain points
employees and passengers is that there may be some who are not technology literate
so they might find it difficult to use the application. This can be counteracted with a
training course for all employees of Cebu Pacific and releasing an informative video for
customers on how to navigate it, when the application is launched and ready to use.
Another disadvantage is that there could be technological errors within the app which
can disrupt its purpose. This problem can be solved with the Cebu Pacific information
technology department and app developers through daily monitoring of the app’s
L. Implementation
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Management Cebu Pacific would The management The management
would be recorded
and the
management would
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summary of the
report to monitor if
application as well
their points
accumulated playing
games.
it would be an
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advantage to upgrade
the application
issues.
sales.
through the
enhanced mobile
application.
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Accounting should allocate should have budget would be applicable
within a specified
period of time.
necessities that
passengers need
once a customer
Information secure the data must have 24/7 should evaluate the
System privacy act since the Help desk and IT inquiries and make
transaction purposes.
Moreover, to ensure
proper addressing of
inquiries of the
advisories of delayed
application.
M. Illustration
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Always Delayed, Often Cancel Without Reason - Review of Cebu Pacific Air, World -
https://www.tripadvisor.com.ph/ShowUserReviews-g1-d8729048-r348175815-
Cebu_Pacific_Air-World.htm
https://www.cebupacificair.com/pages/about/our-story/our-awards
https://edge.pse.com.ph/companyPage/financial_reports_view.do?cmpy_id=624
Kabagani, L.J. (2021, October 31). “Over 59M shots given; 27.3M Pinoys now fully
Eco-Business. (2021, May 11). IFC and Indigo Partners support low-cost carrier Cebu
releases/ifc-and-indigo-partners-support-low-cost-carrier-cebu-pacific-in-
recovery-from-covid-19/
https://www.id1.de/2019/10/24/improve-your-airlines-on-time-performance-
immediately-and-without-spending-thousands-of-dollars/
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