Cost Advantage Discussion


Review AirAsia: The World’s Lowest Cost Airline and discuss the concept of cost advantage. Review textbook Figure 7.10, Using the value chain in cost analysis.

A case study is a puzzle to be solved, so before reading and answering the specific questions, develop your proposed solution by following these five steps:

Read the case study to identify the key issues and underlying issues. These issues are the principles and concepts of the course area which apply to the situation described in the case study.
Record the facts from the case study which are relevant to the principles and concepts of the course area issues. The case may have extraneous information not relevant to the current course area. Your ability to differentiate between relevant and irrelevant information is an important aspect of case analysis, as it will inform the focus of your answers.
Describe in some detail the actions that would address or correct the situation.
Consider how you would support your solution with examples from experience or current real-life examples or cases from textbooks.
Complete this initial analysis and then read the discussion questions. Typically, you will already have the answers to the questions but with a broader consideration. At this point, you can add the details and/or analytical tools required to solve the case.

Case Study Questions:

Discuss how AirAsia achieves a cost advantage. Provide an in-depth analysis for AirAsia Construct and use a value chain to show how AirAsia achieves its multiple cost advantages.
Are AirAsia’s cost advantages imitable by other airlines? Why or why not?
Can AirAsia effectively compete in long-haul air travel given the nature of its existing strategy and the nature of the cost advantages that underpin AirAsia’s existing strategy?

Embed course material concepts, principles, and theories (require supporting citations) in your initial response along with at least one scholarly, peer-reviewed journal article. Keep in mind that these scholarly references can be found in the Saudi Digital Library by conducting an advanced search specific to scholarly references. Use Saudi Electronic University academic writing standards and APA style guidelines.

You are required to reply to at least two peer discussion question post answers to this weekly discussion question and/or your instructor’s response to your posting. These post replies need to be substantial and constructive in nature. They should add to the content of the post and evaluate/analyze that post answer. Normal course dialogue doesn’t fulfill these two peer replies but is expected throughout the course. Answering all course questions is also required.


Chapter 7 in Contemporary Strategy Analysis
Chapter 7 PowerPoint slides in Contemporary Strategy Analysis
Barney, J. B., & Mackey, A. (2018). Monopoly profits, efficiency profits, and teaching strategic management. Academy of Management Learning & Education, 17(3), 359–373.
Sundarakani, B., Abdul Razzak, H., & Manikandan, S. (2018). Creating
competitive advantage in the global flight catering supply chain: A case study using SCOR model. International Journal of Logistics: Research & Applications, 21(5), 481–501.


Arbi, K. A., Bukhari, S., & Saadat, Z. (2017, December). Theoretical framework for taxonomizing sources of competitive advantage. Management Research and Practice, 9(4), 48–60.
Bashir, M., & Verma, R. (2017). Why business model innovation is the new competitive advantage. IUP Journal of Business Strategy, 14(1), 7–17.

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