company is growing, if those costs are not reevaluated and readjusted accordingly, Carnival might run into more cash flows problems in the long run. For example, commission rates with agents should be readjusted based on a certain cap amount and fuel purchases could be made as forward contracts reducing the risks of oil prices inflation in the future. Strategic implications such as cost, and quality are always important when a company to maintain a competitive edge in its market Poor Quality and Safety Control Carnival has a notably worse safety record than other cruise companies. While there is no public database of major cruise accidents, the Center for Disease Control does report many major viral outbreaks on Carnival cruise lines. From 2009-2011 period, Carnival-owned companies accounted for 56% of all viral outbreaks, compared to a 48% industry average. These viral outbreaks usually require the return of a ship to home port, a burst of negative publicity in newspapers, television, and the refund of fees to many passengers. Management need to inspect all the ships regularly and take more precautions to immediately avoid or reduce significantly all those safety control issues. ● Which are the three most relevant lessons learned of this Strategic Management Case? Please explain why? and analyze and discuss in detail. Carnival Corporation Case has reinforced some of the most important decision that every company should implement to be able to achieve their goals. Dominant Market Share With multiple acquisition throughout the years, Carnival Corp is twice as large as its biggest competitor and this gives Carnival a tremendous power over many of its competitors in its industry. With a mission “ to deliver exceptional vacation experiences through the world’s best known cruises brands that cater to a variety of different lifestyle and budgets, all at an outstanding value unrivaled on land or at sea”, Carnival, expansion in the three operational
sectors of the cruise markets including: Contemporary, Premium and Luxury, has enabled the company to undertake more projects, to grow in the industry, to have a platform for possibly more acquisitions, and to be able to negotiate with major manufacturers of cruise ships. Operational experience and excellence The design and implementation of a company processes is as important as its chain of supplies. Carnival has achieved average costs and above-average revenue historically, not only because of the company’s immense experience in owning and operating cruises, especially the large number of years in business and financial data available to draw from to determine what did or did not work in each area, but also because of some smart strategic management decisions. With this operational experience Carnival is able to segment its customers more efficiently than its competitors.
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- Fall '16
- Carnival Cruise Lines, cruise line, Holland America Line, Carnival, Carnival Corporation