MAKERERE UNIVERSITY

BUSINESS SCHOOL
BACHELORS DEGREE OF HUMAN RESOURCE MANAGEMENT

STRATEGIC MANAGEMENT ASSIGNMENT

QUESTIONS

NAME REG NO SIGNATURE

NYIRAGASIGWA PATIENCE 16/U/17294/PS

NANYONGA AFUWA 16/U/16857/PS

NAGGAYI AIDAH 16/U/15859/PS
NAMUGGANGA ZAHARAH 17/U/20273/PS
NAKISIGE SHARON FORTUNATE 16/U/16145/PS
NAKAGWA BARBRA 16/U/15941/EVE
NANKINGA NASSIMU 17/U/20300/EVE

1. Describe the strategic move of the government of Uganda

A strategic move is a plan of action designed to achieve a long term aim or goal.

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Below are some of the strategic moves Uganda has opted for;

-Acquiring loans from various institutions that is China's Exim bank, Export development
Canada, United kingdom export finance, the French public investment bank, and the Euler
Hermes company so as to purchase the four Canadian regional jet 900 series from Bombardier
and two long haul air buses.

- Signing a purchase agreement for four Canadian regional jets 90 and a memorandum of
understanding with Air bus for two A330 planes.

- Allowing ministry of works and transport to reallocate aircraft money to its original use as the
2019/20 such that it can be used for initial payments for the aircraft.

- Procuring two aircrafts to revive Uganda airlines.

Question 2

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Is the strategy of reviving the airlines a worthwhile? Justify and discuss inline with the GE
matrix.

The GE matrix model analyses the long term attractiveness and business competitive strength of
any firm or project. However in this case, the Uganda airlines revival is not a worthwhile simply
because the weaknesses override the strength as discussed below;

- Economies of scale.
Uganda literally has no competitive advantage against all other airlines .the perception of people
towards the Uganda airline is so negative especially when it comes to time keeping. Ugandans
are so poor at it.

- Subsidization
This involves Ugandan government disbanding state monopolie, privatizing state run enterprises
like UEB to UMEME. This reduces the profit made by the government which would have been
allocated to provision of resources needed to revive and provide services to the Uganda airline.

-Presence of an incompetent work force.

Uganda has failed to encourage students to undertake relevant courses in the aircraft industry as
well as proving enough training to the few available. In addition, these courses are very costly .

-Inadequate infrastructure.
Uganda had limited of these among others catering services, cargo shades and technical team for
repair and maintenance of the aircraft.

-Corruption, favoritism and nepotism

This is Uganda's greatest weakness as it is characterized by bureaucratic and political responses
interns of contract awarding and hiring of staff.

-Inadequate funds
Uganda has not enough funds to maintain and repair the crafts since it intends to do both internal
and external flights.

- Competition

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There's very high competition from other regions airlines in Africa such as South African and
Ethiopia airlines who have established their market base already and have a good reputation for
their good services.

-Failure to carry out a proper feasibility study.

Uganda has decided to revive her aircraft simply because her neighbors, Kenya and Rwanda are
doing quite well in that field without considering the involved risks and costs plus her
unsupportive government.

-Small market base

Uganda has few customers given the fact that it has no agency yet to get them passengers.

Question 3
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Conduct a critical analysis of the investment and come up with a suitable model for justification.

Let's look at the Porter’s forces which include the bargaining power of supplies, bargaining
power of buyers, threat of new entrants, threat of substitutes, and the industry revival.

The threat of new entrants

The Uganda airline is at a threat of new countries the aircraft industry such as Sudan and
Burundi. This shall pose a competitive position for market in the industry. Uganda therefore has
to devise means of overriding better customer services or discount offers.

GFV
Uganda dose not have confirmed agencies to supply passengers for the industry to be well
established across the region. The scarcity of agencies result to their high demand which gives
them a higher bargaining power for high prices in return to their services.

Bargaining power of buyers

The bargaining power of agencies on behalf of passengers determines the prices of flights. This
in turn influences the returns/profits made by the airline. That is, if the bargaining power is high,
the returns will be low while if the bargaining power is low, the returns will be high.

Threat of new substitutes

Other countries across the region either in the east African region or the Continent at large puts
the Ugandan airline at a threat of completion in relation to the limited market available to use the
airline, such as the south Africa, Ethiopian, Kenyan airlines among others.

Basing on the analysis above, the product market matrix is the suitable model for the justification
of the investment of the Uganda airline.

No 4

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Environmental factors Description Impact
Economic factors High taxation to pay back the borrowed Negative
funds from the international bodies like
IMF, world bank among others

High interest rates on loans borrowed

Negative.
High maintenance costs
Negative
High jet fuel prices which makes the
Flights expensive leading to reduced
customers
Negative
Limited funds from another countries

Negative

Political factors Emergence of political pressure groups Negative

e.g FDC, people power.

Government policies that is government

Positive
projects are supported by the NRM
party.

Foreign support in terms of funding

given to purchase the plane.
Positive
Political stability that is safety and
security of the country to facilitate the
airlines. Positive

Technological factors High cost of maintaining the planes in Negative

terms of servicing and repairing the

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 planes.

Use of advanced technology to facilitate

comfort of passengers.
Positive

Operational factors High levels of competition Negative

Availability of substitutes to customers Negative

Social factors Negative perceptions about the Negative

operations of the planes due to political
influence and greed.

Competition from regional players like

southafrican and Ethiopian airlines. Negative

High levels of comfort and long range

flying capacity in the airline.
Positive
Ethnic diversity of the Society in the
Negative
region.

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