Business Environment Of British Airways

Business Environment Of British Airways Executive summary: This essay is formed for the purpose of providing British Airways Plc with a strategic plan to apply over the nearing future. British Airways is the UK market leader in the Airline industry. It has faced ever-increasing competition over the past 10 years resulting attrition in their market share. The report commences by analyzing the current internal and external environment of British Airways. Through strategic evaluation we have suggested that BAs focus on their primary service delivery to refurbish their competitive benefit within the industry. This will require applying a grouping of two strategies; a public processes strategy and a strategy focused on technological development. The public processes strategy was a consequence from a number of industry basis demarcating BAs turn down in customer fulfillment. The technological development strategy corresponds with the regeneration of BAs aircrafts and will further improve on the whole consumers satisfaction. Introduction: The main aim of this report is to direct British Airways strategically using the current strategic position of the company and the internal and external environment. After analysing the companys position both externally and internally using appropriate tools, a final design is created giving a set of strategic options to the company. Finally an appropriate strategic option is evaluated and the methods of implementation are discussed. British Airways is the UKs largest intercontinental airline. In addition to scheduled services, BA is affianced in the process of international and domestic carriage of cargo and parcels, and additional services. In association with code share and franchise partners, BA fly to more than 300 destinations, and carried more than 33 million passengers, earning over  £8.7 billion in profits in 2007/08. Employee population in March 2008 was 42,377 people. After being privatised in 1987, BA has been a competitor in the market and has held a place worldwide. In the recent, BA has been named the worlds first airline to take part in a proposal to reduce greenhouse gas emissions in 2002 and to allow passengers to print online boarding passes in 2004. Willie Walsh became Chief Executive of BA in 2005. He has focused the company through the completion of Terminal 5 at Heathrow, amongst other new initiatives. In spite of global economic down BAs future as an international business organisation, looks promising. Current Strategy: The company uses 5 strategic goals for the year 2009/10. They are basically to be the first choice airline for the long haul premium customers, to deliver an outstanding customer service at each and every point, to grow their survival in key global cities, to gain a leading position in London, to meet their customer needs and to improve their margins through new revenue streams. Long haul premium customers are considered to be their key to their profitability. They will use their deep understanding of what is required to be their airline of choice to drive the design choices on product, network and service. They will also maintain a strong presence in the cargo economy and short haul segments, which play a critical supporting role. Their customer-facing staff will be passionate about delivering outstanding customer service. They are planning to build through a revolution in the way they lead, train and reward, so that all customers, on all routes and classes, enjoy a premium experience. They will invest both in improvements targeted at premium customers, such as service training, and in those benefiting all customers. They aim to provide the best global connectivity for customers. They will build their presence in the top global cities, either directly or through their expanding network of airline partnerships. Despite the fact that the established global cities such as London and New York remain critical, they will place a special emphasis on developing their position in the global cities of tomorrow. London is the worlds biggest and most competitive international air market. Ensuring Heathrow remains a world-class hub vital enough to give them a strong London base to serve the largest international long haul markets. To support this, they will look to influence government policy decisions, and work with the airport owners on the continued development of the infrastructure. 1. External Analysis: This section indicates the external environment of BA as it is very necessary for an airline industry to remain updated about the external environmental factors. It also highlights the position of the industry, its competitors, and its capabilities to meet the current and future challenges. 1.1 PESTEL Analysis: 1.1.1 Political: Heavy regulation from the UK government has been a major challenge to the company. Hence, it is essential for BA to comply to the rules if the company has to continue operations. Moreover, since the government has increased security due to past terrorist threats, sufficient security measures should be in position to ensure consumers self-belief and competitive advantage should be maintained. 1.1.2 Economical: Due to global economic crisis, world growth is projected to just over 2 percent in 2009. The value of Pound has begun to slide especially against the Euro. Possible reduction in the amount of business travel as companies are cutting costs and using alternative means of communication such as teleconferencing. Hence BA is vulnerable as an UK operating airline to a poor exchange rate. Oil prices have been declining by 50 % since their peak retreating to 2007 levels. Decline in fuel price will obviously strengthening of the dollar changeability in oil prices and exchange rates will directly affect BAs cost base. UKs consumer spending had its sharpest decline for 13 years between July and September 2008. Hence there is an expectancy of more intense competition in the near future. 1.1.3 Social: According to the national statistics online, The UK has an aging population since the past decades. Potential opportunities may arise, as older generations have more time to spend on leisure activities such as international travel. At the same time the increase unemployment may also led to increase in the bargaining power as an employer 1.1.4 Technological: A recent survey discovered that 34% of online clients plan to use price comparison sites more in 2009. This clearly reveals that there is an increase in consumer awareness and therefore bargaining power of the same may also increase. Online booking services and check-in is becoming popular in the airline industry. Hence BA must ensure that they stay up to date with these technological progress at the same time as avoiding becoming overly reliant, as this may separate certain consumer markets (i.e. the elderly) who dont feel contented using such technology. 1.1.5 Environmental/Ethical: New legislation is being implemented every year. Due to tighter environmental rule the operational costs may increase each year for the company. Hence, BA should be aware of both Noise pollution controls, and energy consumption controls. Due to limited land and for growing airports expansion is difficult. Further expansion at Heathrow is difficult as it may affect the Londons agricultural area. Due to this the company should concentrate on limited capacity aircraft and effective utilization of capacity. Failure to implement an incorporated environmental strategy could lead to an unfavourable effect on the BAs reputation and income. Cancellations of flights and loss of baggage, such ethical issues could have a negative effect on reputation if left unsettled 1.1.6 Legal: Limitations on mergers will have an impact on BAs proposed alliance with American Airlines. Recognition of trade unions and industrial action e.g. Cabin Crew strikes are necessary if the company has to withstand in the global market. Good employee relations are essential if BA wants to avoid industrial action and interrupted operations. Open Skies Agreement is a colossal opportunity for BA and its competitors to freely transport aircraft between the EU and US. 1.2 Porters Five Forces: It is imperative to analyze the competitive nature of the airline industry to measure the position of BA. The Five Forces tool will be facilitate BA to make strategic decisions in order to increase the effectiveness. 1.2.1 Competitive rivalry: BA provides frills for both long haul and short haul flights. Within long haul there is a little isolation between the BA and their other competitors, in terms of price and service contribution. The short haul market is more uneven with many small competitors. Strengthening of competitors has increased the competition. Direct competitive rivalry is severe, e.g. Virgin Atlantic has a website opposing the proposed strategic coalition of BA and AA. Hence it is found that BA does not suffer in its sector due to its competitors. 1.2.2 Power of Suppliers: BA is benefited by a high bargaining power since there are two aircraft manufacturers. The sole supplier of fuel to the airport is being permanently stopped by the company. The existing users get the top priority in landing slots according to their historic rights. Trade unions help BAs employees by providing them collective bargaining, in order to increase their bargaining power. Hence the power of suppliers does not affect the BAs efficiency in the means of its suppliers. 1.2.3 Power of Buyers: The company is found to be more concentrated on its suppliers than the buyers. This is because they have a very little bargaining power. Enhanced usage of internet has enlarged the awareness and interface between the customers. 1.2.4 Threat of New Entrants: High environment regularity requirements and high capital cost requirements are the new main barriers to the company. The failure of new airline companies such as XL and Zoom is likely to discourage new entrants 1.2.5 Threat of Substitutes: There are a few direct substitutes for short haul flights such as euro star and ferries. No notable substitutes can be found for long haul flights. 2. Internal Analysis: It is now important to analyse the internal environment in order to create the suitable strategies. 2.1 Resources and Core Competences: It is derived that a companys competitive advantage and superior performance is calculated from its independent capabilities. The resource based view emphasizing BAs resources and competencies is summarized below. 2.1.1 Resources: The company runs 245 aircrafts covering over 550 destinations. Additional services such as BA Holidays The London Eye Company, has been a fruitful resources for the company. The company is well equipped with an International Customer Database which helps them to keep track on the latest customer information. Partnerships Alliances with one world including American Airlines, increase the companys wealth against the resources. Sole access to LHRs Terminal 5 is a huge boon to the companys brand image. BA is renowned globally as a reputable brand, resistant by its long-lasting survival within the Industry 2.1.2 Competences: The company has its own training of ground school, flight simulators, and cabin safety training which holds the favourable part in its core competences. The company holds the capability to fly and handle passengers safely on different routes (Open Skies). Their subsidiarys aircraft never have more than 64 passengers per flight, with one flight attendant per twelve customers. They also hold the name as the first UK airline known as a training centre by the City Guilds, educating all cabin crew with NVQ Level 2. 2.2 SWOT Analysis: 2.2.1 Strengths British Airways is a well-reputed brand name that has achieved constancy and conviction from its customers. Modern culture enables BA to take full benefit of technological developments such as, online sales, in house check in. BA has a worldwide geographic exposure with excellent communication with strong international coalitions. 2.2.2 Weaknesses BA has however to have recovered from events such as the Iraq war, the 2001 and 2005 terrorist attacks because of its dependence on international air travel. But the hazard still remains. BA continues to have enormous debts. Recent job cuts may have a harmful effect on BA as in the past this frugality effect has resulted in understaffing and industrial exploit in 2004 and 2005. 2.2.3 Opportunities The increase of internet usage worldwide is likely to further expand BAs online customer base Value-added and pioneering flight services such as sleeper services, will attract more customers as customer prospects are heaving. The current UK government hassles Heathrow as a worldwide gateway and proposes a third short runway and sixth terminal be opened by 2020, which will also promote BAs brand image. 2.2.4 Threats Low-cost airlines continue to benefit from strong growth and power in the market and new entrants and the probability of them being issued with long-haul licenses could create a further hazard to BAs market share. The continuing increase and variation in fuel prices may threaten them with regards to not attaining a profit margin of at least 10%. Customers are still vigilant of the threat of repeated terrorist attacks. With the increase of rivalry in the low-cost airline market, more companies may focus their strategy on high eminence and hence increase the direct opposition for BA. 3. Analysis of Strategic Options: Based on the scrutiny performed the five most viable strategic options will now be measured further in terms of aptness, adequacy and viability 3.1 Strategic Option 1 Development to People procedures: The study highlighted the most recent negative attention both internally and externally. The Resource Based View and SWOT are identified as BAs public condemnation for poor customer service and impediment management and disapprovals following a number of unhelpfully handled employment associated cases. A people progression strategy may reconstruct brand image and stakeholders self-assurance. 3.1.1 Aptness: Looking at the current economic environment, unemployment is increasing. Therefore, the hazard of industrial action and acquiescence are less possible at this time. BAs current strategies are to stimulate, employ, support and develop employees, together with recuperating baggage handling and delay management. Enhancement in internet usage, with more consumers and self-governing services reconsidering and contributing feedback. Better customer relations may improve such systems. 3.1.2 Adequacy Staffs and consumers are expected to invest high interest into the growth of their relations with the organization due to the negative past experiences. Skytrax emphasizes that customer relations is an important measure for consumers when selecting airlines, increasing the prospective of high profits. 3.1.3 Viability The Resource Based View shows an global consumer database. Admittance to such information could help BA in market research and customer relationship development based on conclusion. The industry and organization is highly combined, and are likely to increase support from this exterior body when strategically increasing employee relations. 3.2 Strategic Option 2 Enhanced Environmental Position. As recognized within the PESTEL analysis, environmental concerns are becoming increasingly important. An involuntary strategy as a result could be suitable to construct an improved environmental place and go beyond the requirements of parameters such as the climate change. 3.2.1 APTNESS BA profits from a resonance brand image which would be further imposed by this strategy. This would make sure that BA remains a strong global contender by making sure they are meeting changes in socio-economic actions. Customers are becoming more environmental responsive and this strategy would at least make certain that BAs market share is not negotiated if competitors go in a parallel direction. 3.2.2 ADEQUACY Changes in customer choices point out a sharp anxiety for the environment. Therefore this strategy is short risk, especially when attached with a low scale of uncertainty. In addition, this strategy will make sure that BA is recognizing and meeting customer demands. As the necessities of environmental rules are repeatedly increasing, it would be valuable for BA to be the first hauler in the industry and make changes prior to any of its competitors. 3.2.3 VIABILITY Assets may be better engaged elsewhere, as spending in environmental strategy may not increase profits. BA must be certain that it will be able to successfully follow such a strategy as if it would not succeed it would be open to public enquiry which could break its current strong brand image. 3.3 Strategic Option 3 Enhanced Technological Position. The technological capabilities of an airline is increasingly disturbing consumer choice of airlines, from both holiday and business fliers. Better development of the in-flight services will improve their overall service, increasing long-standing profits. 3.3.1 APTNESS The in-flight entertainment amenities need to be greatly enhanced and become more consistent. This will guide to a long-term development in the number of passengers. Many of BAs major competitors are beginning to bring in basic internet facilities on selected flights. Therefore it is in its importance to keep up with the rivalry and surpass it by bringing in internet access on all flights. BA is at present on a service of one flight from London City Airport to JFK, New York. BA also needs to contend with other modes of travel, which already have internet capabilities. By applying the strategy, BA can refresh its image even as maintaining conventional principles. 3.3.2 ADEQUACY Wide-range testing has found the internet connection to be consistent, with loss of connection only taking place for a couple of seconds during unfavorable weather conditions. Project accomplishment takes only 3 days per plane. 3.3.3 VIABILITY Possession of the operations is less expensive and more dependable than the Abandoned Connexion service offered by Boeing. BA has a sagging resource in the technology section needed to apply this strategy. BA must implement this technology first time effectively otherwise, it will receive serious denigration and could mess up its long-standing image 4. Conclusions and Recommendations: On the examining the strategic options it has been determined that before growth strategies are followed BA should concentrate on protecting its current market place and attaining elementary service class. Based on this the people progressions and technological development strategies are believed most suitable for performance. British Airways remains vigilantly hopeful about its future prospects. However, it is sure that significantly more work lies further on if the airline is to accomplish their goals. The FSAS plan integrated by BA resulted in substantial cost savings, and also raised funds to repay debts. The objective of the FSAS plan was to achieve a 10% functioning margin and hence more recent cost cuts and job losses have been made by the CEO in order to achieve this. In air travel, the fact of success or failure depends on peripheral factors, with BA suffering badly in the consequences of the 2001 and 2005 terrorist attacks, the war in Iraq and the worldwide economic slowdown. However, the one most important external factor is the cost of fuel. Fuel costs are continuing to rise and this is likely to both corrode income and hoist prices for BA. Rising prices could rest BA in a detrimental position, particularly given the continued fame of low cost airlines. The CEO must understand that the important growth area for BA is likely to be in value-added services. In some parts, BA found that it could improve consumers experience while deducting costs, such as in its rising up of online sales. Other value-added services are likely to see mid-priced flights being improved, as air travel persists to become more competitive. On the whole, BA must continue to endeavour to reduce costs and improve customers and employee fulfilment.

The Controversy of Abortion Essay example -- Abortion Pregnancy Medica

The Controversy of Abortion In three weeks, Jennifer will leave for college. She broke up with her boyfriend two weeks ago, and today she found out she was pregnant. Should Jennifer have an abortion, or stop all her plans and have a baby at eighteen? Either way the decision is hers to make. On January 22, 1973 the landmark decision of Roe vs. Wade occurring in the Supreme Court made abortion a "constitutional liberty" (Francome 20). Legally, Jennifer can receive an abortion. Socially, however, she will endure many more obstacles. Fighting for society's acceptance In today's American society, viewpoints on certain topics often conflict with what individuals believe is right. This is very evident in the argument for acceptance of abortions among college students. However, with the rise of the anti-abortion movement this procedure has become less accepted and harder to obtain. Should abortions among college students be more widely accepted in society? According to a Planned Parenthood study done in 1997, forty percent of seventeen year olds will become pregnant before their twenty-fifth birthday. This statistic is directly targeted at college age females. The answer is far from being strictly a black and white issue, but my own viewpoint is "yes" abortions should be accepted among society for many reasons. The controversial issue of abortion has many intertwining, surrounding complications. Such an issue is never concrete, "in America, about 20% of Americans thoroughly oppose abortions, 20% thoroughly favor abortions, while a vast majority are 'muddled in the middle'" (Pojman and Beckwith 59). As with any pregnancy there are impending risks involved and many extenuating circumstances that justify an abortion. In a perfect world, abortions are not the best way to prevent unwanted pregnancies, but there are many "bumps in the road," keeping the United States from being perfect. Defining Life? The main question facing society is the definition of a fetus' point of living. Pro-Lifers believe that, "a fertilized embryo is the foundation for a living human being" (National College Students for Life). In contrast, pro-choicers argue that a human being is something more concrete with it's own thought processes and consciousness. Petchesky argues, "the fetus is only a potential human being, and we confuse actual with potent... ...roblem with accepting abortion is the lack of facilities that perform abortions. Only thirteen percent of abortions are performed within hospitals (Landes 64). The rest are performed outside of hospitals in clinics. The Alan Guttmacher Institute surveyed and found only 2,680 abortion clinics in the United States. Eighty-eight percent of the clinics are only in metropolitan areas where ninety-eight percent of abortions are performed (Landes 64). Rural counties that contain colleges or universities do not have such accessibility to facilities that perform abortions. The AGI discovered that eighty-three percent of rural counties did not have clinics. Limited facilities that perform clinics poses a dilemma for college students that may not have transportation or time, to travel to metropolitan areas. However, if colleges installed on-campus abortion clinics with certified doctors and psychologists, for counseling purposes, this problem could be corrected. With on-campus abortion clinics, it would show the university to be more accepting and understanding of college students need for such medical facilities, and therefore, society as a whole may be more accepting.

HR strategy analysis: Smith Radiators, inc Essay

Smith Radiators, Inc. is undoubtedly one of the major players in the automobile industry, being a supplier of radiators to some major automobile suppliers. In fact, it supplies fifteen percent of the Auto of America, Inc. (AAI) demand for radiators in 1991, competing with five other major suppliers and some minor suppliers. On the side of Smith Radiators, AAI is their major customer. About thirty three million dollars of its sales during the early 90’s came from its partnership with AAI. Thus, Smith Radiators must take good care of the business partnership with AAI to maintain or further improve its financial stability. And this could be done if Smith Radiators could sustain and further improve the quality of its products and services. But a more challenging task appeared before Smith Radiators on April 20, 1991. AAI demands a major change to its company. Smith Radiators, being a partner of AAI for thirty years, is obviously affected by this. Due to recession, AAI decided to do some cost reduction but with sustainable quality improvement on its products and services and effective response to its customer needs. AAI will be shifting from its traditional way of purchasing supplies to the so-called just-in-time basis or the JIT. Some major changes using the JIT philosophy would be streamlined purchasing operations and few certified suppliers. On the part of Smith Radiators, this needs immediate attention. It cannot afford to lose its major customer. The president of Smith Radiators called for an emergency meeting with the company’s department heads to address the demands of AAI. Being a company that does not practice JIT that time, the president assumed that problems will arise upon adapting JIT onto their functional areas. Vice-presidents were asked to identify these problems. One of the vital areas to be taken in consideration is the workforce or the labor force. This is under the Human Resource Department. JIT would definitely affect the workforce. Currently, the recruitment process adapted by Smith Radiation is done by the so-called internal recruitment, wherein a prospective candidate will be recommended by a current employee. The candidates will undergo try-outs and interviews, and the successful candidates will be undergoing informal training with fellow workers and under the supervision of a foreman. The workers participate on this recruitment strategy because they earn some extra money if their recruits are accepted and could be able to work for two years in the company. With JIT, that would be a much different thing. The workers of Smith Radiators, like workers of other companies, also have their union. The union serves as the unified voice of the workers that answers, accepts, or contradicts issues that directly affect them. Even before the proposed JIT, the union has several conflicts with the management. The workers’ wage is in fact much lower relative to those working for competing companies. It is saddening that the workers agreed for this low wage for the sake of job security, which is a responsibility of the management. The management of Smith Radiators obviously takes advantage of this situation. They were able to save on their labor cost. On the other side, the job security is what’s important here, considering that most of the workers were high school drop-outs. Another issue is that women were not allowed to work in some of the areas, like those areas that use lead-based chemicals, where higher wage is given for the service. In my point of view, it is just right to ban women in this particular work, because their health will be at risk. This ban, I must say, is a commendable action of the Smith Radiators’ management. But the major concern of the union is that the company is overstaffed by twenty percent, and by the end of 1991, end of the workers’ contract, some of them might be laid off. As a result, workers were dissatisfied with their work. In fact, absenteeism became a habit to some or maybe majority of the workers. Considering all these issues or conflicts between the management and the workforce, it is expected that the vice-president for human resource spends most of his time dealing with the union’s concern, when in fact; some of his times could be used for brainstorming, structuring activities that could improve the working attitude and discipline among the workers. With the need to comply with the demand of AAI, Smith Radiation needs to do some changes especially on its management strategy. The goal is to get a certification to operate as AAI supplier, adapting JIT philosophy in their workplace. JIT depends on elimination of waste, total quality control, supplier participation, and employee’s participation on decision makings. The expected result of JIT would be shorter lead time in production, flexible manufacturing, reduced inventory, higher quality of products, and increased productivity. To be certified, four criteria must be met by Smith Radiation. First: quality of supplied parts. On the current system of Smith Radiators, considering the fact that the company does not provide formal training to their new worker, low quality of products will be produced. Generally, the company currently follows the defender type of strategy, wherein it stays in its comfort zones. Research shows that training and development are guaranteed to be needed at some point of the strategic growth process. And the current human resource department seems to overlook this aspect. But I appreciate the fact that the vice-president for human resource communicates with human resource officers from other companies that were able to practice JIT philosophy already. This is a good start. Smith Radiations could learn from the experiences of other companies and use these experiences as baseline for starting JIT. Second: frequent delivery. The AAI demands that two times per day will be the transfer of products from Smith Radiators. The vice-president for human resource might realize that he needs to train the workers work flexibly. Meaning, he must be multi-tasking for him to respond to sudden changes in the production schedule. This would be an effective move by Smith Radiators, wherein they could save from their labor cost, contrary to the current management practice where a worker is skilled only with a specific type of work. However, on the part of the workers, some of them might be laid off. The management may consider retaining only the most productive workers, and in return, providing them with better wages and development programs. But the good thing is that workers will be challenged to do better to retain their position. Third: reliability of delivery. Quality must come first. In JIT, the human resource department will train the workers to perform during critical decision makings. The worker must be able to inspect his own work. For example, during a process, if the worker sees that the product is out of specification, he can stop the whole process. And this could only be possible if the worker is fully knowledgeable with the basic technicalities of the process. On the part of the worker, this is a good opportunity not only to obtain a higher wage but opportunity to explore new knowledge and opportunity to practice responsibility. In addition to this quality issue and reliable delivery, the management, imploring JIT philosophy, discussions in round table as strategized by the vice-president of human resource is actually an effective way to obtain new ideas. This would be a perfect venue for the workers to communicate with their co-workers, supervisors, and if possible with the managers. These workers are the actual people that experience the process. They could have better ideas to explore changes in processes without sacrificing the quality of the products. The supervisor’s or foreman’s role on this part of the strategy would be to confirm the suggestions of the workers using scientific trials and experiments. Fourth: number of shipments received in exact quantities. Workers being multi-skilled, self-disciplined, group-oriented, and has good quantitative and diagnostic skills, there would be no doubt that Smith Radiators can comply with the demanded two shipments per day at ten radiators per shipment. Over-all, the strategy that is proposed by the vice-president for human resource comply with the goals of the company and supports the business strategy, the prospector business strategy, which aims to obtain certification, and in the long run, sustain its business partnership with AAI. The company, however, is expected to provide job security, fair wage, and respect to the workers. In essence, a strategy made by the human resource department must capture the â€Å"people element,† as it is called by an article in a reliable website, of what is intended to be achieved in the medium to a long run by an organization. According to Richard Chang, author of The Passion Plan at Work, HRM focuses mainly on HR Research and Information Systems, Union/Labor Relations, Employee Assistance, and Employee Compensation/Benefits. In the case of the Smith Radiators, the human resource department did a very great job!

Persepolis Is The Realistic Novel - 1476 Words

Persepolis is the realistic novel about the life Marjane in pre and post progressive war in Iran and her transition in Europe. The novel explains Satrap’s development from young sge to defiant punk-cherishing adolescent in Iran. Importantly, its mostly it covered Satrap growing strains of the political atmosphere in Iran in during the 70s and 80s, with individuals from her liberal inclining family kept and afterward executed, and the foundation of the grievous Iran/Iraq war. This novel also explains fear of loss, suffering, and inequality. There are several factors that shape Marjane Moral and value. The oppression from the war had effect on Marjane life change her moral and value because the death and injustice in Marjane neighborhood. Then she realized her neighborhood was not safe place for because her country does not give her the chance to grow and learn. She was force to accept a value she did not grow in. when she was ten years old and she was forced to wear veil to school. 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