British airways Essay

British Airways is atomic number 53 of the programmeetary Airlines that reserves its flights to 570 destinations in 133 territories. It mainly ope lays from the Heathrow and Gatwick. It faces m what of all time(prenominal) problems like 531 million pounds loss in revenue be take of lack of inter matter commercialize study, employee relationship (strike problem) and many more. thus an effective strategy is the only chance to overcome these problems. The strategy of British Airways includes the innovation in technological accessories, clients relationship, employee relationship, safety and security of stake holders and so on. IntroductionAny strain has ch onlyenges from different elements like globalisation, information and technology, socio and heathenish factor ins, political factors and so on. To meet these challenges a clear strategy is very(prenominal) crucial for any organization. A strategy is a clear lot of what the organisation volition be based on a sustainable hawkish advantage. Actually, strategy is a road map for future cultivateions and scope. It is a long range plan for five years and more. It set ups mission, objective and goals for an organisation. To develop an effective strategy any organisation must set an cover with different factors. environmental analysis, present analysis, strength, weakness, opportunities and so on be the factor done which a strategy raft be developed. Part 11) Identify the mission, Values and key objectives of an organisation within its environs. The mission tilt of British Airways is To be the undisputed leader in world change of location for the next millennium. The values of British AirwaysHonest.ReliableOn prison termGood serviceObjectives of British AirwaysBritish Airways based in crownwork of the united Kingdom is the largest tonal patternlines in the United Kingdomand provides daily flights to more than 400 cities world-wide. bid most large corporations the nervous strainline must bo il down on a variety of goals and objectives both for short-term and long-term survival in the agonistic global trade. General objectives of British AirwaysWith an objective of proper the worlds largest leader in global premium skyway, British Airways will cover to focus on node service at every direct of passengers journey. The overall Objectives ar divided into three argonas. global (appeal to all passengers, whether for empty or business belong in order to create repeat customers). Premium (ensure that passengers receive the highest quality of service where ever they encounter the airways). Airline (maintain the focus on aviation with the largest equipment, mathematical products and serve). Strategic objectives of British AirwaysBritish Airways provides four strategical objectivesAirline of choice (remain the top choice for International flights for premium customers as well as cargo, saving and shorter flights). Top-quality operate (provides the best customer se rvice for passengers on all routes and classes of travel and mitigate online service). Global urban center growth (continue to expand the list of top-tier countries through air passage partnership). Meet customers needs (exploring the latest options and products to enhance customer loyalty. A stakeholder is a person or organisation that has an worry in a business, for showcase benefit from it. As a customer you ar a stakeholder in British Airways. Even if someone is working part time they ar stakeholders in their employers business. You screw be a stakeholder as a customer, in all shops you buy from and anywhere you spend leisure money, it could be going away to the cinema or substantiateing your football match. Stakeholders of o buy products or services, they are looking for a wide range of products and services. They also desire easy accessibility and hope to buy good quality products and services at a competitive price. They are really all- great(a) as they provide mon ey for the business in order to be successful. SuppliersSuppliers ge declare the business with the supplies the business needs, if they are late then it will ca hold a conflict mingled with business and suppliers. Therefor it is vital that all the business suppliers are on time. Suppliers are probably the third all-important(prenominal) part in a business, they provide the products/services and if they are not in time it poses to be a threat to the financial state of the business. On the separate hand, suppliers arent that important in decision making because they are scared of losing their contract with British Airways. EmployeesMay want an plus in pay rise. Staffs perk up a very big evoke in British Airways, they have an interest in the business in the form of wages, bonuses, discounts, and holiday pension. OwnersIn contrast it whitethorn want a decrease in pay rise for their employees you could give voice that the owners probably one of the most important people in a busi ness. Local and national communitiesGive planning permission depending on the business a person wants to do.Part 22) Investigate the stintingal, companionable, and global environment in which organizations operate. What is an economical system An organised manner in which a state or a nation allots its resources and allocates goods and services in the national biotic community. An economic system is loosely defined as a countries plan for its services, goods, and the exact way in which its economic plan is carried out. Basically on that point are three major/different types of economic systems prevailing unless about the world and they are Market Economy In a market economic system, national and state presidential terms play a minor role. Instead consumers and their purchase decisions drive the deliverance. In this type of economic system, the assumptions of the market play a major role in deciding the right path for a countrys economic development. Market economies aim t o reduce or eliminate entirely subsidies for a particular manufacturing, the pre-determination of prices for different commodities, and the amount of command controlling different industrial arenas. The absence of central planning is one of the major features of this economic system. Market decisions are mainly dominated by supply and penury, the role of the political relation in a market prudence is to simply make sure that the market is durable enough to lam out its economic activities properly. Planned Economy A planned parsimoniousness is also known as a command economy. The most important aspect of this type of economy is that all major decisions related to the production, distri thoion, good and service prices, are all made by the governing.The planned economy is government directed, and market forces have very unretentive say in much(prenominal) an economy. This type of economy lacks the kind of flexibility that is present a market economy, and because of this, th e planned economy reacts slower to changes in consumer needs and fluctuate patterns of supply and demand. On the other hand, a planned economy aims at using all available resources for developing production instead of allocating the resources either for advertising or marketing. Mixed Economy A mixed economy combines elements of both the planned and the market economies in one cohesive system. This office that true features from both market and planned economic systems are interpreted to form this type of economy.This system prevails in many countries where neither the government nor the business entities control the economic activities of that country both sectors play an important role in the economic decision making of the country. In a mixed economy there is flexibility in some areas and government control in others. Mixed economies include both capitalist and mixer economic policies and often arise in societies that seek to balance a wide range of political and econom ic views. http//www.economywatch.com/world_economic-indicators/typeBritish Airways operates in the Mixed economic system as British Airways was privatised on February 1987 and the government has less intervention as its a private political party the only intervention that the government would have is only setting the prices of the air tickets. What is companionable Welfare companionable welfare is about how people, communicate and institutions in a society take action to provide certain marginal standards and certain opportunities. It is generally about helping people facing contingencies. Social welfare which British Airways does for its employees. Social Welfare Policy Is fundamentalally to improve and protect the standard of living of the people or citizens as a whole. In the United Kingdom the Name Social Policy is use to apply to the policies that the government uses for welfare and social protection and the ways in which welfare is basically developed in a society.There a re confused social welfare policies that the United Kingdoms adopts and they are Social welfare polity that British Airways has adopted/follows The tint that social welfare initiates on British Airways as well as the wider community is firstly that British Airways adopting the work place regulation is that it benefits the employees of British Airways and that the employees can work without any head aces as British Airways has provided all it employees with training in safety measures, plus rest time is given to the employees and to the man members of British Airways accommodation is given because the crew is normally flying for unending hours/long journeys. The workers are also made alert about the basic terms and sort outs of the organisation which are basically ethics, code of conduct, and the responsibility of the organisation.The other social welfare indemnity which British Airways provides its employees is social security for its employees equal to contribution benefit s (Retirement pension, maternity allowances) and also non contributor benefits (social fund, working tax benefits) to its employees, which gives the employees the exemption to do whatever in their personal life. The Employment Law in British Airways states and illustratesthe normal working hours, antecedents, and the acts of the organisation. What is Industrial PolicyIndustrial form _or_ system of government comprises all government interventions which consist of 1. Directed towards the supply side of the economy that consists of enterprises, industries, sectors). 2. Aims to solve the industrial structure of the economy and its industrial changes. Industrial insurance purposefully pertains incentives to produce specific goods or incentives to enter or endure a specific goods market. It is not limited to manufacturing and includes all types of commercial economic activities. Industrial indemnity interventions have to be justified because if competitive markets worked adequately , any such intervention would 1. Distort optimal allocation,2. Distort dynamic aspiration and its benefits (innovation, flexibility, consumers sovereignty etc.). 3. Privilege specific enterprises or industries or sectors at the expenses of others, 4. Would disadvantage taxpayers and consumers. (An European industrial policy concepts and consequences, Oliver Budzinski). Industrial policy is concern it is the government sponsored economic program in which the public and private sector coordinate their causas to develop sassy technologies and industries. Government provides the financial support and capital to the private sector by direct subsidies, tax credits or government- run developmental banks. Industries policy emphasise cooperation between government, banks, private enterprise, and employees to prove the national economy. http//encyclopedia2.the stilldictionary.com Impact of Industrial policy on British AirwaysIn the United Kingdoms the Industrial policy has touch oned a lot of industries but the Industry that suffered the most was the aviation perseverance including all the airways even British Airways. Therefore British Airways has changed its strategy of working and has been successful as British Airways adopted new policies.One of the policy that states to reduce Co2 emissions by 15% by all air hoses and British Airways has decided to reduce by 50% as they are working on creating a new kind of discharge which is known as bio diesel which is pollution free and environment friendly. Fiscal Policy Government pass policies that influences macroeconomic conditions. These policies affect tax rates, interest rates and government spending in an effort to control the economy. financial Policy The action of a central, bank currency or other regulatory committee that determine the size and rate of growth of the money supply, which in turn affects interest rates. Monetary policy is maintained through actions such as outgrowth the interest rate, or changing the amount of money banks need to keep in the spring or bank reserves. Impact of monetary and monetary policy on airline industry as well as British Airways The principles of economic science tell us that governments can sometimes improve market outcomes.Methods of influencing market outcomes can come in the form of monetary and fiscal policies. Monetary policies influence shifts in aggregate demand for goods and services by increasing the money supply, reducing the equilibrium interest rates and stimulating investiture spending or decreasing the money supply, raising equilibrium interest rates, lowering investment spending (Mankiw, two hundred4). Fiscal policies shift the aggregate demand curve by increasing or decreasing government spending or through the increase or decrease in taxes (Mankiw). Because these policies influence aggregate demand, the government uses such policies to try and bring stabilization to the economy. much(prenominal) polices affect differe nt industries on many different levels. Some industries have positive effects and some negative. In analysing how monetary and fiscal policies affect the airline industry, we can look at how these policies affect employment, growth of the industry, and product prices. Many fiscal policies directed toward the airline industry have had underlying effects. One such policy is represented by the excise taxes and fees levied on air carriers. Such taxes and fees are allocated by the Government to fund improvements of airports, provide security for the airlines and airports, allocate funding for the FAA, provide for services for international customers, and support operations at airpark facilities.These fees represent roughly 26% or $52 of a standard 200-dollar round-trip airline ticket (Air Transport Association, 2005). Current economic conditions of the airline industry are dismal, in particular cod to the tragic exits of kinfolk 11th. The Air Transport Association (ATA) argues that such fiscal policy in these trying times lug the air carriers ability to right themselves through a self-help policy. The ATA further explains that in an effort to stabilize the industry, such taxes and fees can account for the elimination of over 129,000 jobs, forced many carriers into bankruptcy, and, because consumers react intemperately to price increases in this industry, hinder their ability to allocate funds by raising ticket prices. With this legitimate fiscal policy, air carriers have picayune manoeuvrability of funds to meet the demands of an operating budget. Mike smith (personal communication, June 10, 2008), author owner of Pacific Crest Aviation in Big rear Lake, CA, adds that governing agencies institute other fees to generate operating revenues for airports.On usage of this is landing fees. Landing fees vary from airport to airport, but play a key role in the determination of where air carriers decide to base their operations. In attempts to accumulate mor e funding through fiscal policy, Mr. Smith explains that the FAA continues to suggest the implementation of user fees. Still to be determined how such a fee would impact the airline industry present fiscal policies have air carriers screaming for reform. Deregulation is another fiscal policy that has considerably impacted areas of the airline industry. Since deregulation in 1979, the airline industry experienced substantial growth. With the emergence of new competition in the industry this created numerous amounts of jobs, drove ticket prices down, and expanded the available market for various air carriers. Through an industrial wide growth of over 200%, new carriers were able to equal to(p) positions to thousands of new employees in various split of the nation. Average ticket prices in 1979 remain relatively unchanged today. As an extremely competitive market emerged, the rally for passengers on each carriers flights unbroken ticket prices down as carrier created connecting flig hts through this new open sky policy reaching more consumers, minimizing opportunity cost, and offering competitive pricing.The Airline industry continues to be affected by the overall condition of the nations economy. When healthy spending exists and pleasure travel is frequent, air carriers are able to fill flights, raise prices, and maintain a stable economic environment. However, when condition of the nations economy falls, so do the buying habits of the consumer. This is where the airline industry finds itself today. Struggling to fill flights in a slow economy and fighting heavy fiscal policy. Recent monetary policies made by the federal government to improve market conditions are sure to have an effect, but how it will impact employment, growth, and prices in the airline industry are still unknown. The most Recent monetary policy made by the government came in the form of economic excitant checks. This in-flow of money into the economy in an attempt to stimulate the purc hase of goods and services throughout the United States may help diminish the effects of our current sluggish economy. Little to no data exists to show how this has impacted any growth in the airline industry. So far, there seems to be little change in the spending habits of the consumer to travel via air. Because the economic position of the airline industry has been struggling for so long, improvements due to any single event may be impossible to track. Whether changes in fiscal policies, monetary policies, or internal carrier structure help to improve conditions in the airline industry, changes will happen slow and will reflect economic condition in the nations marketplace.By successfully managing opportunity cost, and adapting to an ever changing economic environment, airline industries can have economic success. However, the well-being of the nations economy will have a direct impact on the level of success experienced in the airline industry. During economic shortfalls in the nations economy, travellers will have fewer resources available to travel for pleasure. Contributing to the negative economic influences in the airline industry, future and existing policies targeting the airline industry will continue to hinder the industrys ability to recover losses in periods of economic hardships. http//www.taxreformpanel.gov Makiw, N.G. (2004) Principles of economics (3rd edition). Chicago, 2 Thomson South-Western. PESTLE Analyses on British AirwaysPESTLE Factors lynchpin PointsImplications for British AirwaysPoliticalHeavy regulation (AEA, 2009).Increased security due to past terrorist threats (DFT, 2008) Compliance is essential if British Airways wants to continue. Sufficient security measures should be in place to ensure consumer confidence and competitive advantage in maintenance. EconomicGlobal economic crisis world growth is projected to just over 2 per cent in 2009 (IMF, 2008). Pound weakness especially against the Euro. Oil prices declined by 50% since their peak retreating to 2007 levels. Decline in fuel prises the dollar strengthens (IMF, 2008). UK Consumer spending saw its sharpest decline for 13 years between July and September 2008 (Channel 4, 2008) Possible reduction in the amount of business travel as companies are cutting costs and using alternative path of communication such as telecom fencing. British Airways is vulnerable as a United Kingdom operating airline to a lamentable exchange rate. Fluctuation in oil prices and exchange rates will directly affect British Airways cost base. More intense competition.SocialThe United Kingdom has an aging population.Increasing UnemploymentPotential opportunities for growth as older generations have more time to spend on leisure activities such as international travel. Increased bargaining power as an employee.TechnologicalA recent survey revealed that 34% of online consumers plan to use price- comparison sites more in 2009 (NMA, 2009) Online booking services and check-in is becom ing increasingly used by the airline industry. Increased consumer awareness and and so bargaining power. British Airways must ensure that they remain up to conflict with these technological advances whilst avoiding becoming overly reliant, as this may isolate certain consumer markets (i.e. the elderly) who dont feel comfortable using such technology. Environmental/EthicalNoise pollution controls and energy consumption controls.Cancellations of flights and loss of baggage. natural legislation (e.g. climate change bill) enforcing tighter environmental regulation may increase operational costs each year. Such ethical issues could have a detrimental effect on reputation if left unresolved. Legal tacit consent and price fixing.Recognition of trade union and industrial action e.g. confine crew strikes.Open skies agreement.Restriction on mergers will have an impact on British Airways proposed alliance with American Airlines. Good employee relations are essential if British Airways wants to avoid industrial action and interrupted operations. chance for British Airways and its competitors to freely transport aircrafts between the European Union and the United States.