British Airways Case Study
Introduction
British Airways is a full service global airline that offers low fares with an extensive global route network which also manages to book the flights through online access. This is another part of their major offers for their customers. The continuous development of the airlines rooted from their past of civil aviation. The world’s first schedule air service took flight on August 25, 1919 and sought different recognitions as the entire organization continue to cut the leading edge in developments and challenges.
SWOT Analysis
Airlines are one of the largest service industries and operate in an interesting collaboration with the technological innovations. The increasing number of the customers who turn to this service gives an impact to the travel satisfaction promised by the airlines. This is for the reason that people are trying to find an ideal way to travel with safety and satisfaction (Chan, 2000). The British Airways, as one of the largest airways and close to its centennial year of service is still bothered with challenges in the nature of their business.
Strengths
The company endured many changes and the organization set the goal to continuously process in every change that may appear in the global economy. As an advantage, the business’s strategy to answer the changes enables the entire team to bring the competition in new economics, market structure, and marketing strategy. These changes affect the managerial aspect in different adjustments (Kumar and Subramanian 2000).
Weakness
Because of the answer the Airlines give to the demand of the customers, they offer low prices for the tickets, creating an integrated global airline that offers low-cost carriers (Berry, Carnall, and Spiller, 2006) At first, the company will realize a great advantage but later on if the company continuously process this kind of strategy, the loss will incur (Binggeli and Pompeo, 2002).
Opportunity
The convenience of the first class technology provides the entire airlines to serve better. It is an added benefit in every airline that manages the integrated information system in terms of pricing, seating capacity, scheduling, and ticketing or passenger booking (Newberg, 1989). In other forms, the better communication is also an added factor to the opportunity of the airlines to serve with ease such as the use of the Internet to sell, book and other marketing efficiency for the jetsetters (Oliviera, 2008). The proper utilization of technology is another strategy that facilitates the growth of the organization.
Threats
The worldwide growth of the airlines is the major contribution of the threat because of the increasing competition among the airlines. Because of the competition, customers tend to pick the most valuable service that fits into their budget. In more clear perspective, the consumer behavior is always the basis of the customers whenever there is a tight competition.
Exploration on Solutions
Many of the global airlines turn to the conventional merger and acquisition strategies (Culpan, 2002). The alliance of the airline enables the companies to expand and explore the other developments and services in the market economy without the difficulty in facing their rivals. Still the competition is intensified by the low-cost carriers and other entrants, such as the competitor’s rapid expansion. To avoid the drastic result of the proliferation of the low-cost carriers, the management should set the strategies in line of their corporate objectives as well as providing the needs of the customers. The advantage that the companies received from the technology should be assessed, develop and implement in alignment of their procedures and services.
Problem Description and Identification
According to many historians, the British Airways had been under the series of acquisitions and mergers (Mills, 2000). The company faced different set of problems in terms of the organizational structure, managerial strategies, and legal terms. The corporate value and culture tends to lose if the rapid organizational changes bounced to the world of British Airways.
Recommendation and Conclusion
Since the focus of the British Airways centers on the customer orientation and satisfaction, the company should get intense in delivering the quality of services. The differentiation strategy that is applied in the company is integrated on the set of actions on their products or services, in an acceptable cost (Hitt, Ireland, and Hoskisson, 2003). Part of the successful differentiation involves the design, brand image, reputation, technology, product or service features, networks, and the ability to challenge the competitors from imitation. The organizational behavior of the British Airways should stay stable to avoid the decreasing interests of the workforce and of the customers in their service.
References:
Berry, S., Carnall, M., & Spiller, P., 2006. Airline Hubs: Costs, Mark-ups and the Implications of Customer Heterogeneity’ in Lee, D. (ed), Advances in Airline Economics, vol. 1, Competition Policy and Antitrust, Elsevier, Cambridge, USA, pp. 183–213
Binggeli, U., & Pompeo, L., 202. Hype Hopes for Europe’s Low-Cost Airlines: Europe’s Most Successful No-Frills Carrier Are Making a Lot of Money. But as They Mature, They Will Have Problems Expanding. The McKinsey Quarterly. [Online] Available at: www.questia.com. [Accessed 28 Dec 2009]
Chan, D., 2000. The Development of the Airline Industry from 1978 to 1998: A Strategic Global Overview, Journal of Management Development, 19: 6, 489-514
Culpan, R., 2002. Global business alliances: theory and practice, Quorum Books, Westport, CT
Hitt, M., Ireland, R., and Hoskisson, R., 2003. Strategic Management: Competitiveness and Globalization, 5th ed., South-Western, Singapore
Kumar, K., & Subramanian, R., 2000. Navigating the External Environment through a Market Orientation, SAM Advanced Management Journal, 65: 1, 16-30
Mills, A., 2000. Cultural Traces and Traces of Culture: Problems of Studying Corporate Culture over Time. [Online] Available at: http://husky1.stmarys.ca/~amills/papers/asacbh.pdf. [Accessed 28 Dec 2009]
Newberg, P., 1989. New directions in telecommunications, vol. 2, Duke University Press, Durham, NC
Oliveira, A., 2008. An empirical model of low-cost carrier entry, Transportation Research Part A: Policy and Practice, 42: 4, 673-695
Other Sources:
British Airways [Online] Available at: http://www.britishairways.com/travel/globalgateway.jsp/global/public/en_. [Accessed 28 Dec 2009].
British Airways, 2008. About British Airways. [Online] Available at: http://www.britishairways.com/travel/about-british-airways/public/en_gb. [Accessed 28 Dec 2009].
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