Introduction

BA Presence

Top 3 companies
(based on turnover)

Founded as Imperial Airways in 1924 Have gone under great scrutiny from the public, media and its employees
Long haul and short haul flights
8bn 3bn 2bn

600+ Destinations 135+ Countries 33m + passengers 238 aircraft

Strategic shift in branding and management, relaunched as BA in 1935 Positioned 43rd in top 100 British brands (in order of value)
British Airways
11 Revenue Revenue spread
Passengers

Current market

Top 3 companies
(based on No of passengers)

Operating Profit/Loss

Market Performance
2010 2015

-24.48% - 231m

-11% 8bn
Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

87%

Cargo

Other

6%
0808633 0921862 1007442 0801914

7%

+4m

+6m

6BE003 Strategic Management: Assignment 1

The Environment

P E

EU Union Regulations National and Local legislation

Internet forums, news articles Purchasing process Price comparison websites Inflight entertainment Communication (CS and marketing)

T L

Inflation Recession Impact on business expenditure Influence on disposable income

Collusion Price fixing Competitive rules Employment legislation

Unemployment s Changes in UK buying behavior Customer and media perception

Pratesh Patel Daniel Ofori Mintah Pratesh Patel Jagdeep Kallu Daniel Ofori Mintah Dalkeet Sandhu Jagdeep Kallu 0808633 0921862 0808633 1007442 0921862 0801914 1007442

Noise Air pollution Airport expansion Waste management

6BE003 Strategic Management: Assignment 1

RESOURCES
Set of 245 aircraft accessing over 600 destinations Additional services Car rental, seat selection International Customer Database Partnerships & Alliances with Oneworld Terminal 5

COMPETENCIES
Efficiency of airplanes Productivity of staff Manage cash flows Innovation of the workforce Top UK airline company for training center

DYNAMIC
Sustaining superior performance Managing Cost Customer service Recruitment and development Can not be static Mergers and acquisitions

DISTINCTIVE
Reputable & global brand image Long established brand Customer not doing nothing else (no tension) Main airline British Advertising Website, T.V adverts Locations traveling to

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1

VRIN (Barney, 1981)

BA brand is valued 2.1bn

BRAND Unique brand, BAs premium service can Difficult to imitate be substituted by lowthe BA experience, cost flights and sea brand and services (P&G) reputation.

BA brand has distinguished itself from ALL airlines

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1

The Environment - SWOT

STRENGTHS
Premium British brand valued at 2.1bn and rated as an AA brand No hidden costs The worlds favourite airline No1 in revenue Trained and skilled employees as a 4 STAR airline International operations (600+ destinations) Exclusive access to Heathrow T5 London 2012 Olympics partnership (40m deal) Top of the range fleet of aircrafts (Total of 246 Boeing and Airbus series)

WEAKNESSES
2009 Christmas strike disrupts over 1m people Seen as an expensive and over-priced service High debt and sluggish revenue growth (10bn debt) A business/premium market position whilst attempting to attract individual customers from other segments The worst airline for lost luggage (1 in 3.8 passengers) Strong and powerful employee union

OPPORTUNITIES
Technological developments (in-flight entertainment) Aircraft developments (speed, space, onboard facilities) International Airport expansions Service differentiation New and undeveloped markets for both Short and long haul flights
0808633 0921862 1007442 0801914

THREATS
Weather and environmental forces Rise of labour costs Rising fuel prices Budget airlines Unstable economies Government policies and pressure groups Customers deciding not to go holiday or stay in the UK Other premium airlines Slow annual growth (-4%) compared to competitors

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

6BE003 Strategic Management: Assignment 1

Cultural influence
Greenley (1989) suggests there are 4 main elements to corporate culture
Values Expectations Innovation Growth Profit whilst maximising customer service Employees to represent the airline Maintain and build existing brand reputation Customer expectations In 2007 (BA Annual Report, 2007) the cabin crew strikes Increase recognition and identify the needs of the employees Employees were not inline with the culture of the business (profit) lead to straetic drift between BA and its colleagues BA relies on the wide set of facilities to implement its values and improve its human asset. 1200 hours for cabin crews; library with computer base Learning for Management Staff; Flight simulator to improve and enhance Cabin crews and pilots skills and experience to maintain standards. Creation of a system dedicated to consumers feedbacks Alliance with other companies to increase the number of customers, expand its market and spread its values.
Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu 0808633 0921862 1007442 0801914

Attitudes

Capabilities

6BE003 Strategic Management: Assignment 1

Competitive Analysis
Customer service Market leader Competitors

Porters 5 Forces (1979)

T

BCG Matrix (1970)

Market Growth Stars Question mark

Competitive rivalry

S Cash cows Market Share

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu 0808633 0921862 1007442 0801914

Dogs

6BE003 Strategic Management: Assignment 1

Drivers
External Brand Image
The perception that customers have through previous and current strategic marketing The BA always compared with other premium airlines such as Emirates

Customer experience and Service

Loyalty programmes Executive club Frequent Flyer programme Business accounts for B2B customers High quality inflight service Enjoyable and relaxing flight

Acquisition Retention

Internal Investment
Exceeding expectations Grasping gaps in the markets Maintaining the brand image Marketing and branding within airports Employee training and motivation

REVENUE
Service enhancement

Optimization

Profit

Reinvestment

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1

British Airways Value Chain (Porter, 1988)

Legal Head office employees Onboard entertainment Finance Quality Control Information Management Customer Service staff

Pilots Marketing & advertising

Air hostesses & other flight staff

Purchasing process & check in

Storage of aircraft
Fuel Flight Scheduling Aircraft purchasing

Maintenance

Storage of food
BA Advertising Travel agency Frequent flyer program Group bookings

Baggage handling

Customer travel arrangements (coach, taxi etc) Hotel Designations

Process onefor
delays Complaints procedure Lost luggage process

Ticket handling

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1

Margin

Luggage tracking

Strategies

No1 airline for baggage loss

Business efficiency

Increase in fuel prices

Unclear positioning

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1

Thanks for listening

Pratesh Patel Daniel Ofori Mintah Jagdeep Kallu Dalkeet Sandhu

0808633 0921862 1007442 0801914

6BE003 Strategic Management: Assignment 1