2. History of BT
British Airways (BA) is the largest airline in
the United Kingdom based on fleet size, or the
second largest, behind easyJet, when
measured by passengers carried. The airline
is based in Waterside near its
main hub at London Heathrow Airport. In
January 2011 BA merged with Iberia, creating
the International Airlines Group (IAG),
a holding company registered in Madrid,
Spain. IAG is the world's third-largest airline
group in terms of annual revenue and the
second-largest in Europe. It is listed on
3. BA was created in 1974 after a British
Airways Board was established by the British
government to manage the two nationalised
airline corporations, British Overseas Airways
Corporation and British European Airways,
and two regional airlines, Cambrian
Airways from Cardiff, and Northeast
Airlines from Newcastle upon Tyne. On 31
March 1974, all four companies were merged
to form British Airways. After almost 13 years
as a state company, BA was privatised in
February 1987 as part of a wider privatisation
4.
5. British Airways overview
Full service global airline, offering year-round low
fares
Flag carrier airline of the United Kingdom
Founded in 1924 as Imperial Airways, and operated
under that name until 1935
1939, the airline was nationalized to form the British
Overseas Airways Corporation (BOAC)
1972, BOAC and BEA were combined under the
6. Mission
“The World's Favourite Airline”
provide the full service experience and achieve
the target in both, in-flight and on the ground.
7. Vision
Accreditation for Carbon Offsetting Scheme
offer carbon offsetting
the first airline to win Government approval launch of the
Department for Energy and Climate Change new Carbon
Offsetting Quality Assurance Scheme
Industry united position on climate change
reduce climate change emissions in aviation with a cap on
net emissions by 2020 and a 50% cut by 2050
It will guarantee environmental targets are met, and
minimize costs to passengers.
8. Goals
Environment
Reduce carbon emissions, waste, noise and improve local
air quality.
Community
Support international communities, conservation projects
and charities in the countries we fly to.
9. Marketplace
Encourage our customers and suppliers to act
responsibly.
Workplace
Provide a great place to work and encourage everyone at
British Airways to embrace One Destination.
10. Internal and external capabilities
•Internal Capabilities
• Aircraft fleet and destinations
• fleet of 238 aircrafts
• Access to more than 300 destinations
• Sole access to Heathrow terminal 5
• Variety of Training facilities
• Cabin crews are trained 1200 hours
• Flight simulators – to Cabin Crews and Pilots
• Computer Base Learning, Library facilities,
Audio and Video based learning – designed to
management staffs
11. Internal and external capabilities...cont
•Premium Services
• Quality services to customers at every touch
• Listen to customers feedbacks
• Corporate social responsibility
• Climate Change Programme,
• Reducing waste by 50%
12. Internal and external capabilities...cont
External capabilities
• Close relationship with customers
• Attend customers complain and feedbacks
• Alliances with other airlines
• T o extend greater services, eg. One World,
American Airline, City Flyers…etc
• Openskies Alliance
13. Internal and external capabilities...cont
• Corporate social responsibility
• Community learning centre at Heathrow, London
• Partner with UNICEF, promote “ change for
good”
• Donate ₤1.3 million in 2010 from BA and staffs.
• Raise USD $30 million from passengers ( 10
years)
14. SWOT analysis
•Strengths
• Strong brand image
• Opensky agreement
• International operations
• Sole access to Heathrow terminal 5
• Skilled staffs
• Expansion of Aircraft fleet
• Economies of scale by using
• Spare space of passenger aircraft
for cargo services
15. SWOT analysis
• Official Airline for 2012 Olympic and Paralympics
games.. Deal of ₤40 million
• This create opportunities for BA to impress
their customers with excellent services
16. SWOT analysis... cont
• Weakness
• Cost of management
• Decline profitability
• ₤358m loss in 2009 (After tax)
• ₤425m loss in 2010 (After tax)
• Labour strikes
• Powerful Employee Union
• Christmas strikes in 2009
18. SWOT analysis... cont
• Threats
• Raising fuel prices
• Tight competition from low
cost airlines
• Changes in the consumers
behaviour
• Unstable political issues and
global economic crisis
19. British Airways- market position, by using
porter’s Five forces
Force Strength
Competitive rivalry
• BA caters for both long and short haul
flights
•there is little differentiation between BA
and its competitors in term of pricing and
offer
• The short haul market is more
fragmented with many small players
HIGH
20. British Airways- market position, by
using porter’s Five forces… cont
Force Strength
•Power of suppliers
• Two aircraft manufacturers
• BA restricted by sole suppliers of fuel to the
airport
HIGH
• Power of buyer
• Long Haul destinations- customer has no
other choice
• Availability of flights and seats are limited
•However , prices are changes according to
demand- festival times
MEDIUM
21. British Airways- market position, by
using porter’s Five forces… cont
Force Strength
Threats of new entrance
• competitive environment
• High regulatory requirement
• high cost requirement
HIGH
Threat of substitutes
• There are few direct closed substitutes
• Short haul flights : Euro star or a ferry
•Long haul flights : No notable substitutes
LOW
22. Five Strategic Goals
Be the airline of choice for longhaul premium
customers.
. key to our profitability.
. deep understanding of what is required to be
their airline of choice to drive our design
choices on product, network and service.
23. Deliver an outstanding service for
customers at every touch point.
. to build on this through a revolution in the way
we lead, train and reward, so that all our
customers, on all routes and classes, enjoy a
premium experience.
. will invest both in improvements targeted,
such as service style training, and in those
benefiting all customers, such as Terminal 5.
24. Grow our presence in key global cities.
. to provide the best global connectivity for
our customers.
. will build our presence in the top tier global
cities, either directly or through our expanding
network of airline partnerships.
25. Build on our leading position in London
. To support this, we will look to influence
government policy decisions, and work
with the airport owners on the
continued development of the
infrastructure.
26. Meet our customers’ needs and improve
margins through new revenue streams
. will explore how we can develop new
products and services which exploit our
assets and capabilities, and meet the
needs of our core customers and enhance
loyalty.
27. Competitive Advantage
modern technology – Self Service Check-in
(SSCI) .
. Using IBM's kiosks .
. Lower cost - estimated savings at $3.50 per
passenger
most advanced freight processing facilities service
. BA used one of the largest computers outside
the defence industry.
. extract data from anywhere in the BA network
in two seconds.
28. Strategies that have been implementing?
Setting the priority (not opening too many fronts）
Be more sensitive to Human aspect and job cuts.
It become operations oriented, with low emphasis laid on
employees moral
Bob should have involved people in the process. Change
accomplished through people is far more effective than
change forced upon them
29. British Airways plans to reduce waste
on future flights
By 2014
British
Airways will
be
reducing10%
of its waste
on future
flights
30. Recommendation
Community:
Raise £2 million each year for our partner charities.
Continue to offer a learning experience to schools in the
Heathrow area at the British Airways Community Learning
Centre.
Support a whole range of community and conservation
projects around the world
Workplace:
Make it easier for BA people to volunteer time to charities
and community activities.
Create more energy efficient workplaces for our teams
worldwide.
Ensure that every member of staff has the opportunity to
get involved with One Destination
31. Recommendation… Cont
Environment:
Reduce our average noise per aircraft by 15% by
2015*.
Become 25% more carbon-efficient by 2025 (83 g
CO2 / pkm reduced from 111 g CO2 / pkm).
Recycle 50% of all our waste.
Reduce our net CO2 emissions by 50% by 2050.
Marketplace:
Make it easier for customers to carbon offset their
journeys.
Our key suppliers will be audited independently for
their ethical practices by 2012.
