Preview

British Airways - Organizational Structure

Good Essays
Open Document
Open Document
5676 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
British Airways - Organizational Structure
School of Management and Economics

Business Administration (FE3101/IB3101)

FE3101:1/IB3101:1

Basic Organization Theories Module

Paper – Fall 2009

Structural Perspective: British Airways

André Costa Choi Sin Man Jiyun Baek

0

1 – Introduction In different working fields, companies face the pressure of globalization, and they must find new ways to overcome this challenge. The following example, introduces the case of British Airways, which needs to deal with the globalization issue trying to reduce the operational costs, increase profits and provide suitable services to customers. According to British Airways annual report from 2008/2009, the airline carried more than 33 million passengers. It earned nearly £9 billion in revenue, a 2.7 percent increase from the previous year. At the end of March this year, it has 245 aircraft in service. It shows that the BA financial performance is improving after the financial crisis and the fluctuated oil fuel prices changes (British Airways – Annual Report and Accounts 2008/2009). However, it is a unfortunate fact that in the 2008 report of scheduled international passengers carried, which is based on International Air Transport Association, indicated that British Airways was ranked in the fifth place while the Ryanair, Lufthansa, EasyJet and Air France ranked above the BA. It was shocked to them because they were always first ranking to investigation about airlines. This figure pointed out that BA needs to plan long-term strategies in order to compete with those four airline companies in Europe and in the all world. The British Airways now tries to establish itself as a high-performing, marketfocused and global premium airline. In this paper, we focus on the structural perspective of the BA‟s company in these recent years. Depending on the three different CEOs in BA, they are the Robert Ayling, Rod Eddington and Willie Walsh respectively, this paper divided into three periods of analyzing the structures of BA. Thus, this

You May Also Find These Documents Helpful

  • Powerful Essays

    It can be said that the economic situation and condition affects airline industries’ growth. In the first half of the 90s, the airline industry has suffered not only from world recession but also in terms of the context that travel was further depressed by the existence of the Gulf-War. For instance, in 1991, the number of international passengers has experienced major downturn. Herein, the financial stabilities were worsened by the airlines over-ordering aircraft in the boom years in the latter part of the 1980s, which leads to significant surplus in the airline market. During this time, International Air Transport Association’s member airlines have already suffered cumulative net losses of $20.4 billion from 1990 to 1994.…

    • 1282 Words
    • 6 Pages
    Powerful Essays
  • Satisfactory Essays

    British Airways came into existence since civil aviation began shortly after World War I. A lot has changed in the 90 years from the world's first schedule air service on 25 August 1919 to the present day civil air travel. Every 10 years since civil aviation began. The world has seen changes in the types of planes that have been in service to the speed of sound air travel as well as developments and changes to the business in all aspects of all areas. It is this that has paved the way that British Airways do business and will carry on perfecting and tweaking its service so passengers across the globe can see that British Airways is the world’s favourite airline.…

    • 792 Words
    • 4 Pages
    Satisfactory Essays
  • Best Essays

    The airline business is an industry that is competitive and unique, focussing on consumer choice and the responsiveness of airlines to changes in the external business environment. For any airline, this environment can be very complex as it is ‘hard for them to fully understand and impossible for them to fully control’ (The Times, n.d. p1). Virgin Atlantic is an international airline that is based in the UK. It was started by the entrepreneur Richard Branson in 1982 and now flies to 30 destinations around the world (Virgin Atlantic Airways Ltd, 2011). By looking at the PEST forces of Virgin’s external environment, the aim is to see how these influence the airline and how Virgin can use this information to their advantage.…

    • 2143 Words
    • 9 Pages
    Best Essays
  • Powerful Essays

    In this assignment I was assigned the task of comparing 2 different airlines, one being a full service carrier and the other being a lost cost carrier, from United States of America, namely the Delta Airlines and South West Airlines. The points of comparison were market strategies, financial benefits, load factors, contrasting yield, revenues and passenger/cargo loads. The analysis was done on the business model and a long term strategy. Through this it would be known that which airline is performing better than the other. The disruption of air travel through various incidents like the terrorist attacks and global downturn, which can be considered as economic, political and social conditions, effect airlines adversely. References like books and online resources were used in finding the information required in how the airlines would perform in the future and how the business model has worked for them over the last few years.…

    • 4166 Words
    • 17 Pages
    Powerful Essays
  • Powerful Essays

    International Airlines Group like many businesses in the current economic climate has seen a dramatic change in the way they have to do business due to several social factors. The most prominent of the social factors is the alteration in consumer buying habits due to the recession, as many people have a lower amount of expendable income due to the rise in cost of living prices such as food and energy bills combined with lower wages and high level of unemployment. The reason that this makes this social factor the most severe for IAG is that while most businesses have to deal with this change a large part of the British Airways customer base is that of business clients. Therefore due to businesses looking to cut costs to help with lower revenues many are no longer willing to pay for employees to travel first class and turn to the budget airlines. For example BA released a statement to investors regarding the future of the business ‘What we have been living through in the last two years is the deepest downturn this industry has ever faced. The International Air Transport Association (IATA) is forecasting revenues for the industry as a whole will fall by 15 per cent’ (British airways, Q1, 2010).…

    • 2054 Words
    • 9 Pages
    Powerful Essays
  • Powerful Essays

    Scott, W.G. (1961,April) Organization theory: An overview and an appraisal. Academy of Management Journal, 4, 7-26.…

    • 3082 Words
    • 13 Pages
    Powerful Essays
  • Powerful Essays

    According to a study generated by IBISWorld on the Annual Global Airline industry revenue for 2014, figures were indicated at $745bn with over 9,000 businesses worldwide. From such figures we can infer that global competition in this industry is inevitably high. Such competition is present and can be seen in examples like existing Airline companies such as Etihad and Emirates which offer similar services, packages and prices to its customers. What can be noticed however with the Airline industry is that the threat of new entrants is quite low - this is in large part due to the fact that the Airline business involves a billion dollar investment and high capital (Porter, 2008). It is also a service which although used frequently, in one customer’s life-time; the extent of use may vary depending on many situational factors such as seasonality, business or leisure purposes and so forth. In Australia, the same notion holds in terms of new entrants to the marketplace. Major players in the Australian Airline network include Qantas, Virgin and Jetstar.…

    • 1619 Words
    • 5 Pages
    Powerful Essays
  • Better Essays

    This essay is on organization and management analysis. I will show in detail about the various organizational theories. There will also be discussions on the comparisons of management theories and styles and which organizational theory resembles my organization. This essay is also on changes that could be made to make my organization better. There are many organization theories and management theories and these theories are a major part of the working world.…

    • 1127 Words
    • 4 Pages
    Better Essays
  • Powerful Essays

    1. British Airways Plc (BA) founded in 1974, was in the control of government for thirteen years and went into privatization in 1987. The industry operates about 240 aircrafts, serving about 120 destinations throughout the U.K and Europe including the Middle East, Africa, South and North America, Asia and the Pacific. British Airways competes with various other airlines in the industry but still it has maintained its domination in various parts of the aviation industry in the United Kingdom and Europe as well. Its major competitor is Virgin Atlantic, with 10 percent market share in the airline industry in terms of kilometers logged in 2007. As the airline industries are struggling to survive in this Global Economic Downturn, which saw a huge decline in the number of passengers and flights over the years, British Airways future looks very promising. The Airline announces its aim in its latest annual report (British Airways, 2008) of becoming ‘World’s most responsible airline’.…

    • 1897 Words
    • 8 Pages
    Powerful Essays
  • Powerful Essays

    Aslam, H. D., Javaid, T., Tanveer, A., Khan, M., & Shabbir, F. (2011). A Journey from…

    • 8153 Words
    • 33 Pages
    Powerful Essays
  • Better Essays

    Macro: The first problem changing the culture at British Airways was the merger of the BOAC and BEA. In 1971, the Civil Aviation Act became law and the board was to control policy over British Airways but both BOAC and BEA remained autonomous, each with its own chairman, board, and chief executive. This caused a split within British Airways throughout the 1970s and in the mid-1980. The second problem BA faced was the threat of privatization. In 1984 the government passed legislation that made BA a public limited company. The third was productivity was bad compared to other leading foreign airlines. The fourth was poor service. Poor customer service to the employees and customers led to reduced passenger numbers and high fuel costs. This created a reduction in profit (Jick & Peiperl, 2011, pp. 25-29).…

    • 1098 Words
    • 5 Pages
    Better Essays
  • Better Essays

    Life at “old” British Airways lacked a unifying corporate culture. The 1971 merger of British European Airways (BEA) and British Overseas Airways Corporation (BOAC), by the British Airways Board, only succeeded in putting an umbrella over two separate mature entities. The focus of the BEA had been to build a European airline infrastructure. BOAS was an innovator and pioneered the first jet passenger service. Neither company was concerned with cost or profit. British Airways was government run and according to Jick & Peiperl (2011) “success had less to do with net income and more to do with ‘flying the British flag” (p.26). This inefficient government structure was bogged down with bureaucratic red tape. “There were a lot of people doing other people’s jobs and there were a lot of people checking on people doing other people’s jobs” (Jick 2011.p.28). The British Airways Board failed to obtain a “buy-in” from the merged company employees. According to Jick (2011) “a deceiving string of profitable years in the 1970’s made it even easier for British Airways to neglect its increasing inefficiencies”(p.28). Kotter (2012) illustrates this under “Error #1: Allowing Too Much Complacency”. Why would anything change when there was money being made? People are short-sighted and without a plan for the future, British Airways was heading for financial failure.…

    • 975 Words
    • 4 Pages
    Better Essays
  • Powerful Essays

    Delta Airlines Essay

    • 4692 Words
    • 19 Pages

    Hurt by poor profits and scarred from likely terrorist attacks against the US due to the US involvement in the Iraq war, the airline industry finds itself on a bumpy course. In an effort to head off a drop in the number of passengers and rising costs for security , companies laid off staff and trimmed services. In an already intensely competitive market, the ¡°inevitable¡± industry wide shakedown will have far-reaching effects on the industry's trend towards expanding domestic and international…

    • 4692 Words
    • 19 Pages
    Powerful Essays
  • Powerful Essays

    Boeing Vs

    • 6447 Words
    • 18 Pages

    2. Boeing VS Airbus 2 Abstract The demand facing aircraft manufacturers for new orders is in principal derived fromthe perceived future demand for commercial aviation. Several key external economic factorsare likely to outline demand for new aircraft. These factors are accessed from the perspectiveof decision makers in the airline industry, Airbus and Boeing, in this paper. Also analysed inthe paper are the relevant strategies employed by both airliner makers to manipulate thisfactors or manoeuvre around them in order to survive in the market. The relevant theories ofstrategic management are also analysed in the paper. The paper is also divided into twodistinct parts one tackling on contemporary business issues and strategic management.…

    • 6447 Words
    • 18 Pages
    Powerful Essays
  • Best Essays

    American Airlines

    • 3770 Words
    • 9 Pages

    In this case study we will review the new strategic business plan of American Airlines, and how they are responding to changes in the marketplace to compete in the modern era. We will also analyze the advantages of rebranding efforts, the effectiveness of existing practices of the airline and how the airline may operate post merger with US Airways. By some measurements, the merger between American Airlines and US Airways will create the largest company in the world, thus positioning American Airlines to potentially become the most influential and most widely used airline in the history of aviation. With proper management, this mega airline can become the model for contemporary air travel.…

    • 3770 Words
    • 9 Pages
    Best Essays