British Airways's Environment
1.0 Introduction
British Airways (BA) is the UK’s largest international scheduled airline, operating international and domestic scheduled and charter air services for the carriage of passengers, freight and mail and the provision of ancillary services. The airline flies to over 550 destinations globally and is considered to be a leader in the industry.
In order to profitably satisfy customer needs, an organisation must understand its external and internal situation including the customer, the market and its own capabilities. Furthermore, it needs to understand and adapt to the dynamic and uncontrollable factors of the environment in which it operates.
2005 saw a new Chief Executive being appointed in BA; Willie Walsh, former head of Aer Lingus. The man with an excellent reputation for driving down costs has stressed his determination to realise his predecessors, Sir Rod Erdington’s, goal of a 10% operating margin.
2.0 External Analysis
2.1 Micro Environment
2.1.1 Market Analysis
The first thing that needs to be done is to identify which market BA operate in to be able to carryout an accurate analysis. BA operates in the airline industry. Their main market is hence transportation but they also work in other areas such as communication, leisure and logistics.
During the last 10 years the airline industry in the UK has changed out of almost all recognition. Today, according to the International Air Transport Association (IATA), the airline industry is going through ‘the worst crisis in history’ (BBC, 2006) British Airways operates within the highly competitive airline market. The UK market for airlines grew by 1.2% since 2003 to reach a value of £8.7 billion in 2004. The number of passengers flying from UK airports alone has increased from 70 million in 2000, to 86 million. The development of a fifth terminal at London Heathrow testifies this growth. However, against this expanding...
View Full Essay