Category: British Airways

Introduction

British Airways are one of the world’s largest international airlines it operates both domestically as well as internationally. The company operates internationally with airlines flying in more than five-fifty destinations all over the world. Since the company carries out its operations all over the world there are many macro-environmental challenges that the company faces. Because of these challenges the company needs to develop and adapt dynamic strategies in order to combat the different challenges faced.

Marketing is one of the functions that are carried out in any organization and that plays a great role in the operations of the company. In the case of the British Airways holiday package, the function has a great and important role it plays in the organization. Marketing has played a great role in the marketing of the British airways holiday packages. This is because it has created awareness of the packages to different customers all over the world. This has been possible through internet advertising whereby adverts on the packages are put on the front pages such that when a person is browsing personal information the first thing to view is the advert. Also, the adverts have been placed on the web pages of the British Airways online bookings.

This strategy has resulted in increased awareness of the products and as we know whenever customers become aware of a product in the market what follows is making decisions regarding that product or service. Through awareness creation, many of the customers have made positive decisions regarding holiday packages.

Also through marketing, the brand name of the company has been built, this is because it is used to market the products and services they offer. The more people are informed of a product or service the more the brand name and image is built in the minds of those people. The marketing function in British airways has played a great role in building the brand name and image of the products offered including the holiday packages. Marketing of the holiday package also creates the brand name of the company in the midst of a highly competitive environment.

Marketing also plays important role in British Airways holiday packages, this is because it persuades customers to go for the holiday packages. Through the marketing activities that the company carries out the company has managed to survive in the competitive airlines market. Also based on one of the reports of the company the sales of the company have increased to large extends because of the marketing functions.

The marketing function has played a very important role since based on the report the holiday packages have experienced a 100 percent increase in online sales of the packages. This has been a result of strong marketing strategies that have enabled the company to build its brand name in the market against the competitors. Apart from increasing awareness and persuading customers to purchase the marketing function has also enabled the company to achieve a competitive advantage against its competitors in the market hence an increase in market share.

The marketing department does not operate alone it interacts with other departments in order for its plans to succeed. The finance department plays an important role and it is involved when marketing plans are made in order to ensure that there are sufficient funds to support the marketing operations. The human resource department is also very essential because it provides sufficient human resource to implement the marketing strategies. In order for the department to succeed it integrates the decision-making team with all other departments.

Marketing planning process

In order to have a good marketing strategy, the first thing is to carry out a marketing planning process whereby the plan is set down and ways of implementing it effectively. Coming up with an effective marketing planning process is not an easy thing since there are many factors to put into consideration. Also, there are factors that tend to affect the marketing planning process this is because of the ever-changing business environment in which the business operates.

For the business organization to succeed and operate well, there is a great need of reflecting on the changes that take place in the environment. Also, decisions on how to change the marketing mix for the organization’s products and services have to be made in order to ensure that the marketing plan carried out best fits the organization’s operations. The marketing planning process involves several processes that have to be carried out first before the implementation.

There are several marketing stages that should first be addressed before setting up the marketing planning process. The first step of the marketing planning is the goal-setting stage, this is the first stage, and setting the goals involves two major things. The first component of goal setting is the development of the mission statement; the mission statement shows the purpose or the aim of the business organization and is the foundation of a marketing plan. Depending on the kind of mission statement set a market planning process will begin but under the guidance of the mission.

The other component of goal setting is the definition of corporate objectives. Corporate objectives support the mission statement and they are usually in the same direction as the mission statement but they are detailed and diversified. The setting of the mission statement and the definition of the corporate objectives lay down the foundation of the marketing planning process.

After goal setting the next step is analyzing the current situation, analysis of the current situation of the business organization is very important. This is because it helps to identify the different important areas that need to be tackled and the challenges that may arise. Analysis of the current situation in the business environment involves several strategies that include marketing audit, SWOT analysis, and marketing assumptions.

Marketing audit and SWOT analysis are very important in marketing planning this is because a thorough analysis of the market and provides a clear understanding that is used while making marketing planning. In other words, they form the basics of a marketing plan.

Marketing assumptions are also made in the process of analyzing the marketing situation of the business organization. The marketing assumptions are analyzed and it is determined whether they were met, also the ways that can enable implementation of the assumptions are identified. The other very important stage in the marketing planning process is the creation of the marketing strategy. Marketing strategy is very important in the process because it is based on the current situation of the business organization as well as the objectives and mission set by the business organization. The creation of a marketing strategy involves other components that are highly considered in order to come up with an effective marketing strategy.

The components include setting up marketing objectives and strategies to be used to meet those objectives. Objectives are set based on the mission and general objectives of the business organization and the strategies that can effectively meet those objectives. Another component is the forecasting of the expected results, a forecast is carried out in order to determine the expected results of the implementation of the marketing planning process. After forecasting the results then alternative plans are created, the reason behind this is to ensure that in case one of the plans fails there is another one that can be put in place. (Marketing teacher, 2008).

The final part of the marketing planning process is the allocation of the marketing resources and monitoring the implementation of the plan. In order for this step to be implemented effectively, a marketing budget is set down whereby all the financial requirements of the plan are analyzed and financial resources are allocated to different areas that need financial support. The other component of the final step of the marketing planning process is the creation of a detailed action plan. The action plan represents the way in which the marketing plan is going to be implemented effectively. The action plan consists of all the details of the marketing planning process. (MacDonald, 1995).

These represent the four different stages of the market planning process and all the components of each step. The implementation of the planning process is usually based on the size and the complexity of the business organization implementing it. This means that different business organizations can implement the process but differently.

Marketing audit

Marketing audit refers to the thorough analysis of the market internally, externally as well as competitive aspects. Through marketing audit, it becomes easier to understand the business environment surrounding the business organization and its effect on the operations of the organization. Carrying out a marketing audit is very important in a business organization; this is because it helps to analyze both internal as well as external strengths and weaknesses within that business organization. A marketing audit is very important in any business organization this is because it is usually the determinant and the key point of the marketing planning process.

It also helps an organization to analyze the key areas in relation to the business environment that include the macro environment, microenvironment, and the internal environment. There are various tools that can be used by business organizations to carry out internal, external, and competitive audits and they include SWOT analysis, PEST analysis, and Michael Porter’s five forces. (Tutor2, 2008).

SWOT analysis is also very important in any organization in a marketing planning process. This is because it enables a thorough analysis of the organization to be carried out whereby the strengths of the organization are identified, the weak areas, business opportunities that may arise, and threats that may come on the way. Through analysis of these four important areas enables the process of marketing planning to be easier since the areas that need more attention are easily identified as well as the ones that are pillars to the business organization.

PEST analysis is also an important tool in the analysis of the marketing environment in general. PEST analysis is used specifically to analyze the external environment. This is because it stands for Political environment analysis, Economic environment analysis, social environment analysis, and technological environment. These Are the major areas in the external environment. Analysis of the external environment by use of the PEST analysis tool is very important since it gives a clear understanding of the external environment and its effects on the operations of business organizations.

The third tool is Porter’s five forces analysis, these tools are specifically used to analyze the competitive environment. The five forces of competitiveness analyzed by the tool include buyer power, supplier power, competitors in the market, potential new entrants, and substitutes in the market. Analysis and understanding of these five forces enable the business organization to know exactly how to approach the market and develop strategies to help in creating a competitive advantage in the market. (Marketing teacher, 2008).

Opportunities and threats

There are various opportunities and threats that a business organization is likely to face in the macro-environment. Opportunities and threats are associated with external factors, some of the opportunities that are presented by the external environment include the following; use of the internet marketing due to the advancement in technology, this can enable the firm to develop and access newer markets.

The macro environment is growing to great extend hence creating better marketing opportunities globally. The British airways can utilize the global environment and make use of the marketing opportunities in the global market. Also the macro environment gives an opportunity for the business organization to venture in newer market segments and gain high profits from investing in these markets. This finally gives the business organization a competitive edge over the rivals in the market.

Macro environment also presents threats to the business organizations because of the different pressures that are found in the external environment. Some of the threats include the following:

Increased competition in the market segment is one of the threats that business organizations face in the macro environment. This is because the business is exposed to many competitors. Also issues of price raise in the macro environment whereby the competitors use prices as strategies to survive in the market, this may highly affect the pricing and profits of the given business organization. The other issues involve government taxation of the products and services offered by the business organization. (Marketing teacher, 2008).

When the business organization is aware of the opportunities and threats caused by the external environment ways to reduce the impacts are put in place and the opportunities utilized effectively.

British airways SWOT analysis

The company has faced threats in its business operations that range from the terrorist attacks of 2001 to the various security issues related to the airline. The other threat is associated with political instability in some of the countries where the airline operates. Apart from the threats the company has faced there are also weaknesses associated with its operations and that affect effectiveness of the airline. For instance the power of trade unions influences the operations of the company and government control that has resulted to increased competition.

Changing social and cultural lifestyle for many people creates an opportunity for the company since many of the people are traveling from different places. The major strength of the company is strong brand name it has managed to build over the years that attracts more and more customers. (MRICT, 2008).

References

HotelMarketing.com, 2005, British Airways Holidays reports 100% sales increase. Web.

MacDonald 1995, Marketing planning- strategic marketing process. 2008. Web.

Marketing teacher, 2008, SWOT Analysis lesson. Web.

MRICT, 2008, An analysis of British airways Marketing environment, Web.

Tutor2, 2008, strategic planning-the link with marketing, Web.

Introduction

A strategic alliance is a partnership between firms in which resources, abilities and core competences of firms unite for achievement of the best result, “a credible group of individuals brought together to accomplish a specific goal or purpose which will benefit all members of the group in some way.”(Building Alliances 1999) In the field of airlines, British Airlines is a perfect example of a company that formed alliances providing both successes and failures. A member of One World alliance – “a global alliance that brings together ten of the world’s biggest and best airlines” (British Airlines 2008), British Airlines failed to have an agreement of an alliance with US Airlines (Evans 2003, p.340), ended a merger deal with Qantas airways(Foley 2008) and currently in planned alliance with American Airlines. This analyzes alliances in terms of benefits and disadvantages, particularly in the context of airlines business.

Purpose

The motivation for forming airline alliance was introduced in by British airlines where an analysis had been conducted to identify “the key driving forces shaping the world economy and in turn the airline industry” (Evans 2003, p.337). Thus, the motivation for forming was identified as the information Revolution, global economic restructuring and global completion.

In that sense alliances are formed with a purpose of extending networks, where “it is difficult for a single airline to create a truly global network” (Park 1997, p.181).

In that context, the alliance would allow more efficiency from teamwork, than could be reached by separate companies. Consolidation is an extreme measure to which the companies resort in a situation when all possibilities of efficiency increase in separate companies are already exhausted.

Another purpose for forming alliances could be viewed as avoiding “the limitations under the current legal regime on negotiating international air traffic rights on a multilateral basis” (Cheng-Jui 2007).

Benefits

The benefits can be divided between the company along with their partners and the customers. The benefits for the company and the partners involved can be seen in reducing the cost by coordinating activities (Park 1997, p.181) such as “sharing of airport facilities, technical cooperation, common purchasing, slot exchanges, code-sharing agreements, combined consumer reservation system displays, schedule cooperation, and integration of pricing” (Cheng-Jui 2007).

The benefits for customers can be seen through providing better routes, eliminate the need to retrieve baggage at transit locations and minimize waiting time between fights (Park 1997, p.181-182).

Disadvantages

The disadvantages of forming alliances mostly are concerned with their influence on the airlines’ market rather than the influence on the companies and their partners.

However, some disadvantages might occur in regard to the international aspect of the alliance where “it will be difficult for airlines to comply with different laws, procedures and policies, once various countries or regional authorities start applying their own anti-trust/competition rules to international strategic airline alliance activities and start implementing other measures to reduce anti-competitive impact” (Cheng-Jui 2007).

In regards to the influence on the market, it can be seen through the comments of Richard Branson, the head of Virgin Atlantic, on British Airlines and American Airlines alliance denouncing it as “a “monster monopoly” that would be bad for competition and for the American and British aviation markets.” (Maynard, 2008).

Forming alliances with will give regulations control to the partners involved forcing competitors to abide to the rules set by alliances where “the partners may increase airfares if they behave collusively and exploit their strengthened market power” (Park 1997, p.182).

References

1. British Airlines. (2008). Airline alliances. Web.
2. Cheng-Jui, A. (2007). The Cartel-like Practices vs. Application of Antitrust/Competition Law.
3. Evans, N. (2003). Case Analysis in Strategic Management. In: Evans, N. Campbell, D. and Stonehouse, G. Strategic Management for Travel and Tourism. New Castle: Butterworth-Heinemann. p337-347.
4. Foley, M. (2008). Qantas and British Airways end merger talks.
5. National Association of Conservation Districts. (1999). Guidebook: Building Alliances.
6. Maynard, M. (2008). American Defends Plan for British Airways Alliance. Web.
7. Park, J. (1997). The effects of airline alliances on markets and economic welfare. Transportation Research Part E: Logistics and Transportation Review. 33 (3), 181-195.

Background

British Airways (BA), which is a multinational firm and holds a key position in the flight services industry has been thriving with the success of the organizational change process. There has been a continuous effort by BA administration to establish change within the organizational system (Cawsey et al., 2011, pp.17). The challenges are there, but BA leaders have stood firm to retreat these challenges as time has projected it to do so. This paper is going to produce a report on British Airways’ change process.

British Airways on Organizational Change

According to the theoretical perspective, a cultural change is a transformational process. It is a process, which travels along with one organizational stage of experience to the next organizational state of knowledge (Myers et al., 2012). Organizations, which have gone through experiences, are successful to apply the concept of cultural change (Hellriegel & Slocum, 2007).

Hence, time (experience) itself is a replication of cultural change within organizations and their systems. According to Burke Litwin Model (1992), change is possible when the leadership is committed and highly skilled. It is possible when leadership have will, clear vision, and method to roll the change within the organization system (Falletta, 2008).

High levels skills are required for leadership in projects, which involve revolutionary instead of evolutionary interventions to be made. No organization can accept change in a sudden manner as none of the organizational components can take sudden impositions. Hence, time and leadership are both critical factors to adjust for a change within the organizational system (Cameron, 2004).

British Airways a leading multinational firm in the flight service industry that has gone through different phases of change and experiences. The organization has shown its strong presence in the market over last five decades or more (Bowhill, 2008, pp.324). There have been certain ups and downs, which BA has faced throughout its corporate history.

Cultural change is a part of the BA’s system, which has been achieved through continuous struggles and efforts from its leadership (Bowhill, 2008). As literature projects, it was 1980 when British Airways recognized the need of change at the organizational level. It was the time when BA was facing serious business challenges and aimed to bring a complete change in order to stabilize its position in the competitive industry.

These challenges were persistent and directly related to the continuity of the company (Burke, 2010, pp. 238-240). There were many problems of rising fuel prices, high competition, low financial performance, low efficiency, and low profit projections, which actually turned down the airline’s business in the 1980s.

This demanded a cultural change within British Airways’ system as it had an organizational culture that derailed the company’s performance, and it was this culture which bottlenecked new modifications (privatization) of the system. Hence, as old trends and culture hindered the performance of British Airways, the leadership started to rethink and redo things in the same period (Burke, 2010).

This was the starting stage of the cultural change as the leadership became much concerned about the problem, and was highly engaged to revamp the BA system. From the theorists’ perspective, it has been noted that organizations start to change when there is a rethinking or reconsideration process going on.

It starts off with the leadership as it is the leadership that takes the stand and has the authority to make powerful decisions (decisions of change). The same was realized in the BA during 1980s, when the leadership was highly committed and well intended to adjust the organizational level of change – “the cultural change”.

This was the origin of cultural change within the BA system as there was a seed for change planted and actuated in the 1980s to make the organization change instinctive and progressive (Burke, 2010). According to modern contemplations, rethinking itself is a sign of change within the organization system (Kotter, 1996).

When enterprises start to realize their weaknesses and recognize their problems by themselves, it is this time that organizations begin with the change journey. This is the time when the organization expects change as it is in the profound stage of rethinking (Kotter, 1996). This rethinking stage is when the change process begins.

Applying it to British Airways’ context, the rethinking process began in 1980 when the organization was in the cover of problems, and recognized that it should dissolve its old trends that had derailed the organization’s performance. The culture of relying on the governmental financial support, the centralized decision making, the military mentalities, and the rigid culture of organizational politics introduced the first state of BA change – “the rethinking process”.

This is how the culture change propelled within BA when the leadership started to contemplate and repent on their past mistakes (Burke, 2010). It was the state of rethinking which actually extended the vision of BA leadership, and they started to put impressions on other business segments. According to Schein (2004), there are two things that are essential in the culture change process.

The first is the management of the organizational anxiety – “human behaviours” and second the assessment of organizational potential to change. In 1980, BA leaders identified the organizational potential in the human element (Burke, 2010). They recognized that if humans are changed-improved, it could precisely change the overall system of the organization.

This was firstly understood by BA leaders, and they kept the method of human behaviours management at the highest decision level. This was a part of the rethinking process as it was this process that identified people as potentials for BA leaders, which further led the management of the human activity in the organization (Burke, 2010).

They tried their best to change mentalities and perceptions of people at both internal (employees) and external (customers) levels of the organization. This was how Marshall, CEO of BA, improvised the cultural change within the organizational system. He first sorted out intact segments in the system to initiate the process as they were easy and more flexible to accept the change practice (Bowhill, 2008).

Engineering and Maintenance was the first segment which Marshall tried to adjust. It was the segment that was intact and remained highly influenced by the centralized system of leadership. Marshall thought that by changing people in the engineering wing would surely bring improvements in other sections like marketing or planning (Burke, 2010).

So, it was this human behaviours management practice, which was the second salient feature of the BA’s culture change practice during 1980s (Hellriegel & Slocum, 2007). The policy of “putting people first” was another example of efficient human resource management by British Airways. This policy was another feature that administrated employees and prepared them to display the highest level of performance (Burke, 2010).

It was the time of cultural change (1981-1990), when British Airways started to let go of the military mentality, which never wanted to see employees grow and flourish. The concepts of dedicated customer service and managing employees’ efficiently were implemented in the same period.

These steps were taken to promote the notion of “putting people first”, and also to influence human behaviours at the highest level of consideration (Cameron, 2004). It was a stage wise approach adopted by the BA administrators to bring a cultural change within the system. It took time, but things got on well when BA stood on the change practice apprehensively (Cameron, 2004).

In the striving period, BA was identified with problems in the leadership side. The military mentally in leadership and rules based on power and authority traditionalized the organization system. The employees and the managerial staff all were influenced from the centralized style of leadership in BA (Burke, 2010).

This required a cultural change as from top to bottom all organization segments were under the impression, and required a revolutionary upstanding of the enterprise. Actually, those were the customs that brought the whole system under the influence.

Before change employees had to confront rigid decisions from the leadership as the management was highly politicized, and it concentration was more on the authority, which actually divided the whole system of BA. The administration after 1980s rethinking stage signified its presence within the organization (Kotter, 1996).

It recognized that once the old trends are wiped out then the organization will inevitably stabilize its position. The leaders started to focus on the cultural change first, and brought in parallel decisions to change existing customs. The mentality of just flying off planes and treating customers as luggage also hindered the new leadership style.

It was the conservative mentality that actually stopped employees, workers, and managers to perform. This was the main hindrance that the new leadership faced in all functioning areas of British Airways (Bowhill, 2008). All areas of BA including maintenance, engineering, management, planning or operations were affected by rigid behaviours, culture, and norms imposed by previous military style of leadership.

There was less motivation among employees which was recognized by the new leadership in the declining period of BA (1979). All of these were leading issues when the second leadership took charge in 1980s (Burke, 2010). Among other humanly issues new leadership at BA also confronted coordination issues.

There were relatively weak relationships between bosses and subordinates, which affected the overall teamwork within the organization system. According to Schneider’s Study, the boss-subordinate relationship is particularly important for organizations. This relationship develops an interactive chain of command which is significantly among for building team work at the work place (Burke, 2010).

The MPF program within BA change period was one resemblance of Schneider’s study as it endorsed the coordination feature among the managerial staff (Burke, 2010). The program developed trust between managers and employees, which further on eliminated organization politics within the BA system.

It provided open chance to BA subordinates to learn from their managers and also an opportunity for managers to team up with their subordinates (Hellriegel & Slocum, 2007). The MPF program took a time to adjust, but once team leadership got established things eventually came out positive for British Airways (Hellriegel & Slocum, 2007).

In the striving change period, BA was brought with a couple of financial modifications (Burke, 2010). During the change period administrators reformed the financial and accounting system. They updated the activity by assuring annual reporting systems. This was to transform the slow reporting structure into quick annual reporting system.

The accounting managers were told to release annual financial reports, which was for the clarity of stakeholders and investors’ bench. The financial reform took periods to get transformed, and it was one of the stagnant issues which leaders addressed at the time of change (Cameron, 2004). The struggle was continuous and took a lot of time to adjust change within the BA system, in which functional reform was part of the process (Burke, 2010).

Change – A Systematic Process

According to the theorists’ perception, change is no way possible unless it emerges as a stage wise process. Organizations in the global scenario never change as quickly as they require time to adjust to the transformational process. This is a systematic process that alters all components of the organization over a long period of time.

For this reason, theorists propose a three way model of the organizational change, which includes structural change, cultural change, and then human change (Porter et al., 1975). When organizations pass on with this three stage model they have a probable chance to achieve the organizational level of change.

The first stage in this process is the structural change, which is achieved by making new quality reforms. Talking about British Airways, which was first a state owned firm failed to drive the structural change process. There was a lack of commitment, which brought a lack of deliverance in the organization system (Porter et al., 1975).

Actually, the organization was not structurally prepared to satisfy its customers and even employees of BA. Hence, the first proposed stage to launch the change is the structural change, which is done by adjusting quality reforms instead of minute rigid reforms as sought in BA before the change (Burke, 2010).

The quality reforms include powerful vision, high performance standards, deliverable constituencies, and sound communication systems, which further lead the change in other parts of the organization (Kotter, 1996). The second level of change is the cultural change. Organizations that ignore the cultural change make a big mistake as this is the kind of change required to transform the whole system.

There are different components of the organization including leadership, managers, and employees, which are part of the organizational culture (Cameron, 2004). It is culture that influences all components of the system. BA, which was at the fringe of conservativeness before 1980s, was unfortunate to revive its culture.

There were trends of high complacency, disrupted direction, low motivation, and less determination that kept the organization at low performance levels (Burke, 2010). Cultural change is the second key feature of the organizational change. No organizations can transform unless and until they allow cultural reforms and modifications. Trends formed by cultures and cultures are manipulators for the organizational functions.

To change functions it is necessary that cultures are tainted, and this is what directly fits in the case of BA – an organization which has significantly strived to change its cultural policy. The last and third most important feature of change is the ‘peoples’ change’. The main reason for 1980s BA crises was its conservative style of leadership (Hellriegel & Slocum, 2007).

There was authoritarian rule, which lagged the performance of BA. The change needed efficient and effective human resource management, which mobilizes people from top to bottom in the organization. When people are managed and well engaged, there are high chances that the organization’s performance excels. This is the most decisive area and requires a persistent consideration from the organization’s administration (Hellriegel & Slocum, 2007).

According to John Kotter (The author of the book – Leading Change), there are three main reasons of why enterprises fail to transform (Kotter, 1996). One of the reasons is the lack of vision by the leadership, which allows inspiring functions and actions necessary for change. The same was sought by the leaders at British Airways, which faced a lack of vision and determination by the leadership.

Employees’ performance was low just because they could not find any moral support or boost from the leadership. There were low opportunities to grow because the vision of leadership was limited and not open to recognize and extract employee skill and talent (Kotter, 1996). Similarly, due to lack of vision (1970) BA confronted low synergy and fewer competencies at the operational level.

John Kotter has also related lack of vision to low employee engagement. Kotter in his book described that when the leadership has a lack of skill (vision), there are more chances of high complacency, which negatively affects the organizational system (Kotter, 1996). At British Airways, it has been seen that leaders remained reactive instead of being proactive, which raised complacency among its employees in the period of 1980s.

Due to high complacency employees were not satisfied and enthusiastic to grow or perform. The carelessness in the attitude stained employees’ behaviour, their performance level, and also their commitment towards the BA system. For such reason, BA crew was just on flying airplanes on time and getting them to destinations on time and not more than that. This attitude was a major hindrance for the BA change, and also was against Kotter’s method of leading the change (Kotter, 1996).

Humans’ Management-Importance for Change

At the time of change, British Airways came up with a three way model approach. The model was based on managing human element of the organizational structure, and it was based on the philosophy of “managing people first” (MPF). Nick Georgiades (formal head of the human resources department) came up with a three leg stool approach to imply the philosophy of MPF (Burke, 2010).

He proposed that if three legs of the stool are managed then the human element becomes the source of achieving the change (Cameron, 2004). Here is the discussion of three legs stool model proposed by former BA officer Nick Georgiades:

Leg 1

The leg 1 of the approach dealt with strong communication in BA. It was the first basic component that was required in BA to adjust the organizational level of change. Georgiades proposed that when managers are without paranoia, and they have full confidence in their subordinates and teammates, change is possible.

He further recommended that removing the gap between BA managers and employees will open up ways for change. Leg 1 implemented the concept of managing people at earlier stage (Burke, 2010). Based on this model, BA projected employee-manager interaction as a necessity for integration in the organization system.

Direct employee reporting and performance based appraisals were also implemented as part of the first leg of Georgiades’s stool. This was the starting phase when the human factor started to receive high value and encouragement, and it was an early sign of change within the enterprise (Cameron, 2004).

Leg 2

Leg 2 dealt with the performance appraisal process. Nick Georgiades wanted to see his employees growing, and he identified performance appraisal to be one of the methods for increasing performance. Previously (before times of change), there were also performance appraisal programs in BA, but not aimed at raising employees motivation.

By implementing leg 2, the performance appraisal systems got modified in the BA. The appraisals were made on two bases including evaluation of results generated by managers and methods used for achieving those results (Burke, 2010).

This allowed evaluation of performance in a precise, effective and detailed manner, which eventually became a route to the BA’s change. Such modified performance appraisal systems introduced by Nick Georgiades became drivers to organizational change, and the system started to progress later on after Nick Georgiades left up (Kotter, 1996).

Leg 3

With this leg, the model of Nick Georgiades was completed which fulfilled requirements of the BA’s organizational level of change. Leg 3 was all about compensations; it dealt with rewards according to the ranks attained by managers. In the organizational practice, it has been seen that when employees get justified rewards, they are more determined and motivated towards work (Burke, 2010).

It is the organization’s successful compensation system that allows satisfactory employee rewards. This leg permitted clean rewards in BA to raise employees’ satisfaction and motivation (Kotter, 1996). The three leg stool model was completed in BA, which was implemented by Nick Georgiades to raise the performance of employees.

The model replicated the concept of managing people in BA, and also promoted consideration of the human factor at the highest organization level (Burke, 2010). The three leg stool was therefore, about human resource management, a route to embody the organizational level of change. This was a deliberate effort made by the former officer – Nick Georgiades.

The credit goes out to him as he recognized humans to be major carriers of change. He recognized that if complete change is opted then it is necessary that organizations should start with its employees. It is the same concept that Georgiades identified in the three leg stool model, which later on became a door for the organizational change in BA. Nick also clarified that if one leg of the stool gets damaged or removed then the entire stool will collapse.

Hence, it is necessary that all legs are fixed, managed and adjusted to make way for the cultural change in BA (Burke, 2010). In all of these projects, the human element played a decisive role in the BA organizational change. By managing humans and adjusting “MPF” concepts, BA was able to achieve change in a comprehensive manner (Cameron, 2004).

The same is true from the theoretical point of view as organizations cannot stand or affirm change without invoking human attributes such as “determination, passion, and motivation” (Hellriegel & Slocum, 2007). These are all human behavioural elements, which play a central role in conducting the organizational change.

The same were sought after by few gentlemen in BA, a time when BA revamped, and leaders became prominent figures to manage people of the system. The trend followed and brought concepts of managing people first, which deliberately came out positive for overall BA’s system (Cameron, 2004).

List of References

Bowhill, B 2008, Business Planning and Control: Integrating Accounting, Strategy, and People. John Wiley & Sons, San Francisco.

Burke, W 2010, Organization Change: Theory and Practice, SAGE, Singapore.

Cameron, K. 2004, A Process for Changing Organizational Culture. Research Report, Michael Driver, Ann Arbor.

Cawsey, T, Deszca, G & Ingols, C 2011, Organizational Change: An Action-Oriented Toolkit, SAGE, Singapore.

Falletta, S 2008, Organizational Diagnostic Models A Review & Synthesis, Leadersphere, Sacramento.

Hellriegel, D & Slocum, J 2007, Organizational Behaviour, Cengage Learning, Mason.

Kotter, J 1996, Leading Change, Harvard Business Press, Boston.

Myers, P, Hulks, S & Wiggins, L 2012, Organizational Change: Perspectives on Theory and Practice, Oxford University Press, Oxford.

Porter, L, Lawler, E & Hackman, J 1975, Behaviour in organizations, McGraw-Hill, New York.

British Airways is an airline company registered in the United Kingdom. The airline founded in 1974 enjoys exclusive rights accorded by the government to operate in international market (Katie, 2013). The airline’s target group includes corporate class, upper middle class, and middle class.

British Airways is the biggest group of aircrafts operating together under the same ownership in the United Kingdom. The airline is very successful in the international market in terms of flight, and destination numbers. Its biggest rival is Easy Jet, which has the largest number of passengers transported in a year (Mayer, 2011).

Strengths

Strengths are organizational elements that boost its resource capacity and competitiveness in a market. They are part of an organization’s internal environment and are beneficial.

Strengths that make British Airways successful in international market include unassailable support from the government, a strong center of commerce in the United Kingdom, and a potent brand that enjoys exceptional international presence (Mayer, 2011).

British Airways has operations in six continents, which has helped to market its brand widely and effectively. Other strengths include a fleet size of more than 250 aircrafts, 150 international destinations, an inclusive corporate culture, as well as a highly qualified and skilled workforce (Katie, 2013).

Weaknesses

Weaknesses are organizational elements that limit its ability to be competitive and aggressive in a market. Two major weaknesses prevent British Airways from fulfilling its potential in the airline industry. The first weakness is depleted resource capacity that weakens its ability to compete effectively with rich airlines from the Middle East (Katie, 2013).

This has resulted in limited market share for the company, thus reducing its activity in the international market. The second weakness is weak marketing strategy. International markets are very competitive (Mayer, 2011). Therefore, it is important to apply an equally competitive marketing strategy that will look ahead of the competitor and identify any gaps.

Opportunities

Opportunities are organizational elements within the external environment that have potential for success if exploited effectively. The first opportunity for this airline is the Heathrow terminal, which is a major center for commercial activity with an excellent global presence (Mayer, 2011).

With competition in the market increasing everyday, it would be opportune for the airline to nullify efforts by its competitors who are acquiring a bigger market share. This opportunity would help in growing the airline’s brand, as well as increase its customer base (Mayer, 2011).

The second opportunity for the airline is to diversify and expand its global operations. International market dynamics are swiftly changing (Katie, 2013).

This includes changes in consumer needs and preferences, as people are willing to adventure by trying out new things. Therefore, the airline can take advantage of this phenomenon by introducing new services and expanding existing ones. This will retain their current clients and attract new ones.

Threats

Threats are organizational elements from the external environment that act as a source of danger. With the global economy still dealing with effects of the 2007 financial crisis, most threats to big businesses are financial (Katie, 2013). The case is no different for British Airways, as they face serious threats from the rising cost of fuel and labor.

These two resources are crucial to operations for the airline, and might pay more for them. Another major threat for the airline is increasing competition in the global market, especially in Europe where rich airlines from the Middle East have introduced their services (Mayer, 2011). The biggest competitors include Jet Airways, British Midland, Emirates, and Virgin Airlines.

References

Katie, J, 2013, Strategic Management: British Airways, Oxford University Press, London.

Mayer, F, 2011, Risks and Decision Making: Using the Example of British Airways, Cengage Learning, New York.

Introduction

The case of British Airways reveals how adequate organizational changes can transform many corporations. The corporation used a transformative approach to deal with its inefficiencies. Consequently, the strategy created a stable and customer-focused organization. This discussion describes how efficient transformation can be implemented in an organization.

Accompanying Reading

The reading “Re-Energizing the Mature Organization” is germane to British Airways’ case since it outlines powerful principles that can transform an organization. The article describes how appropriate leadership and scheduling procedures can make a difference. The reading also explores these stages of a company’s lifecycle: inception, cultural stages, and success (Beatty & Ulrich, 1991). The lifecycle echoes the approaches implemented at British Airways to turn things around. The restructured airline would eventually become competitive. The reading, therefore, describes a model for transformation while the case of British Airways shows how it can be applied successfully.

The “Old” British Airways

In 1980, the International Airlines Passengers’ Association (IAPA) indicated that British Airways was a company to be avoided by passengers. The organization’s business model was pathetic and difficult. The existing conditions affected workers’ needs, thereby catalyzing staff discontent. Many customers were dissatisfied with the available services (Kotter & Leahey, 1990). The corporation’s business processes, customer services, and employee relations were inappropriate.

Barriers to Change

British Airways failed to implement new changes due to various factors. For instance, its parent companies supported a rigid culture that was hard to transform. Although the organizations operated effectively, the level of efficiency was quite low (Kotter & Leahey, 1990). Notably, parent corporations were making adequate profits. However, this performance discouraged the leaders from focusing on efficiency (Peronja, 2015). Consequently, the managers were unable to implement meaningful changes.

Transforming British Airways: Critical Factors

The first critical factor that facilitated the transformation was the appointment of John King. The chairman’s experience empowered him to implement a powerful change process. Dunlop Gordon, the new Chief Finance Officer, changed the airline’s image by retaining various services. Additionally, Colin Marshall applied powerful strategies to deliver exemplary services (Kotter & Leahey, 1990). The Putting People First program was another crucial aspect that empowered employees to interact positively and support customers’ needs.

Transforming Themselves

British Airways’ stakeholders identified various steps and sequences to transform the company. The chairman implemented a powerful plan using several steps. The first one was to reduce the number of workers. This was followed by freezing salary increments (Kotter & Leahey, 1990). The third step was to shut sixteen routes. This sequence was used: operational changes, engagement of workers, and customer support. The major risks included the move to reduce the number of employees and transform the organization’s business model.

What I Would Have Done: Biblical Integration

Marshall and King focused on issues such as employee empowerment, customer satisfaction, and service delivery. However, I would have gone a step further to introduce powerful schemes to ensure more people embraced the company’s services. Kurt Lewin’s model (refreeze-change-freeze) could be applied to promote new practices at the company (Burnes, 2009). Joint marketing strategies could have also been used to maximize profitability (Andrews, Beynon, & Genc, 2017). Every worker would be encouraged to embrace virtues such as integrity, respect, ethics, and truth (Abdullah, Chew, & Hamid, 2016). Such attributes would ensure that the airline exhibits the nature of God.

Conclusion

This discussion explains why companies should make appropriate transformations to remain competitive. The use of powerful incentives can deliver meaningful results. The involvement of different stakeholders can transform a company’s image and make it more competitive.

References

Abdullah, M., Chew, B., & Hamid, S. (2016). Benchmarking key success factors for the future green airline industry. Procedia – Social and Behavioral Sciences, 224, 246-253. Web.

Andrews, R., Beynon, M. J., & Genc, E. (2017). Strategy implementation style and public service effectiveness, efficiency, and equity. Administrative Sciences, 7(4), 1-19. Web.

Beatty, R. W., & Ulrich, D. O. (1991). Re-energizing the mature organization. Web.

Burnes, B. (2009). Managing change: A strategic approach to organizational dynamics. Upper-Saddle River, NJ: Prentice Hall.

Kotter, J. P., & Leahey, J. K. (1990). Changing the culture at British Airways. HBS No. 491-009. Boston, MA: Harvard Business School Publishing.

Peronja, I. (2015). Performance effects of the business process change in large enterprises: The case of Croatia. Management, 20(1), 1-22.

Introduction

Economic scholars contend that the 2007-2008 global financial crisis was the worst since the 1930s great depression. However, valid explanations of what caused it have been postulated. For example, according to Wray, economists who are inclined to the Minsky school of thought believe that the disaster was caused by ‘money manager’ entrepreneurship, which led to capitalistic gaps in terms of economy management.⁵

The crisis resulted from misguided financial policies that led to the taking of excessive uncalculated risks. Irrespective of the validity of all possible explanations, the last global financial crisis had negative ramifications to many organizations across the globe. For example, SkyEurope collapsed in 2009 while British Airways received an immense shock due to a reduction in consumer spending. This paper analyzes the performance of British Airways’ leadership in the wake of the global financial crisis. Its focus is on actions that the British Airways corporate leadership took to respond to the international economic disaster.

British Airways (BA) and its Leadership

British Airways dominates the United Kingdom airline industry.¹ It is a major flag carrier in terms of fleet size and international operations. Measuring the company’s operations from the context of passenger carriage capacity, BA ranks second after easyJet. The company’s main offices are located close to Heathrow Airport. As Duffy reveals, the inauguration of the BA administrative centers was held in 1998.²

The company operates centers such as London municipality and Gatwick. British Airways offers airline services in over 160 destinations that are distributed around the globe. Heathrow forms the main operations base for BA, although it has other chief operations in Gatwick. BA CityFlyer, which is a subsidiary of the British Airways, dominates operations in the London municipality airport. BA also operates flights from Manchester Airport. However, due to the reduced profitability, operations within and outside London were closed when BA Connect was sold out. This situation forced people who were traveling to international destinations, especially the UK, to apply for transfers to London. Over 40 percent of all operations at Heathrow are reserved for BA. This observation suggests that the company dominates airline operations from the airport.²

Upon the company’s privatization in 1987, it acquired immense privileges in comparison with its competitors. The privileges included a reservation of 43% of landing openings and departures at Heathrow Airport. Thus, BA a major airline brand in the UK.

Effects of the Global Financial Crisis on British Airways

The global financial crisis influenced all sectors of the UK economy, including the air travel industry. Oprea states that the United Kingdom experienced a sharp decline in the number of air travel passengers, especially in routes that connected the US and Spain.⁴

Tourists usually connected to these nations via the UK. A decrease in consumer spending due to financial hardships that were experienced even at the household level reduced travel rates. Therefore, airlines, including British Airlines registered the lowest number of customers. Indeed, Oprea says that the company resorted to survival tactics, which involved the provision of incentives such as fair reductions to encourage loyal customers to continue using the airline.⁴ Using this approach, amid the increasing operational costs due to oil price fluctuations, the company was aware that the survival tactics would not yield profitability. The main concern was not only breaking even, but also ensuring that it retained its clients while waiting the recession to end.

In the first half of 2008, oil prices hit $146 per barrel. British Airways reveals how this situation had the implication of upward growth of fuel costs for all couriers, including the BA.¹ Therefore, the profit margin of the company was exposed to immense pressures. Although the prices fell to about 33% later, the recession began to take control over economic performance of airlines, this prompting many of them to incur heavy financial losses. Thus, with the challenges of the recession, BA did not anticipate any relief in its price volatility. IATA’s data revealed how the worldwide air travel traffic decreased by about 2.8% in 2008. After the onset of the recession, within the first 3 months of 2009, the decline was about 19%.¹ This finding indicated slimmer fortunes for the British Airways during the recession.

British Airways’ Corporate Leadership during the Global Financial Crisis

Upon recognizing that the recession would take longer than anticipated, BA began to look for mechanisms for ensuring that it came out of the global financial crisis ready to face a promising future. The organization’s corporate leadership began scanning the environment to determine the most appropriate corporate level strategy to ensure success during the uncertain times. According to the British Airways, the organization realized, “For both business travelers and individuals, airline brands that are trusted to be robust and reliable are more sought after in tough economic times”.¹

It also noticed that passengers wanted to seek travel services from airlines that could assure them of their safety and smoothness of flights. They also focused on traveling less while maintaining the usual progress of their business activities. Their idea was to save on air travel costs.

During the recession, BA leaders realized that most customers became price sensitive. As the British Airways confirms, the organization noted that clients were “looking for value for money by demanding excellent levels of service and high-quality standards at lower costs”.¹

Some of them even lost their loyalty to the BA brand in search for cheaper alternatives. This situation presented an agile condition for air travel business operations, which if well managed, had the implications for attracting new clients. The most challenging issue was that while consumers wanted value for their cash, they also demanded superior quality of service and consistency. When selecting their appropriate airlines, they also based their decisions on information that they had gathered. More than before, they used the internet to make price comparisons for different airlines.

The global financial issue presented a business predicament. During this time, effective leaders played the role of setting visions and the desired outcomes to foster organizational prosperity. In any organization, visions, goals, missions, and objectives guide the daily operations. Leaders endeavor to ensure that people believe and work towards the achievement of these aspects. During a crisis, leadership has the role of scanning the environment to provide information on the appropriate strategy to drive an organization forward to overcome the crisis. British Airways leadership managed to scan the environment. It also developed appropriate strategies to cope with the financial crisis. Indeed, coming up with strategies for succeeding during times of uncertainty encompasses an important role of leaders. Such a role is enshrined within their duty to set vision, mission, and objectives to guide the daily organizational operations. How did BA approach this role?

In the financial year 2008/2009, British Airways made its worst loss since its privatization. Milmo informs the company made a loss of £401million. The company had a bill of about £3billion to pay.³ To make the matter worse, the value of the pound had deteriorated and had lost its most crucial markets due to the reduction in consumer spending for transatlantic business people. The shares of the company had also fallen by 6.6 percent. What was next for the airline?

British Airways CEO, Willie Walsh, took the unexpected corporate decision. While the general economic logic suggests that an organization that is struggling with high costs of doing business needs to increase the prices of its products and services to help in offsetting its fixed costs, the CEO announced a no-fare hike policy. He claimed that the demand had shrunk while the banking crisis made customer choices fragile.³ Thus, any increase in prices would have the implication of damaging the already shaking customer base of the airline industry. To avoid any possible collapse, BA leadership decided to provide price offers to its struggling customers. It sought to attract loyal customers to other airline brands that sought high-quality air travel services and value for their money.

The above strategy was most appropriate in dealing with the implications of the global recession. Amid registering high losses, more challenges were experienced elsewhere. The company’s cash pile, which helped in self-defense against financial crisis, had dropped by 25% to stand at £1.4billion.³ This slump was after the consumption of £483million of the reserves in the effort to keep the organization running in a trying economic time. The company also struggled with a pension deficit that amounted to £2billion, which delayed its merger with Iberia. Its net debts were somewhere between £1.1 and £2.4billion. This finding suggests that the leadership needed to look for an alternative for ensuring that the company kept on running.

In the bid to address its increasing financial problems, BA leadership also resorted to another farfetched strategy-payment freezing. The company decided to implement a payment freeze by not paying management their 2009 bonuses. The CEO also informed that a pay deal with the company’s engineers had to be reconsidered. Walsh had the faith that all employees understood the organization’s hardships.

Hence, they embraced any changes in organizational policies to protect the organization from collapse so that it could continue serving their interest in the future. The company also scrapped dividends, amid having been reestablished in 2008. This observation means that the company mainly focused on strategies for minimizing expenditure of financial resources to help it to come through the recession. Indeed, it abandoned keeping fares high by claiming that this plan could not sufficiently compensate the reduction in passengers. Thus, the company pursued the strategy for increasing passenger base.

Conclusion

The 2007-2008 global financial crisis had negative implications on the performance of many organizations in all the affected nations. BA suffered immense challenges. It reported a net loss of £410million in the 2008/2009 economic year. To deal with the crisis effectively, the company’s leadership deployed the unthinkable strategies. It held the payment of bonuses to its managers and recalled a pay deal with its engineers. Instead of increasing fares to help in offsetting the increasing costs, the company decided to provide price offers to its customers. It reduced prices in a bid to increase the number of loyal customers who were looking for value for their money. With the CEO’s corporate leadership strategies, BA ultimately became the clients’ choice.

References

1. British Airways. 2008/2009 Annual Report and Accounts. London: Word Press; 2009. Web.
2. Duffy, F. British Airways at Waterside: a new model office? Architectural Research Quarterly 2004; 3(2): 125-140. Web.
3. Milmo, D. British Airways Makes Worst Ever Loss. The Guardian 2009. Web.
4. Oprea, M. The Effects of Global Economic Crisis on the Air Transport of Passengers in Europe and in Romania. Geo Journal of Tourism and Geosites 2010; 1(5): 52-61. Web.
5. Wray, R. The rise and fall of money manager capitalism: a Minskian approach. Cambridge Journal of Economics 2009; 33(4): 807–828. Web.

Introduction

Transportation has become a significant part of business today which has a great influence over other economic and business practices. Any change in price, demand, and technology influence businesses significantly in relating environments. Low-cost carriers are becoming dominant in the market. Therefore, the provision of low airfares becomes an interesting topic of discussion in addition to the technological advancements that contribute to the cost of transportation as well as to the enhancement of the customer experience.

Information technology and computer-based information systems have become a competitive necessity, essential to the survival of almost every business. Over the years, IT has shifted from a primarily internal orientation to strategic orientation. IT has the potential to change how a business works internally and to identify new ways of competing; several authors (Allan 1998), (David 2004) suggest therefore that IT should become equal to or a driver of business strategies. IT has also become an important factor concerning “innovations”. Joe, et al (2005) suggests that “innovation is essential in order to generate long-term stability, growth, shareholder return, and sustainable performance and to remain at the leading edge of the organization”.

Background information

Most of the problems faced by BA were rooted in such factors as frequent air attacks, competitors’ entry into the market as well as the high rises in the prices of oil (to more than double the original price. The government further imposed taxes to safeguard the environment. After 10 years of losses, British airways needed to rethink its strategies and invest in new ways. Paul Coby, becoming CIO of BA in 2001 saw technology as an opportunity in order to cut costs, increase customer satisfaction and generate growth. Since 2001 BA airways have used technology in order to innovate and stay at the leading edge of their organization.

Aims and objectives

Aims

To analyze technological innovation used by British Airways and how it is related to the improvement of their corporate brand strategy.

Objectives

1. To demonstrate BA’s current alignment between strategic vision, organizational culture, and corporate image.
2. To explain the use and purpose of the computer-based information systems used by British airways.
3. To identify the positive impacts of the computer-based information systems in relation to British Airways corporate brand strategy.

Research methods

The research for this topic will be collected by gathering only secondary data; the researcher will collect this data is based upon three main characteristics. The data will be collected systematically, interpreted systematically and there will be a clear purpose for finding the right data. “We can define research as something that people undertake in order to find out things in a systematic way.” (Allan 1998) Therefore the researcher will carry out this research by following different steps in a chronological way. First, the researcher will clarify his topic, review literature in order to understand and have a better focus to collect the right data, analyze the data and as the last stage write everything down. “Formulating and clarifying the research topic is the starting point of your research project.” (James & Jack 1999). For this research, it was agreed to only use secondary data, which is data coming from a study that already has been conducted.

Literature review

Technological innovation

In the near past, drastic changes in the structure of the airline industry have been evident. The airlines were formally known to be competitors as well as rival groups, a situation that is currently changing into one of cooperation. Currently, both big well as small airlines opts for cooperation rather than competition amongst themselves (Dennis 1976 ). Such alliances allow firms to focus on their respective core competencies while drawing the benefits of scale economies. The following chart illustrates different views of the concept of technological innovation.

The term of innovation used in this study will mainly focus on the development of new computer-based information systems, which are not only used to improve the efficiency of BA’s operations, but also to provide new strategic possibilities for organizational innovation and development. The BA cabin crew has the advantage of acquiring online internships which will significantly enhance their performance. The computer-based information systems discussed will be as follows:

1. The “self-service check-in Kiosk
2. The Catering online extranet, which provides BA with low-cost access to their supply chain applications.
3. The efforts of BA to enhance its allied Google Earth facilitating the visitors to access accommodation in the nearest hotels as well as the most convenient transport by the use of 3D map.
4. The alliance between BA, Cisco, and Prime establishing the Airlines Industry’s largest IP telephone network.
5. The deployment of Wily Technology in order to manage software applications on the BA.com website.

Strategic vision

The model of James and Jack (1999) shown in appendix 1, identifies three main variables: Vision, culture, and image. This model helps managers analyze context concerned with the alignment of strategic vision, organizational culture, and corporate image, so they can evaluate their strengths and weaknesses.

Strategic vision and organizational culture

The vision of a company is defined by its core values. These are a set of guiding principles that have a profound impact on how everybody in an organization thinks and acts. Research done by James and Jack (1999) showed that successful companies build their visions true redefinitions and reinventions of their core values instead of completely changing from one value to another (James & Jack 1999)

The organizational culture of a company is the collection of values and norms shared by people or groups within the company and that control the way they interact with external stakeholders. Mark, et, al ( 2008) find that the concept of organizational culture held by most corporate branding practitioners is naive. They claim that practitioners fail to distinguish the difference between desired values; which are mostly stated in the vision statement, and the practiced values at work which is the organizational culture of a company. So in order to create a perfect harmony between these two elements, it is imperative that there is an interconnection between the promise a brand makes and the performance the corporation delivers (David 2004).

Strategic vision and corporate images

A challenge in corporate branding is to align strategic visions with corporate image. Corporate branding puts a stronger emphasis on the role of strategic visions due to the fact that it requires top management reflection on who the company is and what it wants to become. James and Jack (1999) say that corporate images feed into strategic visions serving as a mirror in which top managers can reflect on who they are. This means that instead of using stakeholder images as exact assessments of brand performance, compare them with strategic vision, images held by stakeholders, on who the company is and what it stands for (David 2004).

Before privatization in 1987, people in Britain said that BA stood for “bloody awful”. The overall image perceived was that BA was operationally incompetent and indifferent to customers. However, in the early 1990s BA succeeded in privatizing and true severe downsizing and corporate-wide customer service training they turned to a respectful and highly competitive corporation. In the mid-1990s BA faced additional pressure for change; market research showed that the customer base was shifting and that only 40% of its passengers were British (Joe, et al 2005 ).

One of the main problems was that BA was based on British traditions which did not cohere with the global image they were striving for. Another problem was that BA culture did not support its vision. The employees were subjected to another round of cost-cutting while at the same time they saw the expenditure of £60 million on tail fin painting. Struggling for globalization, BA radically needed to change its strategies so that a strong corporate brand could be obtained. The employees conducted a strike which was disruptive to a campaign for global vision (Dennis 1976 ).

Data Analysis

This research has several objectives and questions to be achieved to get to the main aim. Having collected documentary secondary data, there are different ways of analyzing them. In this case study, the data that is collected will be analyzed “qualitatively” and to do so, like Joe, et al (2005) method, categorizing data will be the closest process to examine the data according to the topic.

The data needed for this research is divided over a timeline; the researcher has to collect data starting from 2001 directly after the study made by Mark, et, al ( 2008). It is important to have the relevant data to see if there has been an evolution since the study has been made.

Data analysis of technological changes in British Airways is designed to define the improvements they brought to the overall corporate strategy of the company and especially brand strategy, which is one of the most important managerial aspects in modern conditions.

The analysis of improvement will be based on Hatch and Shultz model. Their concept may be described as a gap model providing basic parameters of branding strategy including three basic elements: image, vision, and culture. We shall analyze how technological challenges in British Airways affected these three elements.

Basic technological innovations developed by British Airways management mainly refer to informational technologies which are the primary driving force of modern branding.

First, let us analyze positive changes in branding strategy due to the alliance between BA Website and Google Earth.

To adequately formulate the positive implications of this innovation for the corporate policies of British Airways Company, one should pay special attention to Hatch and Schultz’s helpful differentiation between corporate and product branding. As Hatch and Schultz note, “Corporate branding differs from product branding in several respects(…).

First, and most obviously, the focus of the branding efforts shifts from the product to the corporation. Of course, product and corporation are related in that corporate brands add economic value to the variety of products and services offered by the company(…). But the broader scope of the corporate brand pushes brand thinking considerably beyond the product and its relationship to the consumer or customer” (Schultz and Hatch, 1044). These considerations are extremely important in terms of analyzed innovation. It is evident that the alliance between the British Airways website and Google Earth, which allowed visitors not only to book their flights but find nearby hotels and car rentals on a 3D map, is closely tied with corporate branding strategies rather than product branding.

Giving additional conveniences to customers and allowing them to use new technologies to accommodate their needs and guarantee satisfaction, helps form positive attitudes to the company in general, rather than particular goods and services. Customers of British Airways, using helpful software had the possibility to compare it with other companies’ offers and make a conclusion concerning quality, accessibility, and utility of these tools.

The deployment of wily technology in order to manage software applications on the BA.com website.

This technological innovation may be understood in terms of further improvement of British Airways’ popularity due to the enhanced flexibility and utility of its software. Before these changes took place, the customer often complained about a low number of functions and possibilities provided by the British Airways site, however, the introduction of new software technologies and new methods of control helped increase the number of visitors, scope of online transactions, and contacts with customers and counterparts.

Hence, British Airways managed to overcome its conservative mood which was often mentioned by analysis as the primary source of the negative performance of the company during the 90-s.

Hatch and Schultz’s model helps also understand positive changes to British Airways’ branding strategy brought by an alliance between BA, Cisco, and Prime which established the largest IP telephone network in the industry. From the first sight, this innovation has nothing to do with the branding strategy. However, as Schultz and Hatch claim, that generalization is adequate only from the outdated vision of corporate branding. As these authors claim, “The corporate brand contributes not only to customer-based images of the organization, but to the images formed and held by all its stakeholders, including: employees, customers, investors, suppliers, partners, regulators, special interest and local communities’ (Shultz and Hatch, 1042).

In this light, it should be noted that the introduction of the new IP telephone line in cooperation with other major company’s helped improve British Airways reputation among other businesses, their customers (which resulted in widening the scope of positive customers), widen the network of existing and possible counterparts. These improvements refer mainly to Shultz and Hatch’s concept of corporate vision, which is deeply entrenched in organizational culture.

There is no denying the importance of the fact, that deep cooperation in the technological sphere between British Airways, Cisco, and Prime was positive in terms of enhancing British Airways’ corporate vision and recognitions, which in its turn stimulated the brand’s popularity among customers and counterparts. In this view, one of the most important preconditions for successful branding strategy, that is the interconnection between the performance of the company and the promise of the brand, was maintained.

The cohesion between corporate vision and corporate culture, which are so important for Hatch and Schultz, is also maintained by innovations designed in British Airways for the training of crew members (Little, 2006) This new equipment ‘teaches cabin crew how to use a new in-flight sales system’. This innovative technology won Brandon Hall Research annual awards and managed to gain high popularity among other companies and counterparts, which stimulated the development of the same process. There is no denying the importance of the fact, that introduction of this learning technology allowed significant improvement of employees’ vision of the company and their position in the company. (Wilkinson and Grugulis, 2001).

According to Schultz and Hatch schema, this in its turn is likely to results in stimulating corporate culture and vision development, which is the primary prerequisite for developing effective corporate branding. Besides this, it was important to enhance relations with employees in view of the human resource crisis which menaced British Airways due to massive layoffs following the economic downturn (Pitcher, 2007).

Recommendations

The strategic vision is interpreted in relation to images held by external stakeholders who will use the information on the company that goes beyond what the corporation provides. Due to this external influence, the branding process involves elements that lie outside the direct influence of the management.

In order for organizations to succeed in establishing a strong corporate brand, the integration of visual image and culture are essential in order to compete in conditions of unsustainable product differentiation created by globalization.

Conclusions

The conservativeness of the British brought resistance to the global vision of the airline considering it to be their icon, not to be shared worldwide. The culture of BA contradicted its image leading to a wrong path to corporate branding. The handling of the corporation’s culture, vision as well as the intended image could not be managed at the same time.

References

Allan, A, 1998 Innovation Management. Oxford University Press Inc. the USA.

David, A, A, 2004, Brand Portfolio Strategy. Free Press.

Dennis, G., 1976 Innovations Oxford University Press Inc. USA.

James, R., G., Jack, W., 1999 Marketing Corporate Image New York, McGraw-Hill.

Joe, T, John, B, Keith, P, 2005 Managing Innovation John Wiley & Sons.

Little, B. British Airways flies high with online learning system. Human Resource Management International Digest. Vol. 14. No 4, 2006.

Mark, D, David, G Ammon, S, 2008 Management of Technological Innovation Oxford University Press.

Pitcher, G. Who can pilot BA’s HR into clear skies? Personnel Today, 2007; ABI/INFORM Global, pg. 9

Schultz, M. Hatch, M. J. Bringing the corporation into corporate branding. European Journal of Marketing, Vol.37No.7/8,2003.

Wilkinson, A., Grugulis, I., 2001, British Airways: Culture and Structure, Business School, Research Series Paper, 4 , REAM Paper No. 10.

British Airways was formed in 1974 and it is the flag carrier company of the United Kingdom. These last two decades, the company experienced rapid growth and now has become one of the most prestigious worldwide flying carriers. In the beginning it was formed based on a public ownership scheme but later it undertook a series of transformations throughout the ’70 and the ’80. These transformations culminated in February 1987 when it was privatized by the Conservative government in Britain. At the same time it was indexed at the London Stock Exchange and made a constituent of the FTSE 100 Index. Since that time the airline boosted and, in a period when most big airlines struggled to gain profits, it remained on top of the preferences of worldwide customers. Since that time it had passed a turbulent era of high competition, rising oil prices (which meant cost increase) and even financial scandals, like the 2007 fine for price-fixing.

Company’s Mission Statement

According to its current “Chairman”, the mission of British Airways is to serve the customer with the highest quality service possible and make all the necessary financial operations to satisfy its shareholders too (“2007/08 Annual Report”, par. 1).

Company’s products.

Being a flying carrier company, British Airways is part of the airline industry and airline marketplace. The airline industry market has been under serious difficulties in the last decade. The last was the oil price rapid increase of the last few years, which disfavored the company by raising the fuel costs for its jets. This meant a rise in total operations costs. As stated on their official website, British Airways offers two basic services to the market: passenger flight services and cargo flights service (“What we offer” par. 1). These are the main products that the company operates. These two basic services are differentiated into categories for business purposes. The cargo flights service remains intact and has no category but the passenger flights service is composed of four categories and one mix-category package. The four categories offered are first class flights, business class flights, premium economic flights and economic flights (“Travel Classes”, par. 1,2,3,4). The first class and business class are part of the business flights service within the passenger flights service offered and the other two are part of the economic flight’s service for passengers. Also, the company has operative the mix-category “Holiday package”. This service comprises hotels, resorts and flight offers. The company has signed agreements with hotels and resorts around the world and offers the flight, along with return, to those places.

Competition and position on the market

As valuated by the 2008 Barclaycard Business, British Airways has a leading position in the airline market (“Press Release”, par. 2). From the same source, a couple of paragraphs below, we found the identities of the company’s main competitors. Above all, the strongest direct competitor is the German flag carrier company, Lufthansa. Then two other big companies come to Air France and the Fly Emirates. This is on a global market scale. All of the mentioned companies, including the one we are discussing here, operate in almost all of the world’s markets: Europe, North America, Middle East and Central Asia, Far East and Australia. Of course the competitiveness is different according to the market British Airways is competing in. In the European and North American market the company we are discussing has a leader position on the market and its expanding more its market share (“Press Release”, par. 6). In the Middle East/ Central Asia and the Far East it may not be the leader but it has a relatively good market share (“Press Release”, par. 8).

References

1. “What we offer”. 2008. The British Airways Plc. Official Website.
2. “2007/08 Annual Report”. 2008. The British Airways Plc. Official Website. Web.
3. “Travel Classes”. 2008. The British Airways Plc. Official Website. Web.
4. “Holiday package”. 2008. The British Airways Plc. Official Website.
5. “Press Release”. 2008. Barclaycard Business.

Background

British Airways (BA) is arguably the United Kingdom’s (UK) largest airline. The company is also the national flag carrier of the UK and transports more than 30 million people (annually) around the world (CAP Online 2012). Founded in 1974, BA is part of the One World airline alliance and operates from two airport terminals (Heathrow Airport and Gatwick Airport) (CAP Online 2012). The airline travels to more than 150 destinations, around the globe, and operates a fleet of more than 240 aircraft (making it the UK’s largest airline, in terms of fleet size and international travel destinations) (CAP Online 2012).

Despite its technical leadership, in the last four years, human resource challenges have mainly threatened the airline’s competitive position in the aviation industry. For example, the company has experienced several management changes that have failed to improve the airline’s competitiveness. Observers say some of these changes are unjustified and unfair to employees (Spellman 2010; CAP Online 2012). For example, managerial changes in 2009, created tension between managers and employees. Consequently, the airline experienced several strike actions during this period (Spellman 2010). These employee strikes affected the airline’s operational efficiency and financial performance. Today, the company has not been able to mend (fully) the relationship between employers and employees. Based on this problem, this paper proposes a research study to investigate the perennial strike actions at BA. Particularly, the proposed study aims to analyze job dissatisfaction among BA employees to understand this human resource challenge.

Statement and Purpose of the Problem

British Airways has received a lot of media attention for the wrong reasons. Particularly, in the last five years, several employee groups have voted to strike about several welfare problems (Spellman 2010). For example, pilots have complained of extended working hours. Similarly, flight crews have complained of poor pay. Most of these strikes have grounded the airline’s operations and threatened its competitive position in the cutthroat airline industry. Analysts have criticized the management of BA for failing to mitigate this problem (Spellman 2010). Employees have also held the same view. Particularly, BA workers have been highly dissatisfied with how their managers treat them (Spellman 2010). For example, the cabin crew claims BA’s management undervalues their worth (Spellman 2010). Similarly, passenger crews have raised concern regarding their flight safety. These accusations have compounded the organization’s human resource problems. As a reaction to employee concerns, BA managers have tried to intimidate employees by threatening to replace striking workers (Spellman 2010). Overall, the level of employee job satisfaction at the organization is low. This problem affects other aspects of organizational performance, including job performance and organisational commitment. From the extent that job satisfaction affects other aspects of BA’s organisational performance, this paper proposes a research study to understand the underlying issues informing this problem. Consequently, the findings of the proposed study could contribute to the development of a reliable framework for solving the same problem.

Research Aim

• To explain the underlying causes and solutions for job dissatisfaction at BA

Study Questions

• Why are BA employees dissatisfied with their jobs?
• Why has job dissatisfaction been a perennial problem at BA?
• What are the practical solutions for solving job dissatisfaction issues at BA?

The proposed research aims to answer the research questions, as follows:

• Poor leadership and management explain job dissatisfaction among BA employees
• The failure of BA managers to include employees in the daily running of the organization explains why job dissatisfaction has been a perennial problem in the company
• The viable solutions for improving the level of job satisfaction at BA hinge on improving the managerial attitudes of BA managers

Hypothesis

• Poor leadership and management attitudes are the main reasons for job dissatisfaction at BA

Null Hypothesis

• Poor leadership and management attitudes do not affect job dissatisfaction at BA

Significance of the Study

The findings of this study would help to demystify the human resource challenges at BA. Similarly, they would explain why, despite several efforts to solve its human resource challenges, BA managers continue to experience strike threats. Through this analogy, the findings of the proposed study would help to forge beneficial relationships between employees and managers. Through the same framework, increased cohesion between BA managers and employees would increase organizational efficiency and ease the process of achieving the organization’s goals.

Limitations of the Study

The main limitation of the proposed study stems from the proposed methodology, which suggests the use of secondary research. This approach uses self-reported data, which is difficult to verify. Therefore, the proposed research would rely on information from other researchers, at face value.

Literature Review

Organizational behavior is at the center of BA’s managerial and human resource problems. Nelson & Quick (2008) say organizational behaviours refer to personal and group dynamics that characterize employee-employer relationships. This section of the paper uses the organisational behavior framework to analyze how the leadership and management styles of BA affect job satisfaction in the organization. This literature review also analyses how the two-factor and the expectancy theories explain job dissatisfaction at BA.

Leadership and Management Styles

Many researchers say the problems facing BA stem from its leadership style. Wagner & Hollenbeck (2010) say the main leadership style at BA is the autocratic leadership style. For example, the management of BA requires most employees to comply with existing rules and policies, without question. Through this leadership style, most employer-employee relations in the organization are highly formal. Similarly, the autocratic leadership style explains the high management-employee distance in the organization and the high segmentation among different organizational functions. Some analysts say the formal structure of the organization partially explains why the organization has experienced several human resource problems (Wagner & Hollenbeck 2010). Relative to this assertion, Nelson & Quick (2008) say many employees want to work in an organization that allows free interaction among employers and employees.

Some researchers also say depersonalization is another issue that contributes to the organization’s human resource challenges (Schermerhorn 2011). For example, BA’s “tall” hierarchical structure has contributed to the depersonalization of workers (it leaves little room for employees to contribute to the organization’s decision-making process). Instead, the company’s management requires workers to implement their wishes without question (Schermerhorn 2011). Wagner & Hollenbeck (2010) say BA’s management does not allow employee inputs, even when solving employee welfare issues. Therefore, there is a high rate of centralization of managerial powers in the organization. Furthermore, there is a low incidence of mutual relationship (between employers and employees) in the organization (the delegation of authority in the organization is almost nonexistent).

At a managerial level, Schermerhorn (2011) says there is a high level of employee neglect. Workers have always protested this situation through strike threats and go-slows (Spellman 2010). Schermerhorn (2011) believes that, partially, this problem stems from employee appraisal programs. For example, BA’s management recognizes personal successes without considering the influence of employee contributions towards similar efforts. This way, many employees feel unappreciated.

Two-Factor Theory

The two-factor theory explains why employees often experience job satisfaction and dissatisfaction. Based on the work of Fredrick Herzberg, the theory suggests that one set of workplace processes cause job satisfaction, while a different set of workplace processes cause job dissatisfaction (Miner 2005). Through this analogy, the theory postulates that job satisfaction and dissatisfaction are independent of one another (Miner 2005). Some researchers have used the two-factor theory to explain why BA’s employees experience job dissatisfaction (Nelson & Quick 2008). For example, the theory explains why BA’s autocratic leadership style contributes to employee job dissatisfaction. This view stems from studies conducted by Herzberg, which showed that autocratic leadership styles often lead to job dissatisfaction (Miner 2005).

The high levels of supervision and tall hierarchical structure at BA outline elements of the autocratic leadership style that lead to job dissatisfaction (Nelson & Quick 2008). For example, the theory explains that most employees are likely to develop job dissatisfaction if they complete organizational tasks because the managers require them to do so (Miner 2005). However, the likelihood of experiencing job satisfaction if they complete organizational tasks that they like to do is high (Miner 2005). The two-factor theory has also highlighted the role played by highly formalized organisational structures in contributing to job dissatisfaction. This relationship stems from the theory’s link between strict organisational policies and job dissatisfaction.

Employee Motivation

Miner (2005) says motivated employees are usually highly satisfied with their work. Different aspects of BA’s management and governance affect employee motivation. For example, communication strategies and decision-making processes affect employee motivation. Nelson & Quick (2008) affirm that BA employees experience a low motivation level because of the highly centralized decision-making structure of the organization. However, it is difficult to see (openly) this limitation because, on the surface, the managers of BA seem to give their employees a lot of room to innovate and be creative about their organizational tasks.

However, the organization’s board of directors has to approve any outcomes that may arise from this process (CAP Online 2012). CAP Online (2012) says this precondition stems from a management’s belief that standardizing employee innovations would improve the organization’s efficiency. This precondition affects the motivational levels of employees because they have to surpass their creativity and convince the management board about the importance of their innovations. Robbins (2005) believes that this requirement “dampens” the spirit of innovation because workers have to conform to traditional management principles that leave little room for intellectual innovation. Therefore, employees suffer from low motivation in this regard.

The high focus on business needs, as opposed to social needs, also affects the level of employee motivation at BA. Managers have always given priority to meeting business needs (before employee needs) by requiring employees to sacrifice their time for purposes of business prosperity (CAP Online 2012). Consequently, employees sacrifice a lot of their “spare time” for work. Usually, BA’s management fails to recognize these efforts by failing to provide any “out of the box” incentive, or appreciation, for the employees to continue doing the same. Consequently, employees develop low levels of motivation and job satisfaction.

Researchers have also highlighted the nature of work design as a significant contributor to job dissatisfaction at BA (CAP Online 2012). Particularly, they highlight the failure by the managers of BA to allocate specialised duties to skilled employees (CAP Online, 2012). Therefore, employees in the organization fail to perform the organizational tasks that they understand. This situation creates low motivation levels for the employees (especially those who feel their competencies are under-utilized). Consequently, their low morale contributes to lower levels of job satisfaction in the organization. The failures to allocate work roles and duties to trained employees also compound this problem.

Expectancy Theory

Researchers have used the expectancy theory to explain the low motivational levels at BA (Nelson & Quick 2008). The expectancy theory explains that most employees choose their behaviors, based on their outcomes (Miner 2005). At the center of this theory is the benefit of adopting a particular behaviour. This theory significantly affects organizational behavior because it encourages managers to focus more on performance as a motivational factor for employees (Miner 2005).

The expectancy theory explains the human resource challenges at BA because it shows how the lack of tangible outcomes in workplace processes affects employee morale. Nelson & Quick (2008) believe that the lack of congruence between employee inputs and organizational goals partially explain this problem. The failure of BA’s management to include employees in the decision-making process of the organization also offers no “expectancy” for the employees. Therefore, they develop low morale. Comparatively, if the management allowed the employees to set their goals, they would be more motivated to accomplish them (thereby improving their job satisfaction). Miner (2005) affirms this fact when he says the separation of decision-making processes from employees would hurt their motivation levels. Nelson & Quick (2008) further explore the mismatch between performance and effort, at BA, by saying the poor work design between employee skills and employee roles creates a greater divide between employee performance and employee efforts. Stated differently, employees do not need to increase their productivity if their organizational tasks do not fit their skills.

Summary

The theoretical conception of job dissatisfaction at BA highlights leadership and management challenges as causes of its human resource challenges. Motivational theories also support some of these findings. However, this theoretical framework fails to explain the solutions that the managers of BA could use to mitigate this problem. Therefore, the proposed study would dig deeper into the underlying issues affecting employee dissatisfaction and formulate possible solutions. The study would also explain why job dissatisfaction has been a perennial problem in the organization. Moreover, the interconnection between job satisfaction and other elements of employee welfare, such as employee motivation, would also suffice in the same analogy.

Methodology

Research Design

The proposed research approach would be an action research. This is a collaborative research approach that investigates and solves issues between a researcher and a client (Patel 2005). Therefore, besides generating new knowledge, it also provides solutions for the same problems. The diagram below shows the structure of this approach

Within the above framework, the proposed study would mainly use a mixed research design for analysing the research problem. This design uses quantitative and qualitative research approaches. The mixed research design would be beneficial to the proposed research because it provides a framework for using multiple methods for solving the research problem. Its main weakness would be reconciling the discrepancies that may arise from using different types of research data.

Data Collection/Instruments

The main data collection method for the proposed study would be secondary research. Secondary researches analyse materials from past research studies. The main sources of secondary information would be books, journals, government websites, and business publications (the scope of these sources of information may expand through the research process). The researchers would obtain these sources from online libraries, school libraries, and similar facilities. The main advantages of using this approach are the time and cost effectiveness of secondary research. Similarly, this research method helps to gather extensive data regarding the research issue. Data inaccuracy, time lag issues, and propriety issues are some disadvantages associated with this method.

Data Analysis/Statistical Procedures

The data analysis process would mainly involve the coding technique.

The four basic steps outlined below show its processes

Step 1

The data analysis process would start by contextualising the research sources. Mainly, this process would evaluate the publication history of the secondary research sources and evaluate how they fit within the research framework. Broadly, this step would ascertain how the research sources fit into the scope of the research topic.

Step 2

The second stage of data analysis outlines the start of the coding process. This process involves allocating research attributes to pieces of information that have the same contents, or address the same issues. However, the proposed study would assign such attributes, based on unique themes of analysis. Every theme should have a special code of analysis.

Step 3

The third step of the data analysis process analyses the text structures of the coded themes. The main aim of this process is investigating if thematic analyses overlap one another. Later, this process would provide an overview of how every theme answers the research questions (guides the emerging arguments).

Step 4

The last step of the data analysis process involves examining the discursive statements that would arise from the data analysis process. Mainly, it would establish the validity and reliability of the discursive statements. The same analogy should provide enough grounds for the construction of the study’s findings.

Limitations of the Study

The main limitation of the proposed study would be its “indicative” nature. Certainly, because the research does not involve an empirical analysis, its findings only outline the possible issues that affect BA. Therefore, the possibility of deviances between the real and “indicative” outcomes of the research process is real.

Possible Research Problems

The main research problem that could suffice in the proposed study includes the lack of updated research information, which appeals to the research issues. For example, some of the information available could relate to human resource issues that BA’s management solved. To overcome this challenge, the proposed study would ensure the information used in the paper is current and relevant to the scope of study.

Proposed Research Schedule

References

Miner, J 2005, Organizational Behaviour: Essential theories of motivation and leadership, M.E. Sharpe, Armonk.

Nelson, D & Quick, J 2008, Understanding Organisational Behaviour, Thomson/South-Western, Mason.

Patel, S 2005, Research Methods for Organizational Studies, Web.

Robbins, S 2005, Organisational Behaviour, Pearson Education, Upper Saddle River.

Schermerhorn, J 2011, Organisational Behaviour, John Wiley, Hoboken.

CAP Online 2012, British Airways New Identity, Web.

Spellman, R 2010, A Flying Shame for British Airways, Web.

Wagner, J & Hollenbeck, J 2010, Organisational Behaviour: Securing Competitive Advantage, Routledge, New York.

Introduction

This case is about changing culture at British Airways since 1980s to around 2000. Before the change, the organization was reporting losses year after year due to poor market perception as a result of bad organization image. The case outlines problems the organization underwent through late 1970s and early 1980s.

The case also outlines the changes the company undertook to deal with the problems they encountered. In real sense, the company needed change to improve its financial strength apart from convincing the workforce about the significance of customer service to ensure good market perception.

In addition, the company underwent culture change because the management wanted to come up with a strategy that will ensure maintenance of momentum as well as recapturing the focus that will enable the company to deal with different challenges it was facing like the 1981 crisis.

Moreover, the company was undertaking cultural changes because the British government had announced the plan of privatizing through sale of shares. As a result, the organization was trying as much as possible to ensure that it attract potential public investors willing to buy shares at a better price.

Moreover, the operation cost of the company was too high. This is because the company had a very large number of employees due to their poor market prediction. The company had anticipated their passenger volume to increase which required large staff to ensure efficient and effective production. Instead, the passenger volume decreased by around 4 percent. As a result, there was need to change the company culture.

Moreover, the operations costs were high because of increased fuel costs. High fuel costs were as a result of diverse as well as aging fleets. In total, change was necessary to ensure that the above named factors are dealt with to ensure that by the time privatization takes place, the potential investors will be embraced with the ailing airline company.

Due to the fact that British Airline was facing productivity problems, there was need for change. As a result, for the company to increase its production there was need for culture change. There production percent compared to other foreign airline production was 59% which was the highest ever production the company had ever reached. This is just an average to other competitive airlines. Apart from productivity, customer service was also suffering. As a result, there was need for the company to undergo changes.

Diagnosing the Problems and Analyzing the case

Challenges of Change Management

In dealing with inefficiency and inconveniences, the British Overseas Airways Corporation (BOAC) merged with British European airways (BEA). The merger was to be controlled by British Airways board. Though it was assumed that the board was controlling the merger policies, in real sense, BOAC and BEA were still operating as individual entities. This is because; every corporation had its own chairperson, board as well as chief executive officer.

Though Sir Frank tried to create a functional division to ensure that the two groups are integrated into a single board, still there existed divisions within British Airways. These divisions were due to differences in company culture. BEA’s culture concentrated more on factors that did not exist. For instance, BEA was concentrating more on building airline infrastructure, other than concentrating on profits. They were concentrating more on opening stations and looking for networks to work.

However, the problem was that they were doing nothing to align their market with their expansion strategies. On the other hand, BOAC was concentrating more on technological advancements like initiating jet passenger services. However, such innovations were costing the company a lot of money, hence the company ended up facing financial problems.

The merger also lacked economy of scale as well as residual loyalties to increase efficiency. This is because the opportunity of getting consolidated economy of scale benefits were squandered by distinctions in the merger. Though they were operating under the same umbrella, the merger was being operated by two distinct organizations.

Due to this distinction, the merger was incurring high costs to sustain this structure. In general, the process of merging the two airlines ended up creating “a hybrid racked with management demarcation squabbles” (Campbell-smith 10).

Due to lack of a unifying corporate culture, the competitive advantage that led to the merger ended up being defeated hence rendered hopeless. Most of the time that would have been used in managing change, was being wasted in resolving industrial relation as well as organizational conflict issues. As a result, there was no time to unify the two cultures.

These issues are supported by Ravenscraft & Scherer 55 who argued that controlling diverse values, believes and preferences in a merger is not easy since nobody will be ready to do it. This has been the real problem in ensuring that culture in merged firms is productive. This is mainly as a result of both powerful and influential individuals in the two organizations taking strong stands and running their own bit of affairs.

In addition, merging may make employees divert their attentions due to their concern on the position they are holding by the time of merging. They will question their prosperity, their role, company profits and loses. As a result, potential employees might start looking for jobs in other places.

Zatz par 4 adds that, merging is very demoralizing. This is particularly when communication from the management is inefficient hence delivering misleading information. As a result, people might just spread rumors as well as spending a lot of time on change at the expense of productivity.

According to Ravenscraft & Scherer 64, power relationships might also face some difficulties during firm merging. This is based on the fact that, coming up with a true power sharing in a merger is very difficult, as a result in most mergers one side usually dominate the other.

Other problems emerged as a result of government support by reinforcing operational culture. This is because, the company managers ended up neglecting their increasing inefficiencies. This is because the government was encouraging a monopolistic market, by favoring them.

As a result, managers failed to carry out their responsibilities to the later to improve their efficiencies. According to Fairburn & Kay 46, a monopolistic market does not encourage creativity and innovation to increase product quality. As a result, products from British Airline were of poor quality.

The company used employee retrenchment as a means of reducing operation costs. Though the company wanted to accomplish this process through volunteer-ship, the problem is that the company ended up receiving more volunteers than required. As a result, the company ended up spending more on this process. In addition the company lost potential employees to other airlines.

The company also launched Manhattan Landing campaign and carrying out extensive marketing. During its launch, every employ was invited in a celebration. This acted as a get together party for employees which according (Corke 82) the aim was to motivate employees and building team work. Though the company managed to brighten their brand, the company incurred huge expenses.

BA also encouraged quality customer service; this was a very good culture that encouraged ‘putting people first.’ As a result, employees were taken to training programs to encourage participation of employees in this new culture. Despite of all these changes and improvements, the company still faced change and institutionalization problems. This is because, there was stiff competition and higher operation costs impeded cultural change in the organization.

The company experienced a drift towards higher salary rates. Another challenge as a result of change in British Airways was balancing cost reduction and customer service delivery. In most cases, increasing customer service quality usually calls for increased costs. This is in line with Kotter & Cohen 98 argument that customer satisfaction calls for intensive research, qualified employees among other things, which in total increases the company operation costs.

Enablers of Change

Board’s and management’s commitments; if board members along with top managers can involve themselves at every stage of change, then change will succeed. In addition, board members and top managers should articulate the advantages of change to the company. Their commitment is very significant because it motivates employees by providing momentum during low seasons apart from increasing the chance of a change that will be everlasting.

Prior experience; according to Daryl 67, promoting change in an organization entails a lot of complex dealings. Those organizations which have handled change in previous years are aware of commitments, time and personnel required for successful change. Organizations should know that enhancing change is a process that requires setting realistic objectives along with expectations.

Evaluation and planning; effective written plans for achieving positive change in an organization originate from careful evaluation of current staff, policies and board presentation as they relate to change. It is even good for the company to come up with framework outlining change processes by examining areas that need change, apart from developing a plan of change that can be embraced by the organization as a goal that can be achieved.

Assigned staff members; good leadership and continuity are important elements of any successful change. It is true that there are specific people in an organization who should play a role of change coordination as well as overseeing all phases involved in the process of organization change.

It is not a must that the change coordinator has to be company manager, but the coordinator should receive support from the top management as well as the board. The duties of change coordinators should also be described in the job description of this person. As a result, it should be considered just like other responsibilities of this person (Daryl 67).

Change committee; this committee should be able to take the task-oriented approaches to plan and implement change initiatives. Every committee member should be in a position of playing a catalytic role by advocating change within their respective departments. This committee should also advise the change coordinator, sharing the workloads as well as assuming power and authoritative positions when making recommendations to top managers as well as directors.

Broad involvement; Kotter, & Cohen 78 argued that opportunities of becoming a change committee member should be given to everyone in the company. This will be very effective in the process of creating a sense of ownership as well as commitment to change process and its outcomes. To ensure this, the committee should be made up of individuals from diversified sections of employees and at least a board member.

However, the members should not serve in the board for a very long time, there should be rules and regulations governing the number of years or month a member should be in the change committee. This is because, if members remain in the committee for long, there are possibilities that burnouts will start occurring and the committee will not remain intact particularly when personnel turnover is happening.

Consultancy; for effective change to happen, consultancy must be in line with the organization’s plan and implementation of change. Moreover, consultants usually bring efficiency as well as objectivity to change efforts by being responsible for associated roles. These roles include carrying out organization change assessment and evaluation.

Resources; the organization’s management should be having a will to allocate resources like money, to ensure that change initiatives have succeeded. Moreover, realistic plans are required to consider staff time for change committee meetings, organization activities as well as the responsibility of change coordinator.

Training; employees as well as board members should be trained to acquaint them with various needs along with issues involved in change. There should be an exploration of diversity among individuals during training to ensure greater understanding of change issues, hence improving staff interaction along with prompt attitudes as well as behaviors (Daryl 67).

Effective communication; this is a vehicle of delivering timely and proper information flow within the organization. In addition, it allows change committee to receive timely and proper feedbacks.

Blocks of Change

Unsuitable consultants; in case of improper alignment between consultants and the organization goals and culture, the consultancy will end up being weak. Individuals having no experience or even inappropriate skills will make change initiative a failed process. Moreover, overdependence on consultancy might diminish the organization’s powers and ownership of change process.

Complexity in the organization; the issue of involving employees has been very difficult particularly in large organizations, having many employees playing different roles and in different settings. In addition, getting such employees to involve them particularly in the change committees can be very challenging. This is because most of them have no time to attend meetings (Daryl 89).

Another block to change is resistance; this usually occurs when employees and other individuals feel that their powers and privileges are being threatened by change. Identifying the areas of resistance, addressing fears and issues of their origin is very critical. In case this is not resolved then resistance has the ability to affect true change within the company.

Turnover; this has the ability of creating a challenge of familiarizing with the new changes. As a result, securing the support of such people in change can be very difficult.

Poorly planned training; this can create more problems as to what they can produce as solutions. Sessions undertaken under large groups can lead to counter-productivity in case difficult issues have been raised and no follow-ups, feedbacks along with resolutions of such issues.

In addition, change training based mainly on the identification of oppression of one group other than putting the entire organization into consideration, might end up leading to division and confusion that in one way or the other will lead to resisting change. (Daryl 70).

Financial constrains; budgetary allocations as well as conflicts over limited resources can create lots of frictions along with morale loss. Moreover, employees might doubt the significance of change in case the organization faces financial constrains.

Unions; in case the union opinions have not been incorporated in the change plan or change efforts, particularly when it comes to matters concerning personnel practices and policies it might be very difficult. In case employees are represented by unions, union’s officials have to be included in the change discussion process so that agreements are based on collective bargaining grounds.

Recommendations

How to Manage Change in an Organization

During change, the company should ensure that it has instilled customer’s opinions apart from concentrating on customer’s demands. In managing challenges of change, organization has to be ready to gain competitive advantage by understanding customer’s needs and wants.

In achieving this, the organization should ensure that employees are spending most of their time thinking about innovative and creative ways of meeting customer’s demands, instead of thinking about the next client or their positions in the company. This will be effective in dealing with issues in a merger. According to adamssixsigma.com par 4 this strategy of letting employees to concentrate on client satisfaction helps much in managing change as employees will not feel that change has oppressed them.

Another strategy is to increase change capacity. To achieve this, managers should be in a position to align the company’s activities towards one goal. Kotter, 89 supported this notion by adding that, in case proper alignments have been done by managers, then organization’s structures and systems will move swiftly during and after change.

However, to ensure that change capacity continues for a very long time, both top managers and board of directors have to be flexible. This is because, they should continue learning as well as adopting new knowledge and skills as time goes.

Changing organization hardware as well as software; hardware includes things like organization strategies, systems as well as structures, while software refers to things like employees’ behaviors. As a result, in managing change, managers should not only look at change strategies and structures but they should also consider employee behavior, encouragement as well as changing employee mindsets. Managers intending to manage change effectively have to create new mindsets that employees, clients as well as suppliers will share.

Another strategy to manage change is by empowering employees to act as leaders at all organization levels. This means that every employee is responsible and accountable to all activities taking place in the organization. To manage change effectively, employees ought to be empowered and trusted in a manner that they are in a position of dealing with issues that might affect change. As leaders, employees should be allowed to communicate their views about change.

According to Kotter & Cohen 78 this will enhance a sense of ownership of change among employees. Moreover, managers should try to instill change amongst employees. This is what Kotter & Cohen 78 explains as letting the employees to understand the need and benefits of change.

According to adamssixsigma.com par 3, employee involvement is a very important step in managing change. Managers should not take change process as being one way, feedbacks from different employees is a very integral part of change management process. In addition, analyzing and making corrective measures depending on the feedback provided helps in providing robust cycles of change implementation.

Handling Change Management

Start by bureaucracy bashing, which involves removal of backloads that might hinder the change process. This may be achieved by eliminating processes that might consume a lot of energy but result to frustrations.

Empowering employees is another way of managing change process. Managers should encourage open communication apart from involving employees in the change process. Without dialogue, though costs might be reduced and productivity increased but change process will not last for a longer time. The environment should provide chances to a system where every employee is involved in the change process.

According to Kotter & Cohen 100 though managers might communicate clearly to their employees, employees might not understand the message. This is because, understanding the message depends on several factors. To ensure effective communication, managers should allow the audience, when to say and what to say. As a result, the change committee should design communication plans that encompass the employee, supervisor and executive needs.

To manage change process, there should be continuous improvements. This involves translating initial change commitments, into long term process to ensure that employees are not just followers but part of change. To achieve this, (Kotter 67) suggests that, coaching and training for change management should be enhanced. Managers and supervisors should be acquainted with different ways of motivating employees to change.

However, supervisors are the most difficult group to convince the need to make changes; hence most of them have been acting as a resistance source. Moreover, training should be conducted to ensure that employees have developed skills and knowledge required for change to happen, apart from building change leadership.

Recognizing success as well as celebrating early wins is the best strategy to manage change process. The organization should be in a position to recognize individuals and groups which have attained change.

This is very helpful particularly in cementing as well as reinforcing organization change. Nevertheless, after-action-review is also a very significant way of managing change process. As a result, the management should look at the entire change process, evaluate its success as well as failures and identify process change for the next step.

Works Cited

Adamssixsigma.com. Change Management and Effectively Managing Change, 2011. Web.

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