Business Essays - British Airways Transportation

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British Airways Transportation

Strategic Management of British Airways Company

Introduction

Transportation plays an essential role to the success of many businesses and organizations. Without efficient transportation, many supplies and raw materials will not be brought from one place to another. It has been reported that humans have always needed to get around from place to place, making the act of walking a limitation on the distance traveled and the things they could carry. Consider the innovations that help humans travel around and transport cargo, including automobiles, ships, and airplanes (‘Transportation’ 2006). Through these innovations, humans were able to effectively and efficiently move from one place to the next with the convenience of bringing luggage and cargo.

Today, through transportation, humans were able to make trade relations with one another. Many business organizations make it a point to travel to different cities and countries to promote their products and services. Traveling and promotion are now part of an organization’s strategic management. From this, airlines play a major importance in the success of business organizations around the world. Business organizations are able to widen their market by traveling to different places via the airlines. Their importance leads us to evaluate their strategies in dealing with their business. This paper aims to discuss the strategic management of a specific airline company and assess its effectiveness in the business.

British Airways Airline Company

It has been reported that the British Airways is the largest airline of the United Kingdom and one of the largest in the world, with more flights from Europe across the Atlantic than any other operator (‘British Airways’ 2006a). British Airways flies to over 550 destinations and to more than 130 countries worldwide, including London, major European centers such as Paris and Frankfurt, and Asian hubs like Hong Kong, Singapore and Bangkok (‘British Airways – Fly to London and the World’ 2005).

This airline is synonymous with excellent service and quality and has always been regarded as a leader in the airline industry, and serves more than 35 million passengers annually. Its history traces back to 1924 when the five small British independent airlines merged under state guidance to form Imperial Airways. At present, British Airways operates out of London’s two main ports, namely Heathrow, which is the world’s largest international airport, and Gatwick (‘British Airways – Fly to London and the World’ 2005).

For its travel classes, the British Airways offers four cabins. The first cabin is complete with fully flat seats, each in its own cocoon-style area with a seat for a companion to join the passenger for meals or for a chat. The second cabin is called the Club World, having flat bed sleeper seats. The third cabin is the World Traveller Plus, a premium economy services, offering more room in-flight and dedicated check-in desks, and the last cabin is the World Traveller, which is the airline’s economy, or coach class (‘British Airways’ 2006c).

Strategy Review of the British Airways

Strategic management is that set of managerial decisions and actions that determines the long-run performance of a corporation, and includes aspects such as environmental scanning, strategy formulation, strategy implementation, and evaluation and control (‘Strategic Management’ 2006). Strategic management is important for every business, as it determines its success in the market, in its formulation and implementation of projects. One of the strategies of airlines is alliances or merges.

Alliancing in airline industry seems persistent, as every international airline is forging alliances of some form, which can be traced as far back as the 1940s (Vaara, Kleymann and Seristo 2004). From a strategic perspective, airline alliances have become an inherent part of the task environment of airlines (cited in Vaara, Kleymann and Seristo 2004). Alliances are beneficial for airlines in its control and maintenance on the business. Similarly, this strategy was adopted by the British Airways for better service. On March 31, 1924, Britain’s four airlines, namely, Instone, Handley Page, Daimler Airways, and British Air Marine Navigation merged to form Imperial Airways (‘British Airways’ 2006b).

However, during this time a number of smaller UK airline companies had started their operations, so in 1935, these airlines merged to form the original privately owned British Airways Ltd. The British Government in 1939 nationalized the airlines and after the Second World War, the airlines were combined to form the British Airways in 1974 (‘British Airways’ 2006b). The driving factor behind alliances is long-term profitability, and their formation tends to be for strategic reasons, such as accessing larger markets, establishing global brand loyalty and building hub-to-hub traffic (‘Airline Alliances’ 1998).

This move is advantageous for the airline to service more passengers and establish market reputation. Alliances or merges are part their strategic management plan, as being part of the strategy formulation and implementation. Strategy formulation and implementation is an on-going, never-ending, integrated process requiring continuous reassessment and reformation, is dynamic, and involves a complex pattern of actions and reactions (‘Strategic Management’ 2006). Being dynamic, airlines tend to always innovate and improve their actions to further enhance the quality of their service.

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