https://research-methodology.net Necessary knowledge to conduct a business research Sat, 19 Aug 2023 12:21:21 +0000 en-US hourly 1 https://rm-15da4.kxcdn.com/wp-content/uploads/2020/08/cropped-logoBRM-32x32.jpg https://research-methodology.net 32 32 https://research-methodology.net/british-airways-csr-overview/ Tue, 21 Jun 2016 00:38:15 +0000 http://research-methodology.net/?p=7864 British Airways CSR programs focuses on the following three core areas: Climate Action Noise and Air Quality Resource Management British Airways SCR strategy relies on four primary risk management criteria when measuring the impacts of environmental risks of business operations: Risk impact Probability Velocity Timeframe British Airways Corporate Responsibility Committee chaired by non-executive director – Gavin Patterson deals with the issues of sustainability and it is composed as illustrated in figure below: Structure of British Airways Corporate Responsibility Committee The company releases Environmental Performance Report annually and it includes the details of CSR programs and initiatives engaged by the company. Table 3 below illustrates highlights from the latest report for 2015: Categories of CSR activities British Airways Performance Supporting local  communities The airline is committed to minimizing the noise impact on local communities. British Airways is working towards an overall reduction in average noise per flight by 15 per cent by 2018 compared to 2008 Educating and empowering workers The company has  world class training academy full-scale cabin mock-ups, door simulators, a fire-ground and full height evacuation slides British Airways’ Community Learning Centre has welcomed around 100,000 people since opening in 1999 Labour and human rights The airline’s potential suppliers are required to complete Corporate Social Responsibility (CSR) questionnaire. This insures that their working conditions complies with International Labour Organisation standards Employee health and safety The airline’s Safety Committee systematically ensures that appropriate safety resources and procedures are in place Gender equality and minorities No relevant information found Environment a) energy consumption b) water consumption c) recycling d) CO2 emissions     British Airways is striving for 20 per cent reduction in energy usage by 2020 compared to 2013 No relevant information found British Airways aims to achieve 60 per cent recycling by 2015 at its main bases of Heathrow…]]> https://research-methodology.net/british-airways-mckinsey-7s-model/ Mon, 20 Jun 2016 00:32:10 +0000 http://research-methodology.net/?p=7861 British Airways McKinsey 7S framework illustrates how seven individual elements of the airline business are aligned to increase the overall effectiveness of the business. McKinsey 7S divides elements into hard and soft groups. Strategy, structure and systems represent are considered as hard elements, whereas shared values, skills, style and staff represent soft elements. As it is illustrated in the figure below, shared values are positioned at the core of British Airways McKinsey 7S framework, since shared values guide employee behaviour with implications in their performance. British Airways McKinsey 7S Framework Hard Elements Strategy. British Airways pursues the business strategy of service differentiation. Specifically, the airline differentiates its services via an extensive reliance on digitalization and information technology and a high level of customization of service provision. An aggressive international market expansion is another important element of British Airways business strategy and in 2016 alone the airline company is expected to fly to more than a dozen new routes.[1] Structure. British Airways is owned by International Airline Group (IAG), the largest airline group in Europe that also owns Iberia, Vueling and Aer Lingus. British Airways organizational structure is hierarchical reflecting the large size of the business. The new CEO Alex Cruz is expected to introduce de-layering initiatives into British Airways organizational structure as a part of his wide-scale cost-cutting measures. Systems. Apart from the standard set of organizational systems such as employee recruitment and selection system, performance appraisals system, quality control system, complaint handling system and others, British Airways also maintains a number of industry-specific systems. These include, but not limited to passenger check-in system, baggage handling system, in-flight entertainment system and others. British Airways Report contains a detailed discussion of British Airways McKinsey 7S framework. The report also illustrates the application of the major analytical strategic frameworks in business studies such…]]> https://research-methodology.net/british-airways-porters-five-forces-analysis/ Sun, 19 Jun 2016 00:29:30 +0000 http://research-methodology.net/?p=7857 British Airways Porter’s Five forces analysis is an analytical framework developed by Michael Porter (1979)[1]. The framework distinguishes between five individual forces that shape the overall extent of competition in the industry and studies them. These forces are represented in Figure 1 below: Figure 1 British Airways Porter’s Five Forces Threat of substitute services for an airline is not significant. It has to be clarified that although there is a substitution for air travel, represented by other modes of transportation such as vehicles and sea transports, air travel remains as the fastest form of travel. From this point of view, it can be argued that there is no substitution to airplanes to travel thousands of miles in a matter of few hours. At the same time, rapidly developing internet-based information and communication technologies represent indirect substitution for air travel. For example, an intensive development of communication technologies during the last decade presented the opportunities of real-life video conferencing, thus eliminating the necessity for long-distance travels for business and other meetings. Threat of new entrants into the airline industry is low. Major capital requirements is one of the most significant barriers for new market entrants. As it is illustrated in Figure 2 below, the cost of Boeing aircrafts, one of the most popular airplane brands, can reach USD 400 million and there are no aircraft from reputable manufacturers with a price tag of less than USD 70 million. Figure 2 Average prices for Boeing aircraft in 2015, by type (in million U.S. dollars)[2] Lack of access to distribution channels represents another significant barrier for new market entrants into the airline since. This is because it may prove to be difficult to find free slots and runways in the major international airports such as Heathrow Airport in UK and JFK airport in…]]> https://research-methodology.net/british-airways-marketing-communication-mix/ Sat, 18 Jun 2016 00:16:58 +0000 http://research-methodology.net/?p=7853 British Airways marketing communication mix integrates the elements of print and media advertising, sales promotions, events and experiences, public relations and direct marketing in the manners discussed below. Advertising British Airways uses print and media advertising as an important part of its marketing strategy. In one of the most notable cases, in January 5, 2016, the airline took over all of the advertising space in popular Time Out London travel magazine as part of an ambitious marketing campaign.[1] British Airways television ads are marked with appeal to basic and important human emotions such as love, kindness and excitement. For example, ‘Fuelled by Love’ video clip advertisement directed by Neeraj Ghaywan tells the tale of Helena Flynn, a flight attendant who falls in love with India. “The ad is full of small moments of human kindness—from helping an old woman put on her socks to inviting a stewardess in a strange land into your home and heart”[2] Importantly, British Airways also sells its own advertising space on its online and offline platforms.  The airline’s online advertising platform is its official website ba.com, whereas offline advertising platforms include traveller boarding passes and advertising spaces in 54 British Airways lounges worldwide. Moreover, viral marketing is being increasingly integrated into British Airways marketing strategy. The airline frequently taps into the sentimentality of many expatriates’ desires to visit their faraway homelands and families[3]. Successful viral marketing campaigns ‘Visit Mum’ and ‘The Welcome of Home’ can be mentioned to justify this point. Sales Promotion British Airways uses sales promotions during festive seasons and other occasions. Specifically, the airline uses the following forms of sales promotions: 1. Money off coupons. Various vendors, travel companies and websites such as retailmenot.com, coupons.com, couponcabin.com and fyvor.com offer discount coupons for British Airways travel tickets. However, British Airways does not offer…]]> https://research-methodology.net/british-airways-7ps-of-marketing/ Fri, 17 Jun 2016 00:09:10 +0000 http://research-methodology.net/?p=7850 British Airways 7Ps of marketing integrates important elements of the marketing mix that need to be addressed by marketing managers taking into account taking into account the characteristics of the target customer segment. The most important elements of the marketing mix that consists of product, place, price, promotion, process, people and physical evidence. In January 2015 British Airways announced that “will split its marketing department and bring the unit closer to its commercial operations as part of a major restructure”.[1] Product. British Airways offers airline services of a premium segment. A high level of service customization and the abundance of choice is one of the core advantages of the airline’s competitive advantage. For example, in the World Traveller cabin, customers can choose from a wide range of  Taste of the Far East’, ‘Gourmet Dining’, ‘Taste of Britain’, ‘Great British Breakfast’, ‘Healthy Choice’ and ‘Vegetarian Kitchen’.[2] Moreover, the airline’s service provision is associated with a high level of digitization and an extensive integration of information technology. For example, in 2015 British Airways launched its app for the Apple watch. A simple swipe opens the British Airways app, which was re-designed to fit the Apple Watch screen. It then displays a summary of the customer’s next flight, the flight number, route, departure time, flight status, a countdown to the departure time and the weather at the destination.[3] Place. British Airways flies to more than 400 destinations worldwide and it has the greatest presence in Heathrow, Gatwick and London City airports. British Airways utilizes online sales channel to sell its tickets and air tickers can also be purchased offline via sales agents and other intermediaries. The range of sales support measures offered by the airline include the possibility to hold flights and the price for up to 72 hours after the booking. Price. British…]]> https://research-methodology.net/british-airways-pestel-analysis/ Thu, 16 Jun 2016 00:30:46 +0000 http://research-methodology.net/?p=7846 The acronym PESTEL stands for political, economic, social, technological, environmental and legal factors affecting businesses. Accordingly, British Airways PESTEL analysis involves an analysis of the impact of these external factors on the airline. Political Factors British Airways is a major international airline that flies to more than 400 destinations worldwide. Political stability and the perception of safety by the population is an important political factor that has a tremendous impact on British Airways. A stark illustration of this claim may refer to terrorist attacks at Brussels airport in March 2016, which caused the decline of IAG share price, British Airways’ parent company by 1.5 per cent[1]. Moreover, recently the airline found itself to be engaged in a political debate for demanding a third runway at Heathrow airport from the UK government. Specifically, “the boss of British Airways has warned he could seek to expand the airline overseas if the Government “twiddles its thumbs” over a third runway at Heathrow”[2] Generally, apart from political stability, a wide range of political factors affecting British Airways include the level of bureaucracy, the extent of corruption, home market lobbying activities, activities of trade unions and others. Activities of trade unions in particular have proved to be a major factor affecting the airline to a considerable extent during the past years. Economic Factors Certain economic factors such as the inflation rate, currency exchange rates and the overall economic climate in the UK has direct and important implications on British Airways performance. The cost of fuel is another significant economic factor for British Airways, since the Group used approximately 5.7 million tonnes of jet fuel in 2015 only.[3] For example, in 2015, British Airways expenses on fuel decreased by £484 million, or 13.8 per cent compared to the previous year despite the increasing scope of operations[4].…]]> https://research-methodology.net/british-airways-swot-analysis/ Wed, 15 Jun 2016 00:17:33 +0000 http://research-methodology.net/?p=7841 British Airways SWOT analysis is a strategic analytical tool that facilitates the analysis of strengths, weaknesses, opportunities and threats related to the business. The following table illustrates British Airways SWOT analysis: Strengths 1.      Economies of scale due to its large size 2.      Strong brand image 3.      Market leadership in the UK 4.      High level of service digitalization and effective integration of IT and internet Weaknesses 1.      Overdependence on the UK market 2.      Low return on invested capital (ROIC) 3.      Constrained capacity of Heathrow airport 4.      Lack of experience of the new CEO Alex Cruz in leading the premium segment airline Opportunities 1.      Formation of strategic cooperation with other businesses in airline and catering industries 2.      International market expansion 3.      Benefiting from synergy via Closer integration between IAG’s operating airlines 4.      Improving relations with unions Threats 1.      Further intensification of competition 2.      Terrorist attacks 3.      Service distuptions due to employee strikes 4.      Escalation of the conflict with the UK government British Airways SWOT analysis Strengths 1. British Airways flies to more than 400 destinations worldwide and its parent company International Airline Group (IAG) also owns Iberia, Vueling and Aer Lingus airlines. Thanks to the extensive scope of its operations, the business benefits from the economies of scale to a great extent. This benefit is used to further strengthen the airlines’s competitive advantage via investments in new advanced fleets and achieving a greater personalization of service provision. 2. The airline enjoys a strong brand image. In 2016 British Airways won both the Business and Consumer Superbrands awards for the second year running – the first company ever to do so. In 2015, British Airways was named by The Sunday Times and National Geographic named as best short-haul and long-haul airline. Moreover, Independent awarded British Airways the title of best European airline, while…]]> https://research-methodology.net/british-airways-organizational-structure/ Tue, 14 Jun 2016 00:05:18 +0000 http://research-methodology.net/?p=7835 Organizational structure of a business determines the manners of which the primary objective of profit maximization is achieved. More specifically, organizational structure is the reflection of roles and tasks of employees and the scope of their contribution to the achievement of organizational objectives. British Airways is a part of International Airline Group (IAG). Along with British Airways, AIG also owns Iberia, Vueling and Aer Lingus and the airline group has the following structure: Figure 1 IAG management structure British Airways organizational structure was subjected to certain changes early in 2015. The company announced it would split its marketing team with part of the team joining the commercial department and the other forming a new customer experience team, which focuses solely on the travel experience.[1] Such a pattern of restructuring is a clear attempt to place marketing at the forefront of airline’s business strategy. The latest pattern of British Airways organizational structure before Alex Cruz took over as the new CEO from Keith Williams in April 2016 as illustrated in Figure 2 below: Figure 2 British Airways organizational structure It can be argued that British Airways organizational structure may be subjected to certain changes in the foreseeable future to reflect strategic changes to be introduced by the new CEO Alex Cruz. Specifically, “the consensus at IAG is that Cruz has done a good job at Barcelona-based Vueling, fending off budget rivals like Ryanair and EasyJet on routes around Europe”[2] and this is one of the reasons he has been appointed to lead British Airways. Accordingly, one can expect Alex Cruz will cost-cutting measures that may involve de-layering of British Airways organizational structure. British Airways Report comprises a comprehensive analysis of British Airways. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s…]]> https://research-methodology.net/british-airways-leadership/ Mon, 13 Jun 2016 00:02:23 +0000 http://research-methodology.net/?p=7831 British Airways leadership reports to International Airline Group (IAG), its parent company that also owns Aer Lingus, Iberia and Vueling. The Leadership Team is made up of the Executive Directors and other key management personnel and is responsible for the day-today running of the Group and discharging managerial responsibility. British Airways Chairman and Chief Executive Keith Williams was replaced by Vueling’s Chairman and CEO, Alex Cruz in April 2016[1]. British Airways Board of Directors comprises 10 members and each director overseas a specific aspect of the business. IAG Chief Executive Officer Willie Walsh has previously served as British Airways CEO and he had the greatest impact on the airline than any other CEO before or after him up to date. Once nicknamed as ‘Slasher Walsh’ for his relentless drive to cut costs, Willie Walsh was also known for his uncompromising stance in dealing with unions.[2] Currently, IAG leader is in a controversial dispute with the government over the lack of runways in Heathrow airport. Mr Walsh has threatened that “if the government continues to dither over a new runway, then I’ll move my business elsewhere”[3]. Moreover, British Airways leadership is faced with a complex set of challenges that include intensifying level of competition from budget airlines, increasing uncertainty in the business environment and the threat of terrorist attacks. The range of initiatives implemented or being considered by British Airways leadership to address these issues include the following: Starting charging for meals in economy class on short-haul flights[4] Reducing the scope of expansion plans following attacks in Brussels in April 2016 British Airways Report constitutes a comprehensive analysis of British Airways business strategy. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model…]]> https://research-methodology.net/british-airways-business-strategy-and-competitive-advantage/ Sun, 12 Jun 2016 00:04:42 +0000 http://research-methodology.net/?p=7827 British Airways is a premium segment airline and accordingly British Airways business strategy can be specified as service differentiation. The airline aims to generate a return on capital of a minimum 15 per cent with an operating profit margin of 12 – 15 per cent.[1] British Airways business strategy focused on service differentiation is planned to be continued in the following directions[2]:   Replacement or refurbishment of 99 per cent of wide-body aircraft by 2020 Improvement of in-flight entertainment in-seat power and the rollout of on-board WIFI Further investments in digital technologies to provide personalised, seamless service British Airways business strategy also relies in international market expansion strategy in an aggressive manner. In 2016 alone the airline company is expected to fly to more than a dozen new routes, including Biarritz in France, Mahon in Menorca and Palermo in Sicily. The airline also announced additional services from Heathrow and Gatwick to Krakow in Poland, Stockholm in Sweden, Split in Croatia, Berlin in Germany, Olbia in Sardinia and Gibraltar. British Airways competitive advantage is based on the following points: The highest standards of service with a focus on service personalization. The variety of choice is another important aspect of British Airways competitive advantage. For example, in the World Traveller cabin, customers can choose from a wide range of Taste of the Far East’, ‘Gourmet Dining’, ‘Taste of Britain’, ‘Great British Breakfast’, ‘Healthy Choice’ and ‘Vegetarian Kitchen’.[3] Focus on digitalization and increasing integration of information technology into various aspects of service provision and business processes. British Airways Report contains more detailed discussion of British Airways business strategy. The report also illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on British Airways. Moreover, the report…]]> https://research-methodology.net/british-airways-value-chain-analysis/ Sat, 11 Jun 2016 14:00:47 +0000 http://research-methodology.net/?p=374 British Airways value chain analysis involves the adoption of a systematic approach in the analysis of competitive advantage. The framework makes a distinction between primary and support business activities identifies the sources of competitive advantage for each activity. The figure below illustrates the essence of value chain analysis. Primary Activities Inbound logistics British Airways inbound logistics operations are complex and involve the timely delivery of fleet of planes, catering products and a wide range of other on-board products. The necessity to ensure the freshness of foods and drinks served during the flights further complicates British Airways inbound logistics primary activities. Competitive advantage is achieved in inbound logistics stage of the business by British Airways through establishing on-going relationships with suppliers, sophisticated system for stock control and professional training that has been accredited by UK City and Guilds.   Operations Generally, operations stage of the business involves preparing goods and services to be sold to customers. As the UK’s largest international scheduled airline, British Airways flies globally to more than 400 destinations. Therefore, the scope of its business operations is extensive. British Airways has a range of competitive advantages in operations part of the business through offering its customers increased security for their luggage, offering quick check-in services and also offering some services such as ticket bookings and online booking of other services. Moreover, a high level of customization of service provision and an extensive utilization of digital technologies in a wide range of business processes represent solid sources for additional value for British Airways.   Outbound logistics Outbound logistics involves sending ready products to customers for consumption. Although outbound logistics mainly relate to manufacturing companies, it is also applicable towards service businesses such as airlines. British Airways flies to airports in nearly 80 countries worldwide. The airline derives value in outbound…]]> https://research-methodology.net/british-airways-segmentation-targeting-positioning-2/ Sat, 11 Jun 2016 13:50:36 +0000 http://research-methodology.net/?p=7705 British Airways segmentation, targeting and positioning refer to ways in which the airline company identifies certain individuals among the general public to offer their service packages. Segmentation involves dividing population into groups according to certain characteristics, whereas targeting implies choosing specific groups identified as a result of segmentation to sell products. Positioning refers to the selection of the marketing mix the most suitable for the target customer segment. British Airways follows multi-segment concentration marketing strategy by offering four different service packages to different customer segments. Specifically, British Airways targets different customer segments for its four levels of services: economy, premium economy, executive and first class. The following table illustrates segmentation, targeting and positioning of each category of British Airways services:   Segmentation bases Target segment Economy class Premium Economy Executive Club First Class   Geographic   Region Domestic flights in UK Europe and international flights Selected international flights Europe and international flights Selected international flights Density Urban & rural Urban & rural Urban Urban           Demographic   Age Kids, teenagers, middle-aged, old-aged Teenagers, middle-aged Middle-aged, old-aged Middle-aged, old-aged Gender Male, female Income Low Middle High High Occupation Students, salaried Students, salaried Businessmen Professionals Businessmen Professionals Education High school Bachelor’s Technical Bachelor’s Master’s Business schools Master’s Business schools Social status Low, middle Low, middle High High Family size Joint families Nuclear families Nuclear families Newly married Psychographic Lifestyle Moderate-orientated Moderate-orientated Achievement-oriented Achievement-oriented Personality Easygoing Easygoing Determined Ambitious       Behavioural Occasions Regular travel Vacations Business trips Honeymoon Business trips Benefits sought Affordability Value Luxury Convenience Luxury User status Regular traveller Regular traveller First timer, Regular traveller First timer, Regular traveller Attitude Indifferent Indifferent positive Positive enthusiastic Enthusiastic   Travel and tourism industry base Customer expectations Low Medium High High Customer image Neutral Neutral to positive Positive…]]> https://research-methodology.net/british-airways-report-6/ Sat, 11 Jun 2016 13:41:20 +0000 http://research-methodology.net/?p=7814 British Airways (BA) is the largest airline company in the UK and it flies globally to more than 400 destinations to airports in nearly 80 countries. British Airways is a part of International Airline Group (IAG) that also owns three other airline brands – Aer Lingus, Iberia and Vueling. The Group also owns 13.55 per cent of the equity of IB OpCo Holding S.L. (“Iberia”) and 86.26 per cent of the equity of Avios Group (AGL) Limited (“AGL”). IAG made a record profit of GBP 1,264 million in 2015. By the end of 2015, British Airways had 39,304 employees globally (Annual Report, 2015). British Airways pursues service differentiation business strategy and differentiates its services via an extensive reliance on digitalization and information technology and high level of customization of service provision. These points represent solid sources of British Airways’ competitive advantage. Major weaknesses related to British Airways include an overdependence on the UK market and low profitability of business operations. At the same time, the airline is presented with the opportunities of forming strategic cooperation with other businesses in airline and catering industries, further engaging in international market expansion and benefiting from synergy via closer integration between IAG’s operating airlines. British Airways Report contains the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on British Airways. Moreover, the report contains analyses of British Airways’ business strategy, leadership and organizational structure and its marketing strategy. The report also discusses the issues of corporate social responsibility. 1. Introduction 2. Business Strategy 3. Leadership 4. Organizational Structure 5. SWOT Analysis 5.1 Strengths 5.2 Weaknesses 5.3 Opportunities 5.4 Threats 6. PESTEL Analysis 6.1 Political Factors 6.2 Economic Factors 6.3 Social Factors 6.4 Technological Factors 6.5 Environmental Factors 6.6…]]> https://research-methodology.net/acquisition-of-germanwings-by-lufthansa-german-airlines-motives-strategic-and-organisational-fit-2/ Tue, 17 May 2016 07:53:14 +0000 http://research-methodology.net/?p=7722 1. Introduction Mergers, acquisitions and formation of alliances are commonplace in global airline industry and they are fuelled by the search of competitive advantages in order to achieve long-term growth. However, the implementation of mergers, acquisitions and formation of strategic alliances in practice can be associated with a set of complex challenges that might include differences in organisational culture, clash of personalities within top level management, lack or absence of strategic fit between the two companies and others. Lufthansa Group is a global airline company that employs more than 120,000 workforces that have contributed to generate 713 million EURO through serving 100.6 million passengers during the year of 2011 alone (Annual Report, 2011). Germanwings is a budget airline company that employs 1355 members of staff and served 7.52 million customers in 2011 offering flights to more than 90 destinations with 33 Airbus A 319 airplanes (Facts and Figures, 2013, online). Germanwings is wholly owned by Lufthansa since 2009. This report investigates a range of business issues related to the acquisition of Germanwings by Lufthansa German Airlines in 2009. The report starts with analysis of motives for choosing acquisition method among other alternatives by Lufthansa. This is followed by discussions of strategic and organisational fit between Lufthansa and Germanwings. Moreover, this report addresses potential gains and risks faced by Lufthansa due to the acquisition of Germanwings. The report is concluded with assessing outcomes relative to expectations in relation to this specific airline acquisition. 2. The Motives for Choosing Acquisition Method by Lufthansa Top level management of Lufthansa have selected the method of acquisition among other alternatives such as initiating a merger or forming a strategic alliance in relation to Germanwings due to the set of reasons that include less time required to complete the acquisition, increasing the market share, overcoming entry…]]>