Changing the Culture at British Airways Essay

Macro: The first problem changing the culture at British Airways was the merger of the BOAC and BEA. In 1971, the Civil Aviation Act became law and the board was to control policy over British Airways but both BOAC and BEA remained autonomous, each with its own chairman, board, and chief executive. This caused a split within British Airways throughout the 1970s and in the mid-1980. The second problem BA faced was the threat of privatization. In 1984 the government passed legislation that made BA a public limited company. The third was productivity was bad compared to other leading foreign airlines. The fourth was poor service. Poor customer service

1 This essay will assess how globalisation has impacted on the airline industry using British Airways as an example to illustrate this change had on the industry as a whole. This essay will attempt to show how the airline industry and British Airways in particular coped with thesee change and how neoliberalism thinking allowed and supported this fundamental change to happen.

1. According to the case, it shows that management of M determined that a loss would be “probable” and the estimate range would be $15 million to $20 million. However, they determined $17 million would be the “most likely” amount of loss.

• A catastrophic industry crisis as 200 000 staff were cut in the world aviation industry.

When the CEO looked at the financial statement for the previous year he found that they had a loss of $256,000 (Rakish et

I would characterize the U.S. airline industry in the early 1990’s as a steak being trimmed of all its fat, the economic climate created a financial calamity of bankruptcies and collapse by major airlines, which in turn created opportunity for smaller more efficient carriers with cost advantages to enter a near oligopoly industry. The economic distress the airlines industry encountered was spawned from recession and a doubling of fuel prices during the Gulf War in 1991. Fuel, the second largest cost to the industry, an uncontrollable cost that raised havoc on this industry,

In 2008, the senior management team at Continental Airlines, commanded by Lawrence Kellner, the Chairman and Chief Executive Officer, convened a special meeting to discuss the firm’s latest quarterly financial results. A bleak situation lay before them. Continental had incurred an operating loss of $71 million dollars—its second consecutive quarterly earnings decline that year. Likewise, passenger volume was significantly down, dropping by nearly 5 percent from the prior year’s quarter. Continental’s senior management needed to act swiftly to reverse this trend and return to profitability.

At the onset of the airline industry in the United States, major network airlines were the sole providers of air travel. This multifaceted industry was a difficult industry to break into as a consequence of “sophisticated customer segmentation, hub-and spoke models and costly information systems for reservations, fare wars and intense competition” (Thompson 2008). Shrinkage in airline ticket prices augmented the demand for airline travel. Many markets were simply deserted or over-looked by major network airlines; this is a region a fresh “second tier of service providers” could enter into. This endeavor proved to provide a consumer savings of billions per year. Thus in June of 1971, after a tumultuous battle with other Texas-based

profit from disposal of properties in 2010 was £27m and £108m in 2011 which shows a dramatic

|JD Sports lost stocks worth almost 700,000 pounds in the riots |Continuous adverse economic environment, shrank consumptions expenditures |

The dispute between BA management and Cabin Crew from 2009 to 2011 caused extensive impact throughout the global condition. BA totally lost £150 million and the brand reputation had been affected seriously. It meant that BA has some problems about its change management. This academic report contains

In 1993 IBM reported a $5.6bn loss for the fourth quarter of 1992 ending a yearly deficit of $4.97bn; which at

BA’s product in essence relates to the flights offered. However, the product can be drilled down into specific areas ranging from the airport lounges around the world, the ‘extras’ that you can buy on board such as model BA aeroplanes or even package holidays. Each of these has been specifically tailored to meet customer expectations (which are highlighted in the section of the report titled ‘target market’). This part of the marketing mix focuses on how BA’s products are managed and in the Guardian case study article titled ‘BA, Iberia and American Airlines tie-up heralds new era of transatlantic travel’ dated 06/10/2010 it shows how BA have made an executive decision to link their websites with other companies to have the possibility to offer a higher number of routes (products) to their potential customers.

Life at “old” British Airways lacked a unifying corporate culture. The 1971 merger of British European Airways (BEA) and British Overseas Airways Corporation (BOAC), by the British Airways Board, only succeeded in putting an umbrella over two separate mature entities. The focus of the BEA had been to build a European airline infrastructure. BOAS was an innovator and pioneered the first jet passenger service. Neither company was concerned with cost or profit. British Airways was government run and according to Jick & Peiperl (2011) “success had less to do with net income and more to do with ‘flying the British flag” (p.26). This inefficient government structure was bogged down with

The main reason for Pan Am’s demise was that it was a “victim of spiraling fuel prices, the deteriorating economy and the terrorist bombing of its Flight 103 over Scotland” (Dallos and Gellene). The Persian Gulf crisis increased Pan Am's fuel costs, which cost the company $150 million, contributing the majority of Pan Am’s overall losses (Dallos and Gellene). To add to the company’s problems, there came an era of “repeated international terrorist attacks against U.S. policy overseas, often targeting Pan Am directly” (Byrne). The “rapid rise of world terrorism, culminating in the tragedy of Lockerbie, was the final deathblow” (Banning). Overall, Pan Am’s ultimate failure was attributed to economic circumstances and terrorism.