business environment n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Sample on Business Environment for British Airways PowerPoint Presentation
Download Presentation
Sample on Business Environment for British Airways

Loading in 2 Seconds...

play fullscreen
1 / 21

Sample on Business Environment for British Airways - PowerPoint PPT Presentation


  • 6 Views
  • Uploaded on

In the aviation industry, the company that has made its mark with regards to quality of services and experiences is British Airways (BA). In order to remain successful, BA has always presented itself as the organization that is highly competitive and has predetermined goals and objectives on the path of which the entire business of it walks.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Sample on Business Environment for British Airways' - InstantAssignmentHelp


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
business environment

Business Environment

Get 25% off on Assignment Help and Writing Service

table of contents

TABLE OF CONTENTS

INTRODUCTION ......................................................................................................................1

LO 1 Organizational Purposes of Business ..................................................................................1

1.1 ...........................................................................................................................................1

1.2 ...........................................................................................................................................3

1.3 ...........................................................................................................................................4

LO 2 Nature of National Environment in which BA Operates .....................................................5

2.1 ...........................................................................................................................................5

2.2 ...........................................................................................................................................7

2.3 ...........................................................................................................................................8

LO 3 Behavior of BA in its market environment .........................................................................9

3.1 ...........................................................................................................................................9

3.2 ...........................................................................................................................................9

3.3 ......................................................................................................................................... 11

LO 4 Assessing the Significance of Global Factors That Shape National Business Activities .... 13

4.1 ......................................................................................................................................... 13

4.2 ......................................................................................................................................... 13

4.3 ......................................................................................................................................... 15

CONCLUSION ......................................................................................................................... 15

REFERENCES ......................................................................................................................... 16

Get 25% off on Assignment Help and Writing Service

introduction

INTRODUCTION

In the aviation industry, the company that has made its mark with regards to quality of

services and experiences is British Airways (BA). In order to remain successful, BA has always

presented itself as the organization that is highly competitive and has predetermined goals and

objectives on the path of which the entire business of it walks. In this research report, an

evaluation will be conducted on the business environment of British Airways and also the

objectives of different stakeholders of the organization will be studied (Punzel, 2013). Further

this study will also help in determining the ways in which aviation industry is impacted by

different economic and other external factors that prevails in the country. By the end of the

report, the learners will also be able to evaluate the impact of market structure that they have on

the pricing as well as the output decision as well as the overall impact of global and EU

(European Union) factors that are active in UK (Drexl, 2012).

LO 1 Organizational Purposes of Business

1.1

Every business organization has its own aims and objectives that it wishes to attain

through proper planning. The business organizations have their own mission, vision statement,

core competencies, etc with the help of which they are able to align its goals with that of the

company’s (Tran, 2003). In the similar way, BA also has its mission statement by which it

picturesque its ability to create a high class brand image for its firm. BA is a public sector firm

and the mission statement of BA states it aims to become the world’s favorite airlines and also

provide excellent experiences of its services to its customers both in flight and on ground (Hatch

and Schultz, 2008). The vision of BA is as mentioned below:

Get 25% off on Assignment Help and Writing Service

to guarantee environmental targets

To guarantee environmental targets by accomplishing them within the predetermined

time period leading to cost reduction for the benefit of its customers.

t wishes to offer carbon offsetting.

It also visions to reduce the negative effects on climate change that is caused by Aviation

industry with the cap on the total emission by 50% by the year 2020 (Souiden and

Diagne, 2009).

Thus it can be said that every business today is formed to meet the needs with a

predetermined goals which then are attained while remaining in the provided business structure.

So in order to meet these targets, companies work under different ownerships like private,

public, partnerships, joint ventures, sole proprietors, etc. Other than public sector, explanation to

different forms of business are as follows:

Sole trader: Sole trader or proprietors are the ones that run a business of their own and are

individually responsible for all the profits and losses. This is the simplest form of

business and can take place in any locality and at any time. Any corner shop in a locality

can be the example of sole trader (Kumar, Massie and Dumonceaux, 2006)

Private enterprises: On the basis of free market capitalist system, a private firm is the one

that is jointly owned and run by private individuals. This can be any non-government

business or formed by shareholders’ investments. Wal-Mart, Ernst and Young can be few

examples.

Joint ventures: It is a form of business where parties agrees to form a business for finite

time and puts in new assets by contributing equity. The control is exercised jointly by

them on revenues, assets and expenses. For example, Sony Ericson is a joint venture

between Sony and a Japanese company Ericson (Nataraja and Al-Aali, 2011).

Get 25% off on Assignment Help and Writing Service

slide6

1.2

Stakeholders are the ones who have some or the other form of interest in the profits and

operations of the business and have complete interference in the decision making as well because

of which the business performance is greatly impacted (Hooper and Greenall, 2005). The

important stakeholders of BA are its employees, customers, government and administrative

bodies, suppliers, and all other business clients. Each of them plays an important role within the

business enterprise that can be attained with the higher degrees of performances in an effective

manner (Huettinger, 2014). The stakeholders of British Airways along with their influences on

the organization are as provided below:

Stakeholders

Their impacts on British Airways

Consumers

They have great interest in the types and class of services that the

airlines provides to its travelers because they also look for the

comfort that they can make out from the airline and also for the

value of their money (LeClair, 2000). They are very important

elements in making business a successful one so the company also

has to offer the quality services to them in return with right charges

(Chapple, merman and Rudkin, 2010).

Employees

They are the backbone of the business and have direct impact on

their performances with any of the business decisions and also vice

versa. They also help and support BA in its organizational

operations in certain progressive manner (Rose, 2006). So these

employees should be paid equally and should also be provided with

other different benefits like discounts or free flights to them or their

Get 25% off on Assignment Help and Writing Service

families timely wages bonus and all other forms

families, timely wages, bonus and all other forms of incentives in a

fair manner (Fraher, 2013).

Suppliers

They are the ones who provide major support to make the right

inventory available on right time. The major suppliers of BA are

Airbus and Boeing and BA is dependent on them to a great extent

for getting the fuel, food, entertainment and all other facilities and

these people are also very interested in the success of the company

depending on which they make their decisions to do business with

the company. Thus BA should maintain healthy relations with all of

its stakeholders (Basu, 2014).

Competitors

British Airways plays a very fair game with its competitors and

never motivated any kind of price wars with them because this

would have deteriorated their quality of services (Raktabutr, 2006).

Other than this, BA has also put force on provisions of better

services in comparison to other aviation businesses which makes BA

a market leader (Cahill, 2011).

(LeClair, 2000)

1.3

There are different strategies that BA has employed in form of its responsibilities so as to satisfy

its business stakeholders that can be classified as follows:

Ethical responsibility: BA has a major responsibility that is shared under its ethical head

towards all of its stakeholders along with its employees all those who are related to the

business organization (Chapple, merman and Rudkin, 2010). There are different

Get 25% off on Assignment Help and Writing Service

corporate social responsibility activities that

corporate social responsibility activities that BA undertakes which helps in reducing the

wastes of different natural resources, prevent environment from pollution, carbon

emission and other factors that are affecting the society.

Social responsibility: the social responsibility of British Airways is to get an

involvement from everybody especially the ones who are directly or indirectly related to

the company. BA also has to be very fair and transparent in its business deals to its

stakeholders (Rose, 2006). This can be attained by offering them the quality services at

affordable costs and also by attaining loyalty with its customers. BA is equally

responsible towards its business shareholders by treating them fairly and also making

them available the desirable share from the profits. The organization should also

contribute with different charitable and also should control the pollution (Fraher, 2013).

Legal responsibility: Looking towards this responsibility of BA, it can be said that it is

that act that the organization needs to perform by working under the boundaries that are

formed under legal head or by government as well as EU (Basu, 2014). For instance, staff

at BA should be paid their salaries on time followed by the provisions of equal and

reliable pay. Other than this, there are also different interventions of the organization that

forces the company to be in line with the administrative regulations such as taxes,

interests, etc (Raktabutr, 2006).

LO 2 Nature of National Environment in which BA Operates

2.1

Economic system can be defined as the one that assists in undertaking the business

activities in a planned manner so that all of its resources can be utilized in an efficient manner.

This helps in carrying out all the business operations on economic scales and on the basis of the

same, the economic systems can be classified into three forms that are as shown below:

Get 25% off on Assignment Help and Writing Service

planned economy

Planned economy:

In this form of economic system, most of the important decisions are

taken by the government with respect to the business decisions that are

taken for effective production and distribution of resources in the

economic systems for fixing up the commodity prices (Albert, 2011).

This system can also be known as command economy where

government has the major decision making power and allows

minimum flexibility as well as any chances of change (Klein, 2014).

This economic system also tends to pay attention towards the use of

different and varied sources for the development rather than using

resource allocation (Bhattacharya, Sen and Korschun, 2011).

Mixed economy

This form of economic system is followed in UK and most of the

developed and developing countries of the world. It consists of various

elements of market and the planned economic systems in a

proportionate manner (Hatch and Schultz, 2008). Both private and

public sector reforms takes on the business decisions in an integrated

form with equal importance to both which allows great deal of

flexibility. The reason behind the same is that it features both capitalist

and socialist economies and also enables the management of all the

political and economic approaches to business (Marangos, 2013).

Market economy

In it the central or the state government has barely any part to play and

customers’ buying decisions and behaviors are the ones that drive the

entire economy (Blythe, 2008). In it, the market assumptions play a

major role that helps in attaining the correct direction which is

important for the overall economical growth. It has also helped in

Get 25% off on Assignment Help and Writing Service

focusing to reduce the subsidies that

focusing to reduce the subsidies that are implemented on different

sectors in relation to the pre determined prices and regulations

(Cattaneo, 2010).

(Cahill, 2011)

If looked on to British Airways, this organization runs its business in a mixed economic

system. In this economy, the government interventions are at very minimal level and are

subjected to only certain cases like if proper legal format is not followed or if over pricing of

services is causing any kind of customer exploitation, etc. Thus it can be said that innovative

approaches of BA has helped it to earn revenues and also supported the technological changes

leading to creation of world class standards (Albert, 2011).

2.2

The fiscal and monetary policies have critical impact on the economic systems and also

the basic business operations. In case of monetary policies, when any changes are brought in the

interest rates in short term than there is likely to be a major effect on the long term interest rates.

Lower the interest rates, larger will be the profits which would lead to increased purchasing

power as well as the investments of people (Klein, 2014). Such changes in the rates of interest

have a direct impact on profits, sales, stock prices, etc. On the other hand, if looked on the fiscal

aspect, these policies are related to the changes in the taxation policies and rates that are in

relation to the spending of the people. Here as well, the low tax rates help in bringing in

investments and also provide more liquidity in business (Bhattacharya, Sen and Korschun,

2011).

Aviation industry in UK is largely impacted by economies of the country and as per the

report of Transportation Association of Europe; there are around 2 million people who travel

Get 25% off on Assignment Help and Writing Service

using airlines all the monetary policies

using airlines. All the monetary policies of the country thus have impacted the traveling ability of

the people because the interest and tax rates get increased. This in return lower downs the

purchasing power of people making less number of flights (Hatch and Schultz, 2008). Similarly,

fiscal policies in relation to the rules, regulations and other legislative actions which clearly

depicts that there is deregulation in the entire airline industry which further leads to the increase

in the number of travelers with lowered air ticket prices. Along with it, different security

measures are also required to control the terrorism activities which in return increased the costs

of services which surcharged the customers in return (Marangos, 2013).

2.3

There are different competition policies that are governing the aviation industry entirely

and have always emphasized on three different aspects of business such as alliances, mergers and

cooperation between airlines and all of these are governed under IATA which is International

Trade Transportation Association. It also intends to attain as well as encourage healthy

competition with sufficient mechanism for safeguarding the unhealthy competitive activities

(Blythe, 2008). FAC (Federation Aviation Commission) helps in standardized safety and

infrastructure of transportation activities. Other competition policy regulation is Civil Aviation

Requirement (CAR) which helps in setting up the capital requirement with regards to certain

nonscheduled carriers and also the related service providers. The Civil Aviation Act of 2012

proved very helpful in setting up regulations for air flight traffic movement (Cattaneo, 2010).

Get 25% off on Assignment Help and Writing Service

lo 3 behavior of ba in its market environment

LO 3 Behavior of BA in its market environment

3.1

Market structure for every business helps in determining the pricing and output decisions

as there are different forms of structure that exists namely monopoly, monopolistic, perfect,

oligopoly, etc. Further explanation to the same can be as follows:

Monopoly: Over here, owner of the business has an authority to make prices for its

products on the basis of market demand and consumer likeliness. Because of this reason,

there is only one seller and number of buyers. Competition here is low as there exists a

restriction of new entry and because of this fact, seller earns higher profit (Punzel, 2013).

Oligopoly: In this form of market, there are number of buyers and sellers and depending

upon the market needs, price alteration can be done. With help of this, sellers do earn

considerable amount of profits as they determine the prices themselves.

Perfectcompetition: For organizations like BA, the determined market structure is

perfect market as the prices in this market are analyzed after market analysis as well as

prices of the competitors. In this market, the bargaining power of the buyers is high

(Drexl, 2012).

3.2

Different market forces play a great role in shaping up BA’s responsibilities such as

buyer’s perception, supplier’s power, competitors, demands, substitutes and others. All these

roles can be better understtod with thehelp of image provided below

Get 25% off on Assignment Help and Writing Service

figure 1 porter s five force analysis of british

Figure 1: Porter's five force analysis of British Airways

(Source:Cattaneo, 2010)

All these factors of porter’s five force analysis help in framing up the organizational

responsibility towards its customers because they expect better services from their providers at

the affordable prices with comfortable flight timings and air routes (Tran, 2003). The important

market force that can be named over here is availability of substitutes like for example there are

also many cheap land and water transport facilities that are available. Customers these days

Get 25% off on Assignment Help and Writing Service

demand extra facilities as they now have learned

demand extra facilities as they now have learned to take out full value of their money which has

also created problems for BA. The organization has also been successful in gaining market value

as compared to its competitors resulting in doubled profits as well as the passengers by 8.9% per

year (Hatch and Schultz, 2008).

3.3

Business and culture environment consists of all those factors that affects a company’s

business operations. It also includes consumers, industry trends, regulations, suppliers, etc. these

factors impact the attitude of a firm and the ways in which it deals with different parts of

organization. The PESTEL analysis showcased below will help in clarifying the impact of

different factors:

Get 25% off on Assignment Help and Writing Service

figure 2 pest le analysis of ba source rose 2006

Figure 2: PEST (LE) analysis of BA

(Source: Rose, 2006)

Business environment of British Airways consists of different people who come from

different geographical, cultural and demographical backgrounds whether they are the customers

or employees which makes it very important for BA to fulfill all of their expectations. Different

strategies can be formulated by the company which is framed on the basis of people’s

expectations and in return which will drive the moral and ethical values out of the same (Souiden

and Diagne, 2009). Like for instance, cultural environment for BA will help in getting to know

the traits that are expected by the consumers. This in return will prove very fruitful for the

company as it will help in bringing about the innovative services and also gain maximum

understanding of the entire business scenario (Kumar, Massie and Dumonceaux, 2006).

Get 25% off on Assignment Help and Writing Service

lo 4 assessing the significance of global factors

LO 4 Assessing the Significance of Global Factors That Shape National

Business Activities

4.1

At international level, trading includes import, export, utilization of resources, etc within

different countries which shows that how much are these practices important for British Airways

as in return they will help in gaining competitive advantage and also enable the business

undertakings in an efficient manner. BA will also be able to carry on its trade and other

international activities with mutual understanding. Thus when every country tends to share the

advantages of manufacturing the products and services, then the same thing can be further traded

as well (Nataraja and Al-Aali, 2011). So British Airways should not imagine any of its business

success without giving due consideration to international trade and activities that take place in

UK. There are also many of the reasons that justifies the importance of global trade such as cost

of production, material, market horizons, etc which shows that there are many opportunities that

global trade has provided to the business which will help in taking the business profitability to

great extent (Hooper and Greenall, 2005).

4.2

There are many global factors that put their impacts on the entire aviation industry in UK.

These factors not only affect the demand that comes on the basis of nature of business,

geography, scales, etc in international market but also impacts the supply of the products where

implicit and explicit trade policies affects the overall business environment like those of safety

and security (Huettinger, 2014). The PEST analysis segment as explained in figure 2, there have

been different global and political factors that have impacted the functioning of BA which can be

explained as follows:

Get 25% off on Assignment Help and Writing Service

factors

FACTORS

IMPACT

Perfect market legislations.

Political

Different taxation policies

Employment laws

Foreign trade regulations

Money supply

Economic factors

Unemployment

Business cycle

Availability of energy and cost

Disposable income

Population and demographics

Socio cultural factors

Attitudes towards work and leisure

Level of education

Income distribution

Speed of technology transfer

Technological factors

New developments and introduction of online booking

and ticket generating portals

Government spending on research.

(Fraher, 2013)

Get 25% off on Assignment Help and Writing Service

similarly there are many other factors as well

Similarly there are many other factors as well such as trade blocks, privatization, export-

import markets, globalization, etc. All these factors have restricted the new entries into the

market and also the growths (LeClair, 2000).

4.3

Since the European Union came into existence, there has also been the introduction of

new challenges that came up such as natural and economic crisis, demographic changes etc. This

has also represented that aviation is the third largest active sector of EU which helps in

improving entirely the employment rates in EU (Chapple, merman and Rudkin, 2010). So the

contribution of British Airways in European Union and its aviation related policies can be said as

slots for allocation to EU airports. Single Europe Sky undertakes the air traffic management and

air traffic routes. There is also consumer protection legislation that is also set up according to the

highest possible standards (Rose, 2006).

CONCLUSION

Thus it can be said that BA should give equal importance to all of its stakeholders so that

business operations can be undertaken smoothly. This report has also helped in knowing the

steps that BA can undertake in negative conditions or the ones that arise from economic crisis in

aviation industry. This will help BA in standing strong in the competition and earning higher

profits. All these factors have helped British Airways to be the market leader in Aviation

industry not only in UK but also in the entire world.

Get 25% off on Assignment Help and Writing Service

references

REFERENCES

Journals

Chapple, S., merman, L. and Rudkin, K., 2010. IFRIC 13: accounting for “customer loyalty

programmes”. Accounting Research Journal. 32(2).pp.124 – 145

Fraher, L. A., 2013. Airline downsizing and its impact on team performance. Team Performance

Management. 19(1/2).pp.109 – 126.

Hooper, D. P. and Greenall, A., 2005. Exploring the potential for environmental performance

benchmarking in the airline sector. Benchmarking: An International Journal. 12(2).pp.151 –

165

Huettinger, M., 2014. What determines the business activities in the airline industry? A

theoretical framework. Baltic Journal of Management. 9(1). pp.71 – 90

Kumar, S., Massie, C. and Dumonceaux, D. M., 2006. Comparative innovative business

strategies of major players in cosmetic industry. Industrial Management & Data Systems.

106(3). pp.285 – 306.

LeClair, T. D., 2000. Marketing planning and the policy environment in the European Union.

International Marketing Review. 17(3).pp.193 – 215

Nataraja, S. and Al-Aali, A., 2011. The exceptional performance strategies of Emirate Airlines.

Competitiveness Review. 21(5).pp.471 – 486.

Rose, A., 2006. Measuring operational safety in aviation. Aircraft Engineering and Aerospace

Technology. 78(1). pp.26 – 31

Souiden, N. and Diagne, M., 2009. Canadian and French men's consumption of cosmetics: a

comparison of their attitudes and motivations. Journal of Consumer Marketing. 26(2). pp.97

– 109.

Books

Bhattacharya, B. C., Sen, S. and Korschun, D., 2011. Leveraging Corporate Responsibility: The

Stakeholder Route to Maximizing Business and Social Value. Cambridge University Press.

Blythe, J., 2008. Essentials of Marketing. FT Prentice Hall.

Get 25% off on Assignment Help and Writing Service

cattaneo o 2010 international trade in services

Cattaneo, O., 2010. International Trade in Services: New Trends and Opportunities for

Developing Countries. World Bank Publications.

Drexl, J., 2012. Competition Policy and Regional Integration in Developing Countries. Edward

Elgar Publishing.

Hatch, J. M. and Schultz, M., 2008. Taking Brand Initiative: How Companies Can Align

Strategy, Culture, and Identity Through Corporate Branding? John Wiley & Sons.

Hatch, J. M. and Schultz, M., 2008. Taking Brand Initiative: How Companies Can Align

Strategy, Culture, and Identity Through Corporate Branding? John Wiley & Sons.

Marangos, J., 2013. Consistency and Viability of Capitalist Economic Systems. Palgrave

Macmillan.

Punzel, T., 2013. Risks and Decision Making. GRIN Verlag.

Tran, H. V., 2003. Competition Policy and Global Competitiveness in Major Asian Economies.

Edward Elgar Publishing.

Online

Albert, A., 2011. Stakeholder engagement key to British Airways savings. [Online] Available

through: < http://www.supplymanagement.com/news/2011/stakeholder-engagement-key-to-

british-airways-savings >. [Accessed on June 19th, 2014].

Basu,C., 2014. How Do Monetary & Fiscal Policies Affect the Airline Industry?

[Online].Available

through:<

http://www.ehow.com/facts_7568199_do-policies-affect-

airline-industry.html>. [Accessed on June 19th, 2014].

Cahill, S. A., 2011. Want to own a branded top-level domain? Staking out brand space on the

internet. [Online]. Available through: < http://www.stites.com/learning-center/legal-

updates/want-to-own-a-branded-top-level-doman-staking-out-brand-space-on-the-intern>.

[Accessed on June 19th, 2014].

Klein,

R.

S.,

2014.

responsibility.

[Online].Available

through:

Organizational

<http://www.oxfordbibliographies.com/view/document/obo-9780199846740/obo-

9780199846740-0055.xml >. [Accessed on June 19th, 2014].

Get 25% off on Assignment Help and Writing Service

raktabutr t 2006 analysis of organization british

Raktabutr, T., 2006. Analysis of Organization: British Airways. [Online].Available through:

<http://thanabut.blogspot.in/2007/05/1-introduction-this-report-is-written.html >. [Accessed

on June 19th, 2014].

Get 25% off on Assignment Help and Writing Service