This report is written to give details about organisation overview and organisation process of British Airways Plc.

and provide the critical analysis on the organisation process. First, it will look at company profile and the history of the organisation including the organisational chart in order to give an overview of organisation and then will explore the evolution of the organisation. Next, it will continue to focus on the organisational processes including (1) Change within organisation (2) Organisational Culture (3) Recruitment, Job Placement, Training and Promotion Policy. These organisational processes will be provided in details regarding what are organisational change, HR policy, and organisational culture? How these processes are related and affected in each other? Moreover, it will critically organisation on these processes in order to know their problems and benefits toward the organisation. Finally, it will give recommendations for the organisation to use as a guideline to deal with organisational process in the future.

Chapter 1: Introduction to Global Business Environment The firm is a component of its environment, its resources, its incomes, its problems, its opportunities. Business environment demonstrates the external forces which are economic, social, political and technological factors that can influence to business decisions. These factors are exterior and have power over the business. Business environment is dynamic in that it remains on changing whether in terms of technological improvement, shifts in consumer preferences, entry of new competition in the market. And also global business environment is largely uncertain as it is very hard to predict future happenings, particularly when environment changes are taking place too often as in the case of information technology or fashion industries. 1.2 The nature of business The objectives of any business market are to meet the needs of stakeholders who can be customers, managers, employees, owners, local Environment, suppliers and

government,creditors, and to purchase inputs like raw materials, labour, machinery and equipment, land and to produce goods and services and to focus on proficient use of resources by generating profit. So business market can be classified into consumer markets where consumers work together with sellers to buy goods and services, commodity markets which often have placed centres in developed countries and capital markets where small firms might scrounge or sell shares to family and friends in which larger companies use the stock market to sell shares known as equity capital.

In general, activities of business belong to four categories. They are Primary Sector which comprises of mining, quarrying, fishing, agriculture, forestry and secondary sector includes processing of raw materials into finished or semi finished products ,manufacturing and tertiary sector which provides services in leisure, transport, finance, distribution, retailing, wholesaling, communications and quaternary sector which encompasses hi tech industries, training, health, education.

1.3 Types of organizations in business economy The economy is the communitys system of wealth creation. Following diagram 1 shows that the economy is made up of the formal and the informal economy.

State economy The formal economy (Public and Private sector) Market economy

H I D D E N

V O L U N T A R Y

H O U S E H O L D The informal economy (part of the private sector)

Figure 1: The Economy, Field work According to figure 1, the state sector comprises of all government departments, corporations, agencies and other state appointed bodies. They are created, funded and managed by the state. These government bodies provide a range of goods and services with the objective of profit maximization, but to also fulfill planned objectives of the government.

Taxation on the rest of the economy, fees and charges and government borrowings are the revenue to be financed the government services. The private sector is carried out by privately run organizations and comprises the household and personal sector as well as businesses. Objectives of private sector business are maximizing profit, growth, satisficing, enhance market share and survival. Therefore for a better understanding, organizations in the private sector can be classified according to their ownership structure which is clearly shown in figure 1.1. The legal form of trading organization in the private sector

The Formal economy Sole trader organizations Partnerships Registered companies public companies (PLC) Private companies (Ltd) Franchising Multinational companies

The Informal economy The household economy The voluntary economy The hidden economy

Figure 1.1, ownership structure in private sector, Field work

Chapter 2: The Analysis of Airline Industry The airline industry exists in a strongly competitive market. In recent years, there has been an industry extensive shakedown, which will have far reaching consequences on the industry's tendency towards expanding domestic and international services. The airline industry can be divided into four categories according to the U.S. Department of Transportation. First is that international have the aptitude to take passengers just about anywhere in the world, secondly companies in this category naturally have annual revenue of $1 billion or more, thirdly, national that airlines place 100-150 people and have revenues between $100 million and $1 billion, and finally regional where companies with revenues less than $100 million that centre on short drag flights and cargo where airlines usually transport goods and airport capacity, route structures, technology and costs to let or buy the physical aircraft are important in the airline industry. Besides other concerns are weather which is variable and unpredictable. Consistent with the Air Transportation Association, fuel is an airline's second largest expenditure. Fuel creates a significant segment of an airline's total costs, although efficiency among different carriers can differ widely. Short haul airlines naturally get lower fuel efficiency as take offs and landings consume high amounts of jet fuel where labour is the airline's major cost where airlines must pay pilots, flight attendants, baggage handlers, dispatchers, customer service and others.

2.1 Importance of Airline Industry Air travelling is clearly concerned as a very large industry in a manner of socially, economically, and politically. It is continuing to expand and has been deeply affluent in the past 50 years due to the generally improvement in technology. The consequence has been a stable decline in costs and fares, which has inspired traffic growth. This concentrated traffic creates the expansion of economical development easier and it can be also believed as a vital factor for the globalisation that is taking place in many other industries. The main characteristics of the airline business are that it belongs to service sector,capital intensive, high Cash flow, labor intensive, highly unionized, thin profit margins and seasonal. Due to growth in tourism, there has been a boost in number of the international and domestic passengers airlines play an important role in international tourism. Developing airline services helps the nation to cash on tourism as more than 85% of the foreign tourist arrives by air. Infrastructure in the government, the airport, shippers, passengers, local communities and airlines will result in greater efficiency (lower costs) and in better service levels. In addition of its self is the trading of goods and services of a local economy into an integrated global economy. Technological advances have made this practice more feasible and the milestones were the development of the internet and increased transportation technology. These two advances made the world currency in "flat" and lead for higher living standards.

Chapter 3: Background of British Airways British Airways is a global airline, offering low fares with a wide ranging global route that is set of connections flying to and from centrally located airports. The British Airways Group comprises of British Airways, Plc, British Airways Holidays Limited, BA Connect Limited, Deutsche BA, and British Asia Airways, amongst others. The airline's beginnings go back to the start of civil aviation and the revolutionary days after the First World War on 25 August 1919 its predecessor company, Aircraft Transport and Travel commenced the world's first daily international scheduled air service,

between London and Paris. On 31 March 1924, Britain's airlines which were Intone, Handley Page, Daimler Airways and British Air Marine Navigation merged to structure Imperial Airways, which enlarged its empire routes to Australia and Africa. In the meantime a number of smaller UK air transport companies had started flights. These combined in 1935 to start the original privately owned British Airways Ltd. In April 1987 British Airways was privatized and floated on the London Stock Exchange by the conservative government. In the year 1974-1981 British airways with British overseas airways co-operation and British European airways and the problems encountered after this merging. However overcoming these problems British Airways in present facilitates a variety of services, comprising passenger air, cargo air, and corporate travel services. The company also provides trip planning and travel preparation, assistance for travelers with special needs, and health information for travelers. And British Airways grades 587th in the world, consistent with Forbes Magazine, and is number 442 in the Fortune 500 list of global organizations.

Year

Achievements

1. 2000

y y

British Airways launched the worlds fully flat bed in business class. British Airways introduced World Traveller Plus, its premium economy product. The service was aimed at both the cost conscious business traveller and the discerning leisure passenger requiring more space and privacy than in World Traveller. British Airways launched its online check-in service facility which is now available on over 97% of British Airways routes. The UK Government announced that iris-recognition technology was to be installed at 10 British airports following a successful trial involving British Airways passengers. The technology was to be made available to all passengers travelling through the airports and provided automated clearance through immigration for certain frequent travellers, further cutting down transfer time through the airport. The evolution of ba.com allows customers to book flights, manage their booking, check-in online and much more. In 2009, the website introduced a dynamic packaging facility, enabling customers to book hotels, car hire, local sightseeing tours, attractions and tickets to create the entire Launch of the online boarding pass Sustainable travel Launched in the online check-in facility, in 2008 British Airways unveiled its remote check-in via mobile phones with wireless connectivity. Launched the UKs first mobile internet access on a transatlantic route with the introduction of On air, available on the British Airways service between London City and New York JFK.

2. 2001

3. 2003

4. 1995 to present

5. 2004
y

6. 2005
y

7. 2008
y

8. 2009

Figure 2: Ground breaking development, British airways annual report 2009

3.1 Strategic management process Strategic management process determines the mission, strategic intent, values, goals, objectives, roles and responsibilities, timelines of an organization. Following figure 3 shows the outline of strategic management process in general. Vision

Mission External environment analysis Internal environment analysis

Formulation of strategy Implementation of strategy Monitoring Figure 3: Outline of SMP, Field work At the similar time its completely essential that the objectives currently being pursued are clearly understood. Because of increasable changes in strategies actual or hidden objectives may change from those that were established and made unambiguous sometime in the past. Objectives therefore institute direction and the accomplishment of them should be measurable in some way and ideally they will persuade and motivate people.

Fi

4: Framework for VM

Mi

Tool

Accordi

to fi re 4, it i important to differentiate between t e objecti es and specific

measurable milestones. Intended strategies are developed from t e mission and t e desired objectives as t ey are t e means of achieving them. Hence, a change of objectives is likely to result in changes of strategy. And also it is essential the business to understand clearly where it is going, and why. Ideally, as business management will appreciate the overall mission, and how their own role contributes to its attainment.

3.2 Key objectives of British Airways The vision leads British Airways to form its key objectives in order to deals with current market conditions and to build a sustainable future for business. Figure 5 depicts what the British airways is for.

Figure 5: Key objectives of British Airways, BA 2008/09 Annual Report So according to figure 5, key objectives of British airways can be stated as follows, 1. To be the airline of choice for finest customers. 2. To deliver an exceptional service for customers at every touch point 3. To develop the presence in key global cities 4. To build on the foremost position in London. 5. To convene customers needs and enhance margins via new revenue streams.

First key objective of British airways reflects that people want to fly with British Airways with the premium quality can and the company will continue to introduce great products such as the new business class seat on quality and a redesigned first cabin to complement Heathrow home terminal 5 which will redevelop premium facilities in New York JFK and continue to invest in lounges in other key cities. Second objective explains that employees are being trained on the ground and in the air to provide world class hospitality and customer service where customers can already check in their flights from their mobile. Third objective describes British airways provides the best global connectivity for their customers via strong network from London city to New York JFK, with more flights to Dubai and Johannesburg and a return to Saudi Arabia. Fourth objective illustrates London is positions as the worlds biggest aviation market, remaining Heathrow as a world class hub by acquiring new slots, supporting plans for a third runway and work with BAA (official airport parking) to enhance baggage and terminal facilities at Heathrow. In fifth objective it says by building profitable subsidiary services that provide customers great value to re-enforce British airways brand. And aim of British airways is to grow their mileage business and boost revenues from third party in engineering, in-flight sales and a new online retail website. On ba.com British airways has initiated a variety of great value hotel and car hire options packaged with their flights.

3.3 Vision of British Airways A vision statement is sometimes called a picture of the company in future but its so much more than that. Vision statement is the inspiration, the framework for all strategic planning.

Figure 6: Frame work of vision, Field work

The three components of the business vision can be portrayed as shown in figure 6.A vision statement may apply to an entire company or to a single division of that company. Whether for all or part of an organization, the vision statement answers the question, Where business does want to go? According to Kotler, a vision facilitates to clarify the direction in which the organization needs to move. British Airways started the revolutionize process with its vision, To be the Worlds Favourite Airline and to become the worlds most responsible Airline This vision of British airways focuses on employees and customers and it emphasises British Airways desire to be the worlds global airline which generates a strategy of alliances. British Airways has made sure it is productively carried out throughout the organization, are keys to its commercial success. As competitors became conscious that service substances and mechanised their progressions to suit, British Airways has leaped overconfident again, now significant its target as being the 'undisputed leader in world travel'.

3.3.1 Core Values of British airways British Airways has positioned itself as a high standard, high quality airline and it's the leader in its category. It attempts to satisfy all the different customer needs and expectation from an economy class to the business and the first class offering variety of services. It has diverse lounges for the first class customer and an on board menu for the food and wines. British Airways offers business class seats, blue / silver or gold card for frequent fliers and executive lounge at all main airports. It also supplies customers with free food and drinks on flights and extremely good service. It has as glowing two in flight magazines, a great collection of movies, four radio channels and TV programs for the entertainment of the people. And also British Airways brand stands for a prestige, glamour, comfortableness, safety and reliability by setting its pricing strategies in a manner that customers can chose the how much from the extras the company providing they want. British Airways has placed different prices in view of customers different needs such as the executive class (golden members), the middle class (silver members) and the economy class (blue members and free travellers). Therefore British airways pricing strategy can be considered as a core value which is developed under 3 strategies. 1. Premium strategy ( high quality/high price) 2. Medium strategy ( medium quality/medium price) 3. Economy strategy ( Low quality/ low price) Those three strategies used by British Airways with the intention of satisfying the three different types of travellers and provide them the opportunity to choose the price they want in relation with quality of the service customers like.

3.4 Mission Statement of British Airways A mission statement reflects the philosophy of the company with respect to the company in specific and society in general. On the other hand it questions why the company is in the business. Here by the mission statement of the company offers a proper guideline to employees of the organization about its principles, policies and practices. British Airways' motto is "The World's Favourite Airline," and the company's mission is to achieve that by providing a full service experience, both in-flight and on the ground and that is shown below. To be the most exclusive and first choice airline for all airline travellers This mission highlights the Peter Drucker 5 questions which are, 1. What is our business? = Airline 2. Who is our customer? = Travellers 3. What is the value of our customer? = First 4. What will our business be? = Most exclusive 5. What should our business be? = choice

This mission is, extensive than being simply an airline with good customer relations and service. Although with the intrinsic hazard of being too broadly described, it is suited to an age when the face of travel is changing noticeably. By now, competition has seen airfares come down, however this has not simplicity competitive forces within the air travel industry. Airlines perceive less and less profit per person, guiding to a requirement to discover new projects and hold on to existing customers throughout loyalty programmes. British Airways' mission provides its management with a new permission to be more than just an airline. For an instance British Airways is aspiring to set new industry criterions in customer service and innovation, delivering the best financial performance and develop from being an airline to a world travel business with the elasticity to stretch its brand in new business areas.

Ultimately mission statement clearly demonstrates that in every persons mind the first thing to come for travelling by air should be British Airways and its rationale is to provide guidance for the future. Therefore it is significant where staff and managers are expected to take decisions themselves, without stable recommendation back to management. If employees realize where the company is aiming, then independent decisions are more likely to be line up with each other and with the British airways ultimate objectives and facilitates to set objectives, to develop strategies and to concentrate its resources.

Chapter 4: Economic analysis of British airways In the economic analysis, it is significant to distinguish the aspects that might in turn affect a number of vital variables that are likely to influence the organizations supply and demand levels and its costs (Kotler and Schlesinger, 1991; Johnson and Scholes, 1993). The PESTEL analysis is a structure for reassessing a situation, and Porters Five Forces models, can be applied by companies to re-evaluate a strategic directions, including marketing proposition. The use of PEST analysis can be seen effective for an air line industry and strategic planning, marketing planning, business and product development and research reports. PESTEL also certifies that companys performance is supported positively with the powerful forces of change that are influencing business environment (Porter, 1985). 4.1 Main aspects in PESTEL analysis of British airways Economic conditions concern how easy or how hard it is to be winning and profitable at any time because they have an effect on both capital availability and cost, and demand (Thompson, 2002). Economic conditions are manipulated by political and government policy, being a major influence affecting government decisions. At any one time whichever exported or imported goods can seem expensive or reasonably priced, dependent upon currency exchange rates. While economic conditions and government policy are closely related, they both influence a number of other environmental forces that can affect organizations. The rate of interest charged for loans will be affected by inflation and by international economics and, although the determining rate may be fixed by a central bank, as it is the case with the Bank of England, that will also be influenced by stated government priorities. The expectations of shareholders with regard to company performance, their willingness to provide more equity funding or their willingness to sell their shares will also be affected.Labour costs will be influenced by inflation and by general trends in other industries, and by the role ad power of trade unions.

The social environment is a combination of demand and tastes, which differ with fashion and disposable income, and general changes can again offer both opportunities and threats for exacting companies (Thompson, 2002; Pearce and Robinson, 2005). British airways should be conscious of demographics changes as the formation of the population by ages, wealth, regions, and number of workings can have an significant attitude on demand as a whole and on demand for exacting products and services. Threats to existing products might be increasing in a manner of creating opportunities for differentiation and market segmentation might be rising. Technology is extensively recognised by various literatures on strategic management (Capron and Glazer, 1987; Johnson and Scholes, 1993; Jan, 2002), as an element of the organization and the industry part of the model as it is used for the conception of competitive advantage. New technology could provide a valuable input, in both manufacturing and service industries, but sequentially its purchase will necessitate funding and possibly employee training before it can be employed. Following figure 7 illustrates in which way , how PESTEL factors affect to British airways. .

PESTEL Factors Political

Major Points Strict regulation (AEA, 2009). Enhanced security due to past terrorist threats (DFT, 2008).

Insinuations for BA Conformity is indispensable if BA wants to continue operations. Adequate security determinations should be in place to ensure consumer assurance and competitive advantage is maintained. Likely diminishing in the amount of business travel as companies are cutting costs and using option means of communication such as teleconferencing. BA is susceptible as a UK operating airline to a pitiable exchange rate.

Economic

Global economic calamity: World growth is development to just over 2 percent in 2009 (IMF, 2008). Pound declines especially against the Euro.

Oil prices: diminished by Fluctuations in oil prices and exchange rates affect BAs cost more than50 % since as their base directly. peak retreating to 2007 levels. Decrease in fuel price = underpinning of the dollar (IMF, 2008) UK consumer using its sharpest decline for 13 years between July and September 2008 (Channel 4, 2008). Social The UK has an aging population in order to National Statistics Online, 2008. Rising unemployment (Kollewe and Sager, 2008). Technological Fierce competition

Potential opportunity for development as older generations has more time to use on leisure activities such as global travel.

Amplified bargaining power as an employer.

A recent survey disclosed that Increased consumer consciousness and consequently bargaining power. 34% of online consumers plan to use price appraisal sites more in 2009 (NMA, 2009). Online booking services and check-in is attractively gradually more used by the airline industry. BA must make certain that they stay up to date with these technological advances while avoiding becoming overly dependent, as this may ignore certain consumer markets (i.e the elderly) who dont feel cosy using such technology.

Environmental/Et hical

Sound pollution controls, and power consumption controls (DFT, 2008).

New legislation (e.g. Climate Change Bill) insisting on tighter environmental regulation may boost operational costs each year.

Limited capacity means of utilisation of capacity. Limited land and for expanding airports where extension is complicated at Heathrow as it would result in a loss in the Londons Green belt area. (BBC News 2006) Consumers are more conscious on green and more responsive of the environmental impact of their actions. Failure to accept an incorporated environmental strategy could direct to a negative effect on the BAs reputation and income.

Abandonment of flights and Such ethical issues could have a harmful effect on reputation defeat of baggage (Channel 4, if left undetermined. 2008). Legal Collusion and price renovating. Identification of pressure groups such as trade unions and industrial action e.g. Cabin Crew strikes. Open Skies Agreement (AEA, 2009) Restriction on mergers will have an collision on BAs proposed alliance with American Airlines. Good employee relations are necessary if BA desires to avoid industrial action and interrupted operations.

Opportunity for BA and its competitors to liberally transport aircraft between the EU and US.