Unit 7 Business Strategy Assignment - British Airways

Programme	Diploma in Business
Unit Number and Title	Unit 7 Business Strategy
QFC Level	Level 5
Case Study	British Airways - Business Strategy

Introduction

As per British Airways, the strategy is all regarding the basic concerns that an organization has to deal with in case it wants to be aware of the path to follow. There are so many areas which impact the operations of the British Airways. These can be economic, political and social factors, along with the actions of the competitors prevailing in the market.  In case anybody is looking forward to be the part of Airlines sector he must be aware of the current strategies and the aimed objectives of the business. Though the strategy is not an ivory point, but the business has to make necessary decisions with the two way communication among the business and its environment. Hence, we can say that a business strategy is an enduring way to apply the plans of a firm towards the attainment of its goals. The business strategy is a way by which the business is aware of its proficiencies, higher worth and uniqueness.

Task 3

3.1 Analyse possible alternative strategies relating to substantive growth, limited growth or retrenchment

Substantive Growth-

Substantive growth strategy intends on attainment of good expansion in a limited phase of period. There are rewards of substantive growth strategies, for instance exponential growth, opposition, wealth conception.

Limited Growth-

1: Market Penetration – Simply offering all the more a current item to existing clients is the slightest unsafe development technique for any business and a procedure culminated by substantial customer products organizations. Offer items in bigger sizes, multi-packs and multi-purchase offers or find new courses for clients to utilize a current item.
2: Market Development – Devise an approach to offer a greater amount of a current item to an adjoining business.
3: Alternative Channels – Pursue clients of BA in an alternate manner. A successful approach to do this is by offering your items or administrations on the web. Then again if BA offers items on the web, consider getting your items into nearby shops or other suitable outlets.
4: Product Development – This is an excellent methodology that includes creating new items to offer to both existing and new clients. In a perfect world, offering to existing clients is less dangerous than "needing to take in another item and business in the meantime".
5: New Products for New Customers – Changes to economic situations frequently manage the requirement for new items for new clients. This can open up an altogether new market research for BA and open new clients to more established, existing items.
Serious Growth Strategies do accompany danger, vulnerability and exertion, and BA prompts making one stride at once if at all conceivable. It is imperative to stay centered yet be interested in change along the path in light of the business sector criticism one meets.

Retrenchment-

A scheme utilised by businesses to lessen the assortment or the general dimension of the functions of the corporation. This approach is over and over again utilised with the intention of slicing the costs with the objective of becoming a further fiscal steady industry. Characteristically the strategy engages moving back as of certain markets or the discontinuance of trade of some products or service so as to build a valuable turnaround.
The possible alternative ways for substantive growth can be as below:

i) Franchise:

It is a way of segregating the operations of business among others so as to curtail the needs of huge clientele.

ii) Merger, Joint ventures (JVs) and acquisitions

These are the firms that need a way to penetrate any particular market segment. By merger we mean two different firms merging together to make one. Since, BA also was formed by merger of 4 British airlines. These firms might be of quite equal size or might be of similar line of operation. Joint ventures are the sharing of the knowledge and risks of two firms. In this kind of structure the alliances are beneficial against merger or acquisition. The acquisition is a friendly acquiring of a business firm by any other. This can be referred to as takeover with a motive to boost the share in the market and making the portfolio of the firm quiet extensive and reducing dangers.

iii) Organic expansion:

This strategy focuses on the boost in sales and output of the firm. This shows the actual expansion for the business functions and seeing if the managers are capable of using the skills for betterment of the operation and also the way business uses its assets and increases the revenues.

iv) Horizontal incorporation:

This kind of incorporation is among the firm and its competitors. This is an agreement among them that they would not be rival of each other, rather well place their product into different segments (Dye and Sibony, 2007).

v) Diversification:

It is when the business starts with further new products or tries to enter a different market as from existing market or existing product segment. There can be related or conglomerate diversification i.e. with the previous experience of the industry (related) or even without that (conglomerate).

vi) Vertical incorporation:

It is a situation where business is own distributor and supplier. This can be a backward or forward vertical incorporation depending on the kind of integration.
The possible alternative ways for Limited growth can be as below:

a) Market Development:

In this strategy the existing product is marketed in a new market i.e. to a new customer segment. For e.g., British Airways expands its operations and starts voyages to the new unexplored places, then it is the development in terms of market.

b) Market penetrating:

The existing market is offered with existing products i.e. revenue is raised by brand promotion, little variation and repositioning of product. The customer is not new; neither product is new to the market.

c) Innovation:

The changes are made to the product/service to raise its demand. This can be change in product lifecycle, correcting the product or adding value to it.
The possible alternative ways for Disinvestment strategies can be as below:

1) Retrenchment:

It is reduction in some activities of the business which is not adding any value to the business. They objects that compel retrenchment are: market lessening, ineffective invasions, economic downturn, and alteration of possession, uncompetitive cost understanding and reduced cut-throat arrangement.

2) Divestment:

This strategy is selling-off of the division of a business for raising funds due to poor strategy like cost, unemployed imbursements, politics etc.

3.2 Select an appropriate future strategy for a given organisation

Ansoff’s matrix is method that British Airways is able to recognize prospects to build up a creation assortment. There are three sorts of procedures that British Airways can take after. "They are substantive development through item improvement, market advancement, vertical incorporation and diversifying, limited expansion procedure through business sector penetration or business sector advancement and retrenchment. British Airways utilizes Ansoff's framework on the grounds that it is exceptionally helpful for making an allowance for diverse choices for development, and proposes if it is better to discover new clients for live items, propose more items to the current customer, or continue with active items and exertion to acquire extra impart of the business sector. It assists them to think about the dangers interfaced with every choice and it broadens the dangers. Notwithstanding, it is used by British Airways to distinguish abnormal state procedures. The primary playing point is that it takes extremely perplexing situations and considers a quick and simple appraisal. The item improvement constrains their rivals to enhance and after to enhancement, they increase money or other monetary point of interest and it utilize BA’s picture and credit in one business sector to form into an alternate where organization picture and notoriety could be discriminating segments for achievement.
Retrenchment is all about reducing sales and its employment by BA to slice out the costs or expend in undertaking the activities and they can removal a few manufactured goods or demote that not beneficial. It facilitates to diminish the dimension or assortment of BA functions. It moreover lessens their expenses with the purpose of turning out to be economically secure.

Task 4

4.1 Compare the roles and responsibilities for strategy implementation

The strategy implementation has to be successful for the effectiveness of the management. This implementation is necessary for the effective communication, attaining good team, shared values etc. This causes the team cohesiveness which is necessary for the business to attain its objectives and growth (Baden-Fuller and Morgan, 2010). The strategies have to be shared with the employees so that the clearly know their roles and are able to identify the gaps and expectations with the ability to cover these gaps and fulfilment of the responsibilities. The successful strategy is free of any issues relating to the responsibilities and there is clarity of tasks to be performed as well as regarding the task performer.

Customer strategy:

Listening to their clients and concentrate on the passenger's necessities and needs. BA attempts there level best to make the beneficiary clients completely fulfilled and different types of grumbles are engross by the staff as they accept that client is constantly right.

Pricing strategy:

BA is reasonable for a large portion of the UK’s working class; in any case, because of the fast build in the expansion in the recent years. BA, to keep its items competitive for the white collar class, ought not to expand its rates; as it is monetarily solid enough to relinquish benefit to develop its target market.  Moreover, BA ought to likewise present more lavish items to luxury class, preferably keeping the cost of those items beneath, or closer to competitors’ to ensure that each fragment of the business purchases from it.

Promotional strategy:

Notwithstanding the limited time blend concocted for its items portfolio will chiefly attention on billboards besides BA will be having immediate promoting and deals advancement through its sales representative going to neighbourhood offices, newspaper publishers etc. Inside association centre items ought to be publicized with the assistance of publications.
Notice OF BA: Publicizing is truly vital for any item or for any little business creating. This is additionally truly vital venture of showcasing blend or just promoting
BILLBOARDS BANNERS: It publicize through billboard out and about side, or by staying their flags amidst the street, on the grounds that each individual can see the billboards effortlessly in light of the fact that it is out and about side or on the off chance that it is a standard so it could be seen a whole lot effectively by anybody.
Web: It additionally publicizes through the web, it likewise takes a request through the web. They speak with their clients through web. In the event that anybody needs to think about it so everything is available there in subtle element.

4.2 Evaluate resource requirements to implement a new strategy for a given organisation

To implement a new strategy in British Airways, the available resources need to be analysed so as to form the competitive strength. The functioning of any strategy is totally dependent on the resources. These resources assist British Airways in achieving a competitive advantage over its competitors. The operations of British Airways are all over the globe and it is one of the premium Airlines service providers. The strategy implementation is effective in case it is undertaken by right kind of employees. The main resources of the firm are human resources, which transform the other assets into revenues. So for British Airways the crew members and pilot etc. is people who add the quality to the business and bring in the revenues for the firm. The strategy making of BA cannot ignore the human resources. Similarly, the successful implementation also needs consideration of financial assets of the firm. This is necessary to assess whether the business would be able to fund the chosen strategy. The business strategy of selling the tickets at the lower costs needs to be assessed on the availability of financial resources.
The strategy to recruit the employees for BA has to be effective so that the employees get a nice environment to work in. The employees rewarding and motivation makes the employees of BA to attain the vision of the firm i.e. keeping the customers satisfied on the earth and in the air.
BA has crew members, aircrafts and managers as the most important resources for strategy implementation. Administrators ought to survey the holder in accomplishing the targets. They ought to handle regular dissentions of the clients and guarantee not to rehash if once more Account administrators ought to be in charge of overseeing every day and yearly records. Deals administrator ought to be made in charge of expanding the deals by no less than 2% in every 3 years. Adjacent to all the exercises administrators ought to be made in charge of observing the execution of the workers. The administrator ought to additionally be made in charge of managing crude material suppliers about evaluating, timing and amount of crude materials.

4.3 Discuss targets and timescales for achievement in a given organization to monitor a given strategy.

British Airways is one of the leading airlines in the World. In a progress to develop its customer make, BA is fluttering for a global expansion strategic agreement. The association has lots of companies in more than 10 countries all over the world. The group aims at opening new stores in some areas where there has been no operation. BA is guided by six fundamental values: the system eminence, accomplices, clients, its stores, vicinity and shareholders (Maskrey, 1989).
At the point when considering concerning objectives and timescales for success of business to screen a given line of attack it is supreme to regard as their declaration of purpose. With this respects to BA, their long haul targets will influence their transient targets and timescales. These fleeting targets will assist their organization to watch a known procedure crosswise over diverse divisions and check various distinctive approaches to thrive in it. The main target is to develop its piece of the pie through the years while expanding client's dedication. BA attains its targets by tendering latest affectations to accessible clients. This will inflate their dependability furthermore pull in new ones. BA presents its clients with vouchers as an enticement and extraordinary offers; however the timescale of this business sector will be every year, and they laying down unique offers amid Christmas and New Year and during other festive seasons so that people can plan their holidays in a better way.
In BA execution targets ought to be set and controlled among the workers by the chief. These targets ought to be set to keep work power dynamic furthermore to keep an eye on the execution of the workers. BA has a through and through administration approach it has an imperious administration where supervisor gives the requests and sub-ordinates need to satisfy it accordingly the targets set by the upper administration is must to be accomplished for the continuation. Same administration ought to be kept up with respect to as its fruitful. The execution standards ought to be kept up through recruitment of value staff.
For another business sector advancement an overview of EU ought to be led through particular firm to help utilize the assets accessibility work and time at ideal. The overview ought to contain inquire about the economic situations, contenders, target customers, climate of prospect place, accessibility of work and different components. The time scale for the review will be no less than 20 months. At that point a structural designer ought to be enlisted to draw a configuration of the new airdrum. Moreover an agreement ought to be drawn with a constructor for the design and settlements of the new airport. The time scale for settlement of building will be 4 to 5 years. Amid the development process special exercises ought to likewise be dispatched side by side with it. After all is carried out BA ought to movement its items to the new destination and ought to begin working inside section of time. So the aggregate time for the opening of the new airport at new destination will be one 3 years and 8 months.

References

Dye, R., Sibony, O. (2007) How to improve strategic planning, The McKinsey Quarterly 2007, No. 3, p. 40–48.
Hambrick, D., Fredrickson, J. (2001) Are you sure you have a strategy? The Academy of Management Executive 2001, November, vol. 15, No. 4, p. 48–59.
Johnson, M.W., Christensen, C.M. and Kagermann, H. (2008): Reinventing your business model. Harvard Business Review 86(12), 51-59.
Maskrey, A. (1989)”Disaster mitigation: A community based approach” Development Guidelines 3. Oxfam, Oxford.
PESTLE extracted from External Environment - PESTLE on 16^th Aug’2014.
Strategic contexts extracted from www.BritishAirways.com on 16^th Aug’2014.
Strong, B. (2005) Strategic planning: What’s so strategic about it? Educause Quarterly 2005, No. 1, p. 4–6.
Teece, D.J. (2010) 'Business Models, Business Strategy and Innovation.' Long Range Planning, 43:2-3, 172-94.