Strategic Change Management Plan for British Airways
This assignment is an individual assignment.
This assignment requires you to: For an organisation of your choice, you should formulate a strategic change plan either for the operations of an existing international business or for organisation intending to internationalise. The strategic change plan should be based on a detailed strategic audit and evaluation of strategic option(s). Strong rationale should be provided for the chosen strategic option. Critical evaluation of requirements for implementing the strategic option chosen should also be considered. For instance: issues such as strategic change management, and cross-cultural implications.
You will write a 2000-word essay (strategic change plan), as 'management consultant' and are expected to work on this assignment throughout the course of the module. Your 2000-word strategic change plan should be articulated in a professional manner as if delivering the plan to the company’s Board of Directors for its consideration.
The strategic change plan should consist of at least the following major elements:
• A strategic audit
• The generation of strategic change options and evaluation of strategic change plan in terms of feasibility, acceptability and suitability criteria.
• An action plan for implementation.
The paper aims to provide a view of the strategic change management plan developed by the business. To effectively offer the perspective on the situation, the organization British Airways has been selected. The paper also discusses the strategic audit, which consists of the macro-environmental analysis of the company along with industrial analysis and internal analysis of the company. The paper also provides the strategic formulation along with the strategic implementation required for the company's development.
British Airways is the flag carrier airline of the U.K. It was founded in the year 1919 as the Aircraft Transport and Travel Limited, and the year 1974 the British Airways and is the second-largest U.K. based carrier and also the first passenger airline that have generated more than 1 billion U.S. dollars on a single air route(British Airways, 2021). They have a fleet size of more than 254 and are the destination of more than 183 countries worldwide. They provide the best service to the passengers with luxurious cabins and services for the passengers. They have been constantly ranked within the top 20 safest airlines globally for providing safe journeys to their passengers(British Airways, 2021). The organization has also developed effective measures during the COVID-19 situation to provide consumers with the best health measures.
The strategic audit is an in-depth understanding of the business environment, and it provides successful strategies and aligns with the strategy based on the market insight. In this section, three main layers of the environment will be effectively discussed as the beginning of strategic thinking for the relevant changes within the business.
Political factors play a vital role in the aviation industry as it can be seen that airlines have to work within an operating restriction. During the COVID-19 situation, the organization had to change its operating activities according to the government rules and regulations for providing safety to the passengers. The government and political activities strictly provide the airline industry rules to carry 50% of the passenger. The passenger should have a vaccine certificate or perform a COVID test 48 hours before boarding the airline(El-Boghdadly et al., 2017). British airways being the flag carrier airline of the U.K., effectively maintain the government rules and regulation.
The economic condition of the country provides effective value to the business environment for strategic planning. It can be seen that low fuel prices have effectively increased the profitability of British Airways in the short term. The recent pandemic has created a huge impact on the country's economic condition as numerous people lost their jobs (Cook, 2018). In this situation, British Airways have maintained their strategic value for maintaining the OVID situation and economic condition. Furthermore, the planned third runway of the company results in shifting the operating cost of the airport operational offices that maintain the economic factor.
COVID-19 has created a huge social and cultural impact on the business as it can be seen that the tourism and travel sector were highly affected by the pandemic. For that, there was a temporary shutdown of the company. Furthermore, the main target of British Airways is the millennials as their travel habit are different as compared to the previous generation. They have also presented their brand as the trusted airline that provides low-cost carriers and follows all the rules and regulations of COVID-19.
Technology is the central factor that drives the airline industry's growth and helps improve the safety and operational features within British Airways. The investment within the technology and the warehouse management system will effectively help improve the consumer experience and help reduce costs (Benger et al., 2018). Furthermore, it can be seen that the airline is investing in technology for making their fleet more fuel-efficient and also to offer the best experience to the passengers. It can be effectively understood that technology helps the airline sector to enhance its brand value within the market.
Industrial analysis (Porter’s five forces)
Bargaining power of customers
This is considered a high threat for British Airways as the bargaining power of the consumers' level is high. In recent times, people want transport medium with safety measures and low cost for travelling (Aslam et al., 2018). This eventually allows the airline industry to enhance its operational activities and business process.
Bargaining power of suppliers
British Airways also face a high threat due to the bargaining power of the suppliers. The suppliers for airplanes are minimum, and switching suppliers is a very difficult task and involves huge investment.
Threat of substitute
It is a moderate threat for British Airways as there is a substitute for the consumers like the train, bus, and other transport media. In the COVID-19 situation, the substitute became quite effective for the consumers, and for that, British Airways had to face threats from the other transport medium.
The threat of new entrants
Entering the airline industry has numerous barriers like a massive investment than getting desired market share and also little product differentiation. It is a low threat for British Airways as they have maintained an established position within the market (Too, Le, and Yap, 2017). New entrants did not have the suitable scope or market position to develop their business value.
British Airways face massive competition within the market. The competition level includes the local airline along with the international airline. It effectively shows that British Airways needs to improve its quality and operational activities to maintain its value in the highly competitive market.
· They have the strong backing of the U.K. government
· Have the fleet size of more than 260 aircraft (Gibson and McDonald, 2017)
· Technological strength along with international destination
· Sponsorship of the events like Olympics then Wimbledon, and much more
· High-class service to the passengers
· Have the Rolls Royce engines
· The revenue is highly dependent on the local market
· The Heathrow Terminal is the primary hub across the world
· Expansion within the international market (Gibson and McDonald, 2017)
· Alliances and code sharing with the global airlines
· High level of competition
· COVID-19 impact on the business
· Regulatory factors
How to compete
The generation of the strategic options effectively begins with the choosing strategy with the help of which a business pursues competitive advantages within the market. Three generic strategies could be understood from Porter's generic strategy. In this situation, it is highly recommended that British Airways focus on the differentiation strategy (Gómez-Ríos et al., 2018). The airline industry has a high risk of competitive advantages because there is less differentiation of product and service within the airline companies. The differentiation strategy will help the business focus on the present situation of pandemics and provide valuable service to the passengers.
Strategic change options
It is highly recommended to the business regarding the strategic change options related to diversification and product and service development. The diversification allows the company to provide comprehensive packages to the millennials (Hausladen and Schosser, 2020). With the help of this strategy, the company will be able to diversify its income stream in the domestic and international markets. The product development strategy allows the business to enhance its service and product developed within the market. With their service and product development strategy, British Airways can provide safe travel to their passengers in the COVID-19 situation.
Method of growth
The strategies effectively show the development of new products or services within the airline industry. From the SWOT analysis, it can be clearly understood that the present situation of pandemics created a huge impact on the business. The level of competition is also high within the domestic and international markets (Brewster et al., 2020). It is highly recommended that the organization maintain suitable and effective value within the market for providing their best service to the passengers. Investment in research and development allows the business to improve its competitive strategy within the market and hold its brand value.
Evaluation of the strategic options
The strategic option is effectively developed by understanding suitability, acceptability, and the feasibility of the strategy developed by the business. The product and service development strategy allow the business to perform its activity most feasibly. The business accepts the situation of COVID-19 and creates valuable service facilities for providing a safe and secure traveling experience to the passengers (Asai, 2018). Therefore, the challenges like the resistance to change then lack of domestic experience can be effectively mitigated by using operational strategies.
To put the product and service development strategy, the following is effectively recommended;
• Strengthen health measures: In the COVID-19 situation, it is essential to provide health and safety measures to the passengers. The company effectively develops the hygienic measures in the most effective way that provides valuable service to the passengers and safe journey. The passenger needs to follow the government rules and regulations for boarding an airplane, and also the company maintains their health safety and measures for dealing with the situation.
• Create and adapt the open-air spaces: In many airports, it can be seen that passengers like to spend their downtime in the open outer space, and for that, British Airways developed their strategic change management for developing suitable out space for the passengers (Asai, 2018). After having numerous security checks and health measures, passengers like to spend their time in the out space. British Airways are improving their service facilities for maintaining the passenger and providing them with the best service.
• Ensure cleanliness at all the stages of the journey: Due to the pandemic, situation government has the rules and regulations for maintaining safety and cleanliness within the business sector (Tawse, Patrick, and Vera, 2019). The strategic development of the airline company is to perform sanitization daily and have the team and equipment for health checks up for the passengers. It is also essential to have the COVID test center provide valuable checks up to the passengers.
It is concluded from the paper that a strategic change management plan allows the business to enhance their market value and their working function effectively within the market. It can also be concluded that British Airways effectively maintain the government rules and regulation for providing safety measures to the passengers in the COVID-19 situation. The organization also has a suitable and effective brand image and backing from the U.K. government, which allows the business to provide their best service for the passengers and at the minimum aeroplane fare. The business needs to maintain its strategic value and change management to deal with the pandemic situation and serve suitable health measures to the passengers. It can also be concluded that British Airways maintain their status and value within the market.
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