British Airways: Evaluating Business Environment and Challenges

This report provides an analysis of British Airways, a prominent UK airline, focusing on its business environment and challenges. It examines the company's structure, influential elements of the business environment, and a PESTLE analysis covering political, social, technological, environmental, legal, and economic factors impacting the airline. The report discusses the competitiveness of the UK market and its effects on British Airways, including the impact of Brexit and economic conditions. Furthermore, the report identifies problems and challenges faced by British Airways, such as operational failures and over-reliance on the UK market. The conclusion summarizes the airline's position as a leading player in the industry.

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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
MAIN BODY ..................................................................................................................................3
British Airways............................................................................................................................3
Influential elements of the business environment and it brief structure......................................3
discuss the business organization and its nature of British Airways .........................................4
Pestle analysis of British airways:...............................................................................................4
Discuss the competitiveness of the UK market and its impacts..................................................8
Example ......................................................................................................................................8
Problem and Challenges.............................................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES................................................................................................................................1

INTRODUCTION
MAIN BODY
The present report based on British Airways which is introduced in 1974 when UK two
government owned airlines, its is now owned by company called International Airline group that
is considered as largest airways of UK. Also, study highlight on Standard industrial classification
and influential element of business environment, evaluating STEEPLE in order to analyse
external factors. Further, analysing economic factors by considering determinants and
competitiveness of UK market by identifying challenged faced by chosen company.
MAIN BODY
British Airways
The chosen company for report is to British Airways from Standard industrial
classification (SIC 2007), it is public limited company that is owned by shareholders who have
limited liability. The public company are related to large organization which shares traded and
also brought on Stock exchange (Balmer, Stuart and Greyser, 2019). On the basis of current
standard it has been analysed that SIC help for establishing other statistical units that are related
to economic activity which need to be engaged. This is the different kind of service global airline
that are offer low fares with an extensive global route network on the basis of flying that are
located at airports. This is different from all the airways because it flies more than 200
destinations in 76 countries.
Influential elements of the business environment and it brief structure
Business environment do not operate in order to create the dynamic environment by
directly influencing on how to operate the action that achieves objectives. Also, the external
business environment companied by numerous outside organization that can be force by other
business environment. British airways influences by competitive element in order to complete
the great deal by making the combination differentiation strategy that are related to efficiency of
service delivery process that can be attained competitive advantages with addition other
supplementary services which are helped to enhance the customer experience (EAWLS and

Airways, 2018). This is the important element which help to attract large number of customer by
segmented on the basis of travel, friendly on staff board which provide ones of the best loyalty
to the customer.
Also, the organizational structure opted by British Airways is flats structure in which
company more focus on small management levels but as wide spans of control (Nicolini, G. and
Salini, 2019). Also, it is related to the airline which adopt divisional structure that is mainly
dealt nature of business in order to determine the customer focused.
discuss the business organization and its nature of British Airways
British Airways operates the largest airline in United kingdom and the nature of the
business is to provide legally set up goods an service to the customer of the country. Also, it has
been analysed that organization consist of large number that are help to bring together the people
in order to bring new ideas that can help by achieving goals and objectives by using different
tactics that come up with short runs as well as long run for success in nears future (Eckel, Eckel
and Singal, 2019). Also, The organizational structure is necessary to determined in order tos
more focus on meet the need and preference of organization. Then it is help to set up division
and specialization of labour focusing in context to maintaining the co-ordinations that help to
achieve target. Also, Flat organizational structure is used by the company in order to estimate
wide span of control. It can be said that organization used divisional organization structure which
helps to because nature of business is customer focus. It is beneficial for providing clear visions
to employees by identifying job roles and focused on time.
Pestle analysis of British airways:
Pestle analysis is a concept which used as a tool by companies to track the external
environment they are planning and operating. It can be an effective tool to use in corporative
strategy planning and also identify the business strategy. The political situation, technology
developments, environmental factors, legality , economic and social factors all plays and
important role. It determines the future scope and its action as well as development of strategic
management. In this PESTLE analysis of British airways, in order to illustrate the management
strategies of macro and micro environment of airways company. British airways faces several
challenges which can be operational as well as economical and political. It also leads
opportunities which created by political, economical, technological, legal and others (Gupta,
2019).

 Political: Political factors are playing and important and increasingly central role in the
sky-driving industry. The role of government policies are more important for the political
stability in the airline company which also helps in the term of market attractiveness and
the regulation on the aviation industry. The airline industry are specially affected by a
government policies in the leading sky driving market. The United Kingdom sky-driving
industry was regulated by EU legislation which included traffics rights, safety regulation,
personnel licensing and operator licensing. In the UK, aviation industry oversees its
leading authority under the Civil Aviation Authority. Post Brexit, UK airlines lose
influence over development of European aviation safety agency (EASA) legal framework
as well as uncertain strikes from employees unions in United Kingdom affect the airlines
services and its brand image.
 Social: social factor includes the demographic changes which are very important for the
aviation industry. In further illustration, consumer safety and convenience, specially
focus on he flights operators, social image and the reputation of the airlines companies
become an important factor that affect the business profitable. Apart from this, social
image are more important which can direct troll on the aviation companies. Due to
coronavirus, almost all the airlines in the world are shutdown which has been severally
affected the British airways. The aviation companies plays a responsibilities by
increasing the perception of British airways as a low cost carrier (Jackson, 2020).
 Technological: Technological factor are main factor of the airline business for driving
the growth of the airline industry worldwide. Digital technology helped the airline
businesses to enhance their more customers and grow themselves efficiently. British
airways decide to invest more in the technologies which helps to enhance the
probabilities and also ensure the high efficiencies and better services. In particular
aspects British airways also invest in the warehouse management system will improve
customer experience and reduce costs. Apart from introducing new technologies and
more fuel efficient aircraft, the AIG group is the parent company of the British airways
helps to become an operational efficiencies as well as maintain the company's reputation.
 Environmental: Environment factors are concern for the airline operators as well as
aviation authorities and regulatory authorities around the world. In order to British
airways taken a steps in the direction to minimize its environmental impact which making

its business models more sustainable. British airways command on airlines purchasing
the carbon pollution allows for operating in EU region which is planned by the parent
company of British airways to achieve net zero CO2 emissions. British airlines specially
focus on its sustainability particularly, main reasons behind its including the better
reputation and social image benefits from the UK government as well as customer
satisfaction and improved operational efficiency.
 Legal: legal factors are really important for the aviation industry including the United
Kingdom market. British airways is required to remain compliant in the market because
the customer convenience and passengers security that are law related to labour. There
are several laws which are regulated by govern, the UK airlines industry has until Brexit
remained which regulated under the EU regulations. The competitive analysis of British
airways are settlement payments made to employees regarding lawsuits. Apart from a law
related the operations, labour laws and pilot's strike are significant area which affecting
the British airways.
 Economic: Economic changes directly affect the business of the airline industries in the
United Kingdom. Economic stability, GDP and the level of unemployment factors affect
the travel and flight operators. Economic slowdown has a negative impact on the revenue
and profitability of the airline operator. The economic situation in a country directly
impact on the profitability of airline brand operating industry.
In term of supply, price is essential variable to carry the supply curve. Example, The low fuel
price have increased the profitability for the airlines operational offices and increasing costs. As
aspects of supply, cheaper fuel price increase the supply of airlines tickets. In other words,
consumers will buy more but only at a low price. UK's economy suffer al lot due to uncertainty
by Brexit. British airways effect by the uncertainty over Brexit impact to reduce major
investment by United Kingdom. Elasticity of demand are also important factor that influence the
airline industry which based on the competition affects the price of airline tickets. The diagram
of demand curve :

In term of demand, the change in demand which affect to the airline industry. The beginning
changes that can shift demand curve in income. In further illustration, high income passengers
able to purchase the tickets in replacements of choosing cars and trains. Demand of the airline
industry which are directly influenced by their employees wages and income of the passengers.
particularly, the wages of employees in the airlines are considered in the recent years
(Kongsamutr, 2020). when the demand is elastic, revenues and price will be negative thus, when
the demand is inelastic, price and total revenues will be positive. The supply curve diagram

In the British airway industry, the demand curve and supply curve affect the economy
development. Airline industry has concern many determinants which can affect the airlines
demand and supply.
Discuss the competitiveness of the UK market and its impacts
The competitiveness of UK market are ensured about the policy and procedures used by
company in order to compete with other companies (Mills, 2021). Such as practice encourages
British Airways for compete by getting higher efficiency and wide variety of choice that is
related to providing high quality of services in order to oriented nature of business. The
competitive pricing are using in order to deal with news and existing organization including big
organization also help to rely on quality services so that it help to gain loyalty of customer by
attracting customers from attractive price in such a way in order to improve the quality of its
services.
Example
In order to consider the random shock it has been analysed that in the competitive world
it is necessary to adopt fair business practices which are necessary in the business environment
that can be managed and introducing fiscal and monetary policy (Moyer, 2019). Also, it is
necessary to uses the high impact in order to operates different activities of business organization
that help makes their business decision process. Various legal policies are employees in order to

change the policy regarding taxation laws. Such policy impacted on economy by making specific
laws that can be affect the business operations that directly impacts on financial resources.
Problem and Challenges
It has been analysed that the challenges faced by British Airways are related to failure on
the basis of human error which is based on engineer disconnected and then reconnected the
power of supply in order to centre the data by uncontrolled and controlled action. Also, it
meltdown by blamed the responsible person because at that time they use aggressive cost-cutting
technique and outsourcing of jobs (Prokesch, 2020). Moreover, the weakness is related to
British Airways is to found the problem by considering over on reliant on UK market. Then
more revenue generated by UK have the problem regarding makes it vulnerable to any potential
market slowdown and intensifying competition in UK.
CONCLUSION
In this conclusion, British airways is one of the biggest leading airlines. The company have many
ups and downs in the past year. British airways comes with the innovation leader in the industry
of aviation and attaining its sustainability in the market. As a conclusion, studies about the
marketing strategies and pestle analysis of aviation industry and its business organizational
structure..

REFERENCES
Books and journal
Balmer, J.M., Stuart, H. and Greyser, S.A., 2019. Aligning identity and strategy: Corporate
branding at British Airways in the late 20th century. California Management
Review, 51(3). pp.6-23.
EAWLS, S. and Airways, B., 2018. Population and habitat viability assessment for the African
wild dog (Lycaon pictus) in southern Africa.
Eckel, C., Eckel, D. and Singal, V., 1997. Privatization and efficiency: Industry effects of the
sale of British Airways. Journal of Financial Economics, 43(2). pp.275-298.
Gupta, A., Gupta, N. and Gupta, M., 2019. British Airways-A SWOT and PESTLE Analysis-The
impact of Europe 2020 policy. NOLEGEIN-Journal of Corporate & Business
Laws. 1(1). pp.1-11.
Jackson, S. and Tozer, J., 2020. A vision for data science at British Airways. Impact, 2020(1),
pp.15-19.
Kongsamutr, N., 2020. Impact on Thai Airways of Air Transport Liberalisation in Thailand.
In Aviation Law and Policy in Asia (pp. 221-234). Brill Nijhoff.
Mills, A.J., 2021. Cockpits, hangars, boys and galleys: Corporate masculinities and the
development of British Airways. Gender, Work & Organization, 5(3). pp.172-188.
Moyer, K., 2019. Scenario planning at British Airways—A case study. Long Range
Planning, 29(2). pp.172-181.
Nicolini, G. and Salini, S., 2019. Customer satisfaction in the airline industry: the case of British
airways. Quality and Reliability Engineering International, 22(5). pp.581-589.
Prokesch, S.E., 2020. Competing on customer service: An interview with British Airways' Sir
Colin Marshall. Harvard Business Review. 73(6). pp.100-112.