Analysis of British Airways' Competitive Strategy: HR and Finance

Desklib provides past papers and solved assignments. This report analyzes British Airways' competitive advantage.

Business Essentials
1

Table of Contents
Introduction......................................................................................................................................4
Human resources relevant to that organisation's competitive position........................................5
Finance and accounting relevant to that organisation's competitive position..............................7
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
2

Introduction
British Airways is the second largest airline company in the United Kingdom. The airline’s
headquarter is at waterside near London Heathrow airport. It generates the highest revenue in the
airline sector. In this report, there will be a discussion on British Airways efforts to gain/maintain
competitive advantage among the competitive market. \ Human resource management of British
Airways helps in achieving a competitive advantage. Human resource management helps to face
the challenges related to employees hiring, recruiting, selection, training, performance appraisal,
health and safety, and motivation. Human resource department plays a strategic role in managing
the employees and management of an organisation. It maintains the link between employee and
employer. Apart from that, there will be a discussion on the accounting and finance department
of British Airways which helps to maintain a competitive position in the market. It maintains the
proper books of accounts. It takes the record of income and expenses to manage the cash flow of
an organisation.
3

Human resources relevant to that organisation's competitive position
Human Resource Management maintains a balance between the needs of the employee and
employer of an organisation. Human resource department helps in creating a competitive
advantage among the competitive market. It is the most valuable function of Human resource
management in an organisation (Arasti, et. al., 2012).
HR Team of British Airways creates a competitive advantage among market
Analyses of Data turnover rates – Human resource management helps to analyse the data of
turnover rates. It identifies the problems of the data. It determines the challenges and issues to
take the corrective action for the same. It checks the data if an issue arises in new hire
employees. So, it can provide training to reduce the issues and wastage of resources of an
organisation. It is an analysis of high turnover rates. It also focuses on to get high turnover from
all the departments
Recruiting of the right talent to grow in a competitive market – It is the responsibility of
Human resource manager to hire talented employees for the right position. It helps to grow in the
competitive market. HR expertise searches for potential candidate for recruit on right position at
the right time. It takes the interview of many candidates to select the best potential candidate for
an organisation.
HR can give insights into how other organisations within your industry are structured – It
analyses the market by the information data to check what efforts need to apply to maintain its
competitive position in the market. It also checks the data of a competitive organisation to create
a competitive position among the competitive market.
HR can use data to show how the skill sets of the employees are evolving over time- Human
resource department assists in maintaining the gap between existing and addressed issues. It
fulfils the challenges or issues arise while work by taking corrective actions.
Design employee development pathways – Human resource management develops the
development strategies for the development of an organisation. It provides the proper training to
newly hired employees and refreshment training session for existing employees of an
4

organisation (Atanasov and Black, 2016). It also takes a session to develop the skills of
employees.
HR can use data to find potential employee issues before they become problematic – Human
resource department finds outs the issues arise while potential employees working. It solves the
issues before any problem creates in an organisation. It tracks the data on employee engagement.
It conducts many activities for employees. This communication helps to know the issues and
concerns of employees. Human resource manager researches about the performance employees.
It also gives warning signals for the improvement of performance. Human resource management
plays a significant role in the impact on morale and turnover of the organisation (Dawson, et. al.,
2016).
HR can put together succession plans that take into account the organisation's strategic
goals – Human resource management makes the strategic plan for employees for achieving the
goals of an organisation. It focuses on the higher turnover of an organisation. It helps in
maintaining a competitive advantage among the competitive market. Human resource
department makes a plan according to the goals of an organisation. British Airways makes a plan
considering the other competitors of organisation.
HR analysis the performance of employees – Human resource management is an analysis of
the performance of existing employees. It takes out the good performers and highlights it Top
level management. It focuses the good performers and provides rewards & incentives to motivate
remaining employees.
HR guidance on legal issues can keep the organisation out of costly legal problems – Human
resource department takes care of legal issues arises in an organisation. It helps in protecting
from costly legal problems of an organisation. It helps to save the time, effort and cost of an
organisation. It prevents from major setbacks of company.
Give HR Leadership Positions – Human resource manager defines the description of hiring
upcoming position of an organisation. HR determines the salary of new hire employees. It is also
taking care of the hiring process of an organisation. HR professional decides the step by step
procedure of employees. HR plays an important role in identifying the tactics and recruitment
pay of organisation. It focuses on hiring talented potential employees of an organisation (De
5

Jong, et. al., 2015). Few times Human resource management amends in the policies and
procedures to hire the potential employees. It focuses on retaining the best existing employees of
an organisation.
HR Determine Training Programs – Human resource department decides the goals and
objectives of an organisation. Human resource management takes the decision to make the firm
profitable. It proves the required training for newly hired employees. Training provided to new
hires is according to the specific work type. Existing employees also take training to up-skill the
working of an organisation. Refreshment session provides to employees to increase their
working knowledge (Jiang, et. al., 2012). It helps to increase the production. It enhances the
quality of work. Human resource manager monitors the performance of employees to implement
and achievement of goals and objectives of an organisation.
6

Finance and accounting relevant to that organisation's competitive position
British Airways focuses on maintaining competitive advantage among the competitive market.
Finance and accounts department of British airways plays a significant role in maintaining a
competitive position among organisation. Accounts are creating records of credits and debits of
the business. It analysis the trends and changes arise in the organisation. Accounts help in
generating the skill set among employees. Accountant requires sharpening skill to maintain
proper accounts.
Keeping a record of Data – Accounts is totally based on data. It provides information which
helps in the decision making of an organisation. Accounts are taking the support of technology
for collecting data and making data more accessible. Artificial intelligence helps to keep a record
of data processed and handled completely. Accounts help to maintain reliable data. Technology
helps to complete the data entry automatically to maximise the efficiency of an organisation.
Accounts are willing to translate better data information and actionable piece of information.
Fostering Communication skills – Accounting is an essential part of the business. It helps to
record the data and information on the business. Accounting helps to make proper
communication between customer and organisation. It helps in making a budget, financial
reports, and payroll to present the exact data to management. Financial records are helpful for
future planning of the business. Accountant assesses the specific communication process
between employees and employer. Professionals can take decisions after checking the financial
data to make smart choices for the business organisation.
Becoming a cyber-security – Cyber security is the major concern in the industry. It affects the
retailers, government and credit reporting agencies to effort the cybercrime. An accountant has
the responsibility to equip the information needed to prevent the risk of cyber security. Security
involves data must be kept confidential from all parties, safeguard must be placed to protect data,
access of data in a secure way, data protect unauthorised changes and data must be destroyed
properly with right permission (Labusch, et. al., 2013). Handling of information digitally helps to
maintain a competitive advantage among the competitive market.
Cultivating Adaptability – Adaptability is the important skill required in accounting. Industries
are being replaced by digitalisation. The main fear and concern is the replacement of human
7

expertise. It reduces employment opportunities. Accountants are considering as the assets in the
organisation. Accounting requires wisdom potential to make a record of data. An organisation
adapts new technology to determine the values of humanity. Adaptability helps to implement
change in an organisation. High adaptability leads to maintain a higher competitive position in
the organisation.
Improved Efficiency and service delivery – Financial management helps to bring the
opportunity of automated service. The employee is working on performing the task manually.
The employee is work on giving efforts to the business sector to attract the attention of
consumers. It provides an increased level of efficiency. High-quality services provided to
customers to maintain a competitive position in the market. It also helps to maintain a good
relation with customers.
Free cash flow – It measures the efficiency of financial resources. It helps to generate extra cash
which will help in investing in other sectors. It determines the available cash flow after reducing
all the reductions. British Airways increases the operating cash flow of a firm. It determines the
capital expenditure to reduce the wastage to gain a competitive position in the market (Loughran
and McDonald, 2016).
Growth indices – Growth indices help to evaluate the sale and market share growth. It is
necessary to identify the trade-off growth with a reduction in profit margins, cash flows, and
return on investment. Growth determines the trade-off of reserve borrowing funds. The basic
need for management is to maintain sufficient cash and limited borrowings.
Financing decision and capital structure – Financial management helps to manage the optimal
use of capital structure (Mosadeghrad, 2014). It helps to reduce the cost of capital. The capital
structure identifies the reserve borrowing capacity. Business grows when the capital structure
when the cost rises above the competitors.
Economic value added – The risk of an organisation adjust on the basis of management
effectively. Management takes a decision on the basis of financial planning. It maintains proper
data of budget, cash flow, and payroll management. Value implements the corrective actions in
destroying values. It identifies the net income after deducting the operating capital cost. It
economically assesses the value of the business. Business value contributes to adding the value
8

to maintaining a competitive position in the market. The fundamental success of the plan
depends on firms' alignment with the external environment, sustainable competitive advantage,
and realistic internal view (Robbins and Judge, 2012).
The selected functional areas has helped the company to get sustain long in the competitive
world. The market position of the companies has also got changed in past few years. The
strategic planning in the functional area has helped in attaining the success and growth in the
present market situation.
It can be suggested to the company that in coming year it must take up the possible market
opportunities so that it can be able to perform effectively and well in the competitive market. It is
very important for the company to do focus on all the functional areas of the businesses so that
the emerging challenges can be able to get meet timely and in the required manner. The changing
market needs has to be prioritised by the company for which proper market survey is needed.
This will help company to get stable in coming 2-5 years in the market.
9

Conclusion
From the above report, it is concluded that the Human resource department and financial &
accounting department of business plays an important role in maintaining the competitive
advantage. British Airways takes the help of the Human resource department and financial &
accounting to meet the competition of the market. Human resource management helps to
increase the turnover of employees in an organisation. It helps to reduces the conflicts arises
among the employees of an organisation. It provides training to improve the performance of
employees. It provides training and development sessions to employees. It helps to control the
budget of organisation. Finance and accounting department helps to take a record of data and
information of an organisation. It helps to measures the financial performance of employees and
improved efficiency of workers. It keeps records of financial matters which includes revenue
analysis, financial matters, profit and loss management, debts, credits and business expenses
which helps to maintain a competitive position in the market.
10

References
 Arasti, Z., Zandi, F. and Talebi, K., 2012. Exploring the effect of individual factors on
business failure in Iranian new established small businesses. International Business
Research, 5(4), p.2.
 Atanasov, V.A. and Black, B.S., 2016. Shock-based causal inference in corporate finance
and accounting research. Critical Finance Review, 5, pp.207-304.
 Dawson, A., Hirt, M. and Scanlan, J., 2016. The economic essentials of digital
strategy. McKinsey Quarterly, 3, p.45.
 De Jong, M., Marston, N. and Roth, E., 2015. The eight essentials of
innovation. McKinsey Quarterly, 2, pp.1-12.
 Jiang, K., Lepak, D.P., Hu, J. and Baer, J.C., 2012. How does human resource
management influence organisational outcomes? A meta-analytic investigation of
mediating mechanisms. Academy of management Journal, 55(6), pp.1264-1294.
 Labusch, N., Aier, S. and Winter, R., 2013. Beyond Enterprise Architecture Modeling–
What are the Essentials to Support Enterprise Transformations?. Enterprise Modelling
and Information Systems Architectures (EMISA 2013).
 Loughran, T. and McDonald, B., 2016. Textual analysis in accounting and finance: A
survey. Journal of Accounting Research, 54(4), pp.1187-1230.
 Mosadeghrad, A.M., 2014. Essentials of total quality management: a meta-
analysis. International Journal of Health Care Quality Assurance, 27(6), pp.544-558.
 Robbins, S.P. and Judge, T., 2012. Essentials of organisational behaviour.
11

12