Travel and Tourism Business Toolkit: British Airways Case Study

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THE TRAVEL AND TOURISM BUSINESS TOOLKIT
The Travel and Tourism Business Toolkit
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Introduction
Travel and tourism have been one of the extensive businesses in several continents all around
the world, and this has been because of the raised outflow and inflow of people to
unconventional and engaging locations.
Furthermore, the airline industry has been one of the most flourishing businesses in the travel
and tourism market and has been concerned with the incremental changes within a few years
(Shaw 2016). The companies to enhance the operations and to become flourishing in the
market have used some fiscal analytical models. The study will focus on the fundamental
principles of revenue management and how a company can manage budgets or maintain
monetary or statistical records. The human resource strategy and the life cycle of human
resources in a company will be highlighted along with the legislation and ethics that is
associated with the travel and tourism industry. The company British Airways will be considered
during the project, as it is one of the largest airlines based on the United Kingdom aviation
industry. It has a large number of customers and a fleet size. Currently, the company has more
than 272 aeroplanes, and the estimated revenue of the company is around 12 million Euros
(Britishairways.com. 2019).

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LO1
Introduction
This report focuses on the features of yield and revenue management in the airline industry and
British Airways, United Kingdom, and will focus on understanding the basics of seasonality and
perishability drawing causative connections on the number of tourist’s footfalls within the
country.
Seasonality of industry drives the process of consumer decision making considering the zone of
materialistic distinctions within the tangible phenoms and the seasonality of the establishment.
Seasonality is a significant factor that affects the travel and tourism industry, and even the
pricing strategies of several companies are changed due to these phenomena (Analoui 2017).
The background of general perspicacity is taken into consideration during the pricing strategy,
for example, the companies of the United Kingdom provide the customers with massive
discounts during the period of decreased inbound and outbound within the country.
Perishability can be defined as the unremunerative adventures that are illustrated by the unsold
tour packages, which do not create abundant resources (Nobes 2014). This process also drives
the pricing strategies of the companies, and the existing packages need to be recreated so that
it becomes sustainable in the future.
A definition of revenue and yield management
The characteristic of yield management can be defined as a type of variable pricing strategy that
considers the behaviour of the consumer so that profits can be optimised from time-related
sources. It also considers the concept of marginal cost pricing, which helps to set up the pricing
strategies per the operational cost and is inclined to maximise the profit of the company (Prassl
2014). Otherwise, revenue management can be defined as the application of statistical
assessment that helps to predict the behaviour of the consumer so that the products can be
optimised to increase profitability and growth of the company in the future.
The rationale and principles of revenue management for the travel and tourism industry
The rationale of yield management can be associated with the general purpose of applying
strategic control so that the companies can focus on a proper fraction of customers. Whereas,
for the case of revenue management it is concerned with the understanding of the ideas and

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perceptions of the customer and the value they get when they use a particular product or a
service, correlated to the prices of products (Lawton 2017).
An investigation of how the airlines' industry applies revenue management tools to
generate and maximise profit.
The allocation of discounts
One of the significant scientific tools that help to estimate yield management is by earmarking
different discount for customers in the airline industry. By increasing the number of discounts in
the packages provided by the companies, it will help to build procuring probabilities for all
classes. However, this process is discarded to increase the purchase of particular interest
clients of similar flights, and therefore it becomes easy to estimate the number of seats
maintained for each section, acknowledging the engendering of immense profits. Several
instances have occurred in the British Airlines where there was an ample number of seats left to
reserve (Belobaba et al. 2015). For the case of Airbus A320, 156 seats could have been
reserved in a stipulated time, and the yield managers did not interject a discount system to
expand purchases, as they knew that various business travellers would book the seat on a later
date and they cannot provide these customers with designated seats. This would diminish the
profits of the company too. However, they also thought that if there were a decrease in last
minute bookings, then the company would run in a loss and therefore, they selected some
specified seats and segmented them for the leisure and business travellers without any
discounts (Shaw 2016). After they introduced the discounted rates, there was an increased
profit from all the targeted audiences.
Utilisation of capacity
The airline industry is subject to seasonality, and therefore chances of demand uncertainty can
be seen in this industry. In several Seasons, the purchases of the customer’s decreases to a
huge amount and therefore the companies will have to mitigate this factor and address the
problem of the uncertainty of demand. In the case of British Airways, the potential capacity is
taken into consideration and the managers to design the measures for increasing the number of
seats using the utilised capacity (Worth 2018). This has been a good strategy, and the
company has one able to save 2.7 billion dollars during the seasonal time, and 7% increased
capacity utilisation has been accomplished.
Duration control

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Duration control can be defined as a strategic lever that helps in yield management, and the
implementation of this concept can help in keeping up the income and profits of the company,
devoid of the influences in the market due to seasonality and changes in customer demand.
However, the implementation of the duration control depends upon the situation of the market
that can reduce the uncertainty of the duration, the time consumed between the interactions
between the consumers and the company, and the uncertainty of the arrival of excess demand
(Asquer 2017). Companies as if British Airways has implemented duration control through flight
leg, and this can be defined as the overall time taken by the customer from a single destination
to another. This type of duration control has helped the airline industry and companies like
British Airways to develop the ‘origin-destination pairs' and has helped to predict extended
programming and forethought to yield management standards. This has helped the company to
become more profitable in consideration of the potential constraints (Slack and Brandon-Jones
2018).
The impact of differentiated pricing strategies on revenue management in the airlines'
industry
The concept of variable pricing strategy
Variable pricing strategy is used ordinarily to accommodate the product rates so that the
companies can augment a proper balance between the profits earned by the company and the
overall sales volume considering the factors traded. Companies as British Airways was able to
make this concept applicable in the market; however, they have to maintain the time of
purchase as a parameter during the implementation of the strategy. This means that the prices
of the products or services will be for different in different points of time. This is why, when the
ticket is booked ahead of schedule, the prices are lower (Camilleri et al. 2018). It is evident to
the companies that the people who buy the tickets at a limited time are generally
businesspersons and therefore, these people can be charged more.
The perception of differential pricing
Differential pricing can be defined as the process of selling a particular product and service to a
customer at varying prices according to the category in which the organisation has distributed
the person. Many airline companies like Kingfisher and Lufthansa have used this so that they
can extend the arrangement of small and long-term segments (Palmer and Bejou 2016).
Lufthansa has differentiated the products according to the span, and the short term flights

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exhibited the discrepancies in the rate depending upon the conditions of booking. Kingfisher had
offered at a differentiated price ranging from 400 Euros to 150 Euros for the economy class
depending upon the inclinations of reservation (Koklic et al. 2017).
Conclusion
This part of the assignment has helped to understand the groups that have implemented the
revenue and yield management tools and has described the reason, for which they were taken,
preferably capacity utilisation and discount allocation. This report has also accommodated to
surmise the experiences that are indebtedness on the reckonings of the duration of control.

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LO2
Introduction
This part of the assignment will concentrate on the notion of the human resource life cycle, and
the evaluation of the stages of the human resource life cycle will be developed. A performance
management plan will likewise be elaborated on the specific role taken, and recommendations
will be presented of how the means and the documents of the various staging of the life cycle
can be gained. Talent acquisition process will also be taken into consideration; the issues faced
by the company, British Airways concerning talent acquisition and retention, will be highlighted
concerning the HR life cycle.
Issues in talent acquisition and retention
Talent acquisition can be defined as the process through which a company gathers a skilful
candidate for the requirements of the business so that the person can understand the necessity
of the company. One of the major problems faced by the companies is an increase in talent
gap, and it has been because of the decrease in the supply of skilled labour in this industry
(Chen et al. 2016). There has been a mass retirement of talented and competent professionals
as well, and an increase in new entrants has caused problems for this company for gathering
skilled candidates and for catering the demand in the market. Besides, an increased amount of
rivalry, lack of proper training methodologies and other problems has to lead to such a problem
in talent acquisition. The Company will have to introduce new techniques and strategies to
eradicate issues in terms of employee retention and acquisition and will have to take in
consideration the competition in the market for acquiring the skilled and experienced employees
(Spasojevic et al. 2018).
Factors leading to a specific job at British Airways for a revenue manager
The revenue manager of British Airways will have to be responsible for managing the revenue
of the company and will have to work with a vibrant team of well-informed professionals for a
greater understanding of the business of the organisation. The revenue manager will be posted
on the London city airport for three years, and a person will have to work closely with the
executive and the team of inventory managers to encumber fundamental objectives and social
benefaction. The person will also be responsible for developing pricing strategies in the London
city airport and will have to support other departments related to the information technology,

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conformance and policy extension (Arjomandi and Seufert 2014). Other than that, the person
will be responsible for reviewing the issues of talent acquisition, the human resource life cycle
and employee retention. This helps the company to increase profitability and realise substantial
economic consequences.
The five stages of the human resource life cycle and its importance to the job role of
revenue manager
Recruitment: This is the first and foremost process, and this is where human resource
management will have to hire suitable candidates suitably and adequately. For the job role of
revenue manager, the human resource manager will have to focus on building a proper
package considering the wages and salaries and the competitiveness of the organisation so that
proficient and capable candidates can be attracted (Cascio 2015).
Education: After the recruitment process, the recruited candidate will have to be trained and
developed so that the person can understand the culture inside the organisation and capital
utilities can be formulated on the individual’s part. The revenue manager will have to be
disciplined on the practices inside the organisation as well as the values so that the network can
thrive and exhibit (Careers.ba.com 2019).
Motivation: This is also one of the most critical tasks of the human resource manager.
Motivation is essential to retain the employees in the company, and therefore, the revenue
manager can be motivated through several motivational techniques and frameworks. The
person can be offered a reward or incentive in cash or kind. This is likely to increase the
efficiency and productivity of the employees.
Evaluation: It is Important to measure and evaluate the performance of the employees at
periodical instances and therefore, the Human Resource Management which have to monitor
the performance of the revenue manager. It will be seen whether that revenue manager in
British Airways can understand and predict the demand in the market. It will also be seen
whether the person can develop pricing strategies according to the demand and optimise
accessibility for best financial outcomes (Hecklau et al. 2016).
Celebration: This is the last phase of the human resource life cycle, and the human resource
manager will have to revitalise the revenue manager for the hard work provided to the
company. Even if the person could not achieve the targets, proper training and development will

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be provided, and benefits like awards and incentives will be provided for the hard work
implemented. Even a festive bonus can be provided for retaining the revenue manager.
Performance management plan
Specific The expectation of interest in flight tickets Improvement of accessibility
of tickets and valuing
Measurable This can be estimated by assessing if the
revenue manager can envision the requests
effectively
This can be estimated by
assessing the level of offers
and benefit
Achievable This is finished via completing statistical
surveys
This is finished by watching the
client behaviour
Realistic Different companies have pursued this means Numerous associations have
executed this strategy
Time
Bound
Three months Three months
Table 1: Performance Management Plan
(Source: Created by the learner)
Recommendations
The first process of recruitment can be improved in British Airways, and the job description can
be divided so that the candidate searching for the job can find the job efficiently. The news of
the recruiting manager should have been advertised on several papers and social media
websites. Besides, a skill test should have been introduced, and formal communication should
have been completed before the job interview.

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For the training and development session, the human resource manager could have arranged
for documented policies regarding the culture and values of the company or some PowerPoint
presentation could have been created for a better understanding during the training session.
Even the managers should have participated in the program, and a proper activity list should
have been provided to them before the implementation of the training and development session
(Taqi et al. 2018).
A proper evaluation of the task completed by the revenue manager could have been done with
the help of key performance indicators and analytical frameworks so that statistical data could
have been provided for the better understanding of the lack of knowledge, which could be
worked upon later.
The company can provide the employee with proper incentives and benefits like Health
Insurance, additional income opportunities, flexible working hours, free trips and many others.
Conclusion
This part of the assignment has helped to understand how talent acquisition is essential for a
company and how it helps to decrease the risks and saves time. Issues faced during talent
acquisition in British Airways have been highlighted in detail and recommendations have been
provided for the same. Finally, the five stages of Human Resource life cycle have been
highlighted concerning British Airways.

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LO3
Explanation of the relationship between regulations, standards and legislation
Legislation can be defined as a statutory law that is a governing body for a specific legislature
comprising of the body processing or making it. Regulations can be defined as the obligation
and agreements that are defined by the legislative bodies or the legislation itself. British Airways
has to follow the legislation of the aviation industry of the United Kingdom, which includes the
Civil Aviation Act based on the Civil Aviation authority regulations (Ambrosie 2015). This part of
the assignment will focus on the regulations the company has to follow and the way it helps in a
flourishing proliferation of the enactment.
Legislation that has to be followed in the airline industry and its implications
Data protection and confidentiality
According to the General Data Protection Regulation Act, the companies will have to keep the
personal data of the customers confidential, and none of the data can be handed to third parties
without the consent of the consumer. For the case of British Airways, the customer details
stored on cloud servers will release the company from the threat of data reaching to third
parties. This kind of legislation helps to keep the personal details of the customers confidential
and builds up a transparency between the organisation and the customer (Modica 2015). The
company will also have to mention about the data protection and confidentiality legislation on
the company website, and if the company fail to maintain such legislation, the company can
have to pay 20 million Euros or 4% of the annual turnover to the concerned authorities. This
legislation is important, and if it is not followed, the company can be in the risk of losing brand
image and even render financial loss.
Legislation related to the environment
British Airways has to follow specific environmental legislation based on the United Kingdom.
The corporation will have to adhere to the Long-range Transboundary Air Pollution Convention
and will have to plead every impression within the framework based on ICAO. The company will
have to diminish emanations of greenhouse gases from the combustibles used for the aircraft,
and according to article 2 (2) of the Kyoto obligation, the fellowships will have to collude with the
multitudes and ICAO to focus on the prosperity of the environment. The company will also have
to follow the frameworks based on international standards and recommended practices in terms

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of decreased noise pollution on the aircraft, which is again underlined as an Annex 16 to the
Chicago convention.
The rights of the passengers
British Airways will have to follow the Consumer Protection Act and Consumer Rights Act for
understanding the rights of the passengers in UK aviation. The company will have to consider
this policy during the cases of rerouting and delays and will have to provide the customers with
refunds and compensation in cases of cancellations (Block and Landgraf 2016). Customers
must be assisted with communicating resources, accommodation and provision of meals and
the company will have to reimburse the expenses incurred by the consumers within the seven
days of reservation. If necessary, the company will have to provide a free flight to the
destination of departure. Policy for immediate cancellation will be implied in cases of
unpremeditated cancellation without notification to the customer.
Illustrate how the company, employment and contract law has a potential impact on
business decision-making in the airline industry. Implications of different legislation on
decision making of the travel and tourism industry
The company law has an impact on the decision making of the airline industry, and two of the
main impact includes the pricing mechanism of the investors as well as the statute on wealth
creation. The company law creates a separate legal entity on the life of the organisation, and
therefore, it can own assets, and necessary action can be taken in terms of legal and financial
stipulations. Therefore, the company will have to take into consideration the company law in
corporate governance and capital requirements so that they can maximise the wealth through
shareholders and stakeholders and consider a business analysis (Vajirakachorn and
Chongwatpol 2017). Company law in the aviation industry creates a bonding between the
negotiations, the shareholders and directors, which alters and affects the pricing mechanism.
This affects the legal matters related to the agreements of shareholders and the contracts with
directors in the company.
The employment law is related to the employees in the organisation, and therefore, the Human
Resource Department is accountable for the workplace related laws (Taylor and Emir 2015).
This kind of legislation related to the employment law helps to drive the environment within the
organisation. The company will have to decide about the minimum wages and overtime of the
workers and to keep the workers safe and secure in the workplace. British Airways have to