Strategic Management Report: Analyzing Decisions for Business Growth

This report provides an analysis of strategic decisions made by a company facing challenges over the past three years, aiming to improve overall organizational welfare. It covers issues such as high fare charges, legal disputes, bad service, and the impact of the COVID-19 pandemic on the aviation industry. Solutions such as lowering ticket prices, adhering to government regulations, improving service quality, and implementing COVID-19 precautions are discussed. The report includes a strategic audit of British Airways' performance, an explanation and justification of strategic actions, and a critical reflection on the effectiveness of these strategies. External analysis is conducted using the PESTLE framework and Ansoff Matrix to assess the market environment and identify growth opportunities. The report concludes by highlighting the importance of continuous improvement and adaptation to changing market conditions.

Individual management
report

Executive summary
In this report, will various strategic decisions have taken into consideration for welfare of
company(Cozmuta, 2021). These will be type of decisions which are taken by firms which are
facing problems over past three years and are taken for overall welfare of an organisation. There
are certain problems which have faced by an organisation due to several factors, by properly
implementing such strategies business can solve those problems and achieve their organisation
goal in effective and efficient manner. It will also covered that what are the suitable solutions for
an organisation which are dealing such problems and how they will overcome from
it(Thompson, 2021).
For the given document there were several presentations of problems and issues identifies
in respect to KPI of chosen aviation industry. Rising in prices of tickets causes a serious
problem and affects the overall profitability. So in order to deal with this firm had lower down
the fairs of tickets to make to more consumer affordable(Evans, 2019).
Legal issues also caused problem for given organisation, so in order to deal with that
issue the mentioned firm have to follow all the rules and regulations laid down by government in
order to remove complexity and problems in future.
Services of mentioned company is not good as what customer expects from them, so in
order to deal with that firm had improved its service as per desired manner it had started serving
hygienic food to their customer as earlier they were providing bad quality food.
Covid-19 precautions were not there is the flights so that customer don't prefer to travel
via flights. The mentioned company had made proper covid precaution in their flights in order to
remove the spread of corona virus and make customer feel safe while doing journey. In the
report external analysis has been performed with the help of ansoff matrix as well as pestle
analysis.

Table of Contents
Table of Contents
...............................................................................................................................................1
Executive summary..........................................................................................................................2
Introduction......................................................................................................................................4
Main Body.......................................................................................................................................4
Strategic Audit............................................................................................................................4
Explains and justifies the strategic actions identified in the Executive Summary-....................5
Critical Reflection.......................................................................................................................9
References......................................................................................................................................11

Introduction
Auditing is defined as an evaluation or analysis of company's financial statement In order
to know the future performance of company and what actions should be taken by company in
future to improve its current performance(Morrell, 2021). The term strategic audit is defined as
the auditing or evaluation of strategies set by companies top level management in an organisation
to find out that whether that particular strategy is suitable for business to achieve its long term
goals or not(Alanezi, and Al-Zahrani, 2020).
Main Body
Strategic Audit
In the context of respective organisation, will do the strategic audit of strategies taken by
company to evaluate the business performance in past three years.
(Source: Annual operating profit of British Airways plc from 2011 to 2020 (in million GBP)*)
From the analysis of above chart it can be said that respective company is not performing
well from last three years, 2018-2020. There are several reasons behind the downfall of
mentioned company and strategic option for that problem are:
 High fare charges- Generally respective organisation charges high fair charges from its
customers, as a reason customers don't generally prefer to travel by flights, they prefer
train or other mode of transport to travel different place. Hence , this is the first reason
Text 1: Past years performance of British Airways from 2011-2020

behind downfall of mentioned company. Mentioned company can reduce the prices of of
tickets upto certain level so that it come pocket friendly for passengers(Kaplan, 2021).
 Legal disputes- This is another important reason behind the declination of profits of
company from last three years. The mentioned company is always have some legal
disputes like rising petrol cost, environmental issues, staff strike issue and several issues
from government as well for not following ethical code of conduct while performing
business operation(Ramanadham, 2019). These disputes put a question on creditability
of mentioned company . Hence due to this customers don't prefer to use the service of
that company, this result in downfall of profits of company. Mentioned company can start
follow government rules and regulation and also need to follow code of conduct which
laid down by government.
 Bad Service- The service which are provided by mentioned company is not in good
manner and not as per what customer expects. They offer unhygienic food and sometimes
stale food to passengers which is not good for their health. Hence, this rise question of
creditability of mentioned company because passengers don't prefer to travel by those
flights which offer unhealthy food as health is first priority of customers. This is another
reason for downfall of profits of company is last three years(Rapajic, 2018). Mentioned
company can provide hygienic food to their passengers to solve that problem.
 Corona Pandemic- This disease which came from China is major factor which destroys
the business of mentioned company completely as it put the profits of company in
negative way. During corona, government had announced complete lock down as a result
people were not allowed to move out of their home and this destroyed the business of
mentioned company completely in such a way that profits were went negatively. Due to
this company have to lay off jobs of many people and gave a refund to all those people
who were booked their tickets pre Covid-19. Hence this is another most important reason
behind downfall of mentioned company(Grefe, 2020). Mentioned company can provide
PPE equipment to their passengers who come to travel in plain and can also provide mask
and sanitizers to them in order to reduce the infection of corona virus.
Explains and justifies the strategic actions identified in the Executive Summary-
This report justifies the different strategic decision taken by the company to improve their
products and services. British Airways is the UK's largest international airline. The current

strategies of British Airways is to manage the cost, modernise aircraft services and enhance
customer's satisfaction level to retain the existing customers and attract new more(Taylor, Moore
and Byford, 2019).
The British Airways deals in passenger segment with the customers of 20-50 years of age
group from upper middle or upper-income social group with a tag line ' The World's Favourite
Airline' . The level of customer's satisfaction is always checked by company through various
techniques and methods to retain its customers for long. It manages its work globally with
competitors like Singapore Airlines,American Airlines,Silk Air and many others(Tofalli, N.,
Loizia, P. and Zorpas, A.A., 2018).
British Airlines had lost its grip before the pandemic once it was a reputed company but
now it is not performing successfully as it had planned. In spite of decline, the company
continued to bring new ideas to meet the customer's requirement.
Strategic action is an action that aims at accomplishing the objectives and also focuses on
overall strategy of the company to make sure the efforts of employees, bring together to help
them grow and face all the hurdles. It helps to prioritize goals,make better decisions,boost
efficiency and to keep the resources mobilized to take actions. It gives attention to their
customer services .Main issue arises during strategic action is the external environment. The
strategic methods helps an organisation to allocate resources simultaneously analysing the
market position to improve operations. These actions allows the company to maintain its present
situation and generate good amount of money(Ringham, and Miles, 2018).
Analysis with PESTLE
It helps in understanding market growth or decline ,potential and direction for operation. It is
widely used tool by marketers to monitor the macro environmental factors that have an major
impact on an organisation, company or industry (Formerly known as PEST Analysis)
Pestle analysis of British Airlines is done by following manner-
Political factors- The way government intervenes in the economic and other factors that can
affect a business. These include the trade traditions,political stability,labour
law,bureaucracy,tariffs trade restrictions and tax policy. British airways is not following
some polices that leads to its decline hence, it should follow the rules and regulations of
government to make sure the safety and security of all the customers flying through British
Airways.

Economical factors- Economic factors include economic growth or decline,
interest,exchange,inflation,wage-rates,and,minimum-wage working hours
unemployment(local and national ),credit availability and cost of living. These factors are
determinants to an economy's performance that directly impacts a company's performance.
Covid-19 pandemic has impacted all the industries,all the sectors and all aspects of lives
same with British Airways. Covid lead to keep the planes of the world on the ground. As
the aviation industry has always been a target for government's regulations. The huge drop
in demand of passengers due to COVID-19 pandemic it is a dangerous situation for both
firms and employees . COVID-19 has brought wage subsidies,proper use of human
resources and a new suite of loans and raising concerns about competition.
Social factors-Social factors includes ,media,health,cultural norms ethics,education and
expectation,age distribution,population growth rate,religion, ,brand preferences. ,health and
safety. These factors are helpful for companies to better plan their marketing analytics and
strategy. Brexit was the economic slowdown that affected the economical situation of the
airlines industries which lead to unemployment and negative impact on profitability.
Technological factors- The latest technology is helping the company in a positive manner like it
helps the aircraft to use less fuel that will automatically reduce the operating cost of the
company. It also saves energy, includes Innovations and developments in technologies.
These factors make an impact on organization's operation. Several new developments like
Deep learning, Artificial intelligence,machine learning are being made in the technology
field and if a company fails to match up the trend it may lose its position in the market. It
may have a direct or indirect impact on an industry. It includes technology aspect like R and
D activity,automation and technology incentives(Wilson and Jahankhani, 2020).
Legal factors- These factors have both external and internal sides. Certain laws have an impact
on the business environment in a country. Legal frameworks includes tax law,employment
law and the regulations, employment laws , discrimination law, company law,consumer
protection,industry specific regulation,regulatory bodies,antitrust law,health safety law and
many other laws. This is a important factor of airline industry as its growth declined
drastically affects the profitability of the airline industry. The trade of union has affected so
badly because of actions caused by strikes (Mills and Helms Mills, 2018).

Environment factors- Environment factors is mainly concerned with the effect of the
surrounding environment and the influence of ecological aspects. Environment factors
include water disposal laws,environmental protection laws recycling ,pollution
control,energy consumption regulation, climate, environmental offset,global climate
change,stakeholder and consumer value. Main problematic area is pollution. British Airways
has taken many initiatives towards the environmental approach to make its business more
sustainable like growing the fuel efficiency and reducing its carbon footprint (Chapman,
2019).
Ansoff Matrix of British Airways
The Ansoff Matrix was developed by business manager and mathematician Ignor Ansoff. It is
tool used by company to plan their strategies for growth and helps to analyse the risks associated
with each one. It shows four strategies that will be used to analyse the risk associated with each
strategy. It is also known as Corporate Ansoff Matrix. Following are the four dimensions of
Ansoff Matrix of British Airways -
 Market Penetration: is is the safest of all the options. The firm uses its products in the
existing market and focuses on expanding sales in existing market. It can be done by
acquiring a competitor in the same marketplace or decreasing prices to attract new
customers and many other techniques. British Airways is also facing competition with
other companies so they are developing attractiveness by offering tickets at reasonable
and attractive price because competitive pricing plays a essential role in the airline
industry(M. Deal, J. Mills, and Helms Mills, 2018).
 Market Development: The firm enters a new market with its existing products. It
includes catering to different customer segment or entering into a new domestic market.
British Airways is always trying to be the best by introducing several loyalty programs
for their business customers(Edelman, Perkins and Brewster,2019).
 Product Development:This area is slightly more risky because Company is introducing
a new product into its existing market. The firm develops a new product to cater to the
existing market. This strategy can be implemented in many ways like forming strategic
partnerships with other firms to gain access to each partner's distribution brand or
investing in R&D to develop new products to cater to the existing market. British

Airways has introduced different services like in flight entertainment ,internet services,It
also has cabins that allows customers to sleep,work and eat.
 Diversification: This is the riskiest of four options. The company is selling new
products into new market in order to capture the market and increase the profitability .
Although such strategy is the riskiest. There are two types diversification
 Related diversification
 Unrelated diversification
British Airways procured new aircraft and shift to new routes , it increased the marketing
cost ,aircraft maintenance expenses and reduced the number of passengers. The British Airways
should go for association with other Jet airways that will help British Airways to increase the
destinations in the different countries(Doganis, 2019).
Critical Reflection
In my views, strategic auditing plays a very vital role in overall success of an
organisation. If an organisation will do the strategic audit of its business strategies carefully then
they can evaluate whether the business will achieve its goal with the help of that strategy or not.
In British airways company case I have noticed that company is charging so much fares
charges from its customers which reduce the profitability the company as customers don't prefer
to pay such a heavy prices instead of that they prefer to travel by road transport. In my views
mentioned company should lower down its cost and make it upto that level which is affordable
for customer to travel.
Secondly, I have noticed that British airways is always indulging in so many legal
litigations which I believe that company can avoid if management shows some maturity. If
company will follows that business guidelines laid down by government for doing business and
give time to time increment to its staff on the basis of their performance then such kind of
litigations can avoid and it will develop positive image of company in market.
Thirdly, I have noticed that British airways company provide bad quality of service to
their passengers in the terms of unhygienic food and many more. Health is first priority for every
person and there is no customer in the world who will sacrifice their health. I advice that
company should sacrifice their profits and spend more amount on providing good quality of food
and beverages to their customer. This will create positive image among customer that British
Airways not only concerned about profits but also about health of passengers.

Lastly, I have noticed that corona pandemic completely destroys the business of firm and
turn the profits in negative manner. In my point of view if company will apply some precaution
al measures in their flights then they can again rise their profits. Following measures are:
company can put hand sanitizer for every passenger along their seat so that it reminds customer
to sanitize their hands every time, During this pandemic so many people have lost their jobs, for
the sake of them it should have to cut their prices up to break even pint. It is point of no profit no
loss.
After making this report I have learned so many things like problem solving skills and
good analytical skills which will help me in my both professional and personal growth in future.

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