Virgin Atlantic: Business Environment Analysis and Strategies Report

This report provides a comprehensive business analysis of Virgin Atlantic, examining its organisational structure, business environment, and strategic approaches. It begins with an introduction to the airline and its role in the industry, followed by an in-depth exploration of its hierarchical organisational structure, including its advantages and disadvantages. The report then delves into the business environment analysis, encompassing a SWOT analysis to identify strengths, weaknesses, opportunities, and threats, and a PESTLE analysis to assess the political, economic, social, technological, environmental, and legal factors impacting the airline. The analysis covers various aspects, from financial performance and market position to competitive pressures and external influences, offering insights into the airline's challenges and prospects. The report concludes by summarising the key findings and implications for Virgin Atlantic's future, highlighting the importance of adapting to the dynamic business environment and leveraging strategic frameworks for sustainable success.

Table of Content.
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Organisational Structure..............................................................................................................1
Business Environment Analysis:.................................................................................................2
SWOT Analysis:..........................................................................................................................2
PESTLE Analysis:.......................................................................................................................4
REFERENCES................................................................................................................................6

INTRODUCTION
Business is an activity involving manufacturing, buying and/or selling products to make
living or money by making profit. A business also plays an important role in the growth of GDP
of a country. A business focuses on achieving their organisational goals with the help of their
workforce, as an organisation can not run on it's own in order to carry out it's operations it
requires effective workforce. Business merely depends on workforce it also needs to look after
other aspects and one of the aspect is organisational structure. It is a requisite for any type of
organisation as it enables smooth functioning of business operations. It helps in creating a
blueprint for the organisation which are directed towards achieving organisational goals through
activities like supervision, allocation of task, and hierarchy. The chosen business for the
following is Virgin Atlantic. It is a airline founded by Richard Branson in UK. This is the
seventh largest carrier of passengers along with this it has three classes according to the
requirement of the passengers i.e., economy, premium, and business class. This report will be
brief discussion of organisational structure and its business environment along with SWOT
analysis and in addition with this a PESTLE analysis.
MAIN BODY
Organisational Structure
The system that creates a blue-print for certain tasks to be carried with in the organisation
which directly or indirectly helps in achieving organisational goals. The actions involved are
policies, roles and responsibilities (Ciulla, 2020). It also helps in determining the flow of
information among the employees of the organisation. Determining the framework assists
business to stay focused over attaining the aims of organisation effectively and efficiently (Iosim,
Popescu and Vuici, 2019). There are different types of organisational structure out of which the
tall structure also know as hierarchical structure will be discussed below along with its
advantages and disadvantages in context to the chosen business.
Tall structure:
Hierarchical structure involves many leaders and management levels. This type of
framework basically follows a ‘top-down’ approach along with a long ladder of commands in the
organisation. This type of framework implies a span of management for the managers
1

(RECTOR, 2021). The flow of communication takes time in this structure as the the information
has has to passes across each level of the command ladder.
Advantages and disadvantages of tall framework in context with Virgin Atlantic:
Advantages Disadvantages
 It offers promotional opportunities for
employees. This can promote feeling of
motivation among the team members of
Virgin Atlantic to work hard in order to
achieve organisational goals.
 The field areas are properly managed
and supervised. This helps the team
members get better support from the
experts.
 Due to different fields of areas and
great support from the experts leads to
job specialisation.
1. Implementation of organisational
changes can be slowed down at Virgin
Atlantic. Firms with a long
communication line is more likely to
take abundant amount time to respond
to changes.
 In context to the chosen firm this type
of framework can also results in
delaying of information sue to long
chain of command.
 Due to lack of independence can rise a
feeling of demotivation.
Business Environment Analysis:
The term business environment means effect on business due to all aggregate external
factors, people, forces, institutions that are beyond the powers and control of the organisation
(Cherunilam, 2021). These factors can put a significant effect on the organisational growth and
functions. For instance, Virgin Atlantic focuses on strategic engagements with different partners
along with developing powerful strategies that helped business to fulfil customer needs and
function properly in the time of global pandemic.
SWOT Analysis:
2

Strength:
 Quality: in context to Virgin Atlantic,
they have highly focused on a quality
experience for their passengers by
following a complete quality
management along with they provide
efficient services. In additions with this,
they look after room for improvement
ensuring quality.
 Position: this is one of the strength as
they provide utmost care and quality
experience to their passengers that
helped them create a brand image.
Although the prices are high for these
airlines but the quality check and
personalised attention attracts the
attention of passengers.
Weakness:
 Financial problems: due to the
situation of Brexit in Britain can cause
loss of profits. This is because it the
drop in the value of pounds can effect
their revenue.
 Poor operations: even after providing
quality services to the passengers for a
long time, their competitors have
somehow managed to follow the same
strategies and even better. Due to this
Virgin airline had to face certain
problems. In additions with this their
competitors offers almost similar
services at lower prices which attract
the travellers.
Opportunities:
 Preferences: there have been a notable
rise in business travels due to rise in
more corporate working professionals.
This rise in travel preferences as a trend
can be proved as an opportunity for this
aviation brand.
 New routes: introduction and opening
of new routes can be also an
opportunity.
Threat:
 Competitions: the competitors are
trying their best to thrive as an
individual brand with all the possible
services along with the advanced
technologies. This is building more
trust among the customer in other
airlines. This may effect their business
adversely in future.
 Union clash: Brexit have negatively
effected condition of Virgin Atlantic.
This is because a concerning sudden
fall was noticed in the preferences of
3

the passengers.
The above data determines that the company holds a strong position in the market but
they still need to work in-order to maintain their reputation and smooth functioning of
operations. They must try to eliminate the threats and weaknesses as much as possible (Teoli,
Sanvictores and An, 2019). Grasping the possible opportunities can also help them gain profit
and with only business to offer certain facilities and offers will promote more customer
engagement.
PESTLE Analysis:
It is a framework used by managers and business leaders for effective decision making
strategies (TINGSAGER and SMITH, 2022). This framework is created through a thorough
analysis of factors effecting a business externally. Following are the factors effecting the Virgin
Atlantic:
 Political factors: this deals with the factor such as trade policies, taxation policies,
political stability or instability, etc that can effect a business directly of indirectly. The
stable political situation of Britain can help the chosen business to maintain stability.
However, due to certain political situation with other countries may effect their
operations.
 Economical factors: here the managers look after the economy of their country that can
impact business. Factors such as seasonal factors, labour cost, growth rates,etc. It can
have impact positive or negative impact on the Virgin Atlantic. For instance recession
can impact business negatively and inflation may have positive impacts on business.
 Social factors: social behaviour, attitude, beliefs and trend are the external factors such
as impact an organisation. In accordance with chosen company this does not put adverse
effect on its organisational growth as there are many people who desires to travel and
others travel to go back to their home towns. However, it can have unfavourable impact
due bad customer service resulting in customer's preference to other airlines.
 Technological factors: it refers to technologies that may affect market and business
operations favourably or unfavourably. Some the few examples are emerging techniques
or technologies, intellectual property regulations, research and innovation. Usage of
4

advanced technologies ensuring safety passengers safety will build trust among
customers. On the other hand if the firm is not able to stay updated with the technology it
can have opposite effects.
 Environmental Factors: this determines concerns regarding scarcity of raw materials
due to exploitation or increasing pollution affecting the environmental surrounding.
Choosing to support environmental concerns will create good-will among the customers
but if the chosen business does not focus on addressing these concerns then might impact
the business negatively.
 Legal Factors: it can be partly related with political factors but this factor add-ons more
factors implying law, policies and regulation followed within the geographical territory.
Airline industries have various rules and regulation to follow ensuring passenger's safety
and protecting their rights. This might have favourable and unfavourable impact on the
business depending on how well this industry focuses on following those rules and
regulations.
CONCLUSION
From the above report this can be concluded that, in order to carry a stable position in the
market organisations requires a framework that suits their operations the most and also accepted
by their employees resulting job satisfaction. This report further included analysis on tall
organisational structure along with SWOT. In addition with PESTEL analysis effecting the
chosen business.
5

REFERENCES
Books and Journals:
Cherunilam, F., 2021. Business environment. Himalaya Publishing House Pvt. Ltd.
Ciulla, J.B., 2020. The importance of leadership in shaping business values. In The search for
ethics in leadership, business, and beyond (pp. 153-163). Springer, Cham.
Iosim, I., Popescu, G. and Vuici, A., 2019. Communication management in hierarchical
structures. Lucrări Științifice, Universitatea de Științe Agricole Și Medicină Veterinară
a Banatului, Timisoara, Seria I, Management Agricol, 21(1), pp.33-40.
RECTOR, D., 2021. Organisational Structure.
Teoli, D., Sanvictores, T. and An, J., 2019. SWOT analysis.
TINGSAGER, C. and SMITH, F., 2022. Strategy and structure. Studying Human Resource
Management: A Guide to the Study, Context and Practice of HR, p.41.
6