Organisational Strategic analysis on British airways

Organisational strategical analysis on British air flairsThe trim down of organisational commutes is a corner st one(a) of organisational functioning, development, battle and, yet, subjectiveness. Over the past decades, the way in which volume be managed, promoted and stimulated at workplaces has become a master(a) key to assess and improve organisational efficiency and marketability and became a naval division of a general organisational dodging.The purpose of this solely overcompensate is to conduct a Organisational Strategic analysis one of the largest air passage go with British Airways. The objective of the report is to evaluate the warring and changing market condition of the airlines companies how these companies specially BAs organisational agitates occurred in last five historic periodIn terms of world-wideisation and apace changing disdain environment, as hearty as growing combativeness on the market, modern companies increasingly need to rely rathe r to a outstandinger extent on their skilled and motivated personnel than on pure technologies and productsthe report forget show us how BA wielded honouring issues principal(prenominal) objectives in making the diverseness in last five years. identify f cropors Influence of BAs organisational deepensHow managed transmit toward resistance of switchsIn the Chapter D, the aim of the main(prenominal) executive Willie Walsh for BA to be simpler and improving employees behaviour and per traffic patternance has proveed the 7S manakin argon as tumesce as white plagued. The aim of the report is to outline the atomic number 18as in which the current strategy could be improved and further related adjustments.Conclusion and recomm rarityations atomic number 18 also drawn.Table of ContentsPage No1.0 Overview of the Company1.1 British Airways Organisational shifts in last Five years1.2 Objective in making changePart 22.0Factors influencing British Airways change strategy__2.1 inhering kneadsPart 33.0 placemental Change3.1 organisational opponent how its managed3.2 Types of organizational change constituent5.0 Recommendations and ConclusionsPart 44.1 Timetable for downationsTable of encrypts Page No introduce 1 Model of Change- epoch of EventsFigure 2 Forces Causing and Resisting Change inside an OrganizationFigure 3 Statistics of Favourite airlineFigure 4 europium Sh be market place MovementFigure 5 Timetable for just implementationFigure 6 7S frameworkFigure 7 Herzbergs deuce Factor TheoryFigure 8 Factor affecting employees place5.1 Recommendations for achieving Mr Willie Walshs goal for BA,Part 11.0 Overview of the CompanyBritish Airways happens to be one of the biggest airline operators that is U.K. based and among the different operators of atomic number 63 it is holding the position of the tertiary position by and by the Air France, Lufthansa and KLM. The major jakesters of the airline be at London Gatwick, and London Heathrow in which their range of the services being provided by them from the long routes to the short routes of the domestic European flights. Manchester happens to be one of the Britain Airports from where it is operational for the long distance flights. there are most Five b low gear and fifty destinations to which the airways is providing flights at convenient timings. therefore the British Airways is a group which comprises of the opposite subsidiary firms the likes of the British Airways Plc and some others like the BA conjoin Ltd. and British Airways holidays Limited.As British Airways is considered to be a leader in the industry mainly because of the kind of the technology that is being utilized by the uplifted society in providing non-homogeneous services like the online booking system and the ticketing method of self services(www.britishairways.com)1.1 British Airways Organisational Changes in last Five yearsBritish Airways Plc the skys the limit. British Airways Plc , BA, is the leading airline in the United Kingdom, and of course one of the biggest in the world. In May 2005, Willie Walsh, saucyly taken over from Rod Eddington as chief executive, continued this active caution of attach to acculturation and said of his plyI want them to feel inspired, I want them to feel optimistic, I want them to feel that this is a adept place to be (Dangerous Company, BBC2 April 2006).Willie Walshs vision of change was so ambitious (doing get out and better, never enough for him), Walsh justified himself in saying that he had a long-term vision and lag a day-to-day one. Although before Walshs land tenure as chief executive, BA was a very good-run and profitable fellowship and it was considered as the worlds favourite airline. But as visionary leader he was make number of changes, such(prenominal) as he rationalises top backbreaking executive team from 25 to 14. Thus, he presented five objectives to earnTo confirm BA as the worlds favourite ai rline. cleanse customer service transmute through merger and acquisitionsImprove management and to be stovepipe managed company in the UKCost cutting1.2 Objective in making changeThe overall objective of Walshs glide pathed to reduce the expenditures with in the boldness as well as exterior. Walshs claimed BA needed a second revolution. At the starting signal Willie Walshs vision of change and strategies were correct however its implementation to achieve his objectives were non well-liked by employees or spate around him this resulted in employees de-motivation and de-moralization. As a result there was a intend to strike by the employees which was temporarily held by the court decision but there are planning to consent a strike.This paper discovers the phenomena of radical organisational change in last five years, its implications and consequences over the companys on the whole per engineerance and the statement of leadership and its issues? In this paper author discuss how leadership effect on organizations performance in the context of organizational change? And how well Willie Walsh did his change management strategies. Was he successful or failure. This paper reviews these questions by analysing the case study of British Airways, and also discusses the role of effectual confabulation and the motivation of staff in BA and how these aspects are interrelated with each other.Part 22.0Factors influencing British Airways change strategy__Monitor global competition, customers, competitors and other factorsNeed for changeInitiate ChangeImplement Change appreciate problems opportunities, define needed changes in technology, products, structure growFacilitate search, creativity, view champions, venture teams, skunkworks idea incubatorsUse force-field analysis, tactics for overcoming resistanceEnvironmental ForcesInternal ForcesConsider plans, goals, company problems needsFigure 1 Model of Change- Sequence of Events(Source Richard, 2001)Corpora te Innovation is something that is very hard to change and employees need eon to get used to the new way of organizing. Many muckle are non giveing to change unless they perceive a problem or a crisis. For companies with a very strong and specific culture it go out be even harder to change.Mr. W. Walsh, Chief Executive of British Airways decision to implement change at BA was influenced by a number of various factors. These were mainly based on the effects of the orthogonal environment on British Airways. BAs technology was not in keeping with the technology of their competitors and so this was reflected in its products. To combat this threat, W.Walsh.,(2009) tried implementing new procedures and changing the culture of the organization. He decided to change the organization from a technology driven company to a more service oriented one, lacking the technological specialization of its competitors, BA proposed to offer a superior level of service instead. The external envir onment threat of technology was the main reason behind BAs change.Change indoors the OrganisationForces Resisting ChangeForces for ChangeGlobal PressuresCompetitionThe MarketExternal EnvironmentAspirations of the WorkforceTechnologyCostsInertia miss of TrustComplacencyConservatismFear of FailureFear of the unnamedPower BlocksFigure 2 Forces Causing and Resisting Change within an Organization(Source Jewell, 1990)In couch to survive and prosper in a competitive and rapidly changing environment, organizations also need to change. This may be brought about by many influencing factors which may be internally within the organization or in external environment of the organization.External forces originate in all environmental sectors, including customers, competitors, technology, economic forces and the international arena.External influencesPolitical factors including enactment or other government measures. Organizations are forced to change in order to meet, for example, health and safety, environmental or consumer protection containments.The EUs laws could retard to glow into the no-frills market.This will make less competitions for BA from no-frills airlines. kerfuffle pollutions stricter laws from EU could affect all the airlines.United Kingdom start out decided not to produce the Euro would reduce number of tourists to come into the kingdom.Slots reductions at the airport could enable BA to take over other routes which are served by the other airlines.Reduction in the protection of slots, lead officularly those at the primary airports could enable British Airways to take routes served by other airlines.Government is of all time tried to protect BA as a national iris diaphragm carriers.Costs wealthy person been summationd due to increase fuel price. sparing factors such as changes in levels of unemployment and interest rates which prolong adjudge a major impact on demand.Increase the airport taxes could increase costs of the BA. untried members of EU could increase or introduced new flights to the UK which could foresee to hold up the profits.Current economic downturn and swine flu could prevent people to fly.BA and Spains Liberia airlines merged decision to increase 400 millions of synergism (http//www.breakingtravelnews.com/news/article/ba-and-iberia-agree-merger-deal)Social factors including changes in life styles and environmental issues which organizations must(prenominal) respond to if they are not to lose out to competitors.Threats from terrorists attacks could reduce people to fly such as September 2001 and most recently failed self-annihilation bomb attack at Ameri mass Airlines .Technological progress such as word carry throughing in the office or robots in the factory underside change working(a) materials, methods and practices and create the need for new skills.Trade unions can influence wage rates, working conditions and other aspects of industrial relations.Competition and changes in consumer tastes a nd demand all impact on personal line of credit organizations, making change undeniable in order to respond.Media reports which can influence consumers and employees perceptions of an organization and its goods and services.Internal forces for change arise from internal activities and decisions. If top managers consider a goal of rapid company growth, internal actions will have to be made to meet that growth ( Smillie Hailey., 2001). New departments or technologies will be created. Demands by employees, labour unions and production inefficiencies all can stimulate a force to which management must respond with change.2.1 Internal influencesNew products or services which require change in order to introduce them.Management changes, due perhaps to a merger, take over or the ap arcdegreement of new staff. This may affect the management style and culture of the organization.Quality assurance systems which are becoming increasingly important in organizations in order to meet changing customer expectations.Productivity and positiveness improvements which often require change in systems or procedures in order to control or reduce costs and/or increase output.client service is this gross more crucial than ever for organizations in competitive markets because they can solely survive and prosper if they satisfy customers.After analyzing the external environment, it can be summarized that no-frills zone may pose a big threats in the incoming. Another Problem that most recent indescribable terrorists attack had cancelled number of flights of BA.After the need for change has been perceived and communicated, change must be initiated. This is a crucial stage of change management- the stage where ideas that solve perceived needs are developed. Responses that an organization can make are to search for or create a change to adopt.The modern complex business world is being rapid changes. There are number of factors such as globalization amongst companies, changes in ma rket trends as well as companies who are more globally demanding and mature, necessary to reduce costs and the introduction of new technology has lead to companies to event large amount of competition than they had in the past.It is therefore important for organizations to stand by ahead of their competitors and recent research has indicted that the creativity and innovation of an organization can give them that competitive edge they require. By being creative and pass consumers a more innovative service or product, the company or organization will be able to differentiate themselves from others who offer resembling services. Cook (1998) found that creative organizations harness the ability to think and act in different ways that make sense to their current and future customers.BAs CEO presented his views and identified on the key drivers and directions for the airlines industry and the strategies BA will follow in the transition into the next millennium. He also reiterated BAs dedication to achieve long term growth in earnings and stockholder value in the top quartile of the major airline by centering on people, performance and growth.Part 33.0 Organizational ChangeOrganization changes its overall strategy for success, adds or removes a major section or practice, and/or wants to change the very nature by which it operates. Willie Walshs vision was the same. When in concert all employees or the group of people work to achieve the organizational goal, the organizations are become operational and successful. Therefore, organizational change is possible just when employees of the organization run into the need for change, buy-in the idea of change, are motivated towards the change, and read their interest (McGuire D. Hutchings K., 2006 Beer M. et al, 1990).Keeping in view the importance of employees, management view for change should consider the effect of the change on employees as well as their resistance and reaction on it. They should be taken into figure and should be motivated and explained reasons of change by the management while winning any decision. Other researchers (e.g. Tichy, 1983) ac fellowship the frustration that managers feel when their organizations do not respond to elaborately analyzed plans, where there is a lack of interaction between decision and action. In the case of BA, Willie Walsh did not plan to follow up change because he did not think primitive changes as process but wanted to change entire organizational culture immediately. As Whittington and Mayer (2002) also vindicate this need, adaptive reorganization, the ability to redesign structures frequently, is now critical to organizational performance.However, an effective change can only be achieved if change managers encourage employees participation as much as possible, address their concerns and repercussions and ensure them that leaders involvement would be role bewilders for a change (Heracleous, 2002). Enthusiastic Willie Walsh eager for acquireing changes in BA forgot to get his employees pertain in the change management process.Nevertheless, employees or group of people working together for organizational goal made the organizations as successful.3.1 Organizational Resistance how its managedThere are number of factors are playing for resistance to changes such as fear of the unknown, the possibility of economic in warranter, habit, threats to social relationships and failure to acknowledge the need for change (Nadler, 1988). Another issue of importance in change which is difference between how organisation looks at present and look after the change. According to Cameron et al (1993), readiness for organisational change depend on how the point in time to which a change (TQM) and existing culture differs from that culture, an organisation may be more or less ready for such a change.Tichy and Devanna (1986) discuss creating a need for change in effect, opening up the organizational culture to be receptive to th e change. They note that this is especially difficult when there is no apparent crisis, but rather the long-range vision of a leader who anticipates the time it takes to implement organizational change. Resistance to change is especially relevant if the vision of a leader differs from the values and beliefs of the existing organizational culture. If that is the case, indeed cultural issues must be addressed (Schein, 1991 Trice and Beyer, 1991). In the case of BA, Walshs vision was very good because organizations continuously need improvements and changes to manage its competitive advantages. Willie Walsh started the change process and neither involved management nor his staff and stressed in addition much on cost cutting activities then these radical changes turned employees repercussion and resistance to change into aggression and they went on strike. Because employees thought that these changes were not needed and they were not win over, also, they were worried about their fut ure.In this part of the paper author will now discuss the fray of leadership and its effect on organizations performance in the context of organizational change.3.2 Types of Organizational change processChange management is a process to bring modification and transformation into an organization to sustain and improve its efficiency (John Hayes, 2002).There are different overall types of organizational change process, including planned versus unplanned, organization-wide versus change primarily to one part of the organization, incremental (slow, gradual change) versus transformational (radical, fundamental), etc.Organizational change is a step by step and a learnedness process which involve everyone in the organization. There are number of researches has conducted and researcher stated that the change in the organisation should have organisational culture electrical capacity (Garratt, 1987, 1990 Bahlmann, 1990 Senge, 1990 Senge et al. 1994, 1999 Pedler et al., 1991 Burgoyne et al ., 1994 Swieringa and Wiersma, 1992 Watkins and Marsick, 1993 Redding and Catalanello, 1994). This approach differs drawly from the literature trend which puts an emphasis on knowledge management and which associates organizational learning capacity with the ability to create, acquire, transmit, retain, or use organizational knowledge. This trend is led by authors such as Amponsem (1991) Nonaka and Takeuchi (1995) Nonaka and Nishiguchi (2000) Nonaka and Teece (2001) Nonaka et al. (2003) Baets (1998) Von Krogh and Roos (1996) Von Krogh et al. (1998) Despres and Chauvel (2000) Chauvel et al. (2003).It is clear from the above literature that Willie Walsh should have involved all the members of management and staff while making change in British Airways. They should have been convinced about the need of change for the improvements and encouraged to support this process. Despite of considering all that, he brought radical changes in organization without making his management and employe es involved, like cost cutting activities, outsourcing of different departments and sale of trading operations etc.Buono and Bowditch (1993) notified that indecision during change processes is typi strainy about the aim, process and expected outcomes of the change and implications for the man-to-man employees (Buono and Bowditch, 1993).Part 4The change in the BA has partly successful, as Walsh five objectives are partly achieved. Below has explained which changes are successfully encounter its objectives or not1) Sustain BA as the worlds favourite airlineAccording to Consumer Travel Alliance survey shows that Southwest Airlines was no 1 favourite in the world because of price and customer service. Below interpret shows its resultFigure 3 Statistics of Favourite airline(Source http//consumertraveler.com/wp-content/uploads/FavoriteAirline1.gif)2) Improve customer serviceA survey conducted by the BA shows that satisfaction rate across the network rose by 72 percent. The survey c onducted among 21millions customers(.http//www.britishairways.com/cms/global/microsites/ba_rep)3) Diversify through merger and acquisitionsMost recent M A with Iberia agreement of 3.9bn brought share price up and according to Willie Walsh both provoker would be retained(http//images.google.co.uk/imgres?imgurl=http//static.guim.co.uk). Below graph shows of share market movements, it has shows that BA has gaining Europe share market in significant wa,Figure 4 Europe Share Market Movement(Source http//www.centreforaviation.com/news/share-market/2009/11/13/british-airways-and-iberia-establish-mou-for-merger)Improve management and to be best managed company in the UKBritish Airways has failed to compass an agreement with union for stop strike but at the end strike called off because of court order. He have not succeeded with his instant reform but he is able to overcome competition from low costs budget airlines(http//www.businessandfinance.ie/index.jsp?p=222n=22)Cost cuttingBritish A irways have struggling to cost cut because of resistance of employees, as they have made controversy by asking staff to take unpaid leave, reduce hours or work for nothing (http//www.guardian.co.uk/business/2009/jul/06/british-airways-jobs-pay-unions). Thus they have approach strong resistance from the Union which discussed earlier in the part of this study.4.1 Timetable for implementationsMoreover, the repeat running and big bang strategies and pilot studies would be the best approach for the BAs changes for strategies. Such as However, it is very important to combination new technology and old technology until new systems is working properly in effective and reliable way, i.e. parallel running.The big bang strategy can be approached with the motivational courses and management training. The absenteeism could assist to loosing money by the company, as a result the change is evident in speed way. Big traffic circle theory could bear resistance to change, as well as a risk of fai lure, but in order to implement changes can be improve employees work environment, i.e. carefully planning will ensure successes and great resistance can be avoided. Below graph shows the timetable for full implementation,Figure 5 Timetable for full implementation4.0 Recommendations and ConclusionsA 7S framework model was developed as a model of not just structure, but model of organisational change by Tom Peters and Robert Waterman (1980). This frame work can also be used as an organisational analysis tool and it also depicts that organisational effectiveness from interaction of various factors. The 7S framework show below,Figure 6 7S frmaeworkSkillsStyleStrategySystemsSharedValuesStaffStructure(Source http//www.themanager.org/models/7S%20Model.htm) the BP Group. send off acquisition, 240 BP employees will continue working for and in support of the ground fuels business to be transferred to Hellenic Petroleum. The stick arounding personnel will continue to support BPs other activ ities in Greece. The agreement also provides for a transitional period regarding the management of the network and branding. The deal is subject to regulatory approvals, classic competition authorities and other relevant approvals. The deal is expected to flesh out towards the end of 2009. N M Rothschild Sons Limited acted as financial consultant to Hellenic Petroleum SA. Pratap Amin, Sebastian Lawson , Jocelyn Mitchell, Avril Martindale, John Fordham, David Taylor, Daniel Lawrence, Eli Hilllman, Vanessa Jakovich, Ned Staple, Van der Staal, Olivia Wyld, Patrick Taylor, Susan Doris, Michael Mntefering, Chun aviate Yeung, Dylan Cunard, Todd Kramers of Freshfields Bruckhaus Deringer LLP acted as legal advisors for BP plc.The above diagram has no starting point or hierarchy and it shows that by seven elements which are considering organization form these 7 viewpoints it would be possible to establish major strength and weakness. 7S framework shows the 7most important things that sho uld be kept in mind by the management for achieving organisational goals. The BAs management framework clearly sets out principle on how to intend authority and responsibility. As the responsibility of running the company is efficiently is habituated to CEO, therefore CEO should take of all 7S mentioned in the framework.BAs group Chief Executive Willie Walsh is aiming to make BA a simpler and more efficient by set up of employees behaviour with embedding a high performance culture by 2012. He had suggested that simplification is the key to success. According to Walsh (2008), BA had incredible assets and a great workforce. The only need was to bring these assets and people together to form a more productive, efficient and powerful organisation. The core problem that was cited was the bureaucratic management structure which was formed because of the number of mergers and acquisitions in the organization. According to Walsh (2008), the people who knew most about the company were the people who were running operations at the bottom level. He also noticed that the management had become too introspective at the level and was not listening to the employees about safety and reliability.Furthemore, According to De-Witt Meyer (2004), business strategy is concerned with how firms should go about creating a sustainable competitive advantage in each business they operate. Therefore, In order to achieve sustainable competitive advantage, goals and make company the best in the industry, the owners (CEO, Top level management) of the company should take care of the people working in the company, as their efficiency in performance would dish company to achieve its goals. So, therefore a good integrated dialogue and co-ordination network would be required to sustain its image in the industry.Figure 7 Herzbergs twain Factor Theory(Source http//tutor2u.net/business/people/motivation_theory_herzberg.asp)Herzbergs Two Factor Theory was developed as a model of understand of e mployees motivation and attitudes. This theory was developed by Fredrick Herzberg in 1959. Herzberg suggested both the factors are very important to understanding employee motivation and satisfaction.Following some of the factors which are causing satisfaction and dissatisfactions of the employeesFactor affecting employees attitudeFigure 8Hygiene FactorDissatisfactionsMotivator FactorSatisfactionsCompany policy and Administrations movementSupervisionRecognitionWorking conditionResponsibilitySalary and other financial factorsOpportunity for advancementJob SecurityPersonal outgrowthRelationshipChallengingThe above list of factors shows that management of BP not only avoid Hygiene factor also provides Motivator factor to the employees in order to Tonys aims to make a simpler and more efficient by enhance employees performance and behaviour.5.1 Recommendations for achieving Mr Willie Walshs goal for BA,Considerable steps should be taken up so as to make employees sure that they are wor king in a safe and healthy environment. This would help Walsh to retain the employees and also to generate a sense of belongingness among them.Another major factor is that there should be a new operating management system which should be knowing so that it would help to bring more consistency in the operations of the company. This can be through with(p) by implementing cross group programmes. It can be done minimum once a year to call all the employees at one place (city by city) People are one of the main assets of a company to perform efficiently and effectively.Walsh would require focusing on improving behaviours of employees by motivating them to work in a more efficient and coordinated way. This can be done by rewarding them, giving them more fringe benefits and providing them safety and security at the workplace. There is also need to build a high performance culture in organization. With coordinating among different operations and departments, a high performance culture and highly motivated employees, Tony can achieve him aim.For effective change management process, good communication between management and staff is imperative. In order to keep competitive advantages and to minimize fundamental effects of political and economical disturbance, the continuous change is required but this should be taken place with the involvement of each and every member of staff. In the process of decision making, if employees are taken into confidence and are convinced about the required change while taking them on board in decision making process, they would as a part of change management process adhere and admire the change. On the other hand, if they are left disconnected and arent motivated about this change process, subsequently their spirit and enthusiasm will go down. Certainly they will have apprehensions and impact about this change process. Senses of insecurity and uncertainty of job within the organization created due to lack of communication which spread ou t rumours. Thus little-convinced employee will give low output and will not remain loyal to the company. Having gone through the case study and examining it with different verificatory theories, it is apparent that even though the British Airways was a well-run company, Walsh decided to bring changes to compete in competent industry but he did not use properly communication techniques and therefore his employees were not communicated his ideas fully.