BA analysis - Case Study Changing the culture at British...

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Case Study: Changing the culture at British Airways INTRODUCTION Between 1981 and 1983 BA response to this was strategic downsizing which reduced staff numbers by 40%. Until 1984 BA operated a reactive style of operational and personnel management. Pre-privatization (1987) BA faced little competition on many routes. It controlled 60% of the UK domestic markets and only experienced competition on 9% of routes in and out of the UK (Monopolies and Mergers Commission 1987). This was mainly due to European markets being tightly regulated and market share was often dependent on negotiation skills as opposed to competitive success. Thus BA was able to charge customers what they liked. However, all was not well within BA. In 1980, a survey by the International Airline Passenger Association put BA at the top of the list of airlines to be avoided. This customer satisfaction was mainly due to uncomfortable journeys and lack of punctuality. Thus BA recorded financial losses of 140 million. They had clearly failed to recognize the necessity for change within this rigid organization, the result being a decline in profitability due to its own assumptions about itself and its external environment. CHANGE STRATEGIES Organizations need to change to adapt to the changing internal and external environment & to adapt to their environment as well. The factors which bring about change vary in intensity, but can be grouped into internal and external categories. External sources of change include competitor strategies, technological innovation, deregulation of industry, labor costs, access to resources, economic changes (national and international) and changes in government policy. Internal change factors tend to follow on from the external ones, and include adapting to shifts in corporate missions, changes in technological equipment and processes, shifts in employee attitudes and behavior and corporate culture. Change strategies can be the result of reaction to some force or by managers anticipating the environment and being proactive. The proactive approach, when it proves accurate, allows more time planning and implementing change processes. It is fair to say, also, that change can be applied radically (resulting in major upheavals throughout the company) or incrementally (which involves minimal changes applied
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This note was uploaded on 02/19/2009 for the course MISM TM583 taught by Professor Jones during the Spring '09 term at Keller Graduate School of Management.

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BA analysis - Case Study Changing the culture at British...

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