British Airways

In: Business and Management

Submitted By pussyy44
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British Airways was founded in 1974 as a result of the merger of the then British Overseas Airways Corporation (B.O.A.C.) and British European Airways (BEA). Prior to the merger, the former operated on international routes while the latter focused on continental Europe.

Rather than enhancing good services and operation, the merger brought about a variety of problems resulting from cultural factors. There existed some sort of discriminations between the two groups as the people of BOAC saw themselves as the Gentleman’s Airline and BEA as a trade man’s Airline. BEA on the other hand the saw themselves as the ideal competitors and the BOAC as just a bunch of snobs.

They therefore acted independently, such that the only common factor between them was inefficiency. Consequently, the management became highly inward focused with decisions made in isolation, lacked accountability, had little focus on profitability, slow in its operation, lacked sensibility, was eluded from flexibility, communication and initiative. It was indeed a hierarchical organization and consequently operated a tall organizational chart. By 1980 the problem of B.A. had reached its peak such that the airline was being tagged “Bloody Awful” as it was soon voted as the airline to be avoided at all cost.

In 1981, Lord King whose mandate was to restructure B.A., make it profitable and prepare it for privatization was appointed as the chairman of the company. As soon as he discovered the inner politics in which was jeopardizing the progress of the B.A.? King initiated his survival plan which he reduced the number of staffs from 52000 to 35000, froze salary increase for four years, closed down some routes and online stations and cargo services and sold the fleet. One of the most significant decisions he ever made was appointing Marshal as the CEO of B.A. in 1982.

When Marshal…...

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