close to its major hub at London Heathrow Airport and based on fleet size, international flights and international destinations is the largest airline in the UK. Its other hub is the London Gatwick Airport. British Airways has terminated all straight overseas flights from UK airports with the exception of Heathrow, Gatwick and London City Airport. BA’s UK passengers originating at non-London airports would have to connect through London or make use of different airlines with direct services.
The British Airways Group was formed on 1 September 1974 due to nationalization by the Labor Government as at then. British Airways was created from a couple of airlines which were, BOAC and BEA, Cambrian Airways from Cardiff and Northeast Airlines from Newcastle upon Tyne. In the 1974 all four companies were disbanded to materialize into British Airways. British Airways was privatized in February 1987 after over 13 years as part of the privatization plan by the Conformist Government as at then. The airline quickly expanded with the acquisition of British Caledonian (BCAL) in 1987 and Gatwick-based carrier Dan-Air in 1992.
British Airways is a founding member of the One world airline alliance along with four other airlines – American Airlines, Cathay Pacific, Qantas and the now obsolete Canadian Airlines. The alliance has ever since developed to become the third leading airline alliance, with only SkyTeam and Star Alliance being larger.
By 30 July 2008, British Airways and Spanish airline
Iberia made a pronouncement of a merger plan that would lead to the two airlines joining forces in an all-stock transaction while retaining their separate brands similar to KLM and Air France in their merger agreement. On 12 November 2009, British Airways established that it had arrived at a preliminary agreement to merge with Iberia airline. The merger between British Airways and Iberia would bring about the world’s third-largest airline in terms of annual revenue and the second largest airline group in Europe. The agreement was confirmed on 8 April 2010, and by the end of the year should be completed.
British Airways presently hold a 13.5% stake in Iberia but will obtain ownership of 55% of the new combined group, which would be known as “International Airlines Group”, with Iberia’s shareholders obtaining the lasting 45% of the corporation. The merged entity will operate 419 aircraft, convey up to 62 million passengers yearly and serve a little over 200 destinations. It is expected that the merger will create 400 million Euros of savings annually for the airlines. The Headquarters would be situated in London.
Table 1.1 British airways fleet
(Source: airfleet.net 2010)
Figure 1: Image of British airways aircraft
(Source: bized.co.uk 1996-2910)
2.0 E-BUSINESS MODELS USED BY BRITISH AIRWAYS
Firstly before the discussion on the business models of British Airways, there has to be an understanding on what e-business model is all about.
E-business could be said to be as a derivative from terms such
as e-mail and e-commerce, which is conducting of business activities on the internet, not just buying and selling but giving customer service and cooperating with business associate.
In another definition of E-business, it is the application of information communication technologies in support of all the activities of business. (Beydon-Davies 2004).
So therefore e-business model could be said to be the technological plan implemented by a company online to generate revenue and make a profit from operations, which includes the components and functions of the business, as well as the revenue it spawns and expenses it incurs.
2.1 Infomediary Model
Information about customers and other trends they go about them are carefully analyzed by British Airways, that is they know their customers very well, and what they want as well, so there are a lot of information that could be gotten there. This model is also used for the information of all other partners and airlines that they work with. They help customers understand the kind of hotels that would suit them for their travel plans and how they could go about getting the best possible information. This model has been a source of revenue for a while now for British Airline and it has helped them gain a very good competitive edge in the airline industry.
2.2 Direct Model
British Airways makes use of the direct model, whereby they are directly doing business transactions with their customers, thereby cutting off any form of intermediary that is agents, they do this because these agents do exploit the customers to dissatisfaction which might bring about distrust of the customers
the airline, so therefore the y practice the direct model system of e-business model so as to keep up their competitive advantage and attractiveness to airline industry and society at large respectively.
British airways have certain revenue models that would determine how they will generate profits and produce a superior return on investment. These revenue models are given below:
2.1 Advertisement Model
British Airways uses this e-business model to attract customers to their company, advertisement on tours and holiday sales could be seen on the website. This model works very well for them because there are a lot of people who visit British Airways website, and when they see these ads they become interested want to know more about what it is about there bringing large traffic to the site which is what brings about some of the revenue earned in British Airways today.
Figure 2: screen shot of Advertisement on British Airways.
2.2 Affiliate Model
British Airways uses this model for the purpose on getting revenue, the affiliate model is a very important business model to the company, and they advertise hotels and resort for other companies on their website which in turn these companies would give them a percentage of the returns. With this model being implemented it provides purchase opportunities for the affiliate companies.
2.3 Subscription Model
The subscription model is being used by British Airways to generate revenue. Customers or air travel passengers who would want to become executive club members and business members could subscribe. This membership comes with different benefits for the customers
such as having BA miles which would enable the customer to have some services for free. This model attracts customers, which would in turn bring about profit to the airline.
3.0 WEB TECHNOLOGIES USED BY BRITISH AIRWAYS
Web technologies are extremely significant fraction of an organization or company that utilizes technology, assemble, process, store and disseminate information. With the use of web technologies it could bring about a competitive advantage for a company with other organizations, these technologies are what could bring about success and profits of a company. For a company like British Airways which is an internationally acclaimed company, web technologies have been part of what they have used to gain these competitive advantage as well satisfy all their customers’ needs, not also forgetting the enormous profit at which they have earned all year round, web technology have played a major role in all these. The web technologies at which British Airways have been making use of to gain competitive advantage are as follows:
3.1 Wireless Internet Mobile service
One of the web technology at which British airways have adopted is the wireless mobile internet service, to make the travel experience of loyal customers easier and smoother. British airways have been working in collaboration with IBM to develop a facility that allows frequent flyers to use their mobile phones to check in for flights out of the UK, select their seat and access information on intervals and departures. This has brought about time saving benefits for customers and significant cost reductions at BA call centers and check- ins.
in collaboration with IBM, British airways has become the premier UK airline to allow frequent flyers to use their mobile phones to check in for flights out of the UK, and the first airline in the world to enable passengers to select their seat via a geographical seat map on their phones. In addition, any mobile phone user is now able to check flight availability and view up-to-minute flight arrivals and departure information for any British airways flight.
3.1.1 Customer benefits:
Subscribers to the service would be able to check in using the pictorial seat selection tool on the phone, arrive at the airport, collect their boarding pass from a self-service kiosk in a short time, leave their baggage at the fast bag drop, and go to the boarding gate. Other benefits of this technology are:
âž¢ Passengers can shun check-in queues at the airport
âž¢ Customers can check seat availability on flight devoid of having to make a voice call.
âž¢ Travelers can check real-time departures of their flights if delayed in traffic and meeters and greeters can check flight arrivals from any location.
3.1.2 Business benefits
Beyond the improvement in customer service, the development of its mobile internet services has brought British airways a number of other benefits
âž¢ A decrease in call centre charges through lessening the demand for arrival and
âž¢ A cutback in check-in costs – by keeping customers out of the check-in queues and reducing desk staffing cost.
âž¢ A grip in the mobile computing network
3.2 British Airways World Cargo
This is a technology that British Airways
use to enhance the provision of customers service within the air cargo industry. The technology works with EDI (Electronic Data Interchange). This technology is being used for the following purposes:
âž¢ Receive and transmit air waybill data by means of EDI (Electronic Data Interchange)
âž¢ Receive and process freight
âž¢ Deliver automated notification of the receipt of freight
âž¢ Track and trace freight from the airport of origin to the airport of destination using barcode technology
âž¢ Advance the intelligibility of performance measurement to their customers.
Customers would have to be connected to the Cargo Community System (CSS) for all these services to be readily available.
3.2.1 Benefits of the British Airways World Cargo
Customers who have subscribed to an EDI connection with British Airways World Cargo via a cargo community system will be notified automatically when they receive their shipments. Customers would also receive notification of their shipment’s progress at key points during its journey (e.g. receipt into LHR, departure from, LHR, and then arrival at destination airport etc.)
Customers who transmit their air waybill data to British Airways cargo via EDI who have their consignments accepted and processed faster, accurately, at the airport of origin.
Customers who are able to barcode their shipments prior to delivery to British Airways cargo would have the following benefits:
âž¢ Increased data accuracy
âž¢ Increased handling speed
âž¢ Effective track and trace of shipments
âž¢ Increased customer service through the availability of quality status information, throughout
3.3 Airline Inventory and Reservation System (AIRS)
This web technology is a user friendly solution which enables the users to work on a Graphical User Interface to reduce training times and thus promoting speedy deployment. It provides enormous cost savings to airlines as compared to the traditional models by providing a PC based efficient solution by ensuring savings on mainframe costs as well as legacy platforms and there providing better return on investment.
3.3.1 AIRS Benefits
âž¢ great cost savings for an airline in terms of internal airline offices reservation automation
âž¢ Offers an improved level of functionalities integrated with the steady growth and ensuing requirements of the airline.
âž¢ Is a web based user-friendly solution, which makes it possible the users to work on a Graphical User Interface.
âž¢ Can be implemented the same day at numerous locations and new locations can be added simply with no implementation timeframe setback.
âž¢ It can also be designed according to the airlines requirements. (Bird Information System 2010)
3.4 Baggage Reconciliation System
This is a web based technology used by British airways for their travellers to be able to reconcile with their luggage when departing the airport. There have been huge problems in the past concerning passengers and their luggage, with the large amount of travellers at the airport there is a high tendency for baggage to get missing, so therefore this web technology was designed for sole purpose of avoiding such situations from happening.
The technology uses wireless barcode scanners allowing airport staff to
identify the precise location of any piece of luggage during loading and unloading. The objective is to reduce mismanaged baggage by tracking each piece of baggage and maintaining records of their handling of each piece of baggage.
3.5 E-Ticketing System
British Airways also deploys a system at which customers can prints their own tickets. E-Tickets can be bar-coded for validation. E- Ticketing system has been advantageous for British Airways as it assist in cost and labour savings, with instant delivery to the customer, safe and secure due to bar-code provision etc.
3.6 Ticket Reservation
British Airways utilizes this web technology on their website in order for customers to make their ticket reservation. This web technology allows for an efficient ticket booking. Customers intend to make ticket reservation uses this web technology to make ticket reservation. This has also been a success story for British Airways as it has attracted many customers to the website as it provided efficient and satisfactory ticket reservation for customer as a result of adopting this ticket reservation web technology.
3.7 Online booking
This web technology is used by British Airways which enables users to make online booking on the website, using the functionality and features made available on the website. This web technology is used by making an online booking page directly on the home page with featured links and functionality to enable users make use of it and make satisfying online booking. This is a key web technology in this website as it is the airline’s focal point in operating with a website. This web technology adopted
by British Airways has been crucial to their success in terms of providing easy and satisfactory online booking for the users.
Figure 3: Screen Shot of Online booking
3.8 Manage My Booking
This is a web technology that is being used by British Airways to manage customer’s booking, it provides features such as the check online booking status which enables passengers to view the status of their booking made. Customers can also view, change or send itinerary such as paying for unconfirmed bookings made previously, purchase and re-select passenger seats of their choice, Change flights destinations, Supersize or Add baggage allowance, Purchase/Re-select meals for those that need special meals, update passenger contact details and upgrading fare class. This is done by entering Booking number, departure date, origin, destination city and email, “check flight status” which allows customers to re-confirm the status of their flights. The section allows for passengers to check their flight details of reservations which were made a day (24-hours) prior to the date of departure by entering departing, arriving, depart date, airline code and flight number, “refund status” which shows passengers the current status of refunds from payments made by credit card. This is done by entering PNR and credit card number, “check baggage status” which enables users to check their luggage status if delay report is made. This is done by entering Baggage PIR number or PNR number or full name in PIR report.
Figure 4: Screen shot of Manage my booking.
This is a private network which British Airways uses to communicate
within its organization. This is so because of the enormous size and population of British Airways Infrastructure and staffs, so therefore this intranet is a necessity for the organization to share resources within the entire staff and also improve the communication within the organization.
3.10 Flight Information
This technology enables users to have series of information about their flights. This technology is for the sole purpose of keeping the customers updated. It comes with features such as “latest travel news” which gives updates on when there is any flight disruption, “arrivals and departures” which updates minute by minute information about the flight the customer intends to meet and when its arriving as well as flight departure status, it also has “time-tables” which allows users to check the flight schedule for their chosen destination, it also has information on available flights up to one year in advance.
Figure 5: screen shot of flight information
3.11 Route Map
The route map is designed as a guide to help the passengers to know their destinations and get to their destination safely and easily. This is the quickest and easiest routing technology, based on the normal flying conditions. The route map has all the destinations that British airways fly to in the different continents, when a customer clicks on any of the continent it links to all the directional areas British Airways fly. The route map shows the 300 destinations BA flies. British Airways is a member of Oneworld Alliance which makes them able to offer a total 600 destinations with the collaboration of its partners.
6: screen shot on British Airways Route Map
3.12 Hotel Booking
This is another web technology provided by British Airways, which enables customers to book their hotels at which intend to stay. The hotels have been carefully selected to deliver high quality and level of service that customers would expect from British Airways. It contains over 4000 carefully selected hotels which could be filtered based on the customer’s preference, ranging from 4 star hotels with a pool or spa, to 3 star hotels close to the city centre. Customers would also be able to compare prices, location and other details at a glance, as well as seeing the hotel on a street map, so that the customer would be sure it’s his or her chosen location.
Figure 7: screen shot of Hotel booking.
4.0 IMPACT OF INTERNET TECHNOLOGY TOWARDS THE SOCIETY
The internet technology has been an innovation that has transformed the world to a much better place, it is also commonly referred to as the world becoming a global village where by people or who are divided by a distance of a million miles could actually communicate as if they are just inches away from themselves. The internet technology has had a massive impact on every facet and aspect of life today.
Today the world has changed a lot due to internet technology, financial and governmental institutions are being run based on numerous web technologies, to address issues of human lives. With these technologies commercial business have changed for the better, people do business from almost anywhere in the world today, product are advertised, bought and sold on the internet today,
all these have been made possible by the web technologies which have come into place.
More and more people have become more educated today with internet technologies. People can now be educated by barely sitting at home with their computers and receive lectures, online tutoring have helped a great deal in the society today which could not be achieved until the introduction of internet technologies. Universities now have system whereby students could log-on to in order to get their notes and other necessary information for their lecture or education in general.
Transportation comes in different form, air transport, road, sea, train etc, all have had major technological breakthrough with internet technologies. Looking at the aviation industry today, there a lot of technologies which have now be put in place to ensure air travel is as smooth as ever, passengers can now easily book do all the necessary logistics from booking flight to actually arriving at the destination all entirely on the internet. Same as well goes to other aspect of transport cars are now technologically advanced, sea liners are made as luxurious as five star hotels etc. All these have been achieved with one web technology or the other.
4.4 Health Care
In terms of health care many lives have been saved today, web technologies have contributed towards the improvement of the study of anatomy of humans, diseases have been detected, and analyzed to determine the extent of its damage. More people have been saved what seems to be initially life damning diseases, but technology today has made these diseases look common.
There have been so many other healthcare solutions which have been introduced as well for the improvement of healthcare in the world today.
4.5 Media and Entertainment
Media and entertainment have been an important aspect of life in the world today, web technology have contributed immensely to this effect. Movies and movies today are have been improved with web technologies, people can now easily get to watch movies online or listen to music, the media sector have also improved massively with the wide coverage of almost any activity happening in the world today. People can now get to watch news easily through internet podcast on a website, which has bring about people being increasingly informative.
Telecommunication has its own success story, web technologies have also contributed immensely on this area. Mobile phones are now amazingly smart, whereby people could do almost anything and everything they could think of, this has been so with the ever increasing number mobile applications. Mobile networks have also improved with internet technologies, networks can now serve their customers better with these technologies, and mobile networks have come up with different strategies that have made telecommunication taken to higher level with different promotional activities that are taken place.
5.0 FUTURE DIRECTIONS AND CHALLENGES THE COMPANY FACES IN TERMS OF WEB TECHNOLOGY
With the ever increasing technological advancement in the world today, British Airways would have challenges that would be posed to them in the nearby future and they would need to come up with innovative ideas to keep up with
these challenges. Below are challenges they would be faced with and how they could overcome these challenges.
5.1 Passenger Traffic
Nowadays, the waiting time for travelers to check in at a desk has been estimated to 13 minutes, and it has become a known practice to avoid the agent and use a kiosk to get the boarding passes. The passenger traffic could be reduced to a barest minimum with the introduction of self service air travel. A system could be created whereby passenger facilities could be provided at a kiosk there by reducing running cost. This would reduce the heavy traffic times at terminal entrances, thereby spreading the flow of passengers more evenly throughout the airport. Hotel check-in and car rental information could also be embedded in the system.
5.2 Baggage Delay
Baggage handling is an important aspect of air travel because if not handled properly could bring about flight delays, and it is also a priority for passengers worldwide. Baggage handling could be improved quickly by lessening cost, lowering the number of lost bags and enhancing customer experience. A new technology can be put in place to enable closer collaboration and a more holistic view. The system could have information sharing between baggage and other systems. Systems could be linked which would improve quality of baggage handling through more up-to-date and complete data, and connection of baggage information with passenger information.
Figure 8: Causes of Baggage delay World Wide
(Source: SITA baggage report, 2008)
Security is an important issue in any facet of life today. As travelers continue to increase
British Airways would be faced with more and more issues concerning the security of their passengers. New technology could be introduced in terms of identity management which will revolutionize how passengers are screened and determined secure.
Web technologies on security which could be implemented in the future by British Airways on security are as follows:
âž¢ An innovation that would bring about connecting British Airways and destination airports should also be introduced.
âž¢ Wireless technology to connect British airways with customs and airports
âž¢ Automated document identification system
âž¢ Facial recognition technologies and data analysis systems to prescreen passengers.
The various Internet/web technologies being used by British Airways today have contributed immensely to their growth and success in the aviation industry today. These technologies they have deployed have gone a long way in bringing customers to them as well maintaining a good competitive advantage in the airline industry. Despite all the success and growth they have enjoyed thus far, they would need to improve in their services as well as upgrade to new technologies in the future, because technological advancement doesn’t stop now it continues, so for British Airways to continue to grow and still have this competitive advantage they would need to carry out research on likely improvements they would need to make for the satisfaction of their customers and the improvement of aviation in the world today so as to maintain their status as one of the world’s premier airline company.