British Airways plc 2010

TABLE OF CONTENT:

EXECUTIVE SUMMARY 1
INTRODUCTION 4
Pre British airways and its formation 5
Current British Airways 6
KNOWLEDGE MANAGEMENT 4
Importance of knowledge management 6
SERICE ENCOUNTER 4
SERVICE DIMENTION 4
VALUE CHAIN ANALYSIS 4
Support activities 6

Primary activities 6

REFERENCES 4
APPENDIX 4

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 British Airways plc 2010

EXECUTIVE SUMMARY:

This report identifies through research, the use of technology and its application to British
Airways on how the firm facilitating its process in order to attract and retain winning customers
by creating competitive advantage. The paper as well clearly identify the knowledge
management and outline it’s levels, categories as well as its importance to the firm along with
value creation capabilities to British Airline and its relation to value chain and service profit
chain. In addition this paper explains how British Airways use Information Technology to
implement knowledge management system and how these systems are transforming the firm into
modern organization.

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 British Airways plc 2010
INTRODUCTION:

Pre British airways and its formation:

British Airways history started in late 10s as Imperial Airways. It was in 1919 when the first
British airline company established and started its first flying route in August 25 th 1919. Many
small airline firms such as Aircraft Transport, Travel, Handley Page Transport, Instone Airlines
and British Marine Air Navigation subsequently followed and were getting established but faced
many difficulties to sustain in the market due to the major force of outside competition including
French airlines with lower fares thus led to the vanishing to almost most of them. To overcome
the problem, the companies decided to merge to form one major company and that was the
beginning of British Airways. The formation of British Airways led to the first major British
carrier.

The primary source of revenue on the network was not from transporting passengers but mail.
Nevertheless, an increase in demand for more passenger seating and cargo space generated a
need for larger airplanes.

http://www.aircraft-photos.net/BA.aspx

Current British Airways:

British Airways PLC is now the largest international airline in the world situated it’s airport in
London (Heathrow) which is known to be the busiest international airport in the world. The
airline flies to over 550 destinations globally operating international and domestic scheduled and
charter air services for the carriage of passengers, freight and mail, hence it is considered to be a
leader in the industry. Via its own operations and those of its alliance partners including USAir
in the United States, Qantas in Australia, and TAT European Airlines in France, British Airways
serves 95 million passengers a year using 441 airports in 86 countries and more than 1,000
planes.

http://www.fundinguniverse.com/company-histories/British-Airways-PLC-Company-
History.html

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 British Airways plc 2010
KNOWLEDGE MANAGEMENT:

“Knowledge management is a systematic approach of set guidelines in which data is collected,

accumulated and made easily available to all seeking knowledge and experiences to excel
themselves in order to achieve a communal growth in an organization.”

http://www.knowledge-management-online.com/knowledge-management16.html

Knowledge management is further devided into;

Knowledge Management

Tacit Knowledge:
It refers to the cumulative store of the experience,
mental maps, expertise, skills as well as
organization’s culture that has embedded in the past
and present experience of the organization. British
airline is a long time player in the market; therefore
the experience of their major history helps them to
overcome the problems they are facing. Recently
British airline started replacing self check-in kiosks
with PC and computers. BA’s CIO admitted that the
idea wouldn’t work anywhere but the concept seems
to be more familiar to people as they interact with
computers more often, hence it will b easy to use and
for the company its cost effective.
Explicit Knowledge:
It refers to the information, mission, goals and reports
that have been documented in a form that can be
distributed to others or transformed into a process or a
strategy. British Airways collect all the data at the
counter about their customer’s information and
analyze them to provide value to the organization.
Furthermore they take their customer’s complain and
feedback very seriously because they believe by
providing the solution to the gaps will position them
even better.

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 British Airways plc 2010
IMPRTANCE OF KNOWLEDGE MANAGEMENT:

Identify how
Communication
Profit
Efficiency

KNOWLEDGE Store information

MANAGEMENT

Collect information

Technology Analyze
Organization
KEY:
The application of effective knowledge management
The results from effective knowledge management

The outline above represents the effective knowledge management by British Airways. British
Airways keep close relationship to its customer by enhancing communication through giving
opportunity to their customers of giving feedback; hence the information collected from different
sources is then analyzed by the company’s employees as team. The information is then stored for
future reference. The end result is the introduction of new technologies such as terminal 5,
check-in mobiles, e-tickets and so on. The new innovations help the whole process from
purchasing ticket to the whole experience of flying with the British Airways. Eventually helps
customers as well as the organization itself in maintaining good standard to its customer and
remain priority.
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 British Airways plc 2010

The purpose of knowledge management is not only to be knowledgeable but also to be able to
create, transfer and apply knowledge with the purpose of better achieving objectives.

Effective knowledge management leads to cost reduction. This can be achieved by being more
systematic during collection and processing of data and lead to speed response, better knowledge
access and application, hence attract customers and increase customer relationship. Relevance to
British airways, such practice can be clearly observed in the company’s website where by an
individual can book online and get all necessary information in a spot.

*refer to appendix 1 for British website image.

Furthermore effective knowledge management helps to reduce the tendency of repeating the
same mistake. The organization team should work together in analyze the firm’s weaknesses and
threats and turn them into opportunity by providing the solution. By doing so, dramatically
improve the quality of service.

*Refer to appendix 2 for SWAT and PEST analysis

Successful knowledge helps a firm to understand better its shareholders and customer needs.
Hence direct to better value and profitability chain.

In addition knowledge management is the driver for innovation. Increasingly, products and
services are becoming ‘smarter’ and more knowledge based. The ability to collaborate as teams
leads to sharing of ideas and results to knowledge workers which stimulates the process of new
knowledge creation. Ideas are then turned into innovative products and services much faster.

British Airways in the past few years was facing a problem of air traffic due to the fact that the
airport receives multiple of planes at a time that resulted the problem of late arrivals and
departures. Hence the management came up with the solution to create new airport named
TERMINAL 5 which was released on 14h -03-2008 and it effectively was successful in
minimizing the problem and even helped to reduce the congestion in other terminals.

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 British Airways plc 2010
IT APPLICATION TO BRITISH AIRWAYS:

British airways so far is doing its best in order to stay one of the major
player in the global airline, in which it is are being more creative ,opened
to alliances ,and acquisition. IT being a big influencer to cause the changes in the industry, Bitish
airline make sure not being the last to cope with, several technologies are being applied in the
firm, such technologies include:

The introduction of SOA (Service Oriented Protocol), it is basically a collection of services

whereby activities are coordinated and communicate. This will help the airline develop its self-
service approach and ensure the customer remains the priority by respond quickly to customer
service issues and gain competitive advantage as Self-service technologies such as online check-
in become the norm among airlines. “Anyone can buy the technology to have online check-in,
but the clever thing is how you integrate it with the customer experience. SOA enables you to get
things right by allowing you to make short-term changes where you need to be flexible and agile,
such as making sure the seating policy is right,” says  chief information officer for British
Airways, Coby.
http://www.computing.co.uk/ctg/analysis/1851838/case-study-british-airways

in addition, British airways realizes the increment of using mobile devices and therefore came
up with the establishment of mobile boarding pass where by customers can access to real time
flight information about their upcoming trips, full integration with details
and smoothly guide customers
through each stage of their flight
process. It also provides a dedicated
travel news section, frequently asked
questions and a link to the mobile
website. Over a quator million have
so far downloaded the application
from i-Tunes.

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 British Airways plc 2010

Protecting environment has always been a main priority to British airways. The organization has
been working closely with manufacturers to insure the latest clean technology is used to generate
new air crafts. To reduce noise and air pollution, British airline has modified their planes and is
about to replace the new engines with low NO emission and lower noise level. This will generate
good customer relationship with the company especially since the world is going green as people
are becoming more conscious on environmental pollution, never the less the new air crafts to be
released will reduce 30% of general fuel consumption which will eventually lower down the
cost.

*Refer to appendix 3 for press release on the information.

Online sales are regarded highly important by British Airlines and

they are placing considerable faith in its website presence to boost online-sales
which eventually reduce customer traffic via BA’s call centers. E-Tickets are now the
standard ticket format used by British Airline, making flight ticketing more straightforward,
flexible and secure hence technological advancements can offset upward
pressures on prices and costs.

Moreover, the British airline serve intranet to its employees as well as customers that allow them
to access information. Recently the firm established a new system whereby it allows customers
to receive and send mails and text messages. However voice calls is limited to only between
London airport and New York with the promise of extending the service to remaining flees. The
need for the service was raised since the incident of September 11 and therefore finally British
Airline came up with the solution for creating more reliability.

Clearly the introduction of technology changed the whole perception of serving and delivering
the service to the customers, as quoted by the Chief information officer Paul Coby during press
release saying. It investing resulted in 20%in profit increase.

*Refer to appendix 4 for the press release.

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 British Airways plc 2010
SERVICE ENCOUNTER:

Concerning service encounter regardless whether single or multiple, the level of contacts got
reduced to low and medium from high due to the introduction of self checking-in machines, e-
ticket, as well as online checking-in. This helped to reduce the problem of long queues at the
checking-in counters, hence made the process more smooth and time effective.

SERVICE DIMENSION:

Furthermore IT helped to improve the service quality that eventually created more value to
organization and a root to attraction of customers. The service quality dimension can be
identified through the following measures;

British Airlines proved to be very concerned to its customers. During flight

Empathy cancellation due to the weather problems, British airlines always provided hotels
to its customers along with food to keep them relaxed and stresless.

prevent the passengers from getting lost.

bar service. The airport itself is well organized having superior directories to
Tangibility comfortable surroundings, friendly service, complimentary food and a free
the British airlines are accommodated with relax seats. The flights give

from the customer that it can be relied on in providing information on time.

that has recently been introduced by the company shows a good response
Responsiveness time by time to insure the customers remain the priority. The SOA system
British airways proved to be fast in responding and upgrading their systems

introduction of Terminal 5
addition the problem of late departure has been completely removed after
Reliable airline shows it is so far reliable in case of any emergence onboard. In
with the introduction of intranet, text messages as well as voice mail, British

The application of knowledge effectively, increment in service quality and introduction of IT to

British Airline has dramatically resulted in increment of its market share and raise of profit to the
company. The below analysis presents the evidence of the statement;

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 British Airways plc 2010
VALUE CHAIN ANALYSIS:

British Airways has tried to control the system further by forward and backward mitigation.
Through controlling many component supplies domestically, and through British Airways
Holidays Plc, The company finally was successful in increasing their reach in the value system to
the supplier and channel value chains.

Value chain diagram:

FIRM INFRASTRUCTURE
Structured hierarchy allows British Airline to make use of a multitude of specialist knowledge
in order to gain competitive advantage over downsized firms.
SUPPORT ACTIVITIES

HUMAN RESOURCE MANAGEMENT

Invested in the development of customer service training in 2007 attracting the best
employees.‘Speak Up’ opinion survey encourages employees to provide feedback (British
Airways, 2008).
TECHNOLOGY DEVELOPMENT
BA has added value in this category over smaller companies due to slack resources that can be
employed to innovate the service (e.g. individual LCD screens).
PROCUREMENT
Due to the size and historical business relationships and alliances, BA is able to leverage
suppliers and through economies of scale make efficiencies where competitors may fail.
PRIMARY ACTIVITIES
INBOUND OPERATIONS OUTBOUND MARKETING & POST SALE
LOGISTICS LOGISTICS SALES SERVICE

Stock Control Increased Baggage Customer Service Marketing Loyalty club card.
Security. communications to
High quality training Large database of all stakeholders. Update
accredited by City & Quick check-in airport slots enable communication on
Guilds (British services and secure passengers to access Brand allowing for other services.
Airways, 2008). online bookings with the majority of large budget to be
ability to pre-book destinations from spent in this field.
Ongoing additional services. preferred airport.
relationship with
suppliers (e.g. Gate
Gourmet.

Value Chain highlights the primary and support activities that add value to British Airline, there
are a number of inefficiencies within these activities that arguably reduce the amount of value
provided (see figure 1 and 2).

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Support Activities Value:
Figure 1
SUPPORT ACTIVITIES
Firm Infrastructure
HRM
Technology Development
Primary Activities Value Loss
Figure 2
PRIMARY ACTIVITIES
Inbound Logistics
Operations/Outbound
Logistics
Marketing & Sales
REFERENCES:
Text books resources:
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British Airways plc 2010
Large technical infrastructure decreases effective communication and
increases disinterest.
British Airway’s employee opinion surveys attracted 35% response
rate in 2007 (British Airways, 2008).
Due to high collective bargaining capabilities, British Airways has
contended a number of highly publicized employee relations issues
(e.g. Cabin Crew strike over pay, sickness absence, and staffing in
2007 (BBC News, 2007).
BA has failed to gain recognition for new innovation.
High solidarity between supplier employees and British Airways
employees has created a history of negative industrial action. For
example, in 2005, British Airways employees walked out for two days
when Gate Gourmet employees were fired (BBC News, 2005).
TV documentary reported on Terminal 5 operation difficulties, an
emergency landing at LHR, poor baggage handling and flight
cancellations (Channel Four, 2008).
A lack of innovation in their marketing communications (e.g. Virgin
gaining value over British Airways).
 British Airways plc 2010
 Harvard College, 1998, Knowledge Management, Harvard business Review.
 Myers P. S, 1996, Knowledge Management and Organization Design, United states of
America.
 Khalil T. M, 2000, Management of Technology: the key to competitiveness and wealth
creation, Singapore.
 Lovelock, C and Wright, L., 2002 service marketing and management, 2thedition,
Pearson Education, Inc, Upper Saddle River, New Jersey.
 Lovelock, C and Writz, J., 2007, services marketing 6thedition, Pearson prentice
education, Inc, United States of America.

Online resources:

 British airways plc, Company history (1996). Available at

http://www.fundinguniverse.com/company-histories/British-Airways-PLC-Company-
History.html. (Accessed on 26th december 2010).

  Michael J. Beyman, British airways history (2011).available at

http://www.ehow.com/facts_5526082_british-airways-history.html. (Accessed on 26th
December 2010)

 Leigh P. Donoghue, Jeanne G. Harris and Bruce E. Weitzman, Knowledge management

strategies that create value (2011).Available
athttp://www.accenture.com/Global/Research_and_Insights/Outlook/By_Alphabet/Know
ledgevalue.htm. (Accessed on 26th december 2010).

 Hospitality Times, blackBerry boarding at British airways (13-november-2010).

Available at http://www.ehospitalitytimes.com/?p=5883. (Accessed on 30th December
2010).

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 Goodwin.B, British Airways cites IT investment as key factor in 20% profit increase (30 th
may 2006).Available at
http://www.computerweekly.com/Articles/2006/05/30/216183/British-Airways-cites-IT-
investment-as-key-factor-in-20-profit.htm. (Accessed on 2nd january 2011).

 Cartmell.P, Information Technology for British Airways (24th November 2010).

Available at http://www.ehow.com/facts_7550442_information-technology-british-
airways.html. Accessed on 2nd january 2011).

 Maclver. K, Q&A British Airways (14th April 2009). Availble at http://www.information-

age.com/channels/management-and-skills/perspectives-and-trends/1017797/qanda-
british-airways.thtml. (Accessed on 2rd january 2011).

 Mccue, A, Britsh Airways set up technology innovation Unit (30 November 2009).
Available at http://www.silicon.com/technology/networks/2007/11/30/british-airways-
sets-up-tech-innovation-unit-39169328/. (Accessed on 3rd January 2011).

 British Airways, Air Quality-investing in new technology (2008).Available at

http://www.britishairways.com/travel/csr-air-new-technology/public/en_gb. (Accessed on
3rd January 2011).

 Kelly. L, Case study-British Airways (8th November 2007). ncisive Media Investments
Limited 2010. Available at http://www.computing.co.uk/ctg/analysis/1851838/case-
study-british-airways. Accessed on 4th january 2011).

 Knowledge management Online.com, Definition of knowledge management

(2009).Available at http://www.knowledge-management-online.com/Definition-of-
Knowledge-Management.html. (Accessed on 4th january 2010).

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 British Airways plc 2010
 Knowledge management Online.com, Why KM - the importance of knowledge
management (2009). Available at http://www.knowledge-management-online.com/the-
importance-of-knowledge-management.html. (Accessed on 4th January 2011).

 Skytrax, British Airways official 4-Star Ranking of Product & Service Quality (2011).
Available at http://www.airlinequality.com/Airlines/BA.htm. (Accessed on 4th january
2011).

 British Airways, Travel classes (2011). Available at

http://www.britishairways.com/travel/classes/public/en_gb. Accessed on 5th january
2011).

 Skytax, British Airways Passenger Reviews and British Airways Customer Trip Reports
(2011). Available at http://www.airlinequality.com/Forum/brit_awys.htm. (Accessed on
5th january 2010).

 Scribd.com, British airways case study (2010). Available at

http://www.scribd.com/doc/9204402/British-Airways. Accessed on 5th january 2011).

 Athow D, British Airways Now Allows Voice, Text and Internet Onboard (2010).
Available at http://www.itproportal.com/2009/1/27/british-airways-now-allows-voice-
text-and-internet-onboard/. Accessed on 5th January 2011).

APPENDIX:

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 British Airways plc 2010
Appendix 1: British airways website.

Appendix 2: PESTLE analysis, SWAT analysis and PORTE 5 forces of British airlines.

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 British Airways plc 2010
Current Strategies
The report will be designed in consideration of BA’s current strategies (British Airways, 2008):

1 Upgrade customer experience via the introduction of text and mobile services for business class
customers.
2 Modernise aircraft fleet and offer new services.
3 Manage cost base.
4 Increase corporate responsibility through environmental performance and partnerships.

PESTEL analysis:

PESTEL Key Points Implications for BA

Factor

Political Heavy regulation (AEA, 2009). Compliance is essential if BA wants to

continue operations.

Increased security due to past Sufficient security measures should be in

terrorist threats (DFT, 2008). place to ensure consumer confidence and
competitive advantage is maintained.

Economic Global economic crisis: World Possible reduction in the amount of

growth is projected to just over business travel as companies are cutting
2 percent in 2009 (IMF, 2008). costs and using alternative means of
Pound weakens especially against communication such as teleconferencing.
the Euro. BA is vulnerable as a UK operating airline
to a poor exchange rate.

Oil prices: declined by >50 % since Fluctuations in oil prices and exchange
their peak retreating to 2007 levels. rates will directly affect BA’s cost base.
Decline in fuel price = strengthening
of the dollar (IMF, 2008)

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 British Airways plc 2010
UK consumer spending saw its More intense competition
sharpest decline for 13 years
between July and September 2008
(Channel 4, 2008).

Social The UK has an aging population Potential opportunity for growth as older
(see appendix 3) (National Statistics generations have more time to spend on
Online, 2008). leisure activities such as international
travel.

Increasing unemployment (Kollewe Increased bargaining power as an

and Sager, 2008). employer.

Technological A recent survey revealed that 34% Increased consumer awareness and
of online consumers plan to use therefore bargaining power.
price-comparison sites more in 2009
(NMA, 2009).

Online booking services and check- BA must ensure that they remain up to date
in is becoming increasingly used by with these technological advances whilst
the airline industry. avoiding becoming overly reliant, as this
may isolate certain consumer markets (i.e
the elderly) who don’t feel comfortable
using such technology.

Environmenta Noise pollution controls, and energy New legislation (e.g. Climate Change Bill)
l/Ethical consumption controls (DFT, 2008). enforcing tighter environmental regulation
may increase operational costs each year.

Limited land and for growing Limited capacity=> utilisation of capacity.

airports – Expansion is difficult at
Heathrow as it would result in a loss
in the London’s Green belt area.
(BBC News 2006)

Consumers are becoming Failure to adopt an integrated

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 British Airways plc 2010
increasingly ‘green’ and more aware environmental strategy could lead to a
of the environmental impact of their detrimental effect on the BA’s reputation
actions. and income.

Cancellations of flights and loss of Such ethical issues could have a

baggage (Channel 4, 2008). detrimental effect on reputation if left
unresolved.

Legal Collusion and price fixing. Restriction on mergers will have an impact
on BA’s proposed alliance with American
Airlines.

Recognition of trade unions and Good employee relations are essential if

industrial action e.g. Cabin Crew BA wants to avoid industrial action and
strikes. interrupted operations.

Open Skies Agreement (AEA, Opportunity for BA and its competitors to

2009) freely transport aircraft between the EU and
US.

2 Porter’s Five Forces :

It is important to analyse the competitive nature of the airline industry in order to assess the
position of BA. The ‘Five Forces’ tool will enable BA to make strategic decisions in order to
increase profitability.

Force Strength

Competitive Rivalry

 BA caters for both long haul and short haul flights. Within long haul
there is little differentiation between BA and their competitors, in terms

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 British Airways plc 2010
of price and service offering.
 The short haul market is more fragmented with many small players.
 Direct competitive rivalry is fierce, e.g. Virgin has a website opposing
the proposed strategic alliance between BA and AA - ‘No Way BA/AA’ HIGH
(Virgin Atlantic, 2008).
 Consolidation of competitors has increased competition.

Power of Suppliers

 Two aircraft manufacturers = High bargaining power.

 BA restricted by sole supplier of fuel to the airport.
 Priority of landing slots is given to historic rights of existing users
(IATA, 2008). HIGH

 BA employees use collective bargaining through trade unions in order

to increase their bargaining power

Power of Buyers

 Low concentration of buyers to suppliers means they have little MEDIUM

bargaining power.
 Increased internet usage has amplified awareness and interaction of
customers (Keynote, 2008c).
Threat of New Entrants

 Significant barriers to entry: such as the competitive environment, high

regularity requirements and high capital cost requirements.
LOW
 Barriers to exit are in place which deters new entrants.
 The failure of recent airlines such as XL and Zoom is likely to deter

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 British Airways plc 2010
new entrants (Times Online, 2008).
Threat of Substitutes

 There are few direct substitutes:

o Short haul flights: the Eurostar or a ferry.
LOW
o Long haul flights: no notable substitutes.

1 SWOT Analysis :
It is important that strategic development is reflective of British Airway’s strengths and
weaknesses relative to competitors and the opportunities and threats presented by its external
environment.

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 British Airways plc 2010

Internal Strengths
 Brand Image
 Partnerships & Alliances
 Financial size and stability
 Terminal 5
Internal Weaknesses
 Poor employee relations history
 Reliability and trust
 Innovation & change

External Opportunities
 SkyTrax Quality System
 Competitors forced exit
 Competitors failing on delivering
reliability
 Emergence of new markets
External Threats
 Open Skies Agreement
 Environmental awareness
 Global economic crisis
 Lower cost competition

Appendix 3: British Airways press release on the new technology for preserving environment.

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Appendix 4: British Airways cites IT investment as key factor in 20% profit increase

Bill Goodwin 

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 British Airways plc 2010
Tuesday 30 May 2006 09:19

Investments in IT have played a key role in boosting British Airways’ profits by 20% to
£620m in the face of rising fuel prices and growing competition from no-frills airlines.

BA chief information officer Paul Coby said the airline had used technology to drive the
streamlining of business processes, removing complexity and cutting costs.

The strategy helped BA transform its short haul flight businesses, which made a profit of £7m
last year, after 10 years of losses, the airline said.

“The hidden multiplier is that if you are going to automate, you have to understand the process
and simplify it. Complexity will kill you and slow you down. IT has been an enormous leader in
simplifying BA’s business,” said Coby.

The IT department’s strategy is to ensure that, rather than having multiple IT systems with
multiple sets of data, it has the minimum number of IT systems needed, based around a single set
of customer records.

The airline has been investing in its BA.com website, which accounts for 33% of sales in the UK
and 80% of sales worldwide, as its core IT system. The system has been designed and managed
in-house. “We see this as our key differentiator,” said Coby.

“We said we would make dealing with BA so easy you would want to do it yourself online. We
called the project Customer-Enabled BA internally, because it was about enabling our customers.
It was not technology for technology’s sake.” 

The airline has recently completed a sophisticated programme to integrate the BA.Com website
with the airline’s call centres, allowing both sales channels to operate using a single set of data.

“Our teams have worked with the call centre and talked with staff to understand the call centre
operation. The clever thing is to take data and make sure it moves from one system to another.
That has been the challenge,” said Coby.

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Moving towards e-tickets, which represent 87% of tickets issued, has reduced costs and
simplified BA’s operations. In the past, cardboard ticket stubs were collected, scanned, and sent
through a central clearing house.

“Six months later you might found out what you flew and what your revenues were. With e-
tickets, you find out your revenues as soon as you have clocked in,” said Coby.

The airline has set itself the target of selling 50% of tickets worldwide online within two years
and handling 50% of ticket queries, changes and upgrades online. This will rise to 80% when
Heathrow’s Terminal 5 opens for business in early 2008, said BA.

The IT department is also developing ways to make it easier for customers to manage excess
baggage online and is working on an electronic shopping basket that will allow customers to buy
complete holiday packages, including flights and hotels, online.

A project is underway to develop boarding cards that can be printed from a home PC. They will
use barcodes that can be read by a scanner at the airport.

“Our philosophy has been to build systems for customer use, build it right and build it once. It is
cheaper for the airline. It is also much simpler to change your processes because you have one
system,” said Coby.

 Quality Up, Costs Down

Innovative use of technology has enabled British Airways to improve the quality of its IT
operations while reducing the costs, BA CIO Paul Coby told Computer Weekly.

“We have reduced the cost of running our IT operation by 40% over the past four years. We are
not only doing more technically, we are running it more efficiently. Also, the quality has
improved by two or three times. We have done that by simplifying and standardising how we run
the technology,” he said.

Appendix 5: Mobile technoly in British Airways.

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 British Airways plc 2010
Black berry boarding at British Airways:

BlackBerry users can now take a step into the future and board British Airways flights using the
airline’s new mobile boarding passes.

Users of Android-operated mobile smartphones will also benefit from the new functionality in
November, following its successful launch to iPhone users in July.

Over 30,000 customers have used the mobile boarding pass on their iPhones to fly on BA flights
since it was introduced.

Chris Davies, head of digital marketing, at British Airways, said: “iPhone users have told us how
incredibly convenient the Mobile Boarding Pass is so we’re sure our customers who use
BlackBerry’s will love it too.

“Extending our successful Mobile Boarding Passes to Blackberry and Android users underlines
our commitment to strengthen our mobile offering and enhance the overall travelling experience.

“It gives our customers increased control and makes travelling on British Airways even easier
and smoother, allowing them to stay one step ahead.”

Mobile Boarding Pass

The mobile boarding pass can be used when customers travel on any British Airways operated
domestic flight and to many European destinations.

British Airways was the first airline to develop an App for customers in the UK. Since then, over
quarter of a million customers have downloaded the new App from iTunes, BlackBerry App
World and Android App Store, following a major upgrade with improved functionality.

The App ensures customers have access to real time flight information about their upcoming
trips, full integration with their Executive Club details and easily and smoothly guide customers
through each stage of their flight process.

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It also provides a dedicated travel news section, frequently asked questions and a link to the
mobile website.

Mobile Boarding Passes can only be used by customers who are members of the British Airways
Executive Club.

Appendis 6: Innovation in British Airways.

British Airways sets up tech innovation unit
By Andy McCue, 30 November 2007 12:54
NEWS
British Airways (BA) has set up a special innovation unit to explore ways the airline can useweb
2.0, shareware and open source technologies.
The unit has a core of around 10 people from the IT and commercial departments, which will run
small-scale trials of new technology.

BA's CIO Paul Coby said the real-time and mission-critical nature of internet-based systems
meant it was getting more difficult to introduce new innovations because of the risk.

He told silicon.com: "We are trying to get back to the heroic days of web development when you
could try things."

One of the first things to come out of the innovation unit is the introduction of Google gadgets on
the ba.com website. The gadgets include information such as arrivals and departures, special
offers and timetables and people can add them to their personalised iGoogle homepage.

Coby said: "We have put it quietly live on the website - a sort of beta version - and it is getting
120 downloads a day."

The unit's remit also includes open source and a new portal will go live on the BA staff intranet
in January based on free open source software called Liferay.

Coby said: "We are looking at open source. We looked at the big heavy duty stuff from the likes
of BEA which costs you a big licence and support fee but this does everything you want."

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The Employee Self Service BA staff intranet is also trialling social networking between
employees on travel tips, which Coby said could eventually be extended externally to customers
if successful.
Another initiative that has already come out of the innovation unit is a trial at Dusseldorf Airport
in Germany replacing the BA self-service check-in kiosks with PCs and printers.

Coby admitted the concept would not work everywhere but said: "Those big heavy kiosks are
quite expensive bespoke machines so why don't we just put some PCs in? Then you can do all
those other things you can do online."

Appendix 7: case study on British airways.

Case study: British Airways
by Lisa Kelly 08 Nov 2007
Be the first to comment

SOA will enable British Airways to respond quickly to customer service issues

Paul Coby, chief information officer for British Airways (BA), says a service-oriented
architecture (SOA) will help the airline develop its self-service approach and ensure the
customer remains the priority.
As self-service technologies such as online check-in become the norm among airlines, Coby is
keen to stay ahead of the game. He says SOA a flexible architectural process that allows the
reuse of resources will enable BA to respond quickly to customer service issues.
“Anyone can buy the technology to have online check-in, but the clever thing is how you
integrate it with the customer experience. SOA enables you to get things right by allowing you to
make short-term changes where you need to be flexible and agile, such as making sure the
seating policy is right,” says Coby.

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“If you set up the systems correctly, unlike the old days where you had to go into some code,
SOA allows you to get things done by rules. For example, seating policy or an upgrade can be
based on a set of rules or criteria. There is a lot you can do quickly to manage systems by
allowing analysts to change parameters.”
Coby says BA has already built a range of new systems with SOA in mind, but still has to
undertake development work. “We can’t instantly do what we want to do with SOA, as the
technologies are only just becoming mature,” he says.
BA is using an enterprise service bus (ESB) a distributed middleware system for integrating
enterprise IT assets using an SOA-based approach.
“The direction in which we are heading is the ability to manage things directly by putting the
business in control of the system so it can fine-tune and change things,” says Coby.
“For example, with marketing engines in the BA.com web site, the business can define which
group it wants to talk to in order to make offers.”
Service orientation is also crucial for the development of BA’s self-service staff portal. “With
SOA, we should be able to move much more quickly in what we want to make available to
staff,” says Coby.
“Instead of building a system that takes nine months, it can be done in nine seconds.”
However, Coby says that it is important to realise the limitations of SOA. He says service
orientation cannot change the fundamental actions of systems, but if IT organizations understand
the architecture, they should be able to create more flexible systems.
For example, Coby says SOA can help with convergence projects, as passengers embrace
mobility and look to use phones to receive flight information and check in at the airport.
“We need to keep thinking about new technologies that give people what they want and mobility
ranks highly with the new generation of passengers,” he says. “SOA can help us apply the right
processes as we converge.”

Appendix 8: Knowledge management.

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IMPORTANCE OF KNOWLEDGE MANAGEMENT:

So it is very easy to see how effective knowledge management will greatly contribute to
improved excellence, which is to:

a) Dramatically reduce costs.

b) Provide potential to expand and grow.

c) Increase our value and/or profitability.

d) Improve our products and services.

e) Respond faster.

Knowledge simply underpins everything we do.

But the benefits of knowledge management for improved excellence, is simply ‘one side of the
coin’. There is more.

Effective knowledge management, especially accelerated knowledge creation, is the driver for
innovation. Increasingly, products and services are becoming ‘smarter’ and more knowledge
based.

Our ability to better collaborate in physical and virtual teams, as knowledge workers, is driving
the process of new knowledge creation. Ideas can now be turned into innovative products and
services much faster.

As organizations, we are learning faster, and that means that individuals are learning faster.
People are developing their competencies and confidence faster in organizations that practice
effective knowledge management.

In summary, we simply cannot afford not to mainstream, to embed and embody knowledge
management principles, strategies, policies, processes, methods, tools and technologies into our
daily personal, team and organizational lives.

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Appendix 9: Airlines quality review and ratings.

Airline Quality Review:

British Airway’s quality of service in comparison to its competitors and may highlight strategic
issues that need to be addressed.

The figure below Created using data sourced from Skytrax, 2010

http://www.airlinequality.com/Airlines/BA.htm .

website
check in service averall rating
5

handling delay or cancellation responding to request

British
Virgin
assisting family/children 0 interaction with pasengers
Air France
KLM

cabin safety service efficiency

seat confort Quality of meal

inflight entertainmnet

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All ratings taken from the website are based on scale of 1 to 5 with 5 being the highest.

 The overall Airline Rating for BA was 4. Its major competitors all scored 4 apart from
KLM, which scored 3.
 BA and Virgin Atlantic are virtually identically marked in all categories with the rest less
highly rated.
 BA is not a Quality Approved Airline, whilst Virgin Atlantic is.
 BA needs to improve upon its interaction with its passengers across all classes in order to
outperform its nearest competitor Virgin Atlantic.
 BA needs to improve its baggage delivery service. ‘Slow baggage recovery at T5’ (SkyTrax,
2008).
 General customer reviews have shown a common theme: poor in-flight entertainment which
regularly breaks down.
 BA needs to look at improving its online services by providing additional services all with a
more personal touch.
 Six competitors hold a five-star rating with the independent evaluator.
 For BA to become a 5 Star Airline emphasis needs to be placed on the quality of its customer
service delivery at all levels, which it has lacked in the past. This is what will differentiate
itself between its main competitors.

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