Investigating Business of British Airways, PESTLE Analysis of Qatar - Case Study Example

Investigating business Contents Introduction 3 SWOT Analysis of British Airways 4 PESTLE analysis of Qatar 6 References 10 Introduction Qatar is located in Western Asia. It is an Arab Country located in Arabian Peninsula’s north eastern coast. It shares the land border with Persian Gulf and Saudi Arabia in the South. The country has a total population of 1.8 million. Its huge resource of natural gas makes it a wealthy country. It has a high per capita income. In the Arab world Qatar experiences the highest human development. World Bank has also recognised Qatar in high income economy country (Fromherz, 2012). Therefore it is the main place of many business activities. Most of the companies open its business in Qatar as its developed economic condition will give them a huge profit (Potts, 2000). Along with much other industry airline industry is also expanding its business in Qatar. Airlines are one of the fast expanding industries in the world. British airways are the largest airline company based on its international flights, fleet size, destinations. The company is based in London. SWOT Analysis of British Airways (Stanford, 2012) Strengths of British Airways This Airline Company gets a strong backing of UK Govt. It was established in 1972 by UK Government. From that time it has became a strong player in this industry. It gets a huge support from the government for maintaining its efficient and effective service. British Airlines has a strong presence in UK. It is doing its business for a long time. Therefore nationally and internationally its presence is strongly felt. The company has a strong brand presence. It deals with many international flights and gives a memorable experience to its customers by providing excellent services. It is counted as a leading brand in the airlines industry. The company has an excellent global presence as it provide flights to almost every country of the world. It covers nearly 150 international destinations of six continents of the world. The fleet size of British Airways is over 260 aircrafts. The company is having a strong and prosperous partnership with United Airlines. British Airways forms one world airline. It is the third largest airline company. Weakness The company is facing a strong competition from Cash Rich Middle Eastern Airlines. This airline company is becoming very popular day by day by offering equivalent services and facilities like British Airways. This intense competition limits the market share of British Airways. It is losing its customers of its competitor. The company is also facing the problem of poor employee relation which is not properly handled by the company. In British Airways change and innovation in the service offered is slightly slow. Opportunity The important marketing area of British Airways is its rise in the Skytax quality system. By this syste4m the company can boost its international image in the global market. Many of the competitors of British Airways were forced to leave the market for the struggle of global economy and the high cost of competition. The competitors of this company still face the issue of reliability related to service delivery. Whereas British airlines gets this as an opportunity as its customer believe totally on its service delivery. The company is expanding in new markets. It is introducing offers of budget travelling which increase its opportunities of prominence in new markets. Threats The Rising of fuel cost is one of the major threats of British Airways. The cost of labour in Airline industry is also increasing day by day which creates a problem in the company. The agreement of open skies provides an equal competition to all the airlines company. It also increases competitiveness in all the airlines by the removal of prohibitions on international routes. Most of the consumers of British Airways are developing environmental awareness. This is creating pressure on the company for reinventing its energy policies. It also forcing them to apply strict rules regarding scheduling of flights at off peak seasons. This have to be done adopting regulations related to the environment. The financial threat the company is facing is that the global economy still not been able to recover itself completely from the economic crisis of 2008. For this pound is dropping its value against Euro. The competitors of British Airways are reducing their operational cost. It is making things hard for British Airways to remain fixed in its strategies of profit margin. PESTLE analysis of Qatar Political Qatar government type is emirate. Though the country is slowly developing into constitutional monarchy it does not hold election nor allow any political party. Election is done only in the municipal level. The elected councillor of the municipal election does not have executive power. He can only give advice to the Minister. The country is divided into ten municipalities. They are Ad Dawhah, Al Jumaliyah, Al Ghuwariyah, Al Wakrah, Al Khawr, Jariyan al Batnah, Ash Shamal, Ar Rayyan, Mesaieed and Umm Salal. The strict political rules of Qatar do not allow any political party to interfere in the development and prosperity of the state. Its government takes and implement those decisions which are perfect of the state. Therefore if British airways expand its business in Qatar then it won’t face any political problem. Rather the company will get advantage from Qatar government in developing its business there. The ten municipalities of Qatar can become the main business point for British Airways. Economical Qatar is economically very developed country. Per capita income of the people is very high. Its GDP per capita is US$74,000. The annual growth of the country is 14.2%. There is a continuous expansion of manufacturing and service industry in Qatar. Increased hydrocarbon revenues and government support help to increase the economic condition of the country. The industries and the business houses in Qatar are very optimistic as they are experiencing a huge development of their business in this country. Moreover Qatar has a huge resource of natural gas and oil which adds as an advantage to the industries present there (Crystal, 1995). It will be beneficial for British Airways to do business in such a developed country. It can earn more revenue from Qatar as the economic condition of the country and its people is very good and there spending capacity is also high. The country also provides good infrastructure facilities to its industries which will help the company to establish its business. Social Qatar is an Arabic Country. It follows Islam religion. It has a population growth of 59.6%. Ministry of Labour and Social Affairs provides free public health service and education. About 90% of the people staying there are literate. Other than Qatari of other nations also reside in Qatar like Indian, Sri Lankan, Pakistani, Nepali etc. Work force in the private sector industry of Qatar is much higher than government sector. All these factors will help British Airways in developing its business there. Most of the people of this country are literate. So the company can get its labour from Qatar. As more number of people are working in private companies so they will have an idea about the work culture of British Airways and will be interested to work for this company (Gaskell, 2005). Technology This country’s main strength lies in its resource of natural gas and oil. The revenue earned from this two this has made Qatar as one of the richest country in the world. With the development of its wealth the country has also developed in its technology. It may not possess the largest market for IT but in 2010 its condition was better that other IT market of the world. The IT service market is expected to be the fastest growing market of the country outperforming the software and hardware sectors. The country has increased its development in technology in the last 10 years. The Nanotechnology used by Qatar in many fields is helping the market to manufacture best quality product at a low price. Qatar has the trend of innovating and intervening technology. British Airways can take advantage of this technological growth for settling down its business in Qatar. With the improve technology the company can manufacture the products related to their services in Qatar. The company don’t have to bear the huge cost of importing things for other countries. More over British airways will get the facilities of using the natural resources of Qatar at a low cost (Jarvis, 2014). Environmental The environment of Qatar is well maintained by the Ministry of Industry and Agriculture. To monitor environmental issue an environmental protection committee was created in 1984. Preserving natural wildlife, oil supply conservation, increasing in water supply are the important factors in the environmental development of the country. Water, Air and land pollution are also some major issues of Qatar. All these issues are well handled by the state. So it doesn’t create any problems for the industries doing business there. Therefore British airways won’t face any such environmental issues in Qatar (Beamish and Ashford 2005). Legal Qatar has a comparatively liberal legal system in compared to other Islamic countries. Many foreign countries are settling down in Qatar as they are not facing any such major legal issues for doing business there. So British Airways also can easily start business in Qatar without confronting with legal problems like other companies. References Beamish, K. and Ashford, R., 2005. Marketing Planning 06/09. Burlington: Routledge. Crystal, J., 1995. Oil and Politics in the Gulf: Rulers and Merchants in Kuwait and Qatar. Melbourne: Cambridge University Press. Fromherz, A., 2012. Qatar: A Modern History. New York: I.B.Tauris. Gaskell, K., 2005. British Airways. London: Crowood Press UK. Jarvis, P., 2014. British Airways. London: Amberley Publishing Limited. Potts , D., 2000. Ancient Magan: The Secrets of Tell Abraq. Cape Town: Trident Press Ltd. Stanford, N., 2012. Organization Design. New York: Routledge. Read More