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VIRGIN ATLANTIC CASE STUDY

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The organization Virgin Atlantic is a British airline based out in England, UK. The airline was given the permission to operate in UK in 1991 in terms of providing services through flights to the Caribbean, the Far East and the North America, thus becoming the next airline after British Airways to provide international services. As a student, you must know that drafting a case study is no joke. And when you have a popular brand like Virgin Atlantic for your case study project, you need to be extra careful about your work.

Virgin Atlantic received the two unused land slots of the British Airways by the Civil Aviation Authority thus, gaining grounds on the British Airways in terms of having a good and effective competitive advantage of making 6 round trips between Heathrow and Tokyo. However, over the expanse of two years, the parent company still faced issues in terms of its other subsidiaries and Virgin Atlantic experienced a loss of 9.3 million pounds in 1993. The purpose of the organization has been to provide good service in UK as well as acquire business across the global circuit however, the increasing losses, the company is fighting hard to keep up with the competitive airlines industry.

Background

The British Airlines, Virgin Atlantic was founded in 1984 and originally it was called British Atlantic Airways based on the plan that the flights will be scheduled between Falkland and London. However, the original founders, Randolph Fields and Alana Hellary could not establish understanding regarding management with Richard Branson and Fields sold his share. The company’s headquarters are situated in Crawley, England and the name was changed from British Atlantic Airways to Virgin Atlantic making its first flight across Gatwick Airport to Newark Liberty International Airport.

During the formative years, the airlines focused more on competition with the British Airways by trying to take away their opportunities instead of exploring their own profitable avenues. With the passing years, however, the company years made some good changes and went through some negative impacts such as losses. The airlines have been implementing modern changes that shows a positive perspective towards development in society, gender equality and positive reinforcement in administrative work. Allowing female attendants to have a choice in wearing a trouser or a skirt as well as giving them freedom to either apply makeup or not. However, with the good, the airlines have suffered through losses leading to losses of 233 million pound by 2013. This also led to the company taking away employment of almost 500 employees so that they can establish an efficient structure for management.

The organization has lost a lot of its shares and holdings leading to decrease in the impact of the company in market leadership as well as decrease in the workforce, especially with the pandemic conditions, another group of employees were let go so that the organization’s debts can be managed.  

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External Environment: Virgin Atlantic PESTLE Analysis

Political: In UK, there are two major political parties such as conservative and labour party, with completely different approach in terms of perspective and trying to establish different political environment in the country. Instability in the political environment of UK impacts the performance on different companies related to different industries and airline industry is no different therefore, the unstable political environment does impact the performance of Virgin Atlantic.

Environmental: High Carbon emission through airlines are impacting the welfare of the environment as well as the people therefore, the increasing number of Virgin Atlantic flights did contribute to the negative impact it has on the environment.

Social: The company is impacted by the social factors of UK considering it operates and it also has to consider the social aspects of the countries to which it flies from UK. It is due to the aspects of social differences in the way UK where the lifestyle is different as compared to the places in Asian countries and Caribbean thus, making it difficult for the airline to respect the social requirements of all places. The airlines have its flights scheduled.

Technology: After the competitive edge with British Airways, Virgin Atlantic is considered a low-rate carrier therefore, the reduced cost operations has impacted the technological integration on the safety standards and the increased digitalization has been positive in terms of Virgin Atlantic. The efficiency has been improved of the airlines.

Legal: The factors of maintaining policies, regulations and other factors of other countries that the flights of Virgin Atlantic visits impact the legal influence and there have been issues such as fuel control computer system from the flight from Hong Kong to Heathrow leading to loss of automatic fuel transfer impacting the safety recommendations not being followed. This has the direct impact on the legal responsibility of all the passengers on board.

Economic: Virgin Atlantic has been going through a tough phase making losses since 2000 and it has been observed that they have to cut down on their flight schedules and as well as decreased the fleet size considerably. However, with present COVID 19 pandemic situations, it was a like a last straw in the economic losses considering the organization has gone over two rounds of job cuts by laying almost 3000 employees.

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Internal Environment: Virgin Atlantic SWOT analysis

Strength: The airlines provide three categories for different range of customers such as luxury, economy and premium segments. The airlines try to cater a large number of customers with this service thus, manipulating the levels of personalization and service quality based on the type of the service. The company also has created a cool brand image for themselves, especially due to Richard Branson leading to influencing young people avail case study assignment help services. 

Weakness: Our assignment experts also have the eye for the weaknesses in Virgin Atlantic organisational structure. The strategies of Virgin Atlantic are being copied in recent times by other airline organizations which previously completely in control of Virgin Atlantic, being a pioneer in its formative years. The company has made an image of an expensive airplane making it difficult for many individuals who travel economy to consider the airline as an option thus, there is a smaller number of acquisitions of new customers. Being a strong player, the company used effective strategies to compete with the British Airways however, over time there have been financial challenges where they invest in dollars however, they receive the revenue in pound, establishing a gap in the profit percentage.

Opportunity: The airline has a market image of expensive airline and it is therefore, a suitable step taken by lot of people who like travelling for work comfortably to choose this airline. Individuals due to the time saving factor, prefer air travel which makes it important for them to choose an airline that provide comfort in terms of good seating space, leg space and other such services that makes the travel more comfortable. If you want to give your assignment help an edge over your classmates, it is wiser to get a professional’s assistance. 

Threat: The increasing trend of travelling through air has made the airline industry more competitive leading to increasing number of airlines and making the market more competitive. The Virgin Atlantic considering already experiencing through financial challenges have issues in terms of maintaining effective leadership in the market and provide effective services to its target customers. Brexit has become another threat considering the company is facing critical issue in terms of decreasing number of passengers travelling abroad directly impacting their business.

Recommendation

Based on the external and internal factors analysis, the following recommendations can be identified and provided for the organization to perform well. The British airlines, Virgin Atlantic must bring certain changes in their performance, management, operations and financial management to effectively benefit from their future performance. The organization must acquire a more economic approach in terms of providing services so that there is less investment as compared to their profit. Virgin Atlantic must effectively contribute to the legal aspects by putting more focus in the maintenance of their flights and the safety of the passengers.

The performance of the flight crews and members must be trained effectively in terms of the social aspects of UK as well as different countries as well as it must consider the interaction and communication passengers should be positive. The luxury segments and premiums must be considered to be the main part for profit therefore, the investment should be made in such a way that the gap between dollar and pound do not impact the company’s revenue.

Conclusion

Concluding the performance of Virgin Atlantic in UK, the internal and external environment of the company has clearly experienced many challenges and in its quest to challenge British Airways. There have been constant competition and battle based on their performance and it has been created by Virgin Atlantic thus, overexerting its own resources. This has led to loss based on their resources, operations, management, authority in the market as well as workforce. establishing arguments to inform the internal factors impacting the growth and profit of the airlines considering there have been a lot of issues, both legal, economic, social and political that has impacted the company’s growth.

It is an important way in which these factors are considered important in which the influence it has on the way the company is going through serious issues of employment cuts and financial losses. The external analysis of the factors contributes to a better understanding of the threats that impacts the opportunities as well as the strengths of the company thus, it is important for the airlines to focus on making the weaknesses resolve with effective interventions.

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