Business Environment Assignment
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Virgin Atlantic is Aviation Company that offers one of the best services in the aviation industry. Its C.E.O is Richard Branson and the company has cut itself a niche among fellow airline transport companies. Virgin Atlantic was founded in 1984 and has grown in leaps and bounds over time and has in the past few years been scooping awards for several achievements. For instance, virgin Atlantic is working with free the children and is in support of their long term sustainable change in our destinations. Its change is in the air programme has set clear goals that link the social aspects of sustainable development to the environment. The long term partnership will go beyond donating cash and will allow the staff at virgin Atlantic to learn about some of the global challenges that people in different parts of the world face. The company is based at Gatwick and Manchester and London’s Hearthrow airport. It provides long overhaul services across the globe i.e. to Africa, Asia, America, Caribbean, and Middle East.
The company believes that security, safety and consistent delivery are deemed as the basic foundations of everything they do. Therefore, virgin Atlantic stated that for their company to succeed, their strategy and company requires them to build on the foundation that they had identified and also develop leisure markets that could help in achieving and driving effectiveness and efficiency and therefore the company declared that their mission statement was a simple one: to grow profitable airlines that could make people to love flying and where people love to work. It did not forget to know that it is always of paramount importance to consider stakeholders requirements in any change in the company or in decision making, requirements in this case referring to demands and expectations of stakeholders in regard to what they expect to deliver and achieve. In the organization, there are different stakeholders and therefore the main stage in the process of setting the goals focuses on identifying the different stakeholders and their requirements towards the organization. More so, virgin Atlantic focuses on hard working so that they can build a brand equity that will engage creativity and people –friendliness and therefore focusing on building an image of quality, innovation and sense of fun.
Since virgin Atlantic is just like any other business, it has common aims and objectives that are meant to see it grow in leaps and bounds over time. It has so many long term goals and one of their major long term goals is to provide their passengers with a travel experience that is seamless from the time their decide to make t heir bookings to the time they disembark once they have reached their destination. In so doing, the company has therefore made virginatlantic.com a one stop where all their customers and prospective clients have their needs being met. It also aims at providing the highest value and quality of innovative service that gives the customers in all the classes the value for their money. Other objectives they have are also meant to help them reach their final aim. Their objectives involve return on investment, profitability, employee development and competitive position. Their current objective is to, through the necessary procedures, maintain a safe customer environment and also to concentrate on major competencies by hauling routes directly.
Stakeholders are all those participation and support are crucial to the success of a business and need to be considered in achieving project goals and aims. Any organization could have primary or secondary stakeholders who have interest on issues within the policy or project concerned. Therefore stakeholders’ information is used to assess how the interest of the stakeholders should be addressed in a policy, project or plan. Therefore stakeholders serve to develop a strategic view of institutional and human landscape. Therefore, virgin Atlantic has worked with its major stake holders in fleshing out unambiguous and measurable objectives in order to set their programmes in the right track. The stakeholders in virgin Atlantic have provided the opportunities that enable further aligning of business practices with societal needs and expectations and by helping in driving of long term sustainability and shareholder value. They have also , through their engagement in virgin Atlantic , enabled the company compete in an environment that is increasingly ever changing and complex while at the same time resulting in systematic change that leads towards sustainable development.
The virgin Atlantic has stakeholders who it has a responsibility of ensuring that they also achieve their objectives as well. Employees at virgin Atlantic are the first stakeholders. Worldwide, virgin Atlantic has employed over nine thousand employees. According to their mission statement, they made claims that in virgin Atlantic people love to work. The C.E.O, Richard Branson claimed that the virgin Atlantic is made by people who make up virgin Atlantic. Also, according to their website, virgin Atlantic is a company that is not going to exist without the wit and wisdom of their people and without energy. It further stated that they have greater respect for their staff and in fact treated employees as a very important part of the business and that they viewed them as part of their assets. Virgin Atlantic provides training for their staff to make sure that they are dedicated, enthusiastic and professional for instance, engineering technical training, facilities training, customer service training and cabin crew training. This is because the company believed that everyone within the company plays a major role in delivering the brand of the Virgin Atlantic. All the staff that virgin hires are of high standards and have lot of experience and this can help the company get high reputation and therefore become the top airline transport in the industry.
More so, virgin Atlantic offers the newest training facilities to the staff so that hey can improve their skill and training. In order to motivate the employee, they offer great benefits for instance; they are offered seven free flights per year to destinations they choose from. More so, any employee of the organization is free to express his or her opinion.
Another stakeholder is the customer. In line with virgin’s mission statement of people loving to fly, Richard Branson, the C.E.O always has innovative ideas that help to attract new and retain existing customers. This is because virgin Atlantic had operated for twenty five years and that there were so many loyalty customers who would enlarge his business scale. It does not matter if the guest is flying with upper class or economy class, virgin Atlantic can help in meeting the needs of the traveler. due to the long distances and boredom experienced in other flights, virgin Atlantic have designed premium economy class where travelers have personal seatback entertainment, exclusive meals and extra leg room. They have also different offers and promotion for their customers for instance, mile plus money and flying club.
Finally, Singapore airlines is another stakeholder. In November 2006 virgin Atlantic signed a code share agreement with Singapore airlines which is well known as a result of its excellent customer service. Nowadays, it is one of the most famous airlines that have ninety aircrafts flying over ninety cities. As a result of the code share agreement, passengers from Singapore airlines can fly to Dubai, Los Angeles and Francisco and transit with virgin Atlantic flight from London. This started in 2006 and virgin Atlantic customers can benefit from Singapore airlines service between Sydney and London via Singapore.
Virgin Atlantic aims at meeting its responsibilities. It targets at providing the best airline transport over the earth. It also targets at being efficient when it comes to management issues where it gives the best training to the staff working there. Among other responsibilities are, to minimize negative sites of transport and unleash the positive sites that will enable it to be more sustainable transport. They also want improve air quality by reducing carbon emissions and to offer affordable security systems. More so, they intended to launch community work that would entail donating to charity, improve energy efficiency and ensuring that the environment is safe from carbon emissions. It also serves to make people feel more confident and comfortable because to them, they don’t just consider arriving at the destination but also how and why people travel.
Economic systems are one that a society tries to meet people’s wants and material needs through production of services and goods. Production is influenced by supply of labor, capital and land resources the scarcity of supply resources therefore implies that the organization has to decide on how to allocate these limited resources among the many needs, considering the opportunity costs that is associated with decision of producing a certain product. Different types of economies. In a free market economy, government intervention is at minimum and most decisions are based on market mechanism. Mixed economies are the best because they combine elements of intervention and private enterprises .effective use of resources is achieved in the extent to which the mix economies between the private enterprise and government intervention is done for effective allocation of resources. The government could also intervene in the form of tax regulation, prohibition or subsidies.
Social welfare is mainly meant to mean to value welfare judgments and to measure social ethics. It does not include the standard of living only but includes environment i.e. air, water and soil, insecurity, health, work or study leaves, income maintainance, training and education and the connections it has to the society. The industrial policy allows the gorvnement to take an active role in encouraging faster economic growth and supporting investment so that the manufacturing sector does not decline. It emphasizes the cooperation between employees, enterprises in order to strengthen national economy.
The main purpose of monetary policy is to influence economic activity through, control of money supply, exchange rates, interest rates and control of lending by banks. The international economic integration has resulted in very big economic systems where businesses operate globally and independently. Through this virgin Atlantic can now operate in Africa, Asia, Europe, America and Middle East.
Markets structures deviate from perfect market model in a number of way e.g. because there are big firms that have significant share of the market. This means that each market structure is not too small to affect price via change in it supply because each firm is presumed to be price taker. Also, no firms produce exactly identical outputs, i.e. the products are not homogenous and hence the goods can not be good substitutes to each other. In some cases the customers do not have perfect information about prices of goods in the market. Barriers into and out of the business makes some businesses to deviate from the perfect competition model. Also, there are externalities in consumption and production so there is divergence between social costs and benefits.
The interaction between supply and demand in a market is described by market forces. Organizational response can therefore be defined as the reaction that a company gives to a business or economical circumstance. The way in which an n organization responds to market forces is the key in any circumstance and will therefore impact on the company’s reputation and profile. In terms of demand and supply, the most successful companies will have a perfect research and analysis of the market to ensure that hey supply a product that is able to meet the demands of its customers. If a company judges the market demand for a product correctly, then their customers will always be happy by ensuring that what the customer wants is supplied in correct quantities and quality. Profits will also increase because the company will have done correct judgment of their margins that will enable them sell as much as possible without overstocking. Poor judgment results in misinterpretation of market forces and can leave customers empty hand.
Companies play a major role of encouraging growth and maintaining some policies within their framework like professionalism and being punctual. For instance, in law firms employees will be rewarded more if they bring in a lot of business. This means that the employee, while delivering a great service, will be developing the company and improving its reputation. Such employees can win very many clients to the company which makes the person so valuable to the company. In accountancy for instance, one will benefit from several company strategies including bonuses that are performance-enhanced. This means that depending on the level of qualification and in case of promotions very quickly, they will be entitled to a bonus. This means that here will be so many people driven to succeed and some will benefit from financial incentives if they succeed. Whoever will not want to choose the path will be out of the door and will not be tolerated?
The competition commission is a public body that is independent that conducts in-depth inquiries that relate to markets, mergers and engage in regulating the majorly regulated industries and therefore ensuring healthy competition among UK based companies for the benefit of companies, customers and the general economy. A free market economy is one which the market is free to operate based on wants and needs of the people. In free market economy, the economy is government driven by a government that practices laissez faire rather than controlling its economic policy. Supply, competition and demand forces rule the market place. The United States has free market economy. In command economy, all the production is controlled by the government, for example stains 5 year plans. Here the government determines what goods will be produced and at what price they will be sold for. The Soviet Union had a command economy.
International trade will enable the United Kingdom to get exposed to those services that are not available in their own country. Goods like clothes, jewellery and spare parts are made available through international trade. Trading of services like banking also allows the country to enjoy profits. International trading will also allow the U.K to effectively use their resources like technology, labor and capital. Since the technology in the United Kingdom is higher, it could import unprocessed goods from Africa so that hey process the goods and sell them after adding value to the raw materials. It could also encourage direct investors. Therefore, the UK should buy goods from countries which have lowest price. The United Kingdom cannot be economically independent without decline in its economic growth. They will be able to obtain raw materials for their industries from other countries. By so doing the standards of living of the people of the United Kingdom will go higher and leads to satisfaction among consumers because of increased availability of products.
The policies that have been formulated by the European Union and influence on the operations of businesses in the UK include: European company statute which provides a simple and cheap way of setting up a company that can have its operations in one or more member states. It allows businesses to follow the company law provisions in all the member states and mainly targets to reduce compliance costs that usually arise the national twenty seven rules on company creation and running. However, this does not affect the national employment law and insolvency law. The new form of company will exist alongside the private limited company of the UK providing an alternative of it.
The small business policy is another policy that impacts on UK business organizations. The policy supports innovations and proposals of policies that include: the introduction of principle of think small first when making any policy, carrying out of SME test on all administrative and legislative proposals that emerge from the commission. It also guarantees easier access to public procurement opportunities and information to all the businesses in the UK. It also makes accessibility of R and D funding possible mostly within the framework programme. It also provides incentives for businesses and products that are energy efficient, is in support of SMEs that are in the field of eco-innovation and innovative start ups. It also tries to seek market for goods produced in the European Union mostly in china and other parts of the world hence giving an upper hand to the businesses in the UK hence more profits.
Upon entry of the UK, potential gains have to be compared to any costs related to choice of exchange rate. Using the model of NiGEM, the potential entry rates can be calculated. From the results, we can make a conclusion that upon entry, the sterling pound is at risk of being overvalued and there will be noticeable costs of adjustments. This might reduce the output below the baseline of the UK in the short run. A rate like 1.40 that is low would make inflation rise too much, though temporarily and any rate that will be below this will viewed as competitive undervaluation. As a result of this unexplained weakness, there is a higher chance that the euro will be undervalued by about ten percent against the US dollar.
In case the United Kingdom decides to join what might be viewed as an overvalued real exchange rate, then inflation will be lower in the UK for some short period and monetary conditions will seem tight. Incase it joins at what is deemed as reasonable rate then euro appreciates, the growth in the UK will be slow for some years due to undervaluation.
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