BA has outsourced more of its operations than any other major world airline. All of its...

 

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BA has outsourced more of its operations than any other major world airline. All of its ticketing and Internet operations are designed and managed through Indian IT companies. BA now employs relatively few IT staff directly and these are all employed on key strategic projects. The development of the new shopping basket feature on ba.com is a recent example of BA's tactical use of Indian IT companies. BA's overhead cost per passenger is one of the lowest in the industry. The strike at Gate Gourmet caused chaos on BA flights a few years ago. The airline could not serve food on thousands of its flights due to the strike at its only outsourced producer of in- flight catering. This was a low-cost, high-risk strategy that backfired - BA employs no catering staff itself and other catering firms were unable to produce the quantity of meals that the airline needed during the lengthy strike. 1. Explain TWO benefits to BA from outsourcing many of its operations. 2. Analyse THREE possible outcomes for a business of reducing its core staff to an absolute minimum and using flexible workers and outsourced suppliers. BA has outsourced more of its operations than any other major world airline. All of its ticketing and Internet operations are designed and managed through Indian IT companies. BA now employs relatively few IT staff directly and these are all employed on key strategic projects. The development of the new shopping basket feature on ba.com is a recent example of BA's tactical use of Indian IT companies. BA's overhead cost per passenger is one of the lowest in the industry. The strike at Gate Gourmet caused chaos on BA flights a few years ago. The airline could not serve food on thousands of its flights due to the strike at its only outsourced producer of in- flight catering. This was a low-cost, high-risk strategy that backfired - BA employs no catering staff itself and other catering firms were unable to produce the quantity of meals that the airline needed during the lengthy strike. 1. Explain TWO benefits to BA from outsourcing many of its operations. 2. Analyse THREE possible outcomes for a business of reducing its core staff to an absolute minimum and using flexible workers and outsourced suppliers.

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