Executive Summary This report was produced using appropriate tools of strategic analysis, which

assesses the organisation's operational and industry environment and their competitive position
within it. . British Airways is the UK market leader in airline operations, however has faced
increasing competition over the last decade resulting in erosion in their market share. The report
begins by analysing the current internal and external environment of BA. Through strategic
evaluation we have recommended that BA focus on their fundamental service delivery to restore
their competitive advantage within the industry. This will require implementing a combination of
two strategies; a people processes strategy and a strategy focused on technological advancement.
The people processes strategy was derived from a number of industry sources outlining BA’s
decline in customer satisfaction. The technological advancement strategy coincides with the
renewal of BA’s aircraft fleet and will further improve the overall customer experience.
 1.1 Report Objectives

The objectives and structure of this report will consist of four main sections which will enable a
strategic direction to be recommended to BA: 1 2 3 4 To To To To research in to the current
strategic position of British Airways. critically analyse British Airways’ internal and external
environment.

1.2 Company Overview

British Airways Plc (BA) is the UK’s largest international scheduled airline. Alongside scheduled
services, BA is engaged in the operation of international and domestic carriage of freight and mail,
and the ancillary services (Datamonitor, 2008). In association with codeshare and franchise
partners, BA fly to more than 300 destinations, and carried more than 33 million passengers,
earning over £8.7 billion in revenue in 2007/08 (British Airways, 2008). Employee headcount in
March 2008 stood at 42,377 people (Datamonitor, 2008). Since privatisation in 1987, BA has
continued to grow as competition in the market has risen worldwide. In recent times, BA has
successfully been labelled the world’s first airline to take part in a scheme to reduce greenhouse gas
emissions (2002) and to allow passengers to print online boarding passes (2004) (British Airways,
2008). In 2005, the company saw Willie Walsh become Chief Executive of BA (Flight Global,
2008), who to date has driven the company through the completion of Terminal 5 at Heathrow,
amongst other new initiatives. Despite reported and imminent industry hits due to the global
economic downturn, BA’s future looks promising. As BA announces its aim of becoming the
‘world’s most responsible airline’ in the latest annual report (British Airways, 2008), great
importance lies in developing guiding principles and careful strategic direction to allow the
achievement of this goal. 1.3 Current Strategies The report will be designed in consideration of
BA’s current strategies (British Airways, 2008): 1 2 3 4 Upgrade customer experience via the
introduction of text and mobile services for business class customers. Modernise aircraft fleet and
offer new services. Manage cost base. Increase corporate responsibility through environmental
performance and partnerships.

Although BA does operate in a number of areas such as cargo, we are choosing to focus our report
on the scheduled passenger market due to the size and opportunities that BA has in this market
Business Map (T-O £8.32bn)
Industry Regulators And Influencers

Member of: AEA

UK Government BAA, CAA, DFT

Research and Interest Groups

Component Suppliers

Aircraft Suppliers: Boeing and Airbus SAS

Airports: Heathrow and Gatwick...

Other Suppliers: Food Suppliers…

Support Provider Subsidaries

BA Avionic Engineering, BA Interior Engineering, BA Maintenance Cardiff BA Leasing, BA

Capital, BA Holdings, BA Cash Management, Speedbird Cash Management, Speedbird Insurance
Company, Air Miles Travel Promotions

Cargo = 7.0%
Mail +freight diplomatic bags Scheduled BA Cityflyer, Openskies

Passenger = 86.2%*
Non-scheduled services BA Holidays

BA Service Portfolio
Other Airline Operators: Ryanair, Easyjet, Virgin Atlantic, Lufthansa, Air France KLM, Aer
Lingus…

Other = 6.8% Cargo Handling, Airframe Maintenance, Computer and Communication Services and
Consulting Services Alliances: Quantas, AA, Iberia, Continental Investments (equity owned)
Associates: Iberia S.A. 13.15% Avaliable for sale: Flybe Group Ltd 15%, Comair Ltd 10.9%

Intermediaries

Online websites

Direct Sales BA.com

Travel Agents

Customers

International Travellers: (by sales) Continental Europe = £1,219 ml The Americas = £1,697 ml
Africa, Middle East & Indian subcontinent = £821 ml Far East and Australisia = £659 ml

Domestic Travellers: (by sales) UK = £4,357 ml

Independent Customer Review: Skytrax rates BA as a 4* airline.

5 Adapted from: British Airways (2008) (* percent of operations)

2.0 External Analysis

For success within the airline industry, an awareness of the external environment is essential. This
section aims to highlight the position of the industry, in particular looking at competitors and
assessing BA’s capability to meet current and future challenges. 2.1 PESTEL Analysis (Source:
Johnson et al., 2008, p56) Figure 2 – PESTEL Analysis An analysis of the macro-environment has
been carried out using PESTEL

PESTEL Factor

The main PEST factors that have influenced alliances are:-

Political.
Politically, there are operating restrictions, which airlines have to work within. The benefits in
joining an alliance, is that it makes otherwise unreachable routes, a reality. This also ties in with
slots, as each national carrier in their home cities, has the monopoly. Another political benefit is the
bilateral route agreements, which all members of an alliance can utilise.

Economic.
Capacity in Europe outstrips demand, which leads to rate wars, equalling lower yields for
companies. Economically, alliances lead to a greater control on capacity, therefore reducing
competition and increasing yields. Alliances also reduce the near term possibilities of airport
expansion. By code sharing airlines are able to not only split costs but to offer services and enter
markets, they might ill afford to do on their own. This leads to less aircraft at airports, therefore less
space being required, and is another way in gaining access to prime airports, which can expand no
further.

Social.
These are strong from an employer staffing perspective. Airlines in alliances / code-share can
reduce costs by utilising only one airline's staff.

Technological.
Technology in this industry is fast moving and very expensive. Alliances, give the opportunity for
joint investment ventures, such as shared check-in systems.

(I have to use these point as well)

Political Key Points

Heavy regulation (AEA, 2009).

Increased security due to past terrorist threats (DFT, 2008).
Economic Global economic crisis: World growth is projected to just over 2 percent in 2009 (IMF,
2008).
Pound weakens especially against the Euro. Oil prices: declined by >50 % since their peak
retreating to 2007 levels. Decline in fuel price = strengthening of the dollar (IMF, 2008) UK
consumer spending saw its sharpest decline for 13 years between July and September 2008
(Channel 4, 2008). The UK has an aging population (see appendix 3) (National Statistics Online,
2008). Increasing unemployment (Kollewe and Sager, 2008). A recent survey revealed that 34% of
online consumers plan to use pricecomparison sites more in 2009 (NMA, 2009). Online booking
services and check-in is becoming increasingly used by the airline industry. Noise pollution
controls, and energy consumption controls (DFT, 2008). Limited land and for growing 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 increasingly ‘green’ and more aware of the environmental
impact of their actions. Cancellations of flights and loss of baggage (Channel 4, 2008). Collusion
and price fixing. Recognition of trade unions and industrial action e.g. Cabin Crew strikes. 7 Open
Skies Agreement (AEA, 2009) Implications for BA Compliance is essential if BA wants to continue
operations. Sufficient security measures should be in place to ensure consumer confidence and
competitive advantage is maintained. Possible reduction in the amount of business travel as
companies are cutting costs and using alternative means of communication such as
teleconferencing. BA is vulnerable as a UK operating airline to a poor exchange rate. Fluctuations
in oil prices and exchange rates will directly affect BA’s cost base. More intense competition
Potential opportunity for growth as older generations have more time to spend on leisure activities
such as international travel. Increased bargaining power as an employer. Increased consumer
awareness and therefore bargaining power. BA must ensure that they remain up to date with these
technological advances whilst avoiding becoming overly reliant, as this may isolate certain
consumer markets (i.e the elderly) who don’t feel comfortable using such technology. New
legislation (e.g. Climate Change Bill) enforcing tighter environmental regulation may increase
operational costs each year. Limited capacity=> utilisation of capacity.

Failure to adopt an integrated environmental strategy could lead to a detrimental effect on the BA’s
reputation and income. Such ethical issues could have a detrimental effect on reputation if left
unresolved. Restriction on mergers will have an impact on BA’s proposed alliance with American
Airlines. Good employee relations are essential if BA wants to avoid industrial action and
interrupted operations. Opportunity for BA and its competitors to freely transport aircraft between
the EU and US.
2.2 Porter’s Five Forces
(Source: Johnson et al., 2008, p60)

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 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 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’ (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). • 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 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. • Barriers to exit are in place which deters new entrants. • The failure of recent
airlines such as XL and Zoom is likely to deter new entrants (Times Online, 2008). Threat of
Substitutes • There are few direct substitutes: o Short haul flights: the Eurostar or a ferry. o Long
haul flights: no notable substitutes.
2.3 GE Matrix
(Source: Johnson et al., 2008, p280.)

The GE Matrix (Figure 5) provides evidence of opportunities for growth through market
development in new markets and market penetration in existing. Figure 5 – GE Matrix Competitive
Strength Market Attractiveness High High Medium North America BA=1.7% Latin America
BA=1.9% Low

Medium Asia Pacific BA=1.1% Western Europe BA=6.9%

Middle East and Africa BA=2.3% Low Eastern Europe BA=2.2% Australasia BA=4.0%

Size of Circle = size of market (British Airwayssed on 2006 data) Width of Circle = CAGR Forecast
Growth (2006 – 2011) Source: Euromonitor (2008) From the analysis above, it is evident that if a
market development strategy was to be pursued by BA, Asia Pacific and Eastern Europe would be
prime markets for profitability due to high growth (Appendix 5/6). It may also be a requirement to
build defence strategies in BA’s core market, Western Europe, due to low growth and intense
competition.
10
3.0 Customer Analysis Over the past decade there has been increasing complexity in customer
needs, as the customer has become more educated and demanding. Particularly, the following
changes have occurred:

A shift in demographics to older passengers (Keynote, 2008c).

• Increased global connectivity allowing the usage of internet and search mediums (e.g. comparison
and review websites). • • • Increased requirement for convenience (e.g. new destinations, quick
check-in). Price has become more of a priority Segments have become more defined within their
needs.

Evidence that BA is failing to respond to the changing customer landscape includes:

••
•

The amount of BA customers recommending their services reduced from 61% in 2006/07 to 59% in
2007/08 (British Airways, 2008). BA have been criticised for slow innovation (Doganis, 2006, Pg
165). Poor reliability and baggage handling (AQR)

• Failed attempts to target the price conscious consumer through low cost airline operation (Eirma,
2008).

4.0 Competitor Analysis 4.1 Strategic Groups – Strategic Group Analysis (Source: Johnson et al.,
2008, p73-77.)

Specialist e.g. PalmAir

Mass Service Providers e.g. BA, Virgin, NonFigure 3 illustrates that BA’s direct competitors are
those who operate similar services and lie within Local e.g. schedule Lufthansa, the same strategic
group. The BMI competition is likely to be most intense within this group as they are e.g. AirFrance
KLM seeking similar strategies.

Lufthansa and KLM-Air France are the 2 leading European Airlines Member carriers in terms of
No-frills passenger numbers, withe.g. Ryanand 14.1% respectively of the total number of
passengers carried. 15.1% BA comes in third with 9.3% of the total (Keynote, 2008c). Air, Easy Jet
BA face competition from a small number of serious contenders in the UK, with the main
contenders being Virgin Atlantic, and United Airlines in the Star Alliance soon controlling BMI
(Euromonitor, 2008). Although they do not lie within the same strategic group as BA the advent of
low-cost air LOW travel has changed the face BREADTH OF SERVICE Airlines such as HIGH of
the airline industry. Ryanair and EasyJet have established themselves among the leading carriers in
Europe, whilst the more established long-haul PRICE FOCUSED MIDDLE MARKET carriers
such as BA have struggled to keep up with FOCUS counterparts’OFFERINGS their ON SERVICE
growth rates. Moreover the economic downturn and sharp fall in oil prices has caused a price war
between Emirates, BA and Virgin Atlantic on the London-Dubai route. Fares have dropped by 30%
across the airlines. Thus competition still remains fierce. Based on the strategic group analysis it
could be argued that there is a gap in the market for a low cost airline operating a high breadth of
service however it is likely the reason no airlines have adopted this strategy is due to the fact that it
would be destined to fail. This assumption could be supported by BA’s failed attempt to enter this
market in recent years (Telegraph, 2002).

••••
•

•
•

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.

5.0 Internal Analysis It is now essential to analyse the internal environment in order to formulate
appropriate strategies. 5.1 Value Chain Analysis (VCA) BA have tried to control the system further
by forward and backward mitigation. Through controlling many component supplies in-house, and
through BA Holidays Plc, BA increases their reach in the value system to the supplier and channel
value chains.

Figure 6 – Value Chain (Adapted from: Johnson et al., 2008, p110)

FIRM INFRASTRUCTURE Structured hierarchy allows BA to make use of a multitude of
specialist knowledge in order to gain competitive advantage over downsized firms. 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
SALES SERVICE

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

SUPPORT ACTIVITIES

Update communication on other services

Whilst the Value Chain highlights the primary and support activities that add value to BA, there are
a number of inefficiencies within these activities that arguably reduce the amount of value provided
(see figure 7 and 8).

14
Support Activities Value Loss
SUPPORT ACTIVITIES

Firm Infrastructure HRM

Technology Development

Large bureaucratic infrastructure decreases effective communication and increases inertia. BA’s
employee opinion surveys attracted a mere 35% response rate in 2007 (British Airways, 2008). Due
to high collective bargaining capabilities, BA has contended a number of highly publicised
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.

Figure 8 – Primary Activities Value Loss

PRIMARY ACTIVITIES

Inbound Logistics

Operations/Outbound Logistics Marketing & Sales

High solidarity between supplier employees and BA employees has created a history of negative
industrial action. For example, in 2005, BA employees walked out for two days when Gate
Gourmet employees were sacked (BBC News, 2005). TV documentary reported on Terminal Five
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 BA).

5.2 Resource Based View (RBV) It is suggested that an organisations competitive advantage and
superior performance is resulted from its distinctive capabilities (Johnson et al., 2008 p95). The
resource based view highlighting BA’s resources and competencies is outlined below.

RESOURCES Threshold Resources

THRESHOLD CAPABILITIES Tangible • Fleet of 245 aircraft accessing over 550 destinations
(British Airways, 2008). • Additional services (e.g. BA Holidays & The London Eye Company
(Datamonitor, 2008)). Intangible • International Customer Database. • Partnerships & Alliances with
‘oneworld’ (incl. American Airlines), codeshare/franchise partners, and subsidiaries. Unique
Resources Tangible • Sole access to LHR’s Terminal 5 (BBC News, 2008). Intangible • Reputable
brand image. BA is recognised globally as a reputable brand, reinforced by its longstanding
existence within the industry.

COMPETENCIES Threshold Competencies

Training of ground school, flight simulators, and cabin safety training (BAFT, 2009). • Economies
of Scale from ongoing suppliers. • Ability to fly and manage passengers safely on various routes
(Davies, 2000).

ADVANTAGECAPABILITIES FOR COMPETITIVE

Core Competencies
•

OpenSkies’ subsidiary’s aircraft never have more than 64 passengers per flight, with one attendant
per twelve customers (British Airways, 2008). First UK airline recognised as a training centre by
the City & Guilds, qualifying all cabin crew with NVQ Level 2 (British Airways, 2008).

5.3 Financial Analysis (Source: British Airways, 2008). In 2007/08, BA made post-tax profits of
£694 million, an increase of 128% over the prior year. In 2006/07 profits were £304 million. The
difference is mainly caused by the loss from discontinued in operations in 2006/07 of £134 million.
However, the doubling in profits is also attributed to a decrease in operating costs and no credit
arising on changes to the pension scheme or provisions made for settlement of completion
investigations. BA has performed well in managing and reducing costs. Operating costs have risen
steadily over the past 5 years and this is in-line with the increase in fuel prices and increase in
landing fees/en-route charges as the company expands. In 2007/08 BA had operating costs of
£7,878 million which is a 1% decrease over the prior year despite increase in fuel costs to £2,055
million and increased landing fees, handling/catering charges with Terminal 5. BA managed to
reduce costs through a reduction in the number of employees by approximately 3000 people. BA’
online booking/reservation service helped reduce agency costs leading to a £77 million decrease in
selling costs. BA efficient control of all these costs has helped put them into a strong position in
relation to its competitors, especially with the current economic crisis. BA gearing ratio was at 27%
in 2007/08, which is a reduction from the prior year. This reduction shows that less debt is being
taken on by the firm. This could also be due to the fact that they have paid some of it back. Also,
with increased liquidity to 21% from 19%, BA is a strong position in the current economic crisis
and is more likely to have better relations with its suppliers and financial institutions going forward.
BA’s earning per share increased, reaching 59p per share. This was due to the increase in profit
before tax and the reduced corporation tax rate.Figure 10 – BA’s Fuel and Operating Costs

Overall BA remains financially stronger than its competitors. At the end of the 2007/08 financial
year they were in a good position to withstand most shocks and this has been the case. They have
stated that they expect an operational loss of £150 million for the 2008/09 year (IHT, 2008), due to
the trading conditions and fall in value of the pound. Despite a fall in oil prices, the cost of fuel for
BA will remain approximately the same due to the devaluation of the pound and the fact that fuel is
bought in dollars. However, compared to its competitors it still remains in the healthiest position
and will have to weather the difficult future ahead and may report losses in 2009.

6.0 Summary
18
6.1 SWOT Analysis (Source: Johnson et al., 2008, p81.) It is important that strategic development is
reflective of BA’s strengths and weaknesses relative to competitors and the opportunities and threats
presented by its external environment (Pitts & Lei, 2003): Internal Strengths • Brand Image • • •
Partnerships & Alliances Financial size and stability Terminal 5 VCA Refer to: RBV Financial
Analysis

Internal Weaknesses • Poor employee relations history

•
•

Reliability and trust Innovation & change

External Opportunities • SkyTrax Quality System • • Competitors forced exit Competitors reliability
failing on delivering

A rank ordered SWOT Analysis

Strength

• Size
• Strong brand recognition
• High level customer experience
• Low cost base and lower costs than other airlines
• Customer loyalty
• Part of Oneworld Alliance
• One of the leading world cargo transporters

Weaknesses

• Punctuality
• Lost Luggage
• Delayed & Cancelled Flights
• Reliance on established revenue sources
• Poor communication within the company
• Regular Strikes
• High Cost For Extra Luggage

Opportunities

• Increasing demand for transatlantic flights

• Acquire failing airlines or their assets
• Decreasing costs as industry expectations decline
• Innovative new ways of seating e.g. Standing
• Able to join the "Mile High Club" for a fixed fee

Threats

• Fuel costs
• Strong competition
• Virgin Atlantic
• Terror Attacks
• Loosing Goodwill
• Not as good as other airways
Key Findings

• Global economic crisis. • Higher regulatory requirements. • Increasing environmental awareness. •

Decline in consumer spending. • Increased use of the internet by customers. • High competitive
rivalry and bargaining power of suppliers. • Consumer trends in high convenience and high
expectations of service. • Intense competition within strategic group and trend for consolidation. •
The biggest other threat comes from low cost airlines. • BA = poor baggage handling, poor on flight
entertainment and low customer satisfaction. • Highest growth markets; Asia Pacific and Eastern
Europe. • BA adds value; financial size and stability, brand image, industry expertise, and
partnerships and alliances. BA loses value to competition; employee relations and performance,
marketing delivery, reliability, and slow innovation. Strong resources including sole access to hub
within largest UK Airport. Strong training competencies. Increased profits and lower operating
costs. Lower gearing ratios and higher liquidity. Possibility of a loss in 2009 as a result of the
economic downturn.

Strategic Implications Focus on technological and environmental issues.

Defensive strategies needed to protect market share. Ensure changing customer needs are
understood and met Although low cost airlines are the biggest threat to BA, moving into low cost
market is not deemed appropriate based on previous failed attempts. Service Quality needs to be
improved to gain a competitive advantage BA has a strong opportunity for market development in
Asia and Eastern Europe. BA needs to address the areas where value is being lost to avoid attacking
competitor strategies.
8.0 Analysis of Strategic Options Based on the analysis performed in figure 11 the five most viable
strategic options will now be considered further in terms of suitability, acceptability and feasibility.
8.1 Strategic Option 1 - Improvement to People Processes Brief Outline: The analysis highlighted
recent negative attention both internally and externally. The RBV and SWOT identified BA’s public
criticisms for poor bag handling and delay management, and disapproval following a number of
negatively handled employment related cases. A people processes strategy may rebuild brand image
and stakeholder confidence. SUITABILITY Poor employee relations history and recent negative
attention on BA’s reliability and trust (SWOT). Given the current economic environment,
unemployment is increasing (PESTEL). Therefore, the threat of industrial action and resignations
are less likely at this time. BA’s current strategies are to motivate, engage, support and develop
employees, alongside improving baggage handling and delay management at their resident airports
(British Airways, 2008). Increase in internet usage, with more customers and independent services
reviewing and sharing feedback (Porter’s five forces). Better customer relations may improve such
reviewing mechanisms. ACCEPTABILITY Employees and customers are likely to invest high
interest into the development of their relations with the organisation due to the negative past
experiences. Skytrax highlights that customer relations is an important measure for customers when
selecting airlines for travel, increasing the potential of high returns (Skytrax, 2008). FEASIBILITY
The Resource Based View (RBV) illustrates an international customer database holding. Access to
such data could assist BA in market research and customer relation development based on findings.
The industry and organisation is highly unionised, and are likely to gain support from this external
body when strategically developing employee relations. SUPPORTS STRATEGY?