Playing the regulation game – the rise and demise of British Caledonian |
| |
Authors: | Mike Cronshaw David Thompson |
| |
Institution: | Mike Cronshaw is a Research Officer and David Thompson is a Senior Research Fellow at the Centre for Business Strategy. Helpful comments on an earlier draft of this paper came from Evan Davis and John Kay;the usual disclaimer applies. |
| |
Abstract: | Privatisation means that an increasing number of UK companies have to "play the regulation game". Business success will be determined not just by conventional strategy choices but also by regulatory strategy. British Caledonian is a striking example of one such company. Its financial fortunes ebbed and flowed with shifts in regulatory policy. BCal's chosen strategy – rapid expansion to build an alternative network to compete with British Airways – was always likely to be highly risky. But the risks were increased by regulatory controls which denied B Cal access to the UK's major airport at London Heathrow. In these regulatory conditions BCal's chosen strategy was almost certainly mis-conceived. It should have changed its regulatory strategy or – failing success – changed its business strategy. Changing neither was a recipe for the airline's eventual demise. |
| |
Keywords: | |
|