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Person culture: This can be a rare culture because it emphasises that an individuals’ wishes is the important focal point of structure, and the main purpose being to assist those individuals who choose to work together.
Subsequently it is possible to say that BA had a typical Role based culture, the reason being it was a bureaucratic organisation with hierarchical structure and narrow roles of managers.
I believe that managing culture is very important because it affects performance of the company, for example some of the areas that BA proposed and employed change are leadership style, managerial values, nature of the work, size and organisational structure. I think that by managing these variables the organisation can significantly enhance its performance, and transfer from a role based culture to a task based culture, where the structure is flatter, instead of a traditional hierarchical type, thus resulting in a quicker response time, more flexibility and more integration.
Recent problems being faced by BA:
- British Airways have faced threats and due to the long standing arguments with its unions, as well as a possible expensive strike ahead, as the organisation has cut thousands of jobs as a part of its restructuring programme.
- British Airways are currently struggling with staff shortages as the level of absenteeism for the company’s employees are high above the average and unacceptable figures for the industry. Employees are said to be unmotivated and morale is low, as increase in pay is low and the restructuring of the company have led to 13000 job losses, the reason being the decline of the economy i.e. some ticket prices lowered to attract consumers, thus decreasing staff bonuses, salaries, redundancies etc, or some prices increased due to maintenance, travelling cost.
- Failures with BA’s £4.3billion Terminal 5 (Heathrow) at launching stage, BA blamed the glitches on problems with "staff familiarisation", which had a knock-on effect on bags and flights. Technical difficulties also meant major delays in reclaiming luggage, flight cancellations, and suspension of check in service.
- Anti-airport expansion groups holding protests. This is because these groups are concerned with the level of pollution and harm already caused to the environment.
Factors responsible for change:
The problems outlined above have mainly been caused by internal influences. Nevertheless it is important to remember the different environmental factors that also influence BA and its strategies, structures and means of operating. A high-quality method for outlining the political, economic, socio-cultural and technological factors affecting an organisation is the PEST analysis, and the following outlines other several problems and opportunities.
Political factors
- Increases in fuel prices will drive up expenses of flying a plane.
- Stricter EU regulations regarding noise pollution and aircrew registration could affect all airlines.
- Britain’s involvement in the difficulties in Iraq and Eastern nations may result in consumers unwilling to support British organisations if given an option.
- Britain’s preference not to introduce the Euro could result in a decline in the number of leisure time travellers wishing to travel to the United Kingdom. Also value of the pound decreasing.
Economic factors
- An increase in interest rates will influence consumers to save their money instead of spending, therefore demand for flights and holidays would reduce.
- Increases in airport taxes may well raise costs and thus price of no-frills flights will be frequently used by passengers.
- Passengers may substitute more expensive flights for no frills flights and spend more money abroad on entertainment and accommodation instead.
- Mergers and acquisitions by national carriers and low cost carriers may have dramatic implications on British Airways’ market share and passenger numbers.
Socio-cultural factors
- At the moment it is very popular to travel abroad, however social tastes and attitudes can quickly change.
- Threats of terrorist attack may reduce peoples desire to fly i.e. 9/11 New York, USA
- Increases in airline crashes might result in people being reluctant to casually travel by plane.
- A lot of British Airways’ flights are no smoking.
- As more flights are now leaving from the secondary airports used by no-frill airlines i.e. Easyjet or Ryanair, more revenue will be available to improve the facilities offered in their airports. Thus improved facilities could decrease customers’ negative perceptions of flying from BA’s sites, and impose a threat to British Airways attracting consumers.
Technological factors
- Technology is advancing in society so rapidly that in the future travelling by plane may become not necessary or even obsolete.
- British Airways’ customers are slowly stopping the use of telephones to book their tickets.
Looking at the PEST analysis, it is obvious that no-frill/luxury airlines are posing a large threat to British Airways. A suggestion to deal with this problem would be to take advantage of the marketing means available today, and have promotional campaigns highlighting the advantages of choosing British Airways over the no-frill airlines. In addition another setback that BA has faced in recent years is the threat of terror attacks. British Airways previously had to cancel a number of fights due to these related problems. The main proposal that can be made in this circumstance is to invest as much as possible into security, in order to prevent flights from being cancelled due to terrorist scares.
Implementation of change:
Currently BA is following proceedings that enable change in the long-term, by referring to Kurt Lewin’s three-step model of change approach, I will be able to present how they are going about their changes.
Lewin’s 3 Step-Model:
1. Unfreezing:
This generally entails reducing those current practices and cultural norms that maintain the organisation’s behaviour. It is like a “shake-up” phase for departments concerned. Currently BA’s processes consist of:
- Reduction in number of levels in the organisational hierarchy.
- Downsizing of BA’s workforce.
- Initiation of better training programmes for the workforce, in order to avoid such situations, as employee’s finding difficulty in familiarising with new technology i.e. Terminal 5 incident.
- Modifications of BA’s structures and systems.
- Amendments of the budgeting process.
2. Moving to a new level
This involves BA acting on the results of the previous first step. Having analysed the situation then identified alternatives, and selected the most appropriate path of action, the necessary moves can be made to tackle affairs. This stage helps to ensure that the new ways are not done for just a short period, and staffs are not reverting back to the old ways, subsequently the following tasks are carried out by BA:
- Introduction of incentives such as better bonus systems, in order to encourage employees to embrace the change of culture, procedures, structure and strategies.
- Commitment from all areas of the hierarchy structure to change processes.
- Training programmes for all staff, including senior and middle managers.
- Feedback and monitoring to assess the direction of the change process.
- Support processes integrated to reduce psychological burdens of change.
3. Refreezing
This is the final step in the model that seeks to stabilise the organisations changes. This makes sure that the new methods are working safely and efficiently. This stage performs by positively supporting and reinforcing the new ways of work, such as reward systems, recruitment and induction and cultural strengthening of BA. In addition BA’s refreezing stage consists of the following attributes:
- Development of new performance appraisal systems.
- Promotion and development of staffs that have embraced and performed well with the new organisational changes of practice.
- High standard of physical appearances such as new uniforms and refurbishing of airplanes.
- Continuous feedback from both employees and passengers.
Furthermore other big changes that BA has implemented in its organisation are it’s high-level of Information Technology (I.T). This is becuase information systems and managemenet plays a key role in the airline industry. I.T supports almost every task in BA which most imporatntly underpins the delivery of quality service. Also BA have chosen to intergate better technolgy i.e. self check-in service, and more recently an underground lost baggage collection department, which is around a mile long and directly underneath the airport itself. This is is another path for success in uncertain times. By effectively applicating technology it will definately deliver BA’s objectives and goals. Additionally Information Management objectives regarding I.T in BA includes:
- Supporting the development of the BA’s workforce, I.T and associates relations, so that it can deliver genuinely faultless customer service across their own route network and their associates.
- Improve efficiency of operations and decrease costs as a result of standardised and simplified I.T.
- Utilize BA’s capability and knowledge of the airline's industry processes, in order to deliver the strategic systems, customer service, thus gaining recognition that will help the airline in the future.
Other requirements of change for BA have been Outsourcing, which is process, such as a product design or , to a company. BA has used this for most of their business except their core aspects. They are using outsourcing to reduce costs to a more appropriate level. This often has allowed BA to reinforce losses and make a return to profit.
In addition another area of change that BA has put into practice is its stronger Strategic Alliance. BA has partnerships and alliances i.e. oneworld alliance, which includes BA joining with American Airlines, Cathay Pacific, Finnair, Iberia, Japan Airlines, Lan Airlines, Malév, Qantas and Royal Jordanian. This helps to offer a range of co-operative measures designed to provide a seamless world of network, for example an extended route network of around 700 destinations, global support on the ground and in the air, greater rewards and privileges for our Executive Club members. Also BA integrated franchise partners which means that BA have independent airlines based in South Africa and Scandinavia that use the British Airways name, uniforms, colour and flight code. They operate to a high standard of customer service, quality and hospitality. Moreover BA have also implemented and spent funds on advertising and promotion of the organisation. For example they now sponsor and support various numbers of sporting, cultural and charitable activities (BACC scheme) around the world i.e. 2012 Olympics is proudly sponsored by BA.
Other goals and objectives that they have set themselves to meet in the near future particularly in the marketplace are:
- Encourage 10% of customers to offset their carbon on ba.com by 2012
- Audit 100% of our strategic suppliers for ethical practices by 2012
- 75% of corporate customers use corporate responsibility as a decision criteria by 2010
In addition some key environmental goals that have been drawn up and embedded into the company objectives are:
- Zero waste to landfill in the UK by 2010
- Improve our carbon efficiency by 25% by 2025 - reducing the grammes of carbon dioxide per passenger kilometre from 111 to 83 grammes
- Reduce the average noise per flight by 15% by 2015
- 50% reduction in our net CO2 emissions by 2050
This will have its progression monitored regularly, due to the fact that the global climate changes is a serious issue, and airlines should take responsibility and care for the pollution, carbon dioxide emission that is generated on a daily basis.
Conclusion
Overall I think that this report has looked into various aspects of BA’s changes in management, cultural values, structure, performances; and also the processes in which they have transferred the changes into the organisation. What’s more by looking into the various possible approaches to managing change, I have been able to outline change strategies that have and can be implemented by BA, in order to become more effective. However it should be considered that not all plans for change run smoothly. In some cases chaos and irritation may occur i.e. Terminal 5, with questions being asked concerning the reason behind the whole purpose of change in that process or any other. Although the confusion and annoyance of that particular problem will subside in due time, but at the end of the day it depends on the effective communication from the top management in collaboration with the employees. In addition it is vital that BA transfer their changes into the organisation with significant investment and responsibility. Some of the key areas where this investment is necessary are:
- Development of appraisal schemes, incentives etc.
- Training and development of employees and managers i.e. middle and senior
- Various franchising activities.
- Outsourcing the peripheral actions
Also I believe that the responsibility of implementing the various change processes discussed previously, lay principally with the commitment from the top management and the senior/middle managers, who must ensure the success of the change process. However there must be some sort of involvement of the employees regarding the identification of managing change, because it will add unity and teamwork in the organisation, thus making employees that are lower down in the hierarchy feel motivated and wanted, which in turn will tackle the high level of absenteeism that BA encounters. Furthermore I think that although the stated methods and desired approaches of change throughout this report can assist BA, there are still other techniques that can be considered. For example BA can employ a change agent to help them to facilitate change within British Airways. It will be wise to use a change agent because the changes recommended previously are complex and require knowledge and skills, that some of the managers at the organisation may not possess. And as the changes are so essential for the future of the organisation, a change agent could be used to improve chances of a successful implementation. I think when considering whether the agent should be internally or externally used, it is key to remember that most parts of the organisation is in preparation for change in one way or another, and so it may be difficult to find an internal agent who is able to impartially stand back, from the current situation and look at how things can be done better differently. In this particular situation I think it would be easier for an external agent to be hired, so that BA’s department can successfully reach change agent goals and business objectives.
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British Airways Homepage [Online] viewed April 21st 2009
Launch disaster brings holiday chaos [Online] viewed April 22nd 2009
Workplace [Online] viewed April 22nd 2009
http://www.britishairways.com/travel/csr-work-practices/public/en_gb
[Online] viewed April 24th 2009
<>.
Organisational Change Management [Online] viewed April 25th 2009
Organisation Culture - Links & Articles [Online] viewed April 25th 2009
http://www.new-paradigm.co.uk/Culture.htm
