1. 1 INTRODUCTION British Airways came into existence in 1935, when smaller privately owned UK airlines merged. Another change occurred when the Government nationalized British Airways and Imperial Airways to form BOAC – The British Overseas Airways Corporation. During this period, external markets were more stable and predictable and there was no real need for BA to adopt competitive strategies, being that there was little competition from rivals. There appears to be little in the way of strategy formulation and strategy implementation. This was mainly due to the established strategy and organisation environment remaining largely unchanged.
Any change in BA’s strategy would have developed in an incremental fashion, an almost natural progression. However, due to nationalisation in 1935, this resulted in a fundamental change imposing strategy within BA, and therefore subject to Government policies and machinations of the time. In 1946, BE was established as a separate statutory corporation, its main core competency being a domestic network. In 1973, the BOAC and BEA merged to form British Airways, leaving the airline over-staffed.
Between 1981 and 1983 BA response to this was strategic downsizing which reduced staff numbers by 40%. This included senior staff (Barsoux & Manzoni 1997 a).
... to generally applicable rules and views the various interventions and strategies of change as complementary. Harrison, R.5 sees the different ... . Kotter,J.P. & Schlesinger L.A. , Choosing strategies for change, Readings in Managerial Psychology, 1989, 664-678 6 5. manipulation ... upon the way we manage to offer leadership. Our own staff and employees will decide if our organisation will prosper. ...
Until 1984 BA operated a reactive style of operational and personnel management. Pre-privatisation (1987) BA faced little competition on many routes. It controlled 60% of the UK domestic markets and only experienced competition on 9% of routes in and out of the UK (Monopolies and Mergers Commission 1987).
This was mainly due to European markets being tightly regulated and market share was often dependent on negotiation skills as opposed to competitive success. Thus BA was able to charge customers what they liked. However, all was not well within BA. In 1980, a survey by the International Airline Passenger Association put BA at the top of the list of airlines to be avoided (Blyton & Turnball 1998).
This customer satisfaction was mainly due to uncomfortable journeys and lack of punctuality. Thus BA recorded financial losses of lb 140 million (Warhurst 1995).
With BA’s maturity, it had appeared to go into autopilot and had assumed that the strategies of the past would continue to prosper the company. They had clearly failed to recognise the necessity for change within this rigid organisation, the result being a decline in profitability due to its own assumptions about itself and its external environment. It seemed that staff discontentment also matched customer dissatisfaction, as industrial disputes were now occurring. An organisation with reducing profits, the potential for conflict is likely to be intensified (Mullins 2002).
1. 2 CHANGE STRATEGIES Organisations need to change to adapt to the changing internal and external environment.
Organisations need to change to adapt to their environment. The factors which bring about change vary in intensity, but can be grouped into internal and external categories. External sources of change include competitor strategies, technological innovation, deregulation of industry, labour costs, access to resources, economic changes (national and international) and changes in government policy. Internal change factors tend to follow on from the external ones, and include adapting to shifts in corporate missions, changes in technological equipment and processes, shifts in employee attitudes and behaviour and corporate culture. Change strategies can be the result of reaction to some force or by managers anticipating the environment and being proactive. The proactive approach, when it proves accurate, allows more time planning and implementing change processes.
... organisations are entities made up of interrelated parts which are intertwined with the outside world (the external environment ... to a corporate social responsibility, particularly with regard to the environment. “Corporate social responsibility ... guardian.co.uk/environment/2010/nov/09/oil-spill-inquiry-culture-complacency-bp ... all cases of changes in demand and supply the resulting changes in price act ...
It is fair to say, also, that change can be applied radically (resulting in major upheavals throughout the company) or incrementally (which involves minimal changes applied strategically throughout the firm).
The circumstances will dictate the level of ‘panic’ when applying changes. The more serious the situation, the more radical the change required. It follows that the attitudes of all the company’s employees have to adapt in harmony with the structural and operational changes in order for change to be implemented successfully.
The bulk of BA’s history has been spent as a nationalized industry in a fairly stable environment. 1. 3 CORPORATE CULTURE DEFINED Management researchers seem to agree that the things that companies do called ‘corporate culture’ is an intangible concept and hence difficult to define. Among the attempts to define ‘corporate culture’, the following definition is useful as a starting point: – ‘culture represents an interdependent set of values and ways of behaving that are common in a community and that tend to perpetuate themselves, sometimes over long periods of time’ (K otter and Hesketh, 1992, 141) Peters and Waterman n argue that changing a culture cannot be accomplished.
1. 4 CHANGES WITH BA DUE TO EXTERNAL PRESSURES The story of British Airways is one of the most widely used inspirational accounts of changing culture (Heller 1992).
BA faced two external pressures. The Thatcher government was threatening to privatize it and also the deregulation of the industry worldwide. Within Lundberg’s model of the organisational learning cycle, he suggests that in order for cultural change to occur the requisite external and internal circumstances must occur. He describes the two external enabling conditions.
These are known as domain forgiveness – the degree of threat due to instability of the environment and organisation; and domain congruence – where change is likely to occur if the degree of congruence is perceived as relatively modest. 1. 5 UNFREEZINGLewin’s process of organisational change begins with the unfreezing stage. Brown 1998 discusses this initial process begins when a senior manager develops a ‘felt’ need for change, generally in response to a decline in profitability. BA at this point was showing financial losses of lb 140 million (Warhurst 1995).
... for life anymore. 2. How might Japan’s changing culture influence the way Japanese businesses operate in the future? What ... response to all the benefits Matsushita gave to its employees, the employees worked hard for the greater good of the company ... future. Companies might change their benefits and pay structure from traditional retirement plan structure. They might allow employees to choose from ...
Thus Lord King was appointed Chairman 1981, and Colin Marshall 1984, who recognised that a major cultural change was required.
Bibeault found in his research that you almost always have to do organisational surgery by selecting a new chief executive. Schein 1985 discusses that these basic assumptions held by leaders are ‘sufficiently deviant to accommodate a new culture’. Within Lewin’s framework the rites of questioning and destruction in the unfreezing stage suggest that this is the ‘advertisement’ campaign normally calculated by leaders which aims to persuade rather than inform employees of the proposed changes occurring within an organisation. (This process focused on creating a vision that would inspire the BA staff and gain their enthusiastic commitment. ) 1. 6 PUTTING PEOPLE FIRST It is certainly true that a great deal of effort and energy went into shaping BA’s culture.
At the heart of this was the ‘putting people first’ training programme launched by Colin Marshall, the new COE in December 1983. By 1986, 40, 000 employees attended. The course itself was intended to modify behaviour, following customers deserting in droves and BA acquired the nickname ‘Bloody Awful’ (TMI world. com).
Other Airlines also such as Australian, Olympic, Northwest Airline, Lufthansa, Indian Airlines, have also provided the PPF courses for employees in an attempt to change culture and increase profitability.
... at the time where outside forces are trying to change the traditional culture of the people. In the novel, the strong warrior ... identity which followed, took its toll in the psychological and cultural breakdown of the original inhabitants of the New World resulting ... illogical practices of the people such as how they exalt cultural violence. Of all the positive effects of colonialism as appearing ...
The role training and awareness plays in the cultural change of an organisation relates to the development of shared ways of thinking, beliefs and values (web).
Schein describes that that change mechanism requires outsiders. They provide analysis and facilitation of cognitive change. The outsiders are able to recognise dysfunctional elements of an organisation’s culture by providing an analysis of how culture is operating. The success of this was clearly obvious.
BA moved into profit after one year of working with TMI (training consultants).
BA was voted Airline of the year. On time take-offs and landings went up by 23%, customer complaints went down by 0. 7% from 4% and absenteeism went down by 15%. 1. 7 RESTRUCTURING Dunphy and Stace analysed the categories of change.
The first, being Macro intervention which affects the whole organisation. This is tackled using strategic analysis, developing visions and corporate restructuring. A dictionary definition of ‘structure’ is ‘The mutual relation of constituent parts or elements of a whole which determine its particular nature or character’. What BA has suffered, along with other organisations, is a global shift from modern to post modern organisational structures. That is to say, especially over the last 20 years, companies have moved from mechanistic to more organic styles of operation. Achievement of a strategy can be rendered virtually impossible by an inappropriate organisational structure.
BA’s success in moving into profit was not in my opinion all down to PPF but was in fact the unfreezing process where there was a strategic downsizing which reduced almost 40% of staff, including senior managers (Profits up from lb 5 million to lb 245 million due to 7, 000 layoffs).
Downsizing survivors are less likely to give commitment as this normally causes disillusionment (Mullins 2002).
This reduction in workforce was accomplished by early retirement and substantial financial settlements which eased what was an inevitably traumatic time for the organisation and its employees (Brown 1998).
Climate is influenced by the prevailing economic and business environment.
It may however be conceptualized as the organisational mood – it appears BA was creating a climate of fear. Culture and climate influences the organisation’s goals. Furthermore, ‘culture management’ does not ensure that employees trust management. Colin Marshall’s emphasis on ‘putting people first and caring for one another’ had been preceded by a rule of fear. 1.
... concerned with how the company does and not their employees. If the changes take years to implement, although it would greatly affect ... undermined the traditional culture in Japan of the central bargains of housing and retirement packages for an employees hard work and ... ,000 jobs while selling “huge amounts of assets”. 3. Japanese culture in the 1950’s-1980’s benefited Panasonic greatly because ...
8 BA’S PROMOTION OF CHANGE According to the Lewin-Schein model, if the unfreezing stage has been successfully negotiated, employees will actively seek change without much fr uther prompting. Within this framework are 2 basic unfreezing rites: rites of questioning and destruction and rites of rationalization and legitimation. It appears that within the rites of questioning the ‘advertising campaign failed due to lack of communication and planning. In order to successfully unfreeze the present culture it is necessary for strategic leaders to communicate that original systems were failing. However, BA clearly failed to persuade Managers, thus resulted in an informal strategy being followed. This was perhaps due to the underlying assumptions being pre-conscious, non- confront able and highly complex aspects of human psychology (Schein 1985) (reverting back to ‘old ways’).
This was mainly due the restructuring and the fears associated with this. Hunberg’s model also suggests that within the internal permitting conditions there must be a ‘collective sense’ that induces a willingness to change. Hopfl’s 1993 revealed that BA’s managers’ feelings regarding the new culture were hostile and uncertain, as well as enthusiastic. The new restructuring of BA did reduce the levels of hierarchy (Brown 1998).
The Corporate Leadership Council 1995 has identified that in order to lead to effective change, four design tracks should be planned and implemented. Within this framework is building new competencies.
BA failed to recognise a training needs for managers, which was in fact not utilised until a year after (1984) PPF had been running. Within Lewin/Schein, rites of Rationalisation and Legitimization, BA failed to provide adequate resources to involve managers in training programmes. Lunberg suggests that in the initial stages of change which is referred to as ‘cultural visioning’, the success of this is dependent on it being translated into a cultural change strategy. Johnston Matthey, p 15 initiated this in their planning methods for cultural change. They sent 150 managers on a week-long quality education course. Fifty-five of these managers attended a further two-week course in order to prepare them to teach quality courses to the rest of the workforce (Brown 1998).
... modify traditional practices. The principle agents of change were a group of managers who had extensive experience in Panasonic’s ... Panasonic reciprocated by bestowing “blessings” on employees. However, culture does not stay constant. According to some observers, the generation ... progressed, one Japanese firm after another was forced to change its traditional ways of doing business. Slowly at first, ...
BA failed to recognise this cultural gap, which resulted in managers failing to ‘walk the talk’ of the change strategy which BA had imposed. Therefore skills had not yet been developed in order to create the buy-in to the change process, in order to overcome barriers and therefore decrease resistance (conflict climate).
1. 9 IMPLEMENTATION OF CHANGE WITHIN BAA strategic downsizing of 30% in 1980 resulted as a consequence of the New Human Resource Philosophy (web).
Within K otters integrated model it states this will empower others to act on the vision and in doing so remove the obstacles to change, including systems or structures which seriously undermine the vision and also by encouraging risk-taking and non-traditional ideas, activities and actions. Similarly in Lewins composite model, this is known as the change phase within this stage, rites of delegation and conflict challenge and undermine the existing status quo, ‘Degrading the old order’ (Brown 1998).
In theory, cultural change programmes start with an analysis of the existing culture. The desired culture is then defined, which leads to the identification of a cultural gap (Armstrong 2001).
In an attempt to fill the ‘cultural gap’ and more towards the new desired cultural state, BA sent Senior and Middle Managers on a training programme, ‘Managing People First’. Lundberg’s model describes this as management action plans, that enable people to refine what culture should be implemented. This course again was designed to modify behaviour, involving considerable personal feedback to each individual concerning her / her job related behaviour (Brown 1998), thus encouraging ownership of the process of change. L ashley suggests this management initiative is empowerment through participation (Mullins 2002).
However, BA lacked consistency in translating its vision to Engineering departments, these still remaining operational. Within Lunberg’s model, BA had failed to take into account the scope of change, in a somewhat holistic approach.
The continued use of diagonal task forces to facilitate change appeared to be significant in areas such as sales and marketing. A change was evident in climate to one which was more open, placing value on teamwork. Sethia and Glinow framework of defining culture describes this as an integrative culture reflecting a high concern for performance where people are treated in terms of respect for their contributions. (IBM, Hewlett-Packard, 3 M, Lincoln Electric and Tandem are notable examples of integrative culture. ) Awards were given with BA for excellence and an employee brainwave programme encouraged staff to put forward their ideas. This aided the cultural change in that it promoted an open environment and increased positive attitudes through empowerment.
BA’s change strategy had clearly failed to take into account its engineering departments in its scope of change, within Lunberg’s model. Thus the culture of this department appeared to be that of an apathetic one, in need of a turnaround (Sethia & Glinow) This conflict in cultures between departments provided evidence BA had failed to take into account the pace of change between differing departments. It appeared too cautious and too slow within the engineering. Bryan’s and Cronin identify this as a possible source of conflict within organisations. Within Lewins et al Framework its rites of degradation, it was clear that BA change strategy failed to challenge the underlying assumptions of the engineering department employees.
These rites designed to overcome resistance to change, broaden the base of support for the new cultural system, and encourage ownership of the change process, was evidently not occurring within this department. Similarly Chem co, a regional BU of a major chemical company, failed in its attempts at cultural change. This was due to the fact no clear action plan was implemented for achieving the new vision. Despite some good progress, the initiatives were not communicated in a clear manner. However, CIBA-Geigy, Switzerland’s largest chemical group was successful in their attempts at cultural change strategy. This was due to the following factors: they worked out and set down a strategic direction plan, which identified the company’s goals, these being compatible with employees ” own goals and ethics.
A separate document called ‘Master Plan for Transformation’ containing more specific information on the reshaping of the portfolio. The overarching strategy which informed structural and portfolio changes was one which directed autonomy (Brown 1988).
1. 10 LEADERSHIP SKILLS USED WITHIN BA’S CULTURAL CHANGE To a great extent the culture of the organisation is dictated by the strategic leader. The attitudes and behaviour’s of people are affected as well as their willingness to accept responsibility and take measured risks (Thomson 1995).
Training or simple reasoning will not change the values or behaviour’s.
Transformational leadership can in some cases achieve rapid and major cultural change. These leaders create a vision of the future organisation and employees form an emotional commitment of this vision. Within BA this describes a shift from ‘control by repression’ to ‘control by seduction’ (Reed 1992) and is carried out because it is assumed that employee commitment equates to higher profits. What distinguishes these ‘Transformation Leaders’ from others, and the key to their success is their passionate commitment to a new vision of the organisations future and their ability to share that vision with all employees.
1. 11 LEADERSHIP COMMITMENT Colin Marshall’s own personal commitment is one of the most written about features. He attended 95% of all of the PPF courses that ran, setting out his vision for BA and participating in question and answer sessions with staff (Georgiades and Macdonald 1998).
A COE walking the talk does make it easier to accomplish cultural change. The culture within BA was heavily entrenched, was needed to share the employees out of their complacency and ‘feel’ the need for change.
This destabilization tends to generate legislation to change. Colin Marshall overcame this resistance, by identifying and developing BA’s distinctive competencies and channel led resources to where he felt modifying the budgeting process. Colin Marshall had made clear attempts to tackle artefacts through means of symbols. In the presence of new symbols of the ‘new culture’ these were PPF badges, which Colin Marshall also wore for 2 years (Georgiades and Macdonald, 1998, p 209).
Peters (1978) was cogently and persuasively argued that the COE can manipulate the culture through symbols. New uniforms were also given. These were merely a fashion item communicating the new vision as it was evident the underlying assumptions of the engineering departments were not part of this vision, as change had not yet occurred. 1. 12 MANAGING CHANGE IN BA There has been considerable debate concerning whether culture can actively be managed, much of the debate centring on the extent to which a culture can be modified to resemble a pre-stated ideal (Brown 1998).
It is commonly argued that Human Resource professionals are able to play a crucial role in managing key elements of culture.
Lewin describes this stage as the Refreezing where change is stabilized by introducing the new responses into the personal ties concerned (Armstrong 2001).
But the most impressive aspect of BA’s cultural change was not so much the sophistication of the PPF programme itself, but the extent to which other employment policies and practices were changed to fit the ‘new’ culture. Refreezing was aided by a whole series of training programmes throughout the 80’s and 90’s (Brown 1998).
Not only were team briefing and team workings introduced but these developed and refined with TQM, autonomous team working and multi-skilling introduced in many areas. Atkinson’s model of flexible working patterns was introduced. This consisted of part-time and subcontractors which extended to most aspects of BA’s operations.
A report by the National Association of Citizens Advice Bureaux called Flexibility Abused (1997), shows how flexibility can often take the form of ‘worker insecurity’. One of the main reasons for this is introduction in contractual arrangements. This includes replacement of full-time by part-time. 1. 13 THE ROLE OF HR WITHIN CULTURAL CHANGE Despite BA’s attempting a great deal of effort into encouraging certain behaviour’s, staff did not base its employment policies and practices around the new culture.
Therefore within Lunberg’s model, BA failed to institutionalize the changes through their Stabilisation Action Plans. Management techniques were certainly impressive, but not everyone benefited from them. In areas such as marketing, the criteria for choosing Managers had changed from technical to Management skills and abilities. However, some Managers still preferred recruiting the old fashioned way, promoting and selecting people who were good Technicians, therefore ‘not the best fit’ was achieved and BA had difficulties maintaining change. In Lewins composite model, rites of integration suggest there should be a conflict reduction, thus consolidate the change process. This was clearly not evident.
Managers continued to resist change. This was also evident in appraisal systems and performance related pay. Despite the HR department designing the control systems to fit the new cultures and their array of soft human resource, many managers continued to reward employees using the old values. It appears here that they had failed, due to these control systems merely providing an interface between human behaviour and the very fact that the process of management had its informal group process with its own set of norms, made this unfreezing stage unsuccessful. The driving forces for change were identified by Anderson Consulting and Conference Board (1995) in their research report of more than 300 companies found major re-engineering efforts across the business require more people strategies.
Eich inger and Ulrich (1996) reported discouraging findings from interviews with line executives: ‘Individual members of the HR team are not strong enough or credible enough personally to help HR succeed, much less the business.’ Perhaps if HR had adopted a more aggressive approach to change management, it may have proved successful. TYPES OF CHANGE – INCREMENTAL The life cycle perspective of change (Greiner, 1972; Hanks, Watson, Jansen & Chandler, 1994) argues that a company’s life can be distinguished as a number of sequential stages, following a now familiar pattern of start-up, growth, formalization, etc. Managers do tend to think in terms of the ‘stage’ of their company. Tush man and Romanellis (1985) punctuated equilibrium model of change emphasizes the discontinuous nature of change. Long periods of small incremental change are interrupted by brief periods of discontinuous, radical change. Therefore it can be argued that organisation emergence happens in ‘spurts’, i.
e. in very rapid punctuations that transform the company in discontinuous ways. Following the work of Tu shaman and Romanellis, Katz developed such a punctuated model of entrepreneurial emergence (1993).
This model argues that each organisational stage can be seen as a combination of four properties of emerging organisations, where a trigger creates a revolution or shift in the content of these properties, resulting in a new combination that remains stable for a relatively stable period. This model of punctuated change can be easily integrated with the Resource based view / theory (RBV) to generate a theory of punctuated growth of a firm. In this manufactured model, each unique combination of properties is a unique bundle of resources that generates firm-specific capabilities over time.
It can be argued that strategy formulation starts properly, not with an assessment of the organisation’s external environment, but with an assessment of the organisation’s resources, capabilities and core competencies. This Resource-Based View (RBV) of the firm approach which emphasizes the internal side of S. W. O. T analysis to strategy formulation is gaining in popularity among strategy theorists (Porter 1991, Barney 1991, 1992) 2. 2 TYPES OF CHANGE -TRANSITION The process of change is simply moving from the current way of doing things to a new and different way of doing things.
Bridges (1991) believes that it isn’t the actual change that individuals resist, but rather the transition that must be made to accommodate the change. He states ‘change is not the same as transition. Change is situational – the new site, the new boss, the new team roles, the new policy. Transition is the psychological process people go through to come to terms with the new situation. Change is external, transition is internal. Unless transition occurs, change will not work.’ (Bridges 1991) 2.
3 E. V. R. CONGRUENCE The E-V-R congruence framework demonstrates the underlying concept of strategic management. Strategies are being managed effectively when BA resources are deployed in such a way that the business meets the demands and expectations of its stakeholders and responds and adapts to changes in the environment. In other words, BA will have strengths which it can capitalist on, opportunities and therefore be able and deal with threats in a climate of change pressures.
Our basic understanding of this comes from an analysis of BA’s strengths, weaknesses, opportunities and threats – a S. W. O. T. analysis. 2.
4 CHANGES REQUIRED TO GAIN COMPETITIVE Advantages identified in Appendix 1, BA is operating within a turbulent, unpredictable market. It appears that hyper competition has occurred. Where the frequency, boldness and aggressiveness of dynamic movements (Scho des 2002) by the ‘low cost’, ‘no frill’ carriers has created a condition of constant disequilibrium and change within BA. Its main rivals, Ryanair, and Easy Jet, which recently formed an acquisition with GO, BA ‘no frills’ carrier, continue to gain competitive advantage over BA. (Easy Jet had 128% increase in passengers during October since the previous year (BBC News 7 Nov 2002).
Ryanair experiencing a 71% jump in profits. ) With BA focusing on its breadth of service and passenger extras rather than fares, budget airlines were able to steal the market share, simply by undercutting (bbc news. co. uk, 5 Nov 2002).
However, the threat of these substitute low cost carriers proposes a high barrier of entry for BA with its customer focused strategy on quality. It appears that it would be in BA’s interest to abandon this section of the market. However, despite the sale of GO, BA still continues to compete with low cost carriers. In exploring the strategy clock, the ‘no frills’s strategy is likely to focus on price-sensitive market, e. g. Lid Supermarkets focuses on this particular segment, whereas BA GO focused on hybrid, low cost base and reinvestment in low price differentiation.
Differentiation being slightly more luxurious fittings within carriers and more fashionable uniforms of staff. Clearly unable to compete with its rivals, abandoning this acquisition would therefore allow it to focus on focused differentiation – perceived added value to a particular segment, warranting price premiums, similar to M & S food halls. 2. 5 CUSTOMER CARE It has already been shown that BA has won awards for Best Airline and Best Business Class – a total of 7 awards (Investors Report BA. co. uk).
However, BA also topped a list of complaints made by the AUC (the consumer watchdog for the airline), total ling 117. Air France came second with 110 and Ryanair third with 77, Easy Jet, 42 total complaints (BBC news. co. uk 20 Aug 2002) If BA adopted a strategy for focus differentiation, tighter controls on the safe handling of baggage, more effective booking services would require to be implemented in order to provide this ‘quality service’, thus gaining customer satisfaction and justification of price differentiation. This would inevitably enhance its image and reputation. 2.
6 RESOURCES BA also holds a major resource in its ‘wings’- airport destinations. BA can fly passengers to airports within easier range of the cities. Low budget areas have been attacked over the quality of services in ancillary areas, such as finding lost luggage (bbc news. co.
There are also added costs associated with flying to ‘the countryside, travel costs for shuttles travelling into the city, another justification for price differentiation for BA. One of BA’s key resources is its people. Despite great attempts in the past to ‘design’ their employees through P. P. F and M.
P. F. training courses, there is clearly another approach required. Ideally employees should come up with innovations, new and better ways of doing things for customers. This innovation can result in differentiation or a faster response to opportunities, threats, the basis of competitive advantage. This must be a holistic approach, not just areas such as marketing departments which has been discussed previously.
‘The best culture is team culture’ (Heineken).
Virgin Airlines also encourage this process (web).
BA has experience which is a key source in competitiveness against rivals. Scholes suggest in relation to the experience curve, that an organisation undertaking any activity learns to do it more efficiently over time. Competing is necessary, but winning is more difficult.
Adopting hyper competitive strategies suggests that Managers just have to learn to be better at doing it and faster than competitors. It also suggests that smaller strategic initiatives which develop into longer-term shift in overall strategy have their advantages rather than a grand plan. Therefore an incremental change would be preferable to develop on BA’s core competencies, on focus differentiation. Building on what they have, rather than attempting to transform it, could be positively painful. This will alleviate the psychological process associated with change, instead of laundering an imitated product; BA should launch itself with enhanced features, seeking to differentiate itself by promoting its length of experience in aviation.
2. 7 VALUES Customer surveys are a good starting point to provide information in order to achieve a strategy which might achieve competitive advantage. This will identify what the customer values are rather than what is on offer from competitors. This will enable BA to transform through its bench marking into an emotional experience rather than a functional one.
Starbucks Coffee and the Body Shop are examples of companies where this has been achieved. 3. 1 PLAN FOR IMPLEMENTING CHANGE There are various ways to undertake a cultural change programme and there are various factors involved in making it successful. Clear and objective measurement of the culture you currently have is one of the most common features of successful cultural change. One way this can be achieved is measurement of your current culture. Commence this by defining in precise terms the culture you are trying to build, which can be used as a yardstick for measuring your current culture.
This will provide valuable information, which can be used at the planning stage to focus effort on the areas that require the greatest change. Without this information, the planning stage cannot be properly focused. 3. 2 CULTURAL AUDIT: REASONS FOR MEASURING PRESENT CULTURE Measurement of employee and customer surveys can be used as a change tool. The results provide evidence of what is required and where it is required.
It can help to clarify the purpose and direction of the change. Measuring cultures within BA is a form of communication; it can provide information on: – the effectiveness of the change; effort of the past; how well it was implemented, and how well it is desired now. The measurement effort can be set up as a framework for expecting and anticipating future change. This makes it more controllable and less threatening. 3. 3 UNDERTAKE SURVEYS Surveys are a good way to ‘advertise change’ as they: -involve people in design and feedback / action plans, showing you are willing to ‘walk the talk’; involve everyone, even individuals unwilling to speak out; provide data and impetus for change; break the resistance of individuals who are afraid to speak through feedback meetings; provide evidence and build trust which has been lost due to past problems; provide evidence of the need for change, where beliefs are held that there is no need for change.
The cultural audit can be repeated at various stages, most notably at the end, in order to assess the impact of the change programme. It can provide an early warning system for a time when things are not going as well as planned, enabling management to take the appropriate action to correct it. Without this follow up, all effort put in earlier may be lost. This will inevitably result in the culture reverting back to its original state, or worse. 3. 4 PLAN/DESIGN; THE NEW ROLE OF STRATEGY The new strategy must empower BA to constantly balance the needs of their customers, shareholders and the community while obeying law and containing their costs within budgetary constraints.
Strategy must be developed both bottom-up and top-down. Bottom-up is more pragmatic, because employees know what their customer wants and how they can provide it. Top-down is to define mission, vision, or set of objectives that will facilitate change. Having a ‘mission’ is not good enough – it has to be a ‘motivating mission’ that inspires people and makes them feel good about coming to work.
This will also drive organisational re-design and performance management. 3. 5 HOW TO DEVELOP STRATEGY Strategy development requires a thorough understanding of the external environments, organisational competencies and the consistency of corporate values with the broader needs of the community. UNDERSTAND THE ENVIRONMENT: Thorough environmental scanning, scenario planning and the actual presence of stakeholders will all improve understanding of the environment. ENVIRONMENTAL SCANNING: This will examine community needs, Government and Shareholder priorities and a competitor analysis. This will identify possible inter dependencies or overlaps with services provided by other affiliated organisations.
SCENARIO PLANNING: This can precede corporate planning to produce long term plans that recognise uncertainty by preparing the organisation for a number of alternative futures. INVOLVE EXTERNAL STAKEHOLDERS: The physical presence of external stakeholders during this stage and with the corporate planning processes will sharpen market focus, overcome complacency with the status quo and ad a touch of reality to the final plans. 3. 6 DESIGN AND DELIVER STRATEGIES The first stage of this is to translate desired corporate outcomes into service delivery outcomes and performance measure for each department. It then evaluates current competencies of the organisation and can identify the reasons for any organisational barriers to the achievement of the desired outcomes. CONCLUSION/RECOMMENDATION Despite British Airways has undergone many changes in order to promote cultural change as mentioned previously British Airways lacked a holistic approach, between departments, in it’s previous attempts at cultural change therefore what it requires in actual fact is an integrated approach.
Despite the HR attempts to form policies and procedures around the ‘new culture’ there was evidently a gap between HR and middle management, some managers continuing to use a traditional approach. It is therefore in my opinion that British Airways requires to adopt a partnership Model Within HR. This model cognizes a common interest in order to secure the competitiveness, viability and prosperity of an organisation. Economic tensions appreciated within this model, which is fitting to British Airways turbulent environment.
Partnership involves a commitment from employees to improve quality and efficiency and the acceptance by employers as stakeholders with interest to be considered when decisions are made. Initially this partnership will require a top down approach in order to promote and advertise this change. However what is essential to its success is promoting good strategies that are good for all, as opposed to some areas of the organisation. Strategic decisions within this model, are at all levels. Therefore the workforce is motivated throw the process of decisions making therefore encouraging empowerment. If British Airways did adopt this model, part of the system, with shared values, working towards the same goals.
Where the traditional model is also confronted with conflict, the partnership model conflict is resolved by individuals working together. Tesco uses this model, and its proved successful, as it has aided to consolidate its market share. APPENDIX 1 E. V. R. Strategic thinking enables identification of where we are now, the position and relative success factors.
The E. V. R. analysis provides information of the Environment and key success factors, Resources, which skills and capabilities you have and values ‘the process’ that occurs to enable you to achieve success. This then determines where you want to go and by when. Plans and Actions are set to enable you to reach targets set in the previous phase.
It is useful if this thinking and analysis can take place within a clear framework of a corporate direction and purpose, ‘the mission’ of the organisation. ENVIRONMENT: Which competitor strengths have to be bettered? What do customers and other stakeholders demand? RESOURCES: Which functions are (and will be) critically important, why and how must they be deployed to satisfy (changing) market needs? VALUES: What will it feel like to work in the company? Which values and behaviour’s will be required for adding value, and adapting and changing? E. V. R. ANALYSIS FOR BA Environment: -Turbulent Environment Competition associated with ‘no frills ” Fuel pricesLegislationResources: -Routes and Airport slotsPeopleInformation Systems (e-commerce) Image and Reputation Values: -Customer Care and Values Recognised as being friendly and efficient BIBLIOGRAPHY Barsoux, J-L and Manzoni, J-F (1997 a) ‘Becoming the World’s Favourite Airline ” British Airways 1980-1993.
Bedford: European case clearing house Storey, J, (1992) Developments in Management of Human Resources. Oxford. Blaxwell. (web) Blyton, P and Turnball, P (1998) The Dynamics of Employee Relations (2 nd edition).
Macmillan. Mullins, Lg (2002) Management & Organisational Behaviour (6 th edition).
Prentice Hall. Core, A. (1986) British Airways ‘The Path to Profitability’, London: Frances PinterWarhurst, R. (1995) ‘Converging on HRM? Change and Continuity in European Airlines’ Industrial Relations’ European Journal of Industrial Relations 1 (2) pp 259 & p 279. Bridges, W. (1991).
Managing transitions, making the most of cha DW. Reading. MA, Wesley publishing company.