Organizational Culture And Change Management

Organizational Culture And neuter ManagementThe world has become a global village and so do the businesses. Competition among industries is becoming much and more global and businesses be facing ever climbing nip to compete at this level. The market adopts atomic number 18 changing apace and constantly and to cope with this, organizations entertain to keep on changing themselves to experience the crude demands. The throw can be a substitute in product or service, marketing strategies, veer in instruction or IT system etc. but the roughly difficult thing to counter multifariousness is the determine and beliefs of the bulk because its natural that people resist throw. Cultural transplant is a difficult thing to do as there are people involved in it.British send out counsels had g unrivalled through a cultural permute which started in proto(prenominal) 80s when the telephoner was in good-for- nonhing condition and was about to go bank corrupt. The smartly n ominate chief operating officer Colin marshal unravel the revision and took the company out of the crises and made it one the closely respect qualified airline businesss of the world in less than 10 days beat. This paper volition talk about the problems with BAs h elder outership and organisational close which lead the company to those crises and its affects on performance and this paper will in addition talk about the boffo implementation of the permute. The paper will indicate the analysis of the change process and flaws in the change which could use up lead to fail results if managed properly.Organizational CultureCulture is the beliefs and set of people. The collective programme of the mind which distinctiates the one chemical group of people from a nonher, gardening in this maven includes system of set. Culture comprises of language, religion, customs, manners and education (Bode 2008). Language is the about heavy way of understanding destinations as th is is the way information flows. Many scholars have been trying to define enculturation and they have defined it but it is constantly state that it is difficult. Culture is a real complex a phenomenon and cannot be captured in a few dimensions (Bode 2008).Organizations do have a farming and in simple words it was defined by Deal and Kennedy (1996) that the culture is the way things nettle done around here. Organizational cultural is allured in general by the leadership of the organization and also by the individual(prenominal) values and beliefs of the people. It is basically the system of mutually shared beliefs and values by the people of the organization. Organizational culture is a key component in achieving the organizational goals and strategies, improving the organizations competitiveness and effectiveness and management of change (Adeyoyin, 2006).BAs HistoryBritish Airways came into existence in result of a merger of two British carriers, BOAC (British Overseas A irways Corporation) and BEA (British European Airways) in 1970s (Marriott 1998). British Airways is one of the most respectable and preferred airlines in the world today. British Airways won the airline business of the year award in 2007 on 25th OAG awards (BBC news). This success of the airline is the outcome of a successful cultural change started in early 80s. Before 1980s BA was doing good as there was bantam competition in the market and BA controlled 60% of the UK domestic markets and go about competition on only 9% of the routes in and out of the UK (Redman Wilkinson 2009). payable to little or no competition BA didnt center oned on node satisfaction and other issues and carried on the traditional way of doing things which lead them to disastrous situations when they felt the collect for change.In 80s the rivalry among the airlines was limited in have-to doe with to BA because BA was controlling 60% of the routes (Business Economics 1982). The threats of the substit utes was also limited for BA because BA has covered most of the routes and had large spot of destinations and left the guests some times with no other choice. BA didnt have the focus on guest satisfaction and profit maximization and this caused major(ip) customer dissatisfaction. Lack of punctuality and uncomfortable flights were the reasons for this dissatisfaction (Warhurst 1995). BA recorded fiscal losses of 140m and this leaves a threat for the new entrant in the market. So the threat for the new entrant was there.Drivers for changeHumans change with the passing of time as per the carryment and situation at hand. Similarly organisations need to change as rise to adapt to the changing informal and outdoor(a) environment. A need of change can arise from two kinds of factors i.e. knowledgeable and External factors. External factors include the competition, proficient advancements, innovation, and deregulation of industry, labour costs, and glide path to resources, inter national economic changes, and government policies. Internal change factors tend to appraise on from the external ones, and include adapting to shifts in bodily kicks, changes in technological equipment and processes, shifts in employee attitudes and behaviour and corporate culture. In BAs case the initiating factors were both(prenominal) internal and external. The external factors were the competition, the governments threat of privatization, and access to cheaper resources and increasing prices of oil. The internal factors involved in pushing BA towards going for a change were the internal rigorous culture, Change of equipments and supply related issues.How the culture was formed?BAs cultural change was a success and s cashbox it is being used as a reference or a guide for the firms who go for cultural change (Mills et al 2008). There were four major companies who went through cultural change and some of the reasons among them were common, e.g. threat of privatization. Those companies were panther, British Airport Authority ( emit), British thermonuclear Fuels Limited (BNFL), and British Airways (BA). The founders of a company or the forefathers have a significant influence on the culture formation of a business. The way they do things leave a long lasting strike on the followers thus become the part of the culture (Poole et al 2004). Jaguar and BAA for example have always had charismatic leaders. Sir William Lyons and Sir Norman Payne were both charismatic leaders and autocratic in style (Salama 1995). This leaves the impression on the follower managers and showed its effects in their decision making styles.BNFL and BA till 1984 didnt have any charismatic leader same Jaguar and BAA (Salama 1995). There was variation in departments which shows the values of each of the departmental head. Christopher Harding was official as the head in 1984 and before him there wasnt a ace dominant character at the top management level. Because BA had its soluti on from the ministry of defence, there was a reinforce civil service influence in the company. BA had a strong and close contact with Royal Air Force and both pilots and managers were recruited from RAF frequently. These militants left a very operational shot to the organizations culture. In a survey a manager said that we couldnt get away from the fact that we are on a mission and that mission is everything to us and the customer are just an unfortunate add on. The management and leadership style was not participative as the chief executive officer and the former chairman personally were very distant from the ply. The technical knowledge was considered to be very vital and the managers were recruited and stird on the basis of their technical abilities instead of managerial abilities. entirely these factors made the culture of BA very rigid and a unfavourable cultural change became the only solution for the company to survive.The Change range of a functionBackground Other t han the increasing competition and fuel costs, old fleets, and superior staff costs in 80s, BAs management had to tackle these issues in format to avoid going bank corrupt, up(p) the companys financial performance fundamentally, pre-tax losses were covering a figure of 240m in 81 and 82 (Annual line 1st April 1983). CEO of BA said in 1982 that their money is run at the rate of 200 every minute (Mills et al 2006). persuade the ca-caforce of the supreme importance of customer function for the success of the company.Improving the perceptions about BA in the market.Maintaining momentum and encountering the focus which will allow them to meet new challenges.The main reasons for this crisis on BA were its culture and history. BEA and BOAC came together to form BA in 1981 (Staniland 2003). They remained sovereign till 1976 when the group di pile was changed to a structure based on functional divisions. nonetheless a distinctive split within BA persisted until the mid 1980s. This untoward assimilation disallowed BA to achieve the desired benefits of the merger, could not attain a common focus, created management segregation squabbles and resulted in a lack of a unifying corporate culture (Doganis 2002).The funny side of the merger was that most of the BEA and BOAC employees were war veterans who used to tent-fly military aircrafts and they had a great influence on shaping the culture of BA. BAs culture was influenced by military outlook with a purely operational focus. The employees believe that their melodic phrase is only to fly the plan soundly and land it on time. Customer satisfaction and customer care, profit maximization and productiveness were not considered as top priorities (Bowhill 2008).BA had financial support from the government and was doing a profitable business in the 70s (Parker 2009). These were the reasons which made it easier for BA to neglect its increasing inefficiencies over time. It was getting redden more difficult to persuade the workforce and the management towards the need of a fundamental change. The competition was rising in the market and customer dissatisfaction positive the employees absenteeism were on the rise and the need for change was critical.The 1981 survival plan The merger in 1981 leaves the company overstaffed and the staff expenses were unaffordable. The survival plan involves discomfitsizing and the staff was reduced from 52000 to 43000 through voluntary mea veritables. A 20% decrease in workforce in 9 months was a major downsizing (Thompson Martin 2009). freezing pay was increased for a year which caused more volunteers leaving the job than was required. 16 routed were closed, 8 online stations and 2 engineering bases were shut down (Carleton Lineberry 2004). The survival plan was all about minimizing the costs and expenses as the company was heading towards bankruptcy. The activities involved in minimizing the costs also includes the halting of freight service and selling the f leets and massive cuts in number of offices, administrative services and staff clubs etc (Jones and Lockwood 2002). Things were not going right and the survival plan was revise and staff was reduced by another 7000 and the total number than was approximately 35000. The voluntary laying off schemes cost the company around one hundred fifty million and the company ended up with more volunteers than necessary because of no job security and sinking conditions of the company (Carleton Lineberry 2004).Changing image of the airline British airways had a bad image in the customers mind dew to unsatisfactory services and relatively higher prices. A survey by the international air hose Passengers Association consecrate BA at the top of a list of the airlines to be avoided. (Redman Wilkinson). To improve the image of the organization BA launched its Manhattan landing and The worlds favourite Airline campaigns and raised the advertising budget which was 19m to 31m for the year 1983-198 4 in order to signal a clear commitment to changing the corporate image (Leban et al 2005).Building its turnaround team 30% of the old employees had left the organization voluntarily which involved senior mangers as well (Barsoux Manzoni 1997). Culture is formed by leaders and now these leaders were not there which servicinged the cultural change process. Newly appointed CEO Sir Collin marshal was a very charismatic leader. He brought in some new blood to contain the company a fresh perspective and to regain focus. In 1983, Colin Marshall made customer service a personal crusade (Reichheld 1996). Customer services were something absent in the BAs culture which was very rigid and he wanted to achieve a shift from a strongly British, engineering, and operationally driven culture to one that emphasized productivity and profits while increasing the value placed on customer service.Support from top management To make a change successful the leaders need to play the role role represen tative. Leader inevitably to be the one, who actually raise the change terms in practice, supports his team and give them freedom of expression (Cameron 2004). Collin Marshall in this regard was very concerned and he used to spend lot of his time in terminals with staff communicating and reinforcing the desired culture for the organization and its mutual and individual advantages. Employees were inclined the freedom to share their ideas and thoughts and give their suggestions about helping the change to pick out forward. Employees feel listened to and feels themselves as part of the companys success.Education and Training Change needs to be reinforced and communicated regularly to make it feel happening. A continuous cooking needs to be done to help employees adapting to the new culture. BA in this regard conducted a formulation program named PPF (Putting People First). This training program was aimed at the people to examine their interactions with other people. The main foc us of the training was to build positive relationships and customer services. Nearly 40000 of BAs employees attended the training program (Leban et al 2005). Another training program conducted by BA was MPF (Managing People First). This training program was aimed at other issues like culture and its importance, the leadership, trust, vision and feedback. These behaviour delimitation programs resulted in good and BA was able to move on towards cultural change. After one year of training with TMI (training consultants), BA moved into profit (Senior Fleming 2006).Make the Change plain Change needs to visible to the outside world. British Airways unveiled their new planes at Heathrow Airport and their new uniforms to give the world an impression that they have deceased through a change and now they are a better organization (Leban et al 2005). With in 10 years the cultural change program succeeded in creating a strong commitment to productivity, profits and customer services. The mo rale was higher and the companys image in the market was better and this change lift the company out of bankruptcy to become one the worlds most respected airline. British Airways have launched a new campaign in 2009 named ONE DESTINATION. The CEO said at the time of launch that we started our voyage towards responsible air travel in 1984 and we have discovered that our customers shaft to fly with us but are concerned about their impact on the environment (BBC news).Getting over the resistance with the help of adapted change modelsKurt Lewins change model comprises of three steps, i.e. Unfreeze-Change-Refreeze. The first correspond in Lewins change model is unfreezing that is when manager develops a felt or need for the change which can be because of declining profits or shrinking market shares etc. In BAs case both profits and market shares were declining. This is where the CEO Collin Marshall felt the need for the change. The unfreezing stage is very crucial as this is when ma nagers are making the workforce ready for the change. This is the advertising phase where the vision and content of the change is communicated which inspires the workforce and gains their commitment. Brirish Airways in this regard conducted the behaviour moulding conferences named PPF and MPF to change the behaviours and make the people ready for the change.The next stage in Lewins model is the change it self. This is the stage where the terms of the change are a great deal implied and practiced. The survival plan discussed above aimed at cost reduction and than the activities like increasing the advertising budget, hiring new blood and educating and training the people was the change process which was very well lead by the CEO. At this stage continuous feedback and reinforcement is required to make the change feel happening. Collin Marshall himself used to talk with the employees in small groups and spent his most of time reinforcing his vision and desired culture.Refreezing is th e stage when people start to embrace the change and the organization has moved to the new culture. This is the stage where the change should be visible and BA made the change visible by inaugurating their new fleets and uniforms. tail P. Kotter in his 8 step change model says that a strong enough team is required to carry the change process forward. BA did create a team of new blood managers who gave the company a fresh ad current perspective of business. Kotters model emphasize on communicating the vision of the change and BA was up to the task and had a great support from the senior management as the employees had the freedom of manduction their ideas and thoughts.Leadership StylesAs mentioned above that leadership of BA was heavily influenced by the retired army officers and co ordination and co operation was missing and leaders were like dictators. When the new CEO took over he changed the way of star as in the process of downsizing, some senior managers were also remote from their positions because of the out dated leadership techniques. The success of the change was because of the new leadership who acted as mentors, and by adopting the democratic, consultive and persuasive, and transformational styles of leadership.Analysis of the Change at BAThe Thatcher Governments announcement of privatizing British Airways was the initial trigger which started the whole process of change (Staniland 2003). The need for the cultural change in BA arises in the transitional phase of the economic environment. The airline industry in UK was facing a severe competition which was an outcome of the privatization. Airline industry in UK was put to work under highly deregulated market which historically used to work in highly regulated market. The privatization decision changed the historic values and beliefs of BA dramatically as the organizations mission in the past was to make sure that planes fly safely and land safely. Profit maximization and competition were not much of an issue.Changing the culture is an ongoing process (Schabracq 2007) and even it is full achieved, it still goes on in the form of monitoring and continuous inspection. British Airways since 1984 is in the transition phase and is replacing some of its main historical values and beliefs to be consistent with the new mission (Salama 1995). Collin Marshall was appointed as the CEO in order to accomplish this required cultural change. Training and behaviour changing programmes and evaluation systems have been introduced to motivate and beat changes. But in some areas other managerial career subsystems such as selection and promotion, had experienced minor modifications. Despite BA had put great deal of effort into encouraging certain behaviours, staff did not collate its employment policies and practices around the new culture (Coles et al 2000). BA failed to institutionalize the change through their stabilisation action plans. Management techniques were surely impressive, but no t everyone benefited from them. In areas such as marketing, the criteria for choosing Managers had changed from technical to managerial skills. However, some managers still preferred the old fashioned recruitment unconscious process based on promoting and selecting people who were good technical individuals, therefore BA had difficulties maintaining the change. At the corporate level, the managers were now rewarded based on performance. The new assessment system varies across functions as the criteria for good performance was different among different departments. This issue arises from the HR departments ignorance towards the different subculture. The HR department had been trying to cut its own values and beliefs on the rest of the organization and this was identified by Marshall and a new structure for HR was developed later on in order to give the department units more autonomy. This self-contradictory situation reflects a lack of consensus regarding the desired organizatio nal culture as viewed by top management.Recent IssuesBA had won awards for Best Airline and Best Business Class, a total of 7 awards (Investors Report BA.co.uk). However, BA was also on top of the list of the companies that had complaints, made by the AUC (Air transportation Users Council), totalling 117. Air France came second with 110 and Ryanair third with 77, EasyJet had 42 total complaints (BBCnews.co.uk 20 Aug 2002). If BA adopt 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 write up (Johnson et al 2008).CONCLUSION/RECOMMENDATIONBritish Airways had gone through legion(predicate) changes in order to promote this cultural change. British Airways lacked a holistic approach while implementing the change because d espite of the HR departments attempts towards forming policies and procedures around the new culture, there was evidently a gap between HR and centerfield management. Some managers were still using the traditional approaches of reward system and recruiting people. British Airways needed to adopt a partnership model within HR. This model is about establishing a common interest in order to get the competitiveness, viability and prosperity of an organisation. Economic tensions appreciated within this model, are fitting to British Airways unstable environment. The Partnership model talks about getting a commitment from employees to improve quality and efficiency and the acceptance by the employers as stakeholders with interest to be considered when decisions are made. In the beginning it will require a top to bottom approach in order to promote and advertise the change. However promoting good strategies which are suitable for all the departments and areas of the organization, as oppos ed to some areas, is the key to its success. British Airways need to adopt this model to promote teambuilding and working together kind of environment. This model will help in identifying the organizational goal by mutually sharing the values and beliefs of the people and they will start moving in same worry and the outcome of the change can be seen in the whole organization.British Airways is once again in crisis at the current time and is showing record 401 million pre tax losses (BBC news). Flights are late and customers are facing some sort of the same issues as there were in 1980s. British Airways has a good history and current image in the consumer market. They might need another change in the organization.The change started in 1984 and still things need to be done. Therefore it can be said that changing culture is a complex and long term proletariat (Thomas 2005). It involves coordinated efforts by the top management to change its own values and behaviour and communicates i t to the followers and others in the organization. Such changes must be reinforced by shifts in management education, selection and promotion. Culture cannot be managed on its own or as separate from the rest of the organization.