Thus, as the report has earlier mentioned the role of leadership and its importance in driving these changes, it is imperative that the approach is driven by the top management immediately for successfully sustaining the long term viability of the change process.
3. 2 The long term Approach For the longer term, it is suggested, keeping in mind the planned approach, to follow the three-step model of change. In developing this model, Lewin noted that “A successful change includes three aspects: unfreezing (if necessary) the present level… , moving to the new level…
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and [re]freezing group life on the new level.Since any level is implied that the new force field is made relatively secure against change. ” (Burnes 2000, p. 270) This cultural change will be managed in the following way: 3. 2. 1 Unfreezing This usually involves reducing those forces maintaining the organisation’s behaviour at its present level. It requires a re-education process for those involved and thus the following approach is required: Downsizing of BA’s workforce. The appointment of a competitive leader at the top.
Initiation of training programmes for the workforce. Change in BA’s structures and systems.Reduction in number of levels in the organisational hierarchy. Modification in the budgeting process. 3. 2.
2 Change This involves acting on the results of the first step. That is, having analysed the present situation, identified alternatives and selected the most appropriate, action is then necessary to move to the more desirable state of affairs. The key task is to ensure that this is done in such a way that those involved do not, after a short period, revert back to the old ways of doing things and thus the following needs to be done: Series of training programmes for the senior and middle managers.Usage of diagonal task forces to facilitate change. Commitment from the top leadership to the change process. Provision of support processes to reduce psychological burden of change. Introduction of incentives, such as a new bonus system to encourage employees to embrace the new change culture.
Feedback and monitoring to assess the direction of the change process. 3. 2. 3 Refreezing This final step seeks to stabilise the organisation at a new state of equilibrium in order to ensure that the new ways of working are relatively safe from becoming obsolete.It is frequently achieved through the use of supporting mechanisms that positively reinforce the new ways of working such as recruitment and induction, reward systems and cultural reinforcement through the creation of new norms of behaviour as noted by Cummings et al (Burnes 2000, p. 271) and the following is suggested: Continued support of the senior leadership to the change process. Promotion and development of people who embraced the new culture. A whole new series of training programmes for sustaining the new culture.
Development of new performance appraisal system. Development of new performance based compensation. Physical appearances such as new uniforms and refurbishing of aircrafts. Continuous feedback from both employees and customers The Three-Step model provides a general framework for implementing the process of organisational change.
It has to be kept in mind that both the short term and the long term approach have to be driven by the top management at every phase for the successful implementation of the change process.This view is endorsed in the fourfold typology of change by Storey in which the first fold is ‘Top-down systematic change’. (Burnes 2000, p. 306) 4. 0 Change Strategy – The Action plan The report has so far looked into the internal change processes that need to be undertaken in order for BA to be an effective organisation in the modern times. This section of the report will look into the overall change strategy and develop an action plan for the company to follow. The following changes are ordered with respect to their priority assuming a start date of 1st April 2003:4. 1 Reduction in staff levels: This is apparently a necessary step to make BA a leaner and a flatter organisation and cut costs which are illustrated in Table 1.
[Online: 1] Group number UK Overseas 2001 Total 2000 Total Average number of employees in the Group worldwide during the year: 50,086 12,089 62,175 65,157 i?? million The aggregate payroll costs of these employees were as follows: Wages/salaries 1,682 1,790 Social security costs 167 184 Contributions to pension schemes 124 123 1,973 2,097 Table 1. Employee number and costs (For the year ended 31 March 2001)The current liabilities of BA in terms of payroll costs as of 31st March 2001 were i?? 1,973 million. A 20 percent cut in the average number of employees over a period of next one year will yield a significant saving in the payroll of the company and the work carried out by the employees who will eventually lose the jobs can be carried out by various outsourcing initiatives. 4. 2 Outsourcing Airlines are now outsourcing everything except their core businesses. They are doing this to reduce costs to a more appropriate level.
This often has allowed the fragile world of air travel to bolster up losses and return to profit. According to the latest figures available from Nasscom ; McKinsey the global outsourcing budgets are growing at a tremendous rate and the projected industry averages are as outlined in Table 2: [Online: 2] 1998 2008 $Billion $Billion Customer interaction services 6. 5 33. 0 Finance and accounting 1. 5 15. 0 HR services 0. 2 44. 0 Data search and management – 18.
0 Remote education – 15. 0 Network consulting and Management – 5. 0 Other 1. 8 12.
0 TOTAL 10. 0 142. 0 Table 2.
What services are being outsourced currently and what will happen in the decade ahead? With the probability that most back office and some customer facing activities will be outsourced, BA will need to re-engineer its business processes to take advantage of the benefits and to remain competitive. A Combination of factors is driving the restructuring of businesses: Advances in technology, in both communications and computing, allow large volumes of data to be transferred to low cost economies and processed.