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Qantas Airways: Strategic Contingencies - Essay Example

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Every organization operates in a certain, specific to it, external environment. For this reason each company is exposed to certain risks and influences over which it has no control. The only solution in such a situation is to respond to the influence in an adequate and timely manner…
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Qantas Airways: Strategic Contingencies
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Download file to see previous pages Since an organization, being interrelated and interdependent with its environment, has to be continuously adjusting to new circumstances, it makes sense to apply the strategic contingencies approach to managing external changes that affect the company’s operations.
This is exactly what Group of Qantas Airways Limited companies is doing. Qantas has faces a number of strategic contingencies that affected strategic choices and HR planning of the company. therefore, the purpose of this paper is to determine the strategic contingencies that impact Qantas’ strategic decisions, and examine how such decisions affect HR planning. In addition, recommendations regarding commitment of employees and HR planning will be given on the basis of strategic contingencies analysis.
Background information
Qantas Airways was founded in 1920 in Queensland. Since then the company has become, according to its website, world’s leading long distance airline business. Group of Qantas Airways Limited companies consists of Qantas Airways and 7 subsidiary companies. It is a recognized brand in Australia, and is already operating some subsidiary businesses, among which are Jetstar, Qantas Holidays and Q Catering (Our Company 2011). Though the company is quite large and operates internationally, it has been heavily influenced by the recent financial crisis, natural disasters, increases in prices for fuel and complex negotiations with labour unions. As a result, prices for Qantas shares dropped by one third by June 2011 and the company has decided to cut jobs in order to increase profitability. This strategic decision was taken under the influence of a number of the strategic contingencies that affect business operations of Qantas. Strategic contingencies Definitely, no organization exists in vacuum. On the contrary, each one is a part of larger systems, such as financial, social or legal, and operates in certain specific environments. Therefore, an organization, being an integral part of its external environment, is influenced by it, whether such influence is predictable or not. Similarly, an organization has some influence on its external environment, since both are interrelated and, in some cases, even interdependent systems. For this reason Lawrence and Lorch (1967) introduced using systems approach to managing organizations and built a foundation for the contingency theory. The core essence of the contingency theory is that there exists no ideal prescribed way to organize a company. instead, it should be organized in accordance to the nature of its operations and environment (Walker 2007 , 40). So, the contingency approach connects HR management practices with organizational performance on the basis of the idea that if HR policies and practices are more flexible and responsive to the external environment and immediate circumstances, the overall organizational performance improves (Guest 1997, 267). Therefore, effective HR policies should be based on the qualities of the particular environment in relation to company’s function, and the extent to which the environment of the company is uncertain. At the same time, it should be remembered that no theory is perfect. Regarding the contingency approach, Child (1977, 170) argues that it does not take into account all of the difficulties relation to organizational design that a company may face under the influence of multiple external contingencies. Therefore, it might be that a combination of several ...Download file to see next pagesRead More
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