The Failure of Airbus A380 and the Modern Management Theory - Research Paper Example

Table of Contents Introduction 2 Literature Review 3 Modern Management Theory 3 Henri Fayol’s Management Principles 6 Methodology 6 Findings/Results and Discussion 7 Effects on Singapore Airline 10 Conclusions 10 References 12 Introduction Success in a firm can be attributed to the implementation of modern management, but failures can also be considered as the opportunity to improve the knowledge, practices, and standards in this area (Shore, 2008, p.5). The Airbus A380 project was said to be a failure due to important management factors. With this failure, many airline companies like the Singapore Airline was affected by Airbus A380 project failure. It was known that Singapore Air replaces A380 engines (Paris, 2010; Singapore Air Replaces A380 Engines, 2010). Like any other projects, Airbus A380 project was also subject to various constraints. However, these constraints can also be properly addressed through the right management process. The work at hand tries to elaborate this point. However, crucial to this analysis is the inclusion of important aspects or components of the modern management theory. The modern management theory has a significant link to the actual explanation of the failure associated with the Airbus A380 project. For this reason, the work at hand also includes the common approaches involved in the modern management approaches. However, more than this, the factors in modern management theory is necessary for inclusion because the entire discussion pertains more to the actual factors involved in the failure of Airbus A380 project. Airbus A380 project is a highly technical project, but its nature has nothing to do with the prevailing thought regarding the right implementation of the factors involved in the modern management theory. For this reason, the work at hand has significantly included the remarkable thought concerning on how planning, coordination, organising, command or communication and control should be critically considered in the case. This is the rationale of the work at hand and in order to implement this, the actual problems faced by Airbus A380 project prior to its failure were critically discussed. The actual strength of the analysis lies on the point that the work at hand has remarkably consulted various reliable academic articles as the bases of the argument. However, the limitation lies on the fact that there are only few studies trying to reflect on the kind of problems or failure that Airbus A380 project faced. For this reason, another substantial feature of the discussion reflects on the ability of the proponent to intuitively relate the prevailing concepts linked to the modern management theory and the case of Airbus A380 project failure. Moreover, the main argument in the paper lies on the point that had Airbus A380 project implemented the relevant factors involved in the modern management theory that will have to combine quantitative, system and contingency approach, failure must have been remarkably hindered along the way of and prior to its inception in the first place. Literature Review Modern Management Theory Modern management theory reveals the importance of socio-economic and scientific approaches in order to create a more logical and meaningful output in the long run (Information Resources Management Association, 1994, p.103; Guillen, 1994, p.269). This leads to the actual approach or consideration of quantitative approach, system approach and contingency approach (Hillier and Lieberman, 1995, p.2). The quantitative approach does not have any strong capability to initiate the final decision, but its ultimate point is just to provide the appropriate information prior to the actual decision-making process (Purnus and Bodea, 2013, p.144). A certain research study argued that projects and programmes should be treated separately because of their associated features that will lead to either the occurrence of success or failure (Molloy and Stewart, 2013, p.80). Risk factors and project outcomes are essential considerations of a quantitative approach especially in the area of project risk management (Hu et al., 2013, p.439; Palomo et al., 2007). Constructions projects for instance are set in a dynamic environment where the need to consider risk factors is a must, thus the need to employ analytical tool and computational efforts is necessary (Taylan et al., 2014, p.105). In system approach in project management, interaction between the key players is important prior to the success of the project (Milosevic, 1989, p.173). The contingency approach adheres to the principle that no common rules will be applicable to all organisations especially in managing an organisation (Rahim, 2011, p.57; Sauser et al., 2009, p.665; Howell et al., 2010, p.256). It is argued that one of the important reasons why the project may fail is not because of engineering and other relevant technical reasons, but managerial, as based on the contingency approach in modern management theory (Sauser et al., 2009, p.665). In other research investigation, there must be a dynamic collaboration between the resources and management decisions (Tang et al., 2013, p.551). The result of this study reveals that the actual situation in an organisation should be the main priority of the investigative process prior to the implementation of varying strategies. In addition, the level of staff performance can be attributed to the implementation of contingency management (Hartzler et al., 2014, p.429). In its general sense, the modern management theory emphasises the need to implement plan, organisation, coordination, communication or command and control (Swansburg, 1996, p.1; Rousell, 2011, p.32). A certain research study argues that project managers must put more emphasis on planning in projects marked as high risk, leaving the approval of plans to project committees on projects with low risk (Zwikael et al., 2014, p.435). Project planning is found to contribute to project success, which is clearly identified in the process of placing investment in the definition of the requirements and inception of the specified technicalities (Dvir et al., 2003, p.89). In addition, project management, which primarily involves the formulation of goals, leads to project success (Shields et al., 2010, p.650). Project plan was found to be an effective tool for managerial functions especially in projects linked to high risks (Zwikael and Sadeh, 2007, p.755). Organisation is another important component of modern management (Schermerhorn, 2009, p.158; Peverelli & Verduyn, 2012, p.105). Organizing is critical for the success of the firm especially if the workforce is involved primarily for obtaining knowledge and ensuring productivity (Shao et al., 2014, p.15). The workforce is one of the essential resources that a firm could have, and particularly in dealing with various projects (Lin et al., 2000, p.987; Harms, 2009, p.6).There are also uncertainties in project management that needs to be considered, and organising for uncertainty is another essential component of the success of the project (Petit, 2012, p.539). The ultimate goal of organising is therefore to consider uncertainties, and manage all the resources in a systematic way (Village et al., 2013, p.304; Ceresia, 2011, p.49). Coordination on the other hand allows the management to create moves or actions that are appropriate, especially in guiding its activities so as to ensure the right working relationship. There are many departments that may be possible to coordinate with the project, so coordination is important. Failure to coordinate is absolutely deemed as essential factor of failure (Chen et al., 2013, p.113; Kasahara, 2009, p.183). Command is to ensure that the teams in the project are motivated or inspired in order for them to achieve the goal that they are supposed to fulfill (Flouris and Lock, 2008, p.84; Lock, 2007, p.61). The appropriate command is therefore linked to the achievement of success in project management (Walker et al., 2014, p.706; Anastassova and Purcell, 1995, p.171). Control on the other hand may be a form of evaluative or corrective measure (Vanhoucke, 2012, p.252; Maroto and Tormos, 1994, p.209). Control allows the project manager to see if everything takes place as planned, or if there seems to be some variations, initiating the right course of action for corrections is necessary (Osipova and Eriksson, 2013, p.391; Flyvbjerg, 2013, p.760). Henri Fayol’s Management Principles Henri Fayol, in his 14 principles of management reveals that work division, implementation of authority and responsibility, employment of discipline, command and direction with a touch of harmony, subordination of interest in both personal and general interest, proper compensation, centralisation and decentralisation, appropriate flow of formal line of authority, order, equity, personnel stability, initiative and spirit of teamwork are important principles linked to management success (Kreitner, 2008, p.35; Williams, 2010, p.55). Employing either one or a combination of these principles reveals substantial success in the management arena (Lewis et al., 2006, p.36; Kreitner, 2010, p.35). Methodology The work at hand used research activity, generating information from the literature concerning the modern management theory and the prevailing issue linked to the failure of Airbus A380 project. The information or data were generated from academic journals. Suitable theories were also gathered from various academic articles like journals and other related materials. Online sources were generated in order to understand and acquire important information pertaining to the cause of failure of Airbus A380 and initiate the appropriate analysis. Findings/Results and Discussion Management is necessary. The lack of having the appropriate of its kind was the reason why Singapore Air replaced A380 project, because of the project’s linked failure (Paris, 2010; Singapore Air Replaces A380 Engines, 2010). As investigated, there are various reasons that led to the project failure of Airbus A380 project. The problems were all associated with the prevailing concern in management that has substantial linked to the modern management theory. Planning error is a fundamental problem linked to the failure of Airbus A380 project (Gislason, 2011, p.146; Merkow and Raghavan, 2011). As based on the existing literature, there was a problem with lack of cabin design, the incompatibility of CATIA program, and there was no evidence of alternative plans (Paris, 2010). In addition, there were conflicts existing in the sites, even to the extent of personal rivalries and national pride (Paris, 2010). Generally, there was also lack of communication, due to the fact that uncertainty was created, there was a remarkable distance between sites and meetings are limited (Paris, 2010). In the implementation of Airbus A380 project, culture differentiations are one of the significant potential issues leading to the project failure. There were remarkable differences between languages, management styles, and misunderstanding (Paris, 2010). In addition, inefficient management control was remarkable (Paris, 2010). There was observed lack of teamwork especially among top managers, and even lack of motivation and commitment and ineffective decision making (Paris, 2010). As already stated, planning is a fundamental process that will set everything in order prior to the actual strategic implementation of the necessary courses of actions (Yeh and Xu, 2013, p.604; Zwikael et al., 2014, p.435). In the case of Airbus A380 project, the management may have failed to provide the appropriate cabin design. This is a manifestation of the lack of planning actions primarily on the part of the management level. In fact, to add to this, planning as an essential action prior to elimination of potential project risks was thoroughly lacking in the case of Airbus A380 project. The incompatibility of CATIA program is a mere justification of this point, considering that programs will have to be implemented as already planned. In fact, there was even a hint of the absence of alternative plans in the actual case of Airbus A380 project. As already discussed, planning is an essential component of the success of the project. With planning, goals are created, technicalities are not overlooked and even the right courses of actions to take are clearly understood (Yang, 2013, p.109; Dey et al., 1996, p.231). With this in mind, it is therefore critical to consider that the Airbus A380 project must have sufficiently overlooked all of these, as depicted in its failure, which primarily has strong linked to the failure of creating the appropriate implementation of planning. In a particular case, the study of Zwikael et al reveals that planning in high risks projects must not be overlooked. The case of Airbus A380 is a high-risk project in the first place, which means that the alternative courses of actions in the plan should be available. On the other hand, the existence of conflict in Airbus A380 project is a mark of lack of organisation, coordination and communication within the management system. As a study reveals, organisation is necessary for the success of a project, most especially that it involves the actual human resource (Belout and Gauvreau, 2004, p.1; Huemann et al., 2007, p.315). There should be expected conflict in this case. Furthermore, the presence of uncertainties cannot be overlooked. This is the most important point of organisation. Had Airbus A380 project properly implemented this, conflicts, personal rivalries and pride might have been prevented from taking over the entire system as the project was going on. In a study, communication is vital to the success of the firms, especially those that are involved in creating projects (Diallo and Thuillier, 2005, p.237; Ochieing and Price, 2010, p.449). Everything should be under control, but the right perspective must have to be shared among the participating human resource. For this reason, constant meetings, schedules relevant management actions are important especially in projects with substantial risks involved for consideration (Grogan, 2014, p.506; Wong et al., 2012, p.94). For this reason, the distance between sites might have not been a potential problem in the case of Airbus A380 project when the communication technology was employed. Other companies are using social networking media in order to create constant and consistent communication process (Wang et al., 2012, p.977; Oke and Oke, 2010, p.442). Communication which is under the function of command will have to be used for motivating and inspiring personnel, leading to the success of the project (Khoo et al., 2011, p.328; Badir et al., 2012, p.914). Communication or command, organisation and control are essential points to be combined to manage the project. Evaluation is necessary and at the same time differences will have to be considered. In the case of Airbus A380 project, there were cultural differentiations as manifested through varying languages, different management styles and misunderstanding. The presence of different management styles alone is a hint of lack of control. An organisation with the right level of control will have uniformity in the implementation of management input, for it is necessary for benchmarking and option for standardisation (Kerzner, 2004, p.271; Bent and Humphreys, 1996, p.1). On the other hand, there must be essentially lack of organisation and communication because of the misunderstanding. Misunderstanding is a perfect scenario of lack of communication or inappropriate level of control in the area of command (Federal Aviation Administration, 2007; Bomarius, 2009, p.136). Finally, the inefficient project control is another failure on the part of control in Airbus A380 project. There was a lack of teamwork among top managers and even inefficient decision making and absence of motivation. For this reason, it is implied that the project failed to implement the right level of control. In most cases, control in the firm allows corrective actions to take place, or the evaluation of important aspects in order to promote success and shun away failures (Hakes, 1991, p.60; Grubbs et al., 2005, p.111). In totality, the modern idea of management aspect adheres to the basic point that Fayol explicated concerning the essential principles necessary in management. Effects on Singapore Airline However, the above failures of Airbus A380 projects led to substantial impact on Singapore Airline and its operation (Thomas, 2011; Thomson, 2005; Singapore Airlines Ordered…, 2007; The giant on the runway, 2007). Due to failure, Singapore Airline chose to go for engine replacement with oil traces, which means additional incurring of costs (Wong, 2012; Done, 2009). Due to Airbus A380 project failure, Singapore Airline’s navigation system and autopilot failed on the 26th of April 2012 (Wong, 2012). This remarkably led to contagion effect in the Airline industry as failure to achieve revenue of $6 billion was evident between 2007 and 2010 (Vandore, 2008). Furthermore, the effect of economic crisis was made even worst by late delivery of A380 projects (Vandore, 2008). In addition, there was substantial increase in the cost of employment, approximately 7% salary. Furthermore, because of the loss of reputation of Airbus A380, passengers were hesitant to fly with Singapore Airline, which was even made worst due to emergency landing due to cabin pressure in 2014. Conclusions This study has only relied on the prevailing information relevant to the failure of Airbus A380 and the modern management theory. For this reason, the work at hand provides recommendation on the basis of what has been remarkably generated in the prevailing literature. Airbus A380 must have to consider implementation of the right plan; especially in high risks projects, allowing the management to implement more alternative courses of actions as to be stated in the actual plan. This is to ensure that if the primary plan fails, there are other feasible management actions that will have to be justified for consideration. In addition, the proper implementation of organising and coordination strategies will have to be remarkably taken into account. This is to guarantee that everything, primarily the resources will have to be optimized to their greater potential. Furthermore, the right implementation of command and communication is important because this can lead to the appropriate exclusion of potential conflict within the system and in the entire duration of the project. Finally, control is something that is essentially lacking in the case of Airbus A380 project. The case of this project shows that there was lack of corrective measures or actions and other important evaluative measures to improve or enhance the actual project. In a nutshell, the modern management theory is a helpful application primarily when it is to be employed in the case of Airbus A380 project failure. References Anastassova, L., and Purcell, K. (1995) ‘Human resource management in the Bulgarian hotel industry: from command to empowerment?’ International Journal of Hospitality Management 14(2), 171-185. Badir, Y. F., Buchel, B., and Tucci, C. L. 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