The Importance of Organizational Behaviour in British Airways - Assignment Example

6264-F2F Organisational Behaviour G Semester 1, 2014 Final Examination (take home exam) Section A: Question 1A. Identify and comment on the ways in which British Airways went about changing their militaristic and bureaucratic culture to a customer service and customer responsive culture (see the British Airways case on Moodle). Be sure your comments demonstrate your understanding of core concepts relevant to how organisational cultures are created, sustained and transmitted. Answer: Primarily British Airways is one of those organisations described by that is subject to intense outside pressure (ex. conversion from government to private ownership, deregulation of international air traffic resulting price wars etc.) to change from somewhat military or government type of management to customer oriented and market sensitive business organisation . By analysis, the absence of subsidies from government, risks of financial losses due to airfare deregulation, and commitment from BA’s top management are key ingredients for driving the customer service culture in 1982 and BA’s noticeable financial success five years later. Question 2A. Outline the sources of “noise” that impede effective communication, especially electronic communication. Answer: a. Filtering or omission b. Selective perception or interpretation based on personal preferences. c. Information overload d. Emotions or feelings e. Language or words used means different to other people f. Silence g. Communication apprehension h. Lying i. Gender differences j. Cultural differences k. Political correctness or avoiding offensive words Question 3A. Identify two critical issues in the forming, storming and norming stages of group development (two issues per stage) and their implications for the effective management of groups or teams. Answer: Forming Purpose and Leadership Storming Conflict and confrontation Norming Cooperation and collaboration Effective management of team or group may be hampered by lack of teamwork, cooperation and collaboration among team members as a result of team members’ uncertainties purpose of the team, independent actions, competing ideas and perspective . Question 4A. Identify two critical sources and two critical consequences of stress that might arise from a large-scale change management program. How could this stress be managed? Answer: a. Task and interpersonal demands. b. Higher turnover rate and absenteeism. Effective time management and social support reduce stress by setting work priorities and maximising use of personal energy while people often feel better and cope when others care and willing to help them . Question 5A. How do knowledge of French and Raven’s five bases of power assist managers to effectively manage their power in accordance with high standards of ethical leadership? Answer: The first three legal bases of power provides managers formal authority over a group while the last two offers personal power that influence followers to do beyond performance expectations. These bases of power help managers gain status and influence as ethical leaders valued and approved by followers . Question 6A. Comment on the ways in which the Big Five Personality Model is a predictor of workplace behaviour. Answer: Extroversion is a good predictor of success in sales due to confidence in interpersonal relationship and talkativeness. Agreeableness (commonly associated with trust, courteousness and helpfulness) is a good predictor of constructive behaviour while conscientiousness can diligence and job performance. emotional stability predict productive behaviour and higher job efficiency . Section B. Compulsory Essay Questions Question 1B Question (i) Discuss the motivation issues raised in the case study above (Starbucks: a case study in motivation) from the three perspectives below. Be sure to move beyond simply copying a description of each theory. 1) Maslow’s hierarchy of needs Starbucks’ effort to motivate its employees considers employees need for self-actualisation or personal growth and fulfilment. This is evident in the initiative to extending health coverage to part-time workers, stock-option plan, comprehensive training and above minimum pay scale . The need for esteem, belongingness, and love needs is evident in Starbucks’ reward system, self-managed work teams in coffee bean roasting plant, and employee empowerment . For instance, employees can speak their minds without fear of retribution and be involved in decision-making. The safety needs of employees is addressed through health programs and 24 hours of classroom training that include retail skills, coffee brewing methods, customer service, and responsibility for store cleanliness administered by specialist and training managers . The biological and physiological needs of the Maslow hierarchy are also covered by offering employees good compensation and comprehensive benefits packs. Moreover, the stock option plan include part-time works who work at least 20 hours per week and the projected cost of benefits during that time is around $2,200 for each of the 19,900 employees . 2) Herzberg’s two factor theory The two-factor theory of work motivation promote the idea that one set of factors (motivational factors) can satisfy and motivate people while the other (hygiene factors) can only prevent dissatisfaction . For instance, achievement, recognition, advancement and growth are motivators while working conditions, interpersonal relationship, pay and job security, good supervision and company policies are hygiene factors that prevents dissatisfaction . In relation to Starbucks, the motivational factors are the recognition given to employees as partners or part owners of the company and advancement through stock plan, training, and self-management . The hygiene factors are pay and job security through above minimum wage, good working condition, management’s interpersonal relationship with employees, open communication, empowerment and company policies aimed for employees’ growth and development . For instance, Starbucks’ self-management scheme is evidently aimed at preventing dissatisfaction, as cross-functional teams of partners (employees) can make work-related and hiring decisions. Moreover, the company’s guiding principle seems appealing enough to make an employee stay with Starbucks . For instance, principles such as treating all employees as partners, helping employees learn, and involving employees in decisions can make employees feel valued and committed to the organisation. 3) Adam’s equity theory The Adams equity theory argues equity is a fundamental norm thus social behaviour is greatly affected by the belief that benefits and cost within a group should be allocated equally . According to , people compare their input and output ratio thus a sense of equity and fairness arise when they are equal and the opposite when not. The consequences of inequity is reduced input or working less, complaints and demands for re-adjustment of one’s output, and quitting in worse cases. These inputs in relation to Starbucks are skills and performance of employees while salary, rewards, and benefits provided to employees are the outputs . If the perceived balance between inputs and outputs according to motivates employees performance level then Starbucks must have successfully maintained the balance since 2008 when Schultz returned to the CEO position. Skills and performance of Starbucks employees are well compensated by higher per hour rate, stock plan, comprehensive health programs, recognition as partners and co-owners, and advancement through training . The necessary balance is clearly demonstrated by statistics showing Starbucks low turnover rates, 82% satisfied employees . Moreover, Starbucks was one of Fortune magazine’s ”100 Best Companies to Work For” in 2007. Financially, Starbucks in 2012 reported $3.2 billion total net revenues, 20% sales growth in China, and expanding with 176 new stores opening around the world . Question (ii) These theories contributions to effective management of motivation is significant particularly in satisfying employees hierarchy of needs, identifying motivational and hygiene factors, and maintaining the perceived balance between input and output. As demonstrated by Starbucks, these theories are helpful for businesses that value the contribution of employees to its success. Question 2B Discuss attribution theory and why it is an important tool for managing goal oriented organisational behaviours. Illustrate your discussion with relevant workplace applications. Answer: Attribution is about understanding the causes of an event or behaviour and according to attributions do not always reflect the reality as it can be optimistic, pessimistic, and hostile. Attributions are classified along the dimension of locus of causality or the internality or externality of an attribution such as a medical practitioner attributing misdiagnosis of patient’s sickness to his carelessness (internal) or to faulty laboratory result (external). As people tend to act as inexperienced psychologist and try to make sense of certain events, the resulting explanation of the event systematically affect their subsequent motivation and behaviour . For example, although there is no strong evidence to support his assumption, an employee who did not get his requested salary increase may attribute it internally to his lack of skill or externally to company’s lack of recognition. Consequently, he will either be involve in skills training or leave the company. In relation to its impact on behaviour and performance, attributions can base on consensus, consistency, distinctiveness, personal and situational factors. Consensus is established when other people behaved the same way as the one observed. In contrast, unique behaviour or those rare for other people will receive low consensus . For instance, if the employee who came late for work is the only late employee then consensus about the cause of lateness is low. In contrast, if a group of employee came late and the rest are not then, there may be consensus in attributing that they attended their department head’s birthday party, slept late, and therefore report to work late. Consistency on the other hand considers the pattern of behaviour of a person. If a person’s behaviour is consistently similar then the cause of that behaviour is internal. If not then external factors may be considered . For instance, if an employee is consistently late then this can be attributed to his attitude towards work rather than traffic, travelling distance, and other external factors. Distinctiveness is the failure of a certain behaviour to generalise across situations thus more likely receive external attribution . High distinctiveness according to , make the observer more incline into making external attribution. For instance, when all employees performance is poor, poor performance only occurs on one of several tasks (high distinctiveness), and such level of performance only happened in that particular week then the manager will likely attribute it to external factors such as difficulty of a particular tasks, pressure from client, and others . In general, internal attributions are likely to occur when consensus and consistency are high while external attributions occur when these type of attributions including distinctiveness are low . Attributions in organisations according to can greatly affect the relationship between managers and employees. For instance, a manager’s judgement may be affected by his attribution of an employee’s performance whose personality and behaviour are inappropriate to his personal standard. This attributional tendency is what researchers termed as fundamental attribution bias where a person’s behaviour and personal characteristics is given more emphasis than situational factors associated with performance . Distortions in attributions are errors and biases caused by fundamental attribution or self-serving bias, the tendency in some individual to attribute their own success to internal factors. For instance, an employee putting the blame for failure on external factors like luck while attributing success to his ability, skill, wisdom, or effort . Self-serving bias according to is the type of distorted attribution that will likely affect organisations mainly because regardless of age, gender, or culture people are engage in self-serving bias to satisfy their desire to feel good about themselves. For instance, research of the existence of self-serving bias in sports and in many areas in social psychology reveal people’s tendency to maintain self-esteem . Question 3B Evaluate how organisational change was implemented at British Airways (see the case on Moodle) from the perspective of Todd Jick’s 10 commandments for managing change (see Moodle for Jick’s article). Answer: The first four of Todd Jick’s 10 Commandments for managing change requires an organisation to analyse itself and its need for change, create a shared vision, separate for the past, and create a sense of urgency . Evaluating from the information provided, British Airways organisational change effectively observed these commandments during the 1982 conversion from government to private ownership. For instance, the rapid turn of events suggest that British Airways immediately realised that it can no longer survive without the $900 million government subsidy and will get no support from the conservative government that regard businesses as a private domain . Moreover, BA during that time was in greater risks of bankruptcy if it remains as is in the midst of growing competition, decreasing passenger load factor, and absence of investors as shown in Exhibit 16-4 . Consequently, BA analysis of itself and demand for change result to service-oriented and market-driven vision shared by all, selling shares in London and New York Stock Exchange as a private enterprise capable of maximising shareholder value, and fostering a new culture more appropriate to private business enterprise. BA undoubtedly created a sense of urgency as change did happened in just a matter of months. In view of the fifth and sixth commandment, it is not clear whether BA management developed strong leadership role with operating in high political environment but the favourable turn of events suggest that it did. According to , it was Sir Colin Marshall, BA CEO in 1983 who led BA to become more customer focus, sensitive to cost, productive, and profitable. The seventh and eight commandment that demands creation of implementation plan and development of enabling structures and reinforcements respectively in order to transform the shared vision into reality is not available in case example. However, according to , BA restructured itself into three divisions in 1982 and a new airline structure was put into place in 1983 with eleven profit centres, eight geographic market centres for passenger operations, cargo, charter, and package tours. Moreover, 161 BA’s top managers were removed and replaced with new managers directly reporting to the newly appointed marketing director. Evidently, these reorganisation was planned otherwise BA business operation at that time will be chaotic. For instance, Colin Marshall, a former Hertz and Avis top executive, was given formal authority by the UK system of corporate governance with strong backing from the board, and therefore able to orchestrate the change rapidly and in a manner he perceived suitable for BA . The enabling structures in the eight commandment is characterised by changes in various systems and structures that will support the new operational requirements and by analysis, this commandment was effectively executed by Marshall in 1983. The ninth commandment where communication, people involvement, and honesty are necessary seems not complied in BA. This is because the reorganisation was planned and implemented in total secrecy and in fact radically altered BA’s internal power structure silently without much resistance . The tenth commandment require change efforts to be monitored , refined, and institutionalised and according to this commandment often entails cross-cutting priorities, changes in leadership, and happen at midpoint. Evidently, this commandment started much earlier in BA, which is a year later after being converted as a private enterprise. The next reorganisation occurred in 1986 when BA was already in a stable position to restructure again. This time, the priority and emphasis was given to the network-optimisation concept or techo-organisational change that include creation of information system guided centralised world sales organisation . In summary, although there are evidently some variations caused by urgency and Colin Marshall’s approach to organisational change, Jick 10 Commandments for organisational change were all practiced in BA’s rapid transition to service and market driven organisation. References: Bartunek, J. (2001). Why did you do that? 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