Critical Evaluation of Bureaucracy - Essay Example

Critical Evaluation of Bureaucracy This paper critically analyzes bureaucratic management at British Airways. Bureaucratic management is based on the principles of specialization, a hierarchy of authority and formal rules and procedures that are implemented impartially to ensure continuity and efficiency in the organization. Such management methods are not viable in the postmodern world where employees expect a richer and deeper involvement with their work and their organization. They are likely to experience low motivation and boredom under bureaucratic managers. Furthermore, environmental changes have made reliance on a stable and rigid hierarchical structure untenable for competitiveness. British Airways Description of the Organization British Airways is the national airline of the United Kingdom and also its largest airline. It started operating in 1974 with its centre of operations at Terminal 5 at London’s Heathrow Airport (IAG, 2010). The airline operates flights to 400 destinations around the world and operated 245 aircraft as of 2011 (IAG, 2010). In 1976, the airline started flights to the United States. British Airways remained a public sector airline until 1987 when it was privatized. During the decade of the nineties, there was much friction between management and labour unions as restructuring efforts were undertaken to increase competitiveness. The organization is currently part of the parent group International Airlines Group following its merger with Iberian Airlines. Central power rests with the CEO Willie Walsh (IAG, 2010). Recent Developments The most recent developments to affect British Airways include the financial crisis that began in 2008. The reduced global business activity adversely affected the airlines industry. As a result, British Airways had to take steps to control its expenses while revenues were not expected to grow in the near future. In pursuit of such measures, British Airways announced 1700 job cuts for its UK cabin crew of 14,000 (Macario & De Voorde, 2009). This measure was intended to reduce labour costs and increase profitability. However, the measure backfired and resulted in an industrial dispute with the cabin crew labour union Unite for almost two years. Most recently, the airlines has merged with Iberia Airlines and now operates under the parent company of International Airlines Group (IAG). This illustrates the increasing trend towards privatization in the airlines industry (Macario & De Voorde, 2009). Airline Industry Critical Issues Critical issues in the environment have increased the challenges for British Airways. The terrorist attacks of September 2001 created a fear of air travel worldwide and airlines suffered as a result. British Airways being the national carrier of the United Kingdom also suffered. In addition, since 2008, the costs of jet fuel has been volatile (Department of Transportation, 2012), increasing the cost of operations for British Airways. Smaller, smaller budget airlines entered the industry and exploited the needs of the budget travelers. By offering more flexible no-frills services, they catered to the need of the consumers for prompt and flexible service as opposed to the bureaucratic procedures and red tape at large airlines like British Airways. These smaller airlines successfully started eating away at the share of British Airways. EasyJet is one such budget airline (NCSI UK, 2008). However, this growth was also stimulated by the economic recession of 2008 set in at the close of the decade. With reduced economic activity and the need to curtail air travel expenses, the demand for international travel through large airlines was reduced. The industry responded to these challenges by increased conglomeration. The British Airways became part of the International Airlines Group (IAG) with the merger with Iberia concluding in 2011. These changes were intended to increase efficiency within the group by enabling individual companies to reduce overall expenses and maintain profitability in a competitive and challenging environment. At the same time, this increased consolidation within the industry made British Airways less flexible to respond to the challenges in the environment. The Labour Dispute at British Airways Because of the increasing challenges to the financial competitiveness of British Airways, the management decided to reduce the number of cabin crew from fifteen to fourteen on long-haul flights in October 2009 (BBC, 2011). In addition, the management also decided to put a pay-freeze on cabin crew earnings. This pay-freeze would be applicable from 2010 onwards. Both these terms were completely unacceptable to the cabin crew employees and they came together under the Unite union to protest against these actions. According to the union, the financial well-being and career growth of the cabin crew employees would suffer as a result of these actions (BBC, 2011). However, when management refused to change the decisions, some of the cabin crew employees decided to stage walkouts in March 2010. To punish employees for such actions, the management withdrew travel concessions for the workers and also threatened them with disciplinary action. Under the travel concessions, cabin crew and their family members could purchase tickets at ten percent discounted rates. In retaliation, the Unite union demanded that the travel concessions be restored and the disciplinary action be arbitrated through Acas. It also severely criticized the handling of industrial relations issues by the management (BBC, 2011). After nearly two years of the standoff and a change of CEO, negotiations were successful and the parties reached a compromise. The Unite union accepted the reduction in cabin crew on long-haul flights. On the other hand, management agreed to restore the travel concessions. In addition, the cabin crew were to receive an increase of 7.5 percent for two years in their pay. A mechanism for tying pay increases with employee performance was also agreed upon in principle (BBC, 2011). Management Theory The sections below discuss some significant management theories that would help in analyzing the effectiveness of management at British Airways. These management theories are scientific management, bureaucratic organizations, and the postmodern organization. Scientific Management Scientific management theory came about during the final decade of the nineteenth century. Frederick Winslow Taylor, a young engineer, developed this theory after being disappointed with the slow-paced improvements in worker productivity that were taking place after industrialization. Scientific management theory introduced scientific analysis and rationality in the field of organizational management. It was assumed that the one right way, the most efficient way, for doing a task could be discovered through careful study and experimentation. It was important for organizations in those days to use labour efficiently to increase productivity. Scientific management brought about many significant improvements in organizational management processes. Productivity went up phenomenally at plants where Taylor’s principles were applied. Wastage was reduced and the number of steps required to perform specific tasks was also brought down considerably (Daft & Marcic, 2010). With time, scientific management practices were found to have negative influences on labour morale. As society matured, employees did not want to be treated by their organizations in the same way as machines were treated. Employees learned to identify higher order needs for self-actualization that could not be achieved by performing smaller repetitive tasks of a whole job in isolation. It came to be believed that in the long run, such emphasis on efficiency was counter-productive to employee morale and could result in increased labour turnover. In fact, some critics stated that scientific management results in rewarding managers disproportionately more than workers (Hitt, Black, & Porter, 2009). The labour dispute at British Airways is also an indication of employee resistance to organizational measures at imposing efficiency. Weber’s Bureaucratic Organization During the 1930s, Max Weber proposed the bureaucratic model of the organization. This model was also based on increasing efficiency and consistency in organizations. The tools for attaining this objective were rules and procedures. Uniformity in developing rules and impersonality in implementing them was thought to be conducive to creating predictability and continuity in the organization. It was an effective way of countering the influence of personal allegiances to one’s superiors. Like scientific management, work was specialized by dividing jobs into tasks. The old norms of personal allegiance were replaced by a formal hierarchy that was based on vested authority. The employees were vested with varying levels of authority to perform their respective jobs (Schermerhorn, 2011). Bureaucratic organization theory enabled many organizations to impose order and avoid chaos. Organizations were able to create standard operating procedures and formal rules for the organization. Work could be conducted by following rules regardless of the employees coming into and going out of the organization. In this way, continuity in organizational activities was ensured. The growth of corporations was facilitated when bureaucratic principles were applied in organizations. The focus on specialization enabled the development of specific professional fields and departments within the modern organization. Employees were granted authority and responsibility on the basis of their ability to perform a specific role instead of their personal loyalty to their managers (Schermerhorn, 2011). A number of disadvantages of bureaucratic organizations were also discovered in time. Bureaucratic organizations were found to stifle employee creativity and create boredom. Obsession with rules and standard procedures was likely to result in slow-paced decision making and delays in responding to critical environmental changes. Like it was observed with scientific management, employees in bureaucratic organizations too felt the absence of an identification with the goals of the organization. Employees become more concerned with complying with rules rather than thinking about creative and innovative solutions to problems. Such aspects of bureaucratic organizations result in dehumanizing work for employees (Tripathi & Reddy, 2008). Criticism of Bureaucracy at British Airways The labour dispute at British Airways can be analyzed in the light of some of the common criticisms leveled against bureaucratic organizations. The increased consolidation within the airline industry has brought British Airways under the IAG, with increasing opportunities for bureaucratization. With such consolidation, it becomes difficult for employees to maintain morale in the organization (Banhegyi, 2007). Wallace (2008) states that bureaucracies perceive the employer-employee relationship as a master-slave relationship instead of a buyer-seller relationship to their detriment. Moreover, the financial pressures facing the industry required the management to reduce the single controllable cost area, the workforce. This attitude reflects the adherence to scientific management principles where employees are thought to be managed in the same way as assets. This attitude ignores the role of human needs, creativity and motivation in organizational productivity and management. The labour dispute at British Airways prolonged despite attempts to negotiate with the unions. The primary cause for the labour dispute was the loss of jobs but the reason why the dispute became so prolonged was the failure to identify power centers by the management. It can be argued that the management ignored the importance of involving employees in decisions concerning the future of the company. Decision making power seems to be centralized with the top management at British Airways because of which employees are not invited to participate in decision making. This is a major flaw of bureaucratic organizations because they fail to benefit from employee input when they take decisions unilaterally (Hill & Jones, 2012). Most of the problems that resulted during the labour dispute could have been avoided if the management had consulted with the employee representatives during the decision making process. The negotiations showed that employees were able to exercise their power because they did not agree with the decisions of the management. The labour negotiations also consumed a lot of time because the management did not believe in sharing authority with the employees. The unresponsive attitude of the management was an outcome of the bureaucratic practices at British Airways. The Postmodern Organization The postmodern organization possesses characteristics and features that are more suited to the complex and volatile business environment of today. It opposes the traditional way of perceiving the environment factors in binary pairs (Hardy & Palmer, 1999). Compared to the business environment of the period when scientific management and bureaucracy were proposed, the number and composition of stakeholders in the environment has increased. Furthermore, the linkages and relationships among the stakeholders and between the stakeholders and the organization have become more interactionally complex (Stachowicz-Stanusch, 2010). Technological, economic and social changes have become more frequent. These factors are reflected in chaos theory and the postmodern organization tries to deal with this complex and chaotic environment. Unlike bureaucracies where procedures matter more than outcomes, the postmodern organization is flexible and organic instead of rigid and static (Pugh & Hickinson, 2007). The postmodern organization does not concentrate authority in a single center. Instead, power and authority are shared among various groups in the organization. In fact, Wright (2008) describes it as a kind of “anti-organization (p. 62).” The postmodern organization recognizes that knowledge is the basis of power. As a result, employees are entitled to contribute to the development of the organization and are involved in participative management. Employees possess multiple skills in a postmodern organization. This feature of the postmodern organization helps to overcome the demotivating and dehumanizing effects of scientific management and bureaucratic organizations. British Airways could benefit if management allows employees greater say in decision making. The postmodern organization is also oriented towards customers and products than towards adherence to norms and rules. This allows employees to exercise multiple skills instead of exercising the same skills in their specialized jobs. Employees are organized into teams instead of functional departments (Mills et al., 2006). A product orientation also enables employees to develop a holistic understanding of the product and helps to counter the effect of isolating the worker from the work, which was a common criticism against scientific management and bureaucratic organizations. More importantly, with a customer and product orientation, organizations are able to develop a niche for themselves in a diverse and competitive market. They become able to “orchestrate action (Tierney 2008, p. 98)” instead of simply accepting chaos in the environment. British Airways also operates in a similar market. It is therefore essential for the organization to develop a product or customer orientation so that labour can be better utilized for competitive advantage. A Critique of Power at British Airways The labour dispute at British Airways that lasted from 2009 to 2011 was a test of wills between the British Airways management and the cabin crew union Unite. The dispute gained a lot of media publicity as the ugly dispute threw up one issue after the other that intensified the tension between the two parties. The issue clearly illustrated that both the groups possess a sufficient degree of power over one another. It is for this reason that both had to compromise after realizing that it was impossible to resolve the dispute without acknowledging the validity of the needs and concerns of each other. This reveals that organizations have come a long way from bureaucratic organizations where employees and management have to participate and share authority to resolve management issues. The postmodern view of organizations states that such organizations recognize the influence of groups within the organization and their power to contribute to organizational development. This feature is reflected in the fact that the Unite union of British Airways cabin crew had to accept the cut in the number of cabin crew on British Airways long-haul flights. On the other hand, the management had to return the travel concessions that had been withdrawn from cabin crew as a result of their participation in the protests. It shows that both the parties had come to recognize their role in the success of the negotiations. In the postmodern organization, groups are used to represent the interests of employees. Furthermore, the validity and power of such group is recognized. Dialogue is encouraged among the groups (Lon-Ar, 2006). In the labour dispute issue, the power of the Unite union came to the fore as it threatened to go on strike. However, the management was also able to assert its authority to make strategic decisions for maintaining the competitiveness of the organization. It can be argued that the sharing of power between these two groups is an indication of trends in British Airways as moving towards becoming a postmodern organization. This would see the organization becoming flatter, leaner and more efficient in responding to environmental challenges. References Banhegyi, S., 2007. Fresh Perspectives: Management. Pearson South Africa. BBC, 2011. Q&A: What’s the BA Dispute About? [online] Available at: [Accessed 30 January 2013]. Daft, R. and Marcic, D., 2010. Understanding Management. Cengage Learning. Department of Transportation, 2012. Aviation Industry Performance: A Review of the Aviation Industry, 2008-2011. [online] Available at: [Accessed 30 January 2013]. Department of Transportation, 2012. Aviation Industry Performance: A Review of the Aviation Industry, 2008-2011. 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