What was life like at the "old" British airways? What was difficult about making change?

According to Palmer et al. (2022) the original culture of the old British Airways consisted of a government-run organization that had a ballooned staff of 58,000 employees. An overall focus of British Airways was that of building an airline structure over focusing on profit was prevalent, creating a high financial cost. During the 1950 and 1960s, success was measured by British nationalism rather than as a sustainable business. The hierarchal top-down style of the military was not only inherited by the organization being a government-run entity but ensured the hierarchal military structure was cemented in the culture, with numerous military veterans joining the organization after World War II. The military top-down approach created an environment for accomplishing the mission no matter the costs.

The fact that a profit gained occurred between 1972 and 1980 provided a false indication that the organizational structure and culture were sufficient and change was unnecessary even though a few inefficacies were occurring within the organization. One significant issue is BEA's division, consisting of four organizations (BEA Europe, Regional, Scottish, and Channel). Each division functioned as an independent airline lacking overall unity. Management focused on internal conflicts, failing to consider external factors, threats, and potential innovations. Further, British Airways suffered a poor marketing perception during the 1970s. 

In 1978 – 1979 there was an expected increase in passenger growth of up to 10 percent. However, there was an unexpected loss of 4 percent. Also, the fleet was aging, and fuel and staffing costs were rising.

What were the critical factors in the successful transformation?

Lord John King was appointed chairman in 1981 and began the radical transformational (deep depth) changes by cutting staff from 52,000 to 35,000, reducing staff by one quarter. King also placed a freeze pay increase for one year, closed 16 flight routes, halted the cargo-only service, selling the fleet, leading to massive job cuts. CFO Gordon Dunlop was added to the organization focusing on new market tactics, implemented with a new marketing company, a historical change in British history, demonstrating a clear commitment to change the corporate image. CEO Colin Marshall joined in 1983, focusing almost solely on customer service to change the culture to a customer service-focused environment. Employees were enabled to decide how to focus on customer service rather.

Palmer et al. (2022, pp. 127 – 128) described a similar situation regarding the organizational structure of the British Army, specifically regarding the top-down hierarchal structure also found within British Airways. The traditional military structure was described as requiring soldiers to wait for orders rather than take the initiative, which was unfortunately demonstrated in the 1982 Falkland Islands war. The British Army adopted a more agile structure, empowering its soldiers to make rapid decisions, focusing on the principles rather than waiting for instructions in an ever-evolving combat environment.

How did they transform themselves? (e.g. key steps and sequence, risks)

Pulakos et al. (2019) describe highly agile organizations as creating new, winning strategies in response to competitive threats, successfully creating new strategies and, recovering from unexpected disruptions, quickly returning to normal operations. Colin Marshal created a program called Putting People First (PPF), rapidly shaping the organizational culture in which employees were enthusiastic about the program and individually sought participation. The program focused on the employee recognizing them as individuals. A subsequent program, Managing People First (MPF), focused on management, stressing the importance of trust, leadership, vision and feedback. An effort to maintain the momentum with the creation of subsequent less successful employee-oriented programs mimicking the PPF and MPF programs was created and met with criticism.  

King and Marshall demonstrated innovative organizational changes by creating partnerships with other airlines, purchasing shares in computer aviation, and focusing on globalization. King also restructured the look of the planes, created new uniforms for employees and engaged all employees in unveiling the new look.

What would you have done differently?

Employees noted still needing more trust and belief in the organization. They expressed seeing issues but not being able to provide input on them. Other employees recognized cultural change but reported the fear of it being temporary, believing it had not become the status quo. Shrivastava et al. (2022) note that management is often too detailed or abstract for employees to understand or act upon the desired change. Managers often need to pay more attention to their organization's inertia, and the message becomes progressively less impactful, failing to drive it to the employee. It became clear that this was the case with the 1987 acquisition of British Caledonian, creating a notable impact on the organizational culture, creating a new culture of "do more with less" due to cost-cutting measures with a consistent significant focus on customer service. The merger with British Caledonian impacted the positive cultural changes (inertia), increasing the number of employees and creating pockets of dysfunction, as noted by employee testimonials. Creating an open communication forum recognizing line staff's concerns would allow management to address unseen issues, provide employees a voice and experience greater job satisfaction.

Biblical Integration

The king said to me, "What is it you want?" Then I prayed to the God of heaven, and I answered the king, "If it pleases the king and if your servant has found favor in his sight, let him send me to the city in Judah where my ancestors are buried so that I can rebuild it." Then the king, with the queen sitting beside him, asked me, "How long will your journey take, and when will you get back?" It pleased the king to send me: so, I set a time. Nehemiah 2:4-5.

           This passage demonstrates a willingness to trust in God's will and rebuild what has been ruined. Nehemiah was willing to take a dangerous journey, rebuilding the walls of Jerusalem, placing himself at risk, but having faith in God, and willingly provided a timeline to his king based upon his faith. This concept can be likened to that of Lord John King rebuilding British Airways, tearing down an established system, at great risk of failure, establishing trust with employees and rebuilding the “walls.”

References

Palmer I., Dunford R., & Buchanan D. (2022). Leading Organizational Change. McGraw-Hill Create. 

Pulakos, E. D., Kantrowitz, T., & Schneider, B. (2019). What leads to organizational agility: It's not what you think. Consulting Psychology Journal: Practice and Research, 71(4), 305–320. https://doi.org/10.1037/cpb0000150

Shrivastava, S., Pazzaglia, F., Sonpar, K., & McLoughlin, D. (2022). Effective communication during organizational change: A cross-cultural perspective. Cross Cultural & Strategic Management, 29(3), 675–697. https://doi.org/10.1108/ccsm-08-2021-0144