The application of leadership concepts and practice in real life can be rather helpful in addressing the arising challenges. Much attention will be paid to the development and presentation of the coherent strategy for overcoming of the stated challenge. This strategy will be based on the data from various peer-reviews journals. The identification and evaluation of a challenge one of the biggest American airlines faces forms the background for the application of theoretical knowledge concerning the great variety of leadership practices used to address the real-life problem of this company.
Literature Review
The description of the company, its vision and mission are taken from the official web site of United Airlines. Its major stakeholders are mentioned in Environmental sustainability at United (n.d.). The code of ethics under the name United’s ethics and compliance principles (2016) was also taken from the company’s official web site. Much attention was paid to the detailed analysis of the challenge facing the leadership of the company. Specific identification of this challenge was based on the data presented in the freely accessible articles from the following journals: Bloomberg Business, The Boston Globe, and The Street. It should be noted that the article United’s quest to be less awful (2016) from Bloomberg Business written by Drake Bannet covered the description of the recent strategies presented by the new CEO, which address the discussed challenge. Moreover, the current work offers additional strategies for overcoming the challenge. They are based on outside research and data taken from various peer-reviewed journals. Xesha, Iwu, Slabbert, and Nduna (2014) stressed that managers should nurture an environment of open communication and should provide consistent feedbacks to workers. Emily Atieno Odhong and Jacob Omolo (2014) in their studies supported the idea that free communication between employers and employees can be beneficial to the company. The work A review of employment relations theories and their application (2016) described the necessity of involving employees into working process in a way that they would keep them satisfied at their workplace. Solomon Markos and Sandhya Sridevi (2010) described the possible benefits from such engagement. Chengedzai Mafini and Nobukhosi Dlodlo (2014) identified motivating factors, which can lead to the improvement of the working processes.
Methodology
The information for the current term paper was collected from the sources available on the Internet. These sources include official web site of United Airlines, more specifically United’s ethics and compliance principles page, as well as articles from peer-reviewed and non-peer reviewed journals. These sources were chosen due to their availability. The major challenge connected with the collection of data was the fact that the majority of the information was outdated. In this term paper, the most up-to-date information is presented. The existing literature was thoroughly analyzed and presented in coherent and understandable manner.
Analysis of the Findings and Discussion of Leadership Practice Concepts
Description of United Airlines
United Airlines is the major American airline headquartered in Chicago, Illinois (United, 2016). The company manages comprehensive international and domestic route networks (including its significant presence in the Asia-Pacific region). United Airlines offers both on-stop and non-stop services from any location in the USA (United, 2016b). The modernization and the adjustment of cabin size made company’s vehicles the most fuel-efficient means of transportation in the United States. National (Chicago, Denver, Houston, Los Angeles, Newark, San Francisco, Washington, and Guam) and international (Tokyo) hub locations enabled the use of the most optimal routs (United, 2016b). United Airlines has one of the most rewarding loyalty programs called Mileafe Plus that offers elite travel benefits to frequent flyers, like premier access to airport services and a great variety of destinations as an award travel. In 2014, the company carried 138 million of passengers in its fleet (United, 2016b). The high quality services are provided by 84,000 of employees in different locations all over the world (United, 2016b).
United Airlines together with its “co-workers and stakeholders – customers, airports, business partners, suppliers, governments and NGO’s” accomplishes its objectives, vision and mission, and promotes its strategies (United Eco-Skies, n. d). The mission of the company is to create “an inclusive work environment, characterized by dignity and respect that empowers every employee to serve the global marketplace and contribute to company’s success” (United, n. d.). This mission is realized through the strategy of diversity and inclusion. Diversity is defined as the combination of differences (age, race, ethnicity, gender, ability, sexual orientation) which make employees unique. Leveraging on these distinct features is attributed to the inclusion strategy. Successful combination of diversity and inclusion is directed on the improvement of company’s effectiveness and productivity and finding innovative solutions. The vision of the company consists of the following elements: consideration of diversity and inclusion as business advantage by all employees (including leaders of the company), active engagement of employees into the work of the company, treatment of workers with dignity and respect and delivering high-value services to customers.
The strategy of respect towards employees is mentioned in the company’s code of ethics and conduct under the name United’ Ethics and Compliance Principles (2016). This document covers the information on the background of making ethical decisions, which are applied in the company, the ways of protecting company’s information and assets, and procedures, which assure safety and reliability (United, 2016a). Conduct of ethics is based on the principles of avoidance of conflicts, elimination of gambling, promotion of fundraising, fair competition and protection of employees rights.
The Existing Challenge
United Airlines faced hard times since its merger with Continental in 2010. The company reported economic downfall and a considerable loss of funds since 2011 when its competitors showed the slight growth. For example, in the first quarter of 2014 United Airlines reported loss of $489 million when its closet competitors Delta and American showed record results (Reed, 2014). The main cause of company’s downfall concerns the leadership and managerial style.
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The new CEO Oscar Munoz that was assigned in 2014 faced considerable issues in the working environment. The employees of United Airlines reported problems in intra-company communication, poor morale, issues with IT sector and excessive outsourcing (Reed, 2014). The additional attention should be paid to low quality of customer service (Koenig, 2015). It is reflected in the resentfulness and unwillingness of personnel to assist passengers. According to the US Department of Transportation, “United had the second-worst complaint rate in the first half of 2015” (Koenig, 2015). Cancellation of the large number of flights in 2015 led to the reduction of trust of employees, customers, and contracting parties (Koenig, 2015). In 2012, the Department of Transportation outlined that 43 % of all consumer complaints against American airlines were connected with United Airlines (Bennett, 2016)
All these issues are connected with management losing their confidence. Managers of United Airlines and emerged companies put the top priority on cutting costs instead of promoting high quality services (Bennett, 2016). This policy was reflected in the mass “layoffs, furloughs, and baggage handling and gate agent jobs were outsourced” (Bennett, 2016). Even new uniforms of employees “seemed the result of cost-cutting” (Bennett, 2016). This unhappiness caused poor performance, lowering the involvement in organizational activities, unwillingness to help consumers, and lack of desire to further personal and professional growth. The additional attention should be paid to the inability of employees to change the managerial style. They were powerless in preventing flight delays or loss of baggage. Employees were “constantly trying to deal with customers that are not happy, and they’re completely powerless” (Bennett, 2016). Even the computer meltdown in 2012 could be prevented if the managers paid attention to warnings of their employees about the existing issues in the IT system (Reed, 2014). The lack of trust and respect between employees and managers peaked during the incident on July 14, 2014, “when menacing graffiti—the words “bye bye” and two crude faces—were found scrawled in oil on the fuselage” of the airplane that was about to departure from San Francisco to Hong Kong (Bennett, 2016). Managers decided to cancel the flight and to fire the flight attendants for insubordination. This case shows the exiting sharp disrespect of employees to their work and managers.
The Current Strategies
Oscar Munoz and his team tried to improve the existing situation. The new CEO personally communicated with employees from different departments of the company and listened to their grievances. This person “understands the value of an engaged workforce” (Bennett, 2016). However, his actions were not limited by simple negotiations and listening. Employee’s complaints concerning the low quality of uniform were taken into the consideration. Moreover, the company recognized the necessity to hold the existing workforce and to eliminate layoffs by lowering the amount of delegated responsibilities. United Airlines “declared a moratorium on outsourcing airport customer service and ramp jobs until 2017” (Bennett, 2016). Much attention was paid to the improvement of the quality of customer service. United Airlines brought back free snacks to economy class and replaced the low quality coffee supplier with Italian Illy (Bennett, 2016). These changes brought the considerable satisfaction to flyers and the staff.
The Proposed Strategies
The above-mentioned issue of the lack of confidence in management can be addressed more effectively. Actions of CEO and his team should be directed on regaining trust and respect. They can be earned “through open communication, consistent feedback and delegation of responsibilities to the staff” (Xesha et al., 2014, p. 313). Managers of the company should better understand behavior of employees and interpret them into company’s actions and strategies. For example, if the majority of the workers are dissatisfied with the lowered quality of the uniform, managers should recheck the material and purchase the uniform of the higher quality in order to eliminate annoyance of workforce. Leaders and managers should demonstrate their commitment to care for the well-being of the staff.
Moreover, managers should improve their communication skills in order to explain better the necessity of some actions, like layoffs or cutting costs, to their workers. Employees should understand the final goals of company’s strategies and that the actions they take will help the company to reach these goals. The additional attention should be paid to persuasion skills. Leaders should “use the authority and systems they have in their organization to persuade and influence the staff to work efficiently and effectively” (Xesha et al., 2014, p. 314). Emily Atieno Odhong and Jacob Omolo (2014) in their study proved that information flow and free communication are the major factors in the promotion of employee relations. Their research found ways, which can be applicable in improve communication between workers and managers of United Airlines, including such steps as explaining the strategies of the company to the staff and enabling workers to give their feedbacks about the existing practices.
Increase in employees’ satisfaction from the performed job can solve the existing issues. Positive feelings and attitudes can be gained when the staff clearly understands that accomplishment of organizational goals will provide them with some valuable benefits, like bonuses, higher quality of working conditions, and career promotion. Managers should identify the desires of each employee and explain to them that these desires can be reached through high quality performance of the assigned work. Workers will become more satisfied and motivated to and, thus, will be not only empowered but also engaged at work. Consequently, this will lead to the improvement of productivity, effectiveness, and efficiency. Moreover, this will lead to decrease in tensions between United Airlines and employees because “a satisfied worker usually has good relationships with the employer” (Xesha et al., 2014, p. 315).
Additionally, attention should be paid to a higher involvement of employees into the organizational processes. As per human relations theory, the core task of managers “is to manipulate workplace relations in ways that enable employees to feel personal satisfaction with being involved” (Abbott, 2006, 188). Engaged workers are emotionally attached to their company and involved in their work with higher enthusiasm for making their company more successful (Markos, and Sridevi, 2010). Moreover, workers should be confident, that their propositions are heard by managers and are taken into account. Solomon Markos and Sandhya Sridevi (2010) noted that engaged workforce demonstrated higher retention, improved productivity and profitability, and better loyalty to customers.
Employees should have the right to express their opinions concerning the possible ways to improve the organizational performance. Managers should align employees’ efforts with mission, vision and strategies of United Airlines. They should encourage people to further personal and professional development. This can be reached through special trainings. Leaders should adopt the practice of promotion and encouragement of teamwork and collaboration inside the staff. Chengedzai Mafini and Nobukhosi Dlodlo (2014) in their research proved that job satisfaction is closely connected with the following “extrinsic motivation factors: remuneration, quality of work life, supervision and teamwork” (p.1). Motivation and satisfaction of needs of employees will also lead to the reduction of actions, which disturb the working process, as it happened in San Francisco as described above. Additional attention should be paid to fair treatment and recognition of workers irrespective of their race, gender, age or nationality.
Further Strategic Planning
It is very important for leaders to perform an accurate analysis of the possible outcome of any future strategies. They should identify, whether employees would be satisfied with the changes in the organizational performance and the reasons of workers’ possible dissatisfaction. Workers’ remarks should be taken into consideration. The additional attention should be paid to the free information exchange between managers and employees. Leaders and managers should provide the exhaust and understandable explanations to the staff about any new initiatives in order to avoid misunderstandings and rejection. United Airlines should direct its efforts at encouraging workers involvement into organizational activities and personal and professional growth, instead of simply cutting the expenses. This strategy will lead to higher employee and customer satisfaction, improvement of productivity, faster fulfilment of company’s goals and elimination of low confidence in company’s management.
Conclusion
Thus, the current work shortly describes one of the biggest American airlines. The major mission of the company is the development of the inclusive work environment characterized by dignity and respect among employees. However, ineffective managerial performance leads to formation of the challenge that may threaten the very existence of United Airlines. Lowering of confidence in management caused by cost reduction made the company outsider within the industry. This issue caused such negative consequences as low quality of provided services, dissatisfaction of employees, managerial disregard of workers’ statements concerning the existing problems in the organizational performance. The new CEO of the company Oscar Munoz and his team tried to improve the situation by adaptation the great variety of strategies. They listened and took into account employees’ grievances, lowered layoffs and improved the quality of customers’ service. The current term paper described additional strategies, which can address the stated challenge more effectively and efficiently. These strategies are based on information taken from peer-reviewed articles. It is recommended to make the following changes in the organizational performance: open communication and free information flow, providing feedbacks, better explanation of company’s initiatives, mastering of managerial persuasion skills, and greater involvement of employees into organizational processes. Clarification of the problem of United Airlines and the related issues helped to provide better understanding of the existing leadership concepts and apply them to real-life challenge.