The Essay On Economic Factors' Impact On Qantas Airlines' HRM.

Write an individual Report on any of the following Scenarios within a 2500 word limit.

Background of Qantas Airlines

Human Resource is the essential assets as it is considered as one of the strengths of the organization. In order to deal with the challenges related to technology, knowledge, and altering trends in the worldwide economy require effective human resource management (Hendry, 2012). As businesses restructure to attain competitive advantage, human resources perform a major role in supporting businesses to deal with the changing environment and meet the demand for quality employees. The factors inducing the activities of HR are not static. To increase recruitment and retention and to decrease issues of employees, managers of business should repeatedly monitor external and internal factors of environment and regulate strategies of HR accordingly.

Human resource management is said to be a contemporary approach of retaining people at the workplace, it focuses on development, maintenance, acquisition, and utilization of human resource (Alami, Sohaei, Berneti, Younesi, Farnia & Mirzajani, 2015). HRM is concerned with growth in the organization. It is the concerned area for administrators of every level and offers space for the involvement of employee, growth, and performance. Various businesses today prefer human resource management because it performs an essential part in preserving team with effective personnel (Burma, 2014). Based on Scenario 2, this report will present the facts related to the impact of the environmental factor that influences the operations of the business. In order to discuss this, Qantas airline has been selected which is based in Australia. Moreover, to conclude the discussion, this report will recommend some possible steps for the business to overcome challenges.

Qantas Airways is functioning as the part of the publicly listed company. It is Australia’s national airline with main centers in Melbourne and Sydney and secondary centers in Brisbane and Perth. Using a big fleet of narrow and Airbus with the broad body and Boeing aircraft, Qantas maintains a wide international and domestic network, with a service area in Asia, Europe, New Zealand, South Africa, and America. Qantas Link offers local services (CAPA Centre for Aviation, 2018). Qantas is an establishing member of the one world alliance. Qantas is one of the oldest airlines established as the Queensland and Northern Territory Aerial Services in 1920. Initially, Qantas use to offer pleasure flights and taxi services. In the early 21^st century, its planned air routes extended all over in Europe, New Zealand, Asia, America, and Australia. The initial service between Cloncurry and Charleville started in 1922, in the subsequent years; other native paths were also included. In 1934, Britain's Imperial Airways and Qantas made Qantas Empire Airways Limited in order to run the Brisbane-Singapore foot of facility from Australia to England (Qantas, 2016). The Commonwealth government of Australia bought Qantas Airlines in 1947 and labeled the company as the flag carrier of Australia. Besides this, in the same year, Qantas Airlines started regular service on the "Kangaroo Route” to London (Qantas, 2018). Same like other airlines businesses, Qantas also experiencing increasing financial troubles, which results in cost-cutting of staff and exclusion of some routes.

Operation of HRM in Qantas

The operation of the Human Resource management in Qantas is managed under four major areas that are corporate, shared services, business segments, and development and learning. Under corporate level, the human resource management is accountable for remunerations of employees and benefits, management growth, and the airline’s industrial relations with its rivals. Under the business segment level, the team of human resource mostly cooperate with different segments of the business to confirm successful conveying of policies that will guarantee a competitive advantage. HR department of Qantas Airlines possesses key responsibilities in the business and in shared services. The department is accountable for handling records of workers, managing recruitment, and remuneration procedure and compensation of employees along with this; they present strategic plans in regards to staff traveling schemes and schedules. Lastly, in the learning and development level, the human resource management arrange different training programs for the workers to support them in delivering productive work.

Analysis of external environment is a principal study and examination of the forces of the macro environment, competitor analysis, and industry analysis, in order to attain growth of the organization (Gupta, 2013). Macro-environmental forces are scopes in the wider society, which affect the companies within it. It concentrates on the probability of the future events. The environment of the industry comprises a set of incidents that have a direct effect on the response and action of the company. It discusses the factors that affect the company’s profitability in the industry whereas competitor analysis concentrates on the anticipating the vitality of the competitor in terms of response, action, etc. The external environment is comprised of various factors such as political, legal, technology, social, economic, and environment (Indris & Primiana, 2015). One of the factors that have affected the business operations and productivity of the Qantas Airlines is Economic Factor.

Economic factors have a major influence on the way a company operates its activities and their profitability. Factors that are comprised in this are interest rates, inflation, economic growth, customer's disposable income, exchange rates, and businesses (Dcosta, 2017). These factors can be fragmented into microeconomic and macroeconomic factors. Factors of Micro-economic talks about the manner people spend their earnings. It has a major influence on the B2C organizations. Factors of Macroeconomic deal with the organization of demand in the given economy. The government of the economy makes use of interest rate control, government expenditures, and taxation policy as their key instruments (Bush, 2016).

External Environment Analysis

The economic factors majorly influence the Australian airline industry and Qantas Airlines. The 9/11 attacks left a huge influence from which the whole industry of airlines has yet not recovered. The continued recessions, variations in the prices of oil and an impending worldwide slowdown are other devastating issues that are affecting the development of the industry of airline. Airline companies have to manage with decreasing travelers, high prices of fuel, competition from the airlines with low-cost, demands of labor and rising cost of functioning and maintenance (Pestle Analysis, 2014). Besides this, the events like the disappearance of Malaysian airline have also negatively influenced the worldwide industry of airline (Goyal & Negi, 2014).   

The Human resource management of Qantas in the change management has focused on cost-cutting and reduction in the cost of labor to ensure productivity, the balance of wages and overview of flexible structures by a multipurpose and interested workforce. Labor cost-cutting in the Qantas has followed strict measures by the HRM like decreasing salaries and wages by removing costly practices (Wassener, 2014).

The HRM of Qantas airline has done various alterations to manage the varied internal and external factors. Numerous factors resulted in changes in the management of human resource like to have increased profits in the organization.

Although the two main human resource management functions are to confirm effective change management and job design and analysis, the Qantas Company has experienced different challenges in the same two areas. The human resource management in their change management emphasized on cost cutting like labor costs to upsurge the productivity, confirm sensible workers, the establishment of flexible structures, and salary. However, the company has been unsuccessful in confirming non-biased and effective change management. It is due to the recent complaint by the workers of receiving fewer wages and salaries; because of this, the labor of the company also went to strike (Mishkin, 2011).

While conducting change management, the company would have confirmed successful employee’s remuneration. On the other hand, it is very awkward to look that a trustworthy company like Qantas Airlines with an effective strategy of change management has been unsuccessful to take care of their workforce. The unresolved issues of salary have caused worker outcry and numerous scandals in the organization. The flight pilots have been objecting over meagre payments and the workers of the union have sustained to validate over inequality pay, by arguing that they are paid 25% less as compared to their equals in Victoria (Smith & Howard, 2012).

Change Management Challenges in Job Design and Analysis

According to a survey, which was conducted on 3000 employees of Qantas, the employees showed their disappointment towards the administration of the company majorly the Human resource management department (O'Sullivan, Massola & Lucas, 2014). Severe staff encounters started intimidating the organization; still, the human resource management is unwilling to bring a new model of change management like the ADKAR model. This model will work for the worker’s interest and permit the organization to concentrate on specific results of the business.

In job design and analysis of the Qantas Airlines, it is reflected that the human resource management made various mistakes in selecting the perfect candidates. The company has experienced various incidences, which reflects that the training programs provided in the organization do not provide any positive influence in the organization such as company got involved in the in-flight incident, which resulted in severe injuries to the travelers and death of around 129 travelers to false instructions (Qantas, 2010). Besides this, once the pilot of the Qantas Airlines failed in monitoring their location henceforth landed the flight on the wrong runway (Qantas, 2013). This reflects that the company is not investing much in the training of its employees, which resulted in losing the confidence and trust of the consumers as well as employees.  

Different stakeholders comprise government, customers, business partners, unions, non-governmental organizations, shareholders, employees, community, and media. They all have a significant influence on the strategy and performance of the company. The media reporting on incorrect decisions in the Qantas Airlines has affected adversely the image of the company. The issues deliberated clearly indicate that the partners of business, shareholders, and HRM have been unsuccessful in resolving the present crisis henceforth disturbing the company’s performance. Because of the negative reviews about the company, many customers are not ready to travel from Qantas Airlines, which affect the profitability. Moreover, the challenges in the business have influenced consumers and employees on grounds that their confidence in regards to the future operations of the company has lost (Schneider, 2011).

The disagreement between the pilots and Qantas reflects clearly that the Human resource management and the partners of business have failed in ensuring their contribution to the company's effective management. Moreover, the Non-governmental organizations also have been unsuccessful in resolving the conflicts between employees and Qantas. It is disappointing to see that the employees of Qantas go on strike because of issues of poor management in the organization possessed by numerous stakeholders (Bamber, 2011). The business partners, CEO, shareholders, non-governmental organizations, and HRM, have a key role in certifying that the problems in the organization are solved and the business is moving towards profitable situations. Hence, they have to conduct meetings and bring a rational plan for improvement.

Possible Recommendations

The issue concerning HRM function has instigated the company to undergo financially losses. The Qantas Airline in their strategic statements always states that it is committed to offering significant jobs with superior benefits and competitive salaries. However, they have been unsuccessful in accomplishing their promise as the reported strikes reflect a diverse story. Moreover, they claim that they offer quality training to the employees and help in the skill development. Nevertheless, the accident that takes place shows a significant gap in the strategy of training. The human resource management must reconsider their model of communication and training and make some changes in it. It is the time when the business should not focus on the change strategy that just concentrates on profit. In fact, the company should focus on the approaches that are employee oriented as it takes into account the interest of employees. With the help of an effective model of training, that will be comprised of workshop and sessions, where the workers will resolve their grievances and will get a solution for their problems.

Beside this, Qantas should concentrate on effective HRM communication that will contribute towards successful learning, safety, teamwork, productivity, and innovation. In addition, the Human resource department must invest in their pilots and confirm that they receive perfect training. In relation to the communication model of human resource, it is essential to ensure that all the employees are treated equally and informed about the changes that take place in the organization. This step will support in discussing principal problems with the employees that are disturbing the company’s operations. Once the communication between employees and management of the company will be clear, there will be no issues such as a strike.

The human resource management must be apparent in its strategy. It means that the strategic and operational agenda of the company must be communicated openly with the employees and ensure acceptance. This will help in fulfilling the needs of the employees and eliminating the chances of operational challenges. Moreover, its mission must be shared with the shareholders in order to ensure that they are walking on the precise oath towards enhancing the company’s image.

Today's Human Resource models rely on the fact that employees do not leave their problems at home at the time they are going for their job. For the business to become successful, it must concentrate on the worker’s need whether professional or personal. It will inspire the workers to effectively work on their operations. In that case, the number of accidents and problems related to remuneration will be less within the organization.

Conclusion

From the above analysis, it can be concluded that every department within the organization needs to take reasonable and profitable decisions in order to operate the business for a longer period. If the decision affects the important assets of the organization it means the decision will no longer deliver positive results to the business. Similar to other different departments within the organization, HRM has numerous functions. The responsibility of human resource management is to ensure successful implementation of change management within the organization and the right candidates are employed at a different post. However, the HR department of Qantas Airlines failed due to some economic factors such as changing fuel prices, competitive low-cost airlines, etc. in managing its workforce by adopting the cost-cutting methods in terms of remunerations and salaries. Due to this step workforce of the organization went on strike. In order to avoid such type of incidences in the coming future, it is effectual for the company to changes its model of communication. Moreover, they remain transparent in their business operations and involve stakeholders to confirm they are moving towards the correct direction. This will support organization in avoiding strikes by dissatisfied employees. 

References

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O'Sullivan, M., Massola, J., & Lucas, C. (2014). Qantas staff fear 3000 jobs may go as airline cuts costs. Retrieved from https://www.smh.com.au/national/qantas-staff-fear-3000-jobs-may-go-as-airline-cuts-costs-20140221-337r9.html

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Schneider, K. (2011). Qantas to cut flights, staff due to rising fuel costs. Retrieved from https://www.news.com.au/travel/travel-updates/qantas-to-cut-flights-staff-on-rising-fuel-costs/news-story/be0431049d2269736b0bf0953c2e6d82

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Wassener, B. (2014). Qantas Announces Cost-Cutting Measures. Retrieved from https://www.nytimes.com/2014/02/28/business/international/qantas-airways-announces-cost-cutting-measures.html