West London College of Business & Management Sciences

Division of Business
Course: Edexcel BTEC Level 7 Extended Diploma in Strategic Year:2011
Management and Leadership
Student Name & Ref.:
Unit: 3 – Strategic Change Management Lecturer’s Name: Francis Adewusi
Learning Outcomes Covered:
1 Understand the background to organisational strategic change
2 Understand issues relating to strategic change in an organisation
3 Be able to lead stakeholders in developing a strategy for change
4 Be able to plan to implement models for ensuring ongoing change
Date Issued: 17/05/2011 Completion Date: 15/07/2011
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Assessor’s Signature:______________ Referred Date:______________

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I declare that the work I am submitting for assessment contains no sections in copied in whole or part
from any other source, unless it is explicitly identified by means of quotation mark or by means of
wholly indented paragraphs. I declare that I have also acknowledged such quotations by providing
detailed references in an approved format. I understand that unidentified and un-referenced copying
both constitutes plagiarism which is an offence.

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Date: Date:
 STRATEGIC CHANGE MANAGEMENT
CASE STUDY:
CULTURAL AND COMMITMENT CHANGE IN
LONDON BA AIRWAYS

LECTURER: FRANCIS ADEWUSI

At the beginning of 2000 London BA Airways faced some serious difficulties as financial journalists pointed
out that the airline was loosing money at the rate of £500 per minute.

The company was also confronted by a serious downturn in the market and a problem of overstaffing.
London BA Airways has always been a government owned airline with high level of bureaucratic style of
management and a poor reputation for customer service

The government was so concerned about the subsidiary funding consumed by the airline to stay competitive.

You are the newly appointed Chief Executive Officer and the first thing you did was a drastic reduction in
staff number from 60,000 to 30,000. Lucky, this was achieved by a combination of voluntary redundancy and
natural wastage.

You also dealt with unprofitable routes by abandoning those routes which are not competitive.

Additionally, surplus assets, particularly some aircrafts were sold off to bring some profit to the airline, but
such cost reduction strategies must be maintained consistently.

When you present the new profit turn around news to the Board of Directors meeting, it was recognised that
a radical change was needed in the way that the organisation operates.

Despite the achievement of cost reduction, it was thought that the airline needed to shift from being
operationally driven to being market led with customer focus strategy, because the airline was finding it
increasingly difficult to compete on the cost alone.

Moreover, most of the costs were outside the company’s control, such as aviation fuel and airport charges,
so customer service was seen as ‘the critical factor that could give a competitive edge’ to the company.

After your analysis of the company’s current business environment, you discovered some gaps between
where the expected company’s performance and the actual company’s position because the company’s staff
had become demoralised and lack appreciation and understanding of customer needs.

So you realised the need ‘to create some motivational vehicle with the employees that will raise their morale
and in turn increase the level of customer service’ (Young, 1989).

During the cost cutting period, staff training cost was affected, but now you realised that the company need
to put the staff through a refresher training to concentrate on teaching them about how to sell the airline
and its services to the customer.
This led to a campaign known as ‘Putting People First’ with various event organised to bolster the staff self-
esteem. The PPF concept suggests that if you feel good and alright about yourself, you are more likely to feel
good about dealing with other people.

The training introduced a concept of setting personal goal and of taking responsibility for achieving the goal,
through confidence building exercises. Actually it was a behaviour modification to help staff to develop new
approaches to dealing with upsets customer, coping with the stress attached to the job of airline front
service operators and developing a more positive attitude.

You also established the aspect of PPF that enable the staff to become actively involved in developing ideas
for improving customer service, creating a customer first team, using the techniques of quality circles across
all department in the organisation.
Additionally you introduce a profit sharing scheme to encourage the staff to have a stake in the company’s
future

You therefore separated the personnel roles from the Human Resource Department to become a new
department and research and development functions moved from the Marketing department to become a
department on its own.

All these changes were directed at improving customer service but it was discovered that managers at
various department needed to alter their management style if they were to support the changes and achieve
the expected result effectively, because the current and dominant style of the whole organisation was seen
to be bureaucratic and authoritative with an emphasis on the rationality and dependability on a deep rooted
system

You eventually introduced a week-long residential training program for all the managers with the Title
‘Managing People First’

Your method of planning and implementing the change was to target the middle managers first, then the
junior managers, then the people at the supervisory level in an attempt to direct the company towards a
more open, visible and dynamic approach to management.

At the directors and senior management level you set up the themes of urgency, vision, motivation, trust and
people taken responsibility but no training for this group.

In order to reinforce and maintain the change, this training ran for 5 years in which you intended to change
the culture and commitment of all the Middle managers, junior managers, supervisors and junior staff of the
West London Airline.

Various interventions was introduced to give emphasis on the benefits of collaboration to make a change
and sustain the change on the long term by breaking up the barriers of the trans-functional factors that
normally exist in most large companies.

Additionally, some of the programs were run by the staff and for the staff by learning from each other and
sharing information and successful experience.
At every training program, a significant feature was the appearance and present of yourself (the chief
executive) and other directors to endorse the commitment of top management to the program.

During the 5 years of the change management, you also launch a training program for ordinary staff known
as ‘How to be the best staff’ as a means of reinforcing the message about the importance of customer
service ethic and a pride in the company’s achievement which is celebrated yearly.

The effect of the change that you introduced was revealed in the monitoring and measurement by the
financial result and positive customer feedback which has been very impressive.

Furthermore, the feedback from the staff indicated that some changes had been achieved as one of the staff
stated that ‘In the past we are abysmal at customer service and arrogant’. . I don’t think I had ever met any
one of the company’s engineer or any flight crew member since I had been working in the ticket office’.
She added that ‘however this training about ‘Managing People First’ was a tremendous opportunity and it
gave everyone the chance to meet other managers with similar problems and to talk through the way of
motivating the people’

Other staff commented that ‘the training and education was an indication that the company is very
committed to change and support managers who were prepared to take risks as we all admitted that we
needed a change’.

Unfortunately, there are other people who are not happy with the change, especially the process and style
of change.

Some staff complained about the ‘visible management’ aspect of the change, the level of compromised
required.

One of the staff agued that ‘the company says a lot about encouraging people to consider the family and it
claimed that the company does a lot for women, but I cannot trust that message because if I go for a
maternity leave I may not be able to get back to work.

Another staff said that ‘the company talk about caring for people, but there is bullying tactics going on
successfully every time at work, most especially, the fact that we are not allowed to make a genuine mistake.
Therefore I am afraid to take a risk as I am well aware that I will not survive the management punishment for
any mistake’

A male staff junior manager commented that he had not been able to get home on time to see his family
because of work loads and different training program.

He added “I do have my reservation about the ways in which the changes were conducted even though we
needed the change but a fairly radical not a completely radical change”.
So I can say that this change gave me the experience of share humiliation rather than shared self-esteem.

So everyone is now afraid of loosing their job in case the company is any trouble, therefore the price of
commitment and loyalty is not worth taking, because caring about people and making them feel good about
themselves is pretty hypocritical.
You started to talk about the situation with the staff in a general meeting regarding most of the things
beyond the company’s control such as fuel price, inflation, the world-economic downturn and airport
charges.

All these required some radical changes in order for the company to survive and be more competitive.
So you realised that the directors and senior managers also need to change and modify their attitudes
towards the staff in order to manage the change effectively and successfully.

OB & HRM (Gowler, Legge, Clegg and Chapman 1993)

 ASSIGNMENT TASK
Strategic Change Management
3500-4000 WORDS
You have just been appointed as the Chief Executive Officer of London BA Airline and you are required to
write a report to be presented to the Board of Directors based on the case study above in which you address
the tasks below regarding strategic change management that you had just completed within the company.

Task 1(Learning outcome and criteria 1.1 and 1.2)

Identify and explain 3 different models of strategic change that can be implemented at London BA Airline in
the current global economic conditions.

Task 2 (Learning outcome and criteria 1.3)

Discuss various types of strategic intervention techniques that you used to during the planning and
implementation of the change in London BA Airline.

Task 3 (Learning outcome and criteria 2.1 and 2.2)

Examine the factors responsible as the driving forces for the need to change in the airline business
environment

Task 4 (Learning outcome and criteria 2.3)

If the company refused to change what are the resources implication for failing to respond to the forces of
change according to the airline business environment.

Task 5 (Learning outcome and criteria 3.1 and 3.2)

Identify the airline’s various stakeholders’ interest and develop a system for involving all the stakeholders in
the planning and implementation strategy for change management.

Task 6 (Learning outcome and criteria 3.3 and 3.4)

It is very obvious that any strategic change in any company is likely to meet some resistance. Evaluate the
types of resistance in the case, the reason for the resistance and explain the strategy created for reducing
the resistance to the strategic change.

Task 7 (Learning outcome and criteria 4.1 and 4.2)

Provide the evidence of one model of strategic change management and how you have used them to plan,
implement and manage the strategic change.

Task 8 (Learning outcome and criteria 4.3)

Provide the evidence of appropriate monitoring form that you designed to measure and monitor the
progress of the change management within the London BA Airline. Such monitoring form must also identify
the impact of the change that you are measuring to the company performance.