Impact of Cultural Differences, Internal and Environmental Factors at Airbus Essay
Impact of Cultural Differences, Internal and Environmental Factors at Airbus
Employees are affected by a number of internal and external forces that when combined produce given behaviours and attitudes. In this paper, I will consider the key factors affecting individual and groups’ behaviour and their corresponding relationship to the personal and organisational performance. The scenario, Airbus’ manufacturing plant in Toulouse, is dominated by tensions amongst groups of workers with different cultural background. The impact of those cultural challenges, the pressures of delivering the A380s in time and the demands from the external environment will be some of the factors that will be considered in the analysis below. In order to understand the multiple forces and the organisational change processes undertaken by Airbus, two influential frameworks for change have been examined in this paper. The model introduced by Burke and Litwin (2002), and the approach presented by Kotter (1995), based upon the authors’ research into corporate change.
1. Individual factors Attitudes and personal behavioural codes consist of an organisation of feelings, thoughts and cognitions in a defined situation. Airbus’ employees appear not to be motivated to fulfil the group’s objectives as “there are too many tensions and too much suspicion” (Hollinger & Wiesmann, 2008), as reported by an official of the French union. As work motivation and job satisfaction are closely linked with the overall performance of workers, it is important to identify factors leading to job dissatisfaction at Airbus. The arrival of two thousand electricians to resolve wiring problem has impacted negatively on the Toulouse plant resulting in overcrowding, sudden change in industrial processes and dispositions against other individuals with a number of differences. The temperament and individual emotions are difficult to understand for people with diverse cultural upbringing. There are also differences in pay which are perceived as unequal and negative, particularly for those employees not on secondment. In summary, individuals are often resistant to change which involve loss and uncertainty. One of the most common reasons for human resistance is the focus on their own best interests instead of the organisation’s (Kotter & Schlesinger, 1979).
2. Work group factors Although team diversity can potentially create a positive organisational synergy, the same can also create unique challenges resulting from social integration, tension, and conflict (Jehn, Northcraft & Neale, 1999). In the case of Airbus, it appears there are two leaders from different groups and cultures bringing different attitudes and dispositions to the groups, giving birth to nationalistic tensions between French and German employees. Management rivalries become a detrimental model for working groups (Drucker, 1986). Team engagement and social integration are then increasingly difficult as the majority of Germans are temporary employees coming from outside the company. Furthermore, the organisational culture of Airbus is affected by the lack of trust and transparency from management. In this situation, fear and suspicion emerge and French groups start to perceive the growing influence of German managers as unfair and unequal. All these factors create frustrations amongst the teams and individuals thus producing uncertainty which affects the plant performance and the company’s ability to meet delivery schedules.
3. Organisational factors The organisational structure and culture as well as its policies and systems, together with the set goals influence employee and team behaviours. With this in mind, it is important to consider that Airbus and its parent company EADS were merged in the name of European unity and intended to be more competitive in the aerospace industry. With the internal pressures of company restructuring consisting of the A380 delivery targets and current production delays, Airbus workers become dominated by uncertainties and tension between different working groups. As Kotter and Schlesinger (1979) highlighted in their study, human resistance often emerges during organisational change efforts. Power 8, Airbus’ restructuring programme which consisted of undertaking a number of changes including job cuts, factory sales, new areas for components sourcing and leadership turnover, produces social tensions and management rivalries inside the organisation.
4. External environment An analysis of the national and global context of Airbus is crucial to understanding the influence of external forces producing both opportunities and threats to the organisation. Amongst those factors, pressures from politics, unions and public opinion are dominant forces in the case of Airbus. Competition in the global market, mainly between Airbus and Boeing, is also intense. Each company is under pressure and suffering from severe delays in delivery targets. State shareholders naturally makes the company subject to political interests and government rules and regulations affect Airbus’ operations management and its decision making process. Questions are raised about the compatibility of the company’s economic goals and its commitment to more political and social objectives. The leadership team need to engage and negotiate with trade unions, political parties and public movements to ensure success in the company’s outcomes. Thus pressure from different groups makes it problematic for Airbus to align the internal organisation with the external forces.
5. Change dynamics Burke and Litwin (1992) present a causal model that helps to define and establish a cause-and-effect relationship between a number of organizational elements which are key to organizational change. The linkage between these is the key to effective change. They identify the external environment as the dominant factor driving change in organisations which affects their mission, culture, leadership and strategy. The company’s structure, systems, management practices, and climate are in turn linked to those dimensions and impact the overall performance. In the case of Airbus, the merger between Airbus and EADS and the strong competition of Boeing in the global aerospace market are the most dominant external forces. Those trigger a series of further changes in the company, which together, affects the motivation level of employees and work groups.
6. Change management issues Kotter (1995) in his corporate change analysis provides a number of lessons learnt which help understand the complex issues outlined in the Airbus case study. One of the issues in Airbus’ strategy is the lack of cooperation from individuals and teams. Morale and motivation are important factors to control and influence, especially in the first phase of the transformational process. Additionally, the role of leadership in terms of establishing a vision, communicating it and being the example of the new behaviours is also crucial. Airbus’ past rivalry between the former French and German management sides have been detrimental for the change effort. As Drucker (1986) points out “managers’ inability to change their attitudes and behaviour as rapidly as their organizations require” (Drucker, 1986) is a barrier for organisational growth. It is important to consider that changes take a long time to naturalise into the company culture. The benefit of Airbus’ restructuring programme, Power 8, cannot be judged before its time. The change in habits and rules destabilise people and the company’s exposure to public opinion and political interest increases the process of change in its complexity.
Conclusion Today’s workforce is becoming more diverse in terms of age, gender and ethnicity. Managers are duty bound to develop skills to influence the relationship between team diversity and team outcomes by analysing the current situation and possible issues to be avoided. Changes are generally needed; in the instance of Airbus, they are implementing a large scale change affecting the organisational leadership, culture, structure and operations. Consequently, people affected by change experience some level of discomfort but leaders can increase their level of success by selecting the right strategy and approach to use with workgroups and individuals. Effective change management strategy should be consistent with the company’s management behaviour and the overall company’s culture, ensuring alignment of people internally and externally in the public environment. The change process in every organisation requires a length of time and readiness for individual change which proceed through stages which should not be overlooked for a successful outcome.
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 19 October 2016
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