Solved Case
7
ORGANISATIONAL COMMUNICATION: A CASE STUDY By Thomas A. Booth Introduction The organization chosen for this case study on organizational communication is a small political activists’ organization for which the writer of this paper once volunteered. The organizational communication problem encountered was that the volunteer supervisor did not have projects ready during the scheduled volunteer time slots, and despite a thorough interview process to determine skill-need matches and prior verbal scheduling of volunteer times, this problem persisted for months. With the lack of a communication plan, the consequence was a diminished enthusiasm for the cause and growing level of frustration causing this writer to cease volunteering for the organization de spite having a true belief in its mission. Knowledge The major problem in this case study was that the volunteer supervisor was engaged in so many projects that she did not invest the time to communicate projects to delegate to the volunteer. Most volunteers for this organization worked on updating databases, solicitations, and mailings. This writer’s volunteer emphasis was on writing and doing special projects. Therefore, it was only through horizontal top down communication from this particular supervisor that these special projects could be delegated. Because the volunteer work was so different than the other volunteers, there was no real value to vertical communication. In Organizational Communication, Kathryn Baker, contends many communication theories are not so relevant in today’s service world as well as today’s technologically globalized world. (Baker, 2002) While many organizational communication principals would apply, this organization operates locally and nationally, and falls into Baker’s description of ‘the service’ organization. What the supervisor could have done was implement time saving communication systems, such as writing memos, e-mails, and other written communication methods to delegate tasks to be done within that specific time frame. If this was done, the task(s) often were so simple that they did not take all the volunteer time, and she was left scrambling to find ano ther volunteer project. Sensitivity The person that appears to be most responsible for the problem was the v olunteer supervisor. However, she was being asked to do more than supervise vo lunteers; she was an assistant to the Marketing/Communication Director and was involved in a very extensive public awareness campaign which required a lot of hands on work on her part.
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Transcript of Solved Case
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 17
ORGANISATIONAL COMMUNICATION A
CASE
STUDY
By Thomas A BoothIntroduction
The organization chosen for this case study on organizational communication is a small political activistsrsquo organization for which the writer of this paper once volunteered Theorganizational communication problem encountered was that the volunteer supervisor didnot have projects ready during the scheduled volunteer time slots and despite a thoroughinterview process to determine skill-need matches and prior verbal scheduling of volunteer times this problem persisted for months With the lack of a communication plan the consequence was a diminished enthusiasm for the cause and growing level of frustration causing this writer to cease volunteering for the organization despite having a
true belief in its mission
Knowledge
The major problem in this case study was that the volunteer supervisor was engaged in somany projects that she did not invest the time to communicate projects to delegate to thevolunteer Most volunteers for this organization worked on updating databasessolicitations and mailings This writerrsquos volunteer emphasis was on writing and doingspecial projects Therefore it was only through horizontal top down communication fromthis particular supervisor that these special projects could be delegated Because the
volunteer work was so different than the other volunteers there was no real value tovertical communication In Organizational Communication Kathryn Baker contendsmany communication theories are not so relevant in todayrsquos service world as well astodayrsquos technologically globalized world (Baker 2002) While many organizationalcommunication principals would apply this organization operates locally and nationallyand falls into Bakerrsquos description of lsquothe servicersquo organization What the supervisor couldhave done was implement time saving communication systems such as writing memose-mails and other written communication methods to delegate tasks to be done withinthat specific time frame If this was done the task(s) often were so simple that they didnot take all the volunteer time and she was left scrambling to find another volunteer project
Sensitivity
The person that appears to be most responsible for the problem was the volunteer supervisor However she was being asked to do more than supervise volunteers she wasan assistant to the MarketingCommunication Director and was involved in a veryextensive public awareness campaign which required a lot of hands on work on her part
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 27
Additionally the communications department seemed at odds with other parts of theorganization and other departmental managers often were putting demands on thissupervisor as well Her lack of time resulted in her being a poor communicator and eventhough this volunteers skills could have helped ease her work load she couldnrsquot slowdown enough to implement a concrete communications strategy
Skills
The writer of this case study looks to Carter McNamararsquos Basics in InternalOrganizational Communications (McNamara 2007) who suggests a communication planThis plan can involve verbal or written communications that would cover how toeffectively manage a nontraditional volunteer As cited earlier this supervisor dealtmostly with people with specific tasks not project skills and therefore did not need aone-on-one short session with them during their volunteer time They also had the valueof communication with one another to help them out when they ran into a specific problem
ValuesThe value of the frustrated volunteer was the desire to create some quality work and beincluded within a network of volunteers for this cause The value of the supervisor was toimpress her managers The values of the volunteer and supervisor were not mutual If thegoals had been mutual it might have created an environment that would have made itmore conducive for the supervisor to take the time to communicate special volunteer projects of value Itrsquos rather ironic that during the initial volunteer meeting how thewriter of this paper could assist the cause was a major point of discussion
This paper does acknowledge that as with many political activistsrsquo organizations thingshappen on the spot and there is a great deal of crisis management and not a lot of pre- planning Additionally the communication focus for this organization was external notinternal This organizational culture spilled over into the communication methods of thiswriterrsquos volunteer work and was a cause of a great deal of frustration
Alternative Solutions
The volunteer supervisor should delegate another volunteer to hand out the writteninstructions for the volunteer time block and because of the nature of the work keep thevolunteer time appointment in her appointment book not just on the general volunteer
log This would have eased the frustration and allowed the writer of this paper to feel likea valuable contribution was being made to this particular cause
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 37
Proposed Solutions
McNamararsquos communication plan could be written The written communication vehiclescould include hand written memos or emails This former volunteer believes that thesupervisor did not see the benefit of investing the necessary time to guide mentor or
retain the volunteer A communication vehicle needed to be defined tasks assigned andthen executed with a communication vehicle defined for feedback
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 47
HR Problems at Jet Airways Coping with Turbulent Times in
the Indian Aviation Industry
Abstract
The case is about the retrenchment drama that unfolded in one of Indias leading aviationcompanies Jet Airways (India) Limited (Jet) in late 2008 After showing the door tomore than 1000 employees in a bid to streamline its operations Jet was faced withimmense criticism and opposition by various organizations and political parties
Jets chairman Naresh Goyal (Goyal) reinstated the employees a day later saying that hewas not aware of these sackings The Indian aviation industry was going through a tough phase and experts felt that it was in the interest of the company to retrench employees toremain competitive
Experts largely felt that Goyal had capitulated under pressure from external parties whileothers felt that all may not be well with the organizational communication mechanisms atJet
Issues
raquo Analyze the HR problems faced by Jet Airways in 2008
raquo Discuss various concepts related to hiring firing and compensation management
raquo Understand the rationale behind Jets decision to lay-off employees and the reasons behind its later decision to take back the sacked employees
raquo Understand the importance of communication in an organization and analyze whether there were any loopholes in Jets organizational communication network
raquo Understand the rationale behind the pay cuts initiated at the company
raquo Understand how environmental variables could affect a companys HR policies
We have created high morale for our people Our employees believe in the company
They believe its their company Theres a feeling among employees that if the company
makes money its their money and if the company loses money thats their loss 1
Naresh Goyal Chairman Jet Airways (India) Limited in July 2007
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 57
While the mishandling of the Jet Airways sacking and reinstatement of 1900 employeeswas an HR and PR disaster the larger implications of what happened are also worth
considering It is not just that the chairman of Indias most successful airline became the
butt of jokes it is also a question of what he knew when he knew it and who did thebungling 2
- Anjuli Bargava Columnist Business Standard October 2008
The sackings were completely illegal There was no notice nor was governments
permission taken to sack 800 employees Perhaps they realized their folly and decided to
take these employees back The matter would have landed in the court otherwise 3
- Anand Pujari Labour lawyer SI Joshi amp Co4 in October 2008
-
Introduction
In October 2008 Jet Airways (India) Limited (Jet) one of Indias leading domesticairlines decided to lay off more than 1000 employees to streamline its operations5 Theretrenchment was the second phase of its trimming operations
The first phase which took place a day earlier saw the airline showing the door to 850cabin crew members6 The second phase of retrenchment included employees from alloperations - cabin crew pilots ground staff airport services staff and employees from
management departments
The sudden decision not only took the employees by surprise but also caused alarm in theIndian aviation sector Amidst great furor and opposition by various organizations and political parties Naresh Goyal (Goyal) chairman of Jet reinstated the employees a daylater amidst great emotional drama He was quoted as saying he had been appalled by theretrenchments of his employees which he claimed he had come to know only throughmedia reports
He added that he would not be able to live as long as he lives with the tough decision
his management had taken and clarified that he was taking back the employees as theywere family to him and as head of the family he would take care of them7
A month later - in November 2008 Jet announced that it would consider serious salarycuts for its staff to handle the aviation crisis
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 67
While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 27
Additionally the communications department seemed at odds with other parts of theorganization and other departmental managers often were putting demands on thissupervisor as well Her lack of time resulted in her being a poor communicator and eventhough this volunteers skills could have helped ease her work load she couldnrsquot slowdown enough to implement a concrete communications strategy
Skills
The writer of this case study looks to Carter McNamararsquos Basics in InternalOrganizational Communications (McNamara 2007) who suggests a communication planThis plan can involve verbal or written communications that would cover how toeffectively manage a nontraditional volunteer As cited earlier this supervisor dealtmostly with people with specific tasks not project skills and therefore did not need aone-on-one short session with them during their volunteer time They also had the valueof communication with one another to help them out when they ran into a specific problem
ValuesThe value of the frustrated volunteer was the desire to create some quality work and beincluded within a network of volunteers for this cause The value of the supervisor was toimpress her managers The values of the volunteer and supervisor were not mutual If thegoals had been mutual it might have created an environment that would have made itmore conducive for the supervisor to take the time to communicate special volunteer projects of value Itrsquos rather ironic that during the initial volunteer meeting how thewriter of this paper could assist the cause was a major point of discussion
This paper does acknowledge that as with many political activistsrsquo organizations thingshappen on the spot and there is a great deal of crisis management and not a lot of pre- planning Additionally the communication focus for this organization was external notinternal This organizational culture spilled over into the communication methods of thiswriterrsquos volunteer work and was a cause of a great deal of frustration
Alternative Solutions
The volunteer supervisor should delegate another volunteer to hand out the writteninstructions for the volunteer time block and because of the nature of the work keep thevolunteer time appointment in her appointment book not just on the general volunteer
log This would have eased the frustration and allowed the writer of this paper to feel likea valuable contribution was being made to this particular cause
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 37
Proposed Solutions
McNamararsquos communication plan could be written The written communication vehiclescould include hand written memos or emails This former volunteer believes that thesupervisor did not see the benefit of investing the necessary time to guide mentor or
retain the volunteer A communication vehicle needed to be defined tasks assigned andthen executed with a communication vehicle defined for feedback
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 47
HR Problems at Jet Airways Coping with Turbulent Times in
the Indian Aviation Industry
Abstract
The case is about the retrenchment drama that unfolded in one of Indias leading aviationcompanies Jet Airways (India) Limited (Jet) in late 2008 After showing the door tomore than 1000 employees in a bid to streamline its operations Jet was faced withimmense criticism and opposition by various organizations and political parties
Jets chairman Naresh Goyal (Goyal) reinstated the employees a day later saying that hewas not aware of these sackings The Indian aviation industry was going through a tough phase and experts felt that it was in the interest of the company to retrench employees toremain competitive
Experts largely felt that Goyal had capitulated under pressure from external parties whileothers felt that all may not be well with the organizational communication mechanisms atJet
Issues
raquo Analyze the HR problems faced by Jet Airways in 2008
raquo Discuss various concepts related to hiring firing and compensation management
raquo Understand the rationale behind Jets decision to lay-off employees and the reasons behind its later decision to take back the sacked employees
raquo Understand the importance of communication in an organization and analyze whether there were any loopholes in Jets organizational communication network
raquo Understand the rationale behind the pay cuts initiated at the company
raquo Understand how environmental variables could affect a companys HR policies
We have created high morale for our people Our employees believe in the company
They believe its their company Theres a feeling among employees that if the company
makes money its their money and if the company loses money thats their loss 1
Naresh Goyal Chairman Jet Airways (India) Limited in July 2007
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 57
While the mishandling of the Jet Airways sacking and reinstatement of 1900 employeeswas an HR and PR disaster the larger implications of what happened are also worth
considering It is not just that the chairman of Indias most successful airline became the
butt of jokes it is also a question of what he knew when he knew it and who did thebungling 2
- Anjuli Bargava Columnist Business Standard October 2008
The sackings were completely illegal There was no notice nor was governments
permission taken to sack 800 employees Perhaps they realized their folly and decided to
take these employees back The matter would have landed in the court otherwise 3
- Anand Pujari Labour lawyer SI Joshi amp Co4 in October 2008
-
Introduction
In October 2008 Jet Airways (India) Limited (Jet) one of Indias leading domesticairlines decided to lay off more than 1000 employees to streamline its operations5 Theretrenchment was the second phase of its trimming operations
The first phase which took place a day earlier saw the airline showing the door to 850cabin crew members6 The second phase of retrenchment included employees from alloperations - cabin crew pilots ground staff airport services staff and employees from
management departments
The sudden decision not only took the employees by surprise but also caused alarm in theIndian aviation sector Amidst great furor and opposition by various organizations and political parties Naresh Goyal (Goyal) chairman of Jet reinstated the employees a daylater amidst great emotional drama He was quoted as saying he had been appalled by theretrenchments of his employees which he claimed he had come to know only throughmedia reports
He added that he would not be able to live as long as he lives with the tough decision
his management had taken and clarified that he was taking back the employees as theywere family to him and as head of the family he would take care of them7
A month later - in November 2008 Jet announced that it would consider serious salarycuts for its staff to handle the aviation crisis
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 67
While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 37
Proposed Solutions
McNamararsquos communication plan could be written The written communication vehiclescould include hand written memos or emails This former volunteer believes that thesupervisor did not see the benefit of investing the necessary time to guide mentor or
retain the volunteer A communication vehicle needed to be defined tasks assigned andthen executed with a communication vehicle defined for feedback
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 47
HR Problems at Jet Airways Coping with Turbulent Times in
the Indian Aviation Industry
Abstract
The case is about the retrenchment drama that unfolded in one of Indias leading aviationcompanies Jet Airways (India) Limited (Jet) in late 2008 After showing the door tomore than 1000 employees in a bid to streamline its operations Jet was faced withimmense criticism and opposition by various organizations and political parties
Jets chairman Naresh Goyal (Goyal) reinstated the employees a day later saying that hewas not aware of these sackings The Indian aviation industry was going through a tough phase and experts felt that it was in the interest of the company to retrench employees toremain competitive
Experts largely felt that Goyal had capitulated under pressure from external parties whileothers felt that all may not be well with the organizational communication mechanisms atJet
Issues
raquo Analyze the HR problems faced by Jet Airways in 2008
raquo Discuss various concepts related to hiring firing and compensation management
raquo Understand the rationale behind Jets decision to lay-off employees and the reasons behind its later decision to take back the sacked employees
raquo Understand the importance of communication in an organization and analyze whether there were any loopholes in Jets organizational communication network
raquo Understand the rationale behind the pay cuts initiated at the company
raquo Understand how environmental variables could affect a companys HR policies
We have created high morale for our people Our employees believe in the company
They believe its their company Theres a feeling among employees that if the company
makes money its their money and if the company loses money thats their loss 1
Naresh Goyal Chairman Jet Airways (India) Limited in July 2007
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 57
While the mishandling of the Jet Airways sacking and reinstatement of 1900 employeeswas an HR and PR disaster the larger implications of what happened are also worth
considering It is not just that the chairman of Indias most successful airline became the
butt of jokes it is also a question of what he knew when he knew it and who did thebungling 2
- Anjuli Bargava Columnist Business Standard October 2008
The sackings were completely illegal There was no notice nor was governments
permission taken to sack 800 employees Perhaps they realized their folly and decided to
take these employees back The matter would have landed in the court otherwise 3
- Anand Pujari Labour lawyer SI Joshi amp Co4 in October 2008
-
Introduction
In October 2008 Jet Airways (India) Limited (Jet) one of Indias leading domesticairlines decided to lay off more than 1000 employees to streamline its operations5 Theretrenchment was the second phase of its trimming operations
The first phase which took place a day earlier saw the airline showing the door to 850cabin crew members6 The second phase of retrenchment included employees from alloperations - cabin crew pilots ground staff airport services staff and employees from
management departments
The sudden decision not only took the employees by surprise but also caused alarm in theIndian aviation sector Amidst great furor and opposition by various organizations and political parties Naresh Goyal (Goyal) chairman of Jet reinstated the employees a daylater amidst great emotional drama He was quoted as saying he had been appalled by theretrenchments of his employees which he claimed he had come to know only throughmedia reports
He added that he would not be able to live as long as he lives with the tough decision
his management had taken and clarified that he was taking back the employees as theywere family to him and as head of the family he would take care of them7
A month later - in November 2008 Jet announced that it would consider serious salarycuts for its staff to handle the aviation crisis
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 67
While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 47
HR Problems at Jet Airways Coping with Turbulent Times in
the Indian Aviation Industry
Abstract
The case is about the retrenchment drama that unfolded in one of Indias leading aviationcompanies Jet Airways (India) Limited (Jet) in late 2008 After showing the door tomore than 1000 employees in a bid to streamline its operations Jet was faced withimmense criticism and opposition by various organizations and political parties
Jets chairman Naresh Goyal (Goyal) reinstated the employees a day later saying that hewas not aware of these sackings The Indian aviation industry was going through a tough phase and experts felt that it was in the interest of the company to retrench employees toremain competitive
Experts largely felt that Goyal had capitulated under pressure from external parties whileothers felt that all may not be well with the organizational communication mechanisms atJet
Issues
raquo Analyze the HR problems faced by Jet Airways in 2008
raquo Discuss various concepts related to hiring firing and compensation management
raquo Understand the rationale behind Jets decision to lay-off employees and the reasons behind its later decision to take back the sacked employees
raquo Understand the importance of communication in an organization and analyze whether there were any loopholes in Jets organizational communication network
raquo Understand the rationale behind the pay cuts initiated at the company
raquo Understand how environmental variables could affect a companys HR policies
We have created high morale for our people Our employees believe in the company
They believe its their company Theres a feeling among employees that if the company
makes money its their money and if the company loses money thats their loss 1
Naresh Goyal Chairman Jet Airways (India) Limited in July 2007
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 57
While the mishandling of the Jet Airways sacking and reinstatement of 1900 employeeswas an HR and PR disaster the larger implications of what happened are also worth
considering It is not just that the chairman of Indias most successful airline became the
butt of jokes it is also a question of what he knew when he knew it and who did thebungling 2
- Anjuli Bargava Columnist Business Standard October 2008
The sackings were completely illegal There was no notice nor was governments
permission taken to sack 800 employees Perhaps they realized their folly and decided to
take these employees back The matter would have landed in the court otherwise 3
- Anand Pujari Labour lawyer SI Joshi amp Co4 in October 2008
-
Introduction
In October 2008 Jet Airways (India) Limited (Jet) one of Indias leading domesticairlines decided to lay off more than 1000 employees to streamline its operations5 Theretrenchment was the second phase of its trimming operations
The first phase which took place a day earlier saw the airline showing the door to 850cabin crew members6 The second phase of retrenchment included employees from alloperations - cabin crew pilots ground staff airport services staff and employees from
management departments
The sudden decision not only took the employees by surprise but also caused alarm in theIndian aviation sector Amidst great furor and opposition by various organizations and political parties Naresh Goyal (Goyal) chairman of Jet reinstated the employees a daylater amidst great emotional drama He was quoted as saying he had been appalled by theretrenchments of his employees which he claimed he had come to know only throughmedia reports
He added that he would not be able to live as long as he lives with the tough decision
his management had taken and clarified that he was taking back the employees as theywere family to him and as head of the family he would take care of them7
A month later - in November 2008 Jet announced that it would consider serious salarycuts for its staff to handle the aviation crisis
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 67
While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
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Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
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While the mishandling of the Jet Airways sacking and reinstatement of 1900 employeeswas an HR and PR disaster the larger implications of what happened are also worth
considering It is not just that the chairman of Indias most successful airline became the
butt of jokes it is also a question of what he knew when he knew it and who did thebungling 2
- Anjuli Bargava Columnist Business Standard October 2008
The sackings were completely illegal There was no notice nor was governments
permission taken to sack 800 employees Perhaps they realized their folly and decided to
take these employees back The matter would have landed in the court otherwise 3
- Anand Pujari Labour lawyer SI Joshi amp Co4 in October 2008
-
Introduction
In October 2008 Jet Airways (India) Limited (Jet) one of Indias leading domesticairlines decided to lay off more than 1000 employees to streamline its operations5 Theretrenchment was the second phase of its trimming operations
The first phase which took place a day earlier saw the airline showing the door to 850cabin crew members6 The second phase of retrenchment included employees from alloperations - cabin crew pilots ground staff airport services staff and employees from
management departments
The sudden decision not only took the employees by surprise but also caused alarm in theIndian aviation sector Amidst great furor and opposition by various organizations and political parties Naresh Goyal (Goyal) chairman of Jet reinstated the employees a daylater amidst great emotional drama He was quoted as saying he had been appalled by theretrenchments of his employees which he claimed he had come to know only throughmedia reports
He added that he would not be able to live as long as he lives with the tough decision
his management had taken and clarified that he was taking back the employees as theywere family to him and as head of the family he would take care of them7
A month later - in November 2008 Jet announced that it would consider serious salarycuts for its staff to handle the aviation crisis
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While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 67
While many industry analysts were surprised by the turn of events that had led to thereinstatement of the sacked employees they opined that Jet had been forced to takedrastic decisions such as laying off employees or initiating pay cuts because of theturbulent phase through which the aviation industry was passing
In September 2008 the International Air Transport Association8
(IATA) had predictedthat world over the aviation industry would lose about US$52 billion based on anaverage jet fuel price of US$140 The rise in fuel prices had pushed the fuel bills of theaviation industry to US$186 billion by the end of the year 20089
Excerpts
Background Note
Jet with its headquarters in Mumbai India began as an air taxi operator in April 1992and started its commercial operations a year later in 1993 It operated with just 24 flights
across 12 destinations initially but showed exceptional growth with more than 357 dailyflights to about 62 domestic and international destinations in 2008 It was first listed inthe National Stock Exchange (NSE) in the year 2005 As of June 2008 it operated over 370 daily flights to about 68 destinations both in India and abroad including SanFrancisco New YorkToronto Singapore Brussels London (Heathrow) Hong KongShanghai Kuala Lumpur Colombo Bangkok Kathmandu Dhaka Kuwait BahrainMuscat Abu Dhabi Dubai etc
HR Issues Management and Decision Making at Jet
According to the company Jet paid the utmost importance to the composition of itssenior management and its human resources with emphasis on teamwork as a key successfactor Being in the service-based industry Jet gave priority to high quality professionalservice to its customers
The Retrenchment Drama Unfolds
The retrenchment drama unfolded on October 16 2008 when Jet announced that it
would lay off nearly 1100 of its staff a day after it had already laid off around 800 of itscabin crew members
The second phase of 1100 employees included those from departments like managementflight attendants and the cockpit crew
The company decided to lay off these employees with no prior notice but offered them amonths remuneration
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
832019 Solved Case
httpslidepdfcomreaderfullsolved-case 77
Reasons for Retrenchment
The growing challenges in the Indian aviation industry were the main reason for the layoffs at Jet according to the company and other industry analysts
Turbulent Times for the Indian Aviation Industry
The Indian aviation industry was one of the fastest growing aviation industries in theworld The Air Corporations (Transfer of Undertakings and Repeal) Act 1994 opened theIndian skies up to private operators Apart from government-owned airlines the aviationindustry was flooded with private operators and low cost carriers
The Debate Leading to the Reinstatement of Employees
Jet received criticism from several quarters for retrenching its employees Many of itsemployees protested against the decision to oust them without prior notice Most of them
had paid substantial amounts to receive training at major Aviation Training institutes
Massive Salary Cuts Follow
In the last week of November 2008 Jet decided on a 20 cut in the salaries of its pilotsengineers and some other staff The company planned a 5 percent to 10 percent cut in thesalary of top officials who drew a salary above Rs 75000
Exhibits
Exhibit I A Snap-shot of Kingfisher AirlinesExhibit II (a) Financial Snapshot of Jet Airways for the year 2007-2008Exhibit II (b) Comparison of Financials of Jet Airways in the quarters from June 2008-June 2007Exhibit III Growth in Passenger Traffic in the Aviation Sector
