The reports aim to apply four organizational management structures of bureaucracy, contingency, political and cultural to analyze Qantas as a corporation. Qantas is known a complex organization with open structure closer to outside environment. It uncovers the organizational structure and change from a widespread tall to fashionable flat structure. It identifies the set of the formal rules and techniques followed by the organization and depict a wider span of the control with low level of integration. The structural tension of Qantas focus on integration side first and then differentiation. Also, Qantas has a written code of ethics, and breaches of this code of ethics is very rare. It classifies the organization inside the engineering quadrant consistent with Charles perrow’s category of the technology version.
Qantas has recently comforted with hundreds of troubles with unions and workers members resulting in the formation of coalition within organization hence indicating how pluralistic the organization is. The report also regarded measures taken by the management to evolve the culture of organization. The organization faces great challenges in the future relate to increase in the competition in term of local and international brand. The report ends up with the conclusion summarizing the key points of the finding and best fit structure for Qantas.
Qantas is the largest and oldest airline of Australia. It founded in 1920 in Queensland and was initially known as Queensland and northen territory Aerial Services Limited. It currently operates a fleet of more than 145 aircrafts and operates to all majore cities and airports in Australia and around the world. It was owned and operated by the government until privatization in 1995. Since then it has made significant changes to the structure and cultre of theorganization and also setup a low cost carrier with the name of Jetstar in order to compete in the local domestic market. Qantas group is divided into four major divisions of Qantas Domestic, Qantas International, Jetstar and Qantas Frequent Flyer. It aims to boost it international operation by targeting Asian region and as a result it had concluded a deal with Emirates, aims to increase the presence of Qantas in the Asian Market.
Organizational structure and complexity
The organizational structure for the Qantas was very complex, as it has employees over 25,000, with over 1000 leaders and supervisors, and more than 400 senior managers (Workplace gender equity agency 2016, p.1; Qantas Annual Review 2017, p.14). According to the information provided on the Qantas official website, there are 12 members in the group management committee (Qantas Board of Directors, 2018). And based on this information, the organizational structure has been generated and it is shown in the Figure 1.
However, as the information provided on the official website is only about the board of directors and executive leadership team. Therefore this organizational chart is not precise and from the second layer below is all assumptions of general managers and staff.
Figure 1. Organizational chart of Qantas
According to Robbins ; Barnwell (2006, p.105), the organization complexity refers to “the degree of differentiation that exists within an organization”, and it consists two aspects, horizontal differentiation and vertical differentiation. The horizontal differentiation refers to “the number of different occupational, task and administrative groupings within the organization”, and vertical differentiation considers “the number of layers of management in the organization” (Robbins ; Barnwell 2006, p.105).
It was pointed out in the week 3 lecture that horizontal differentiation consists three different types of structures, and they are functional structure, divisional structure and matrix structure (Reveley 2018).
The functional structure refers to group people in the shared skills, and “each functional department has its own hierarchical mode of organization” (Reveley 2018; Morgan 2006, p.20). On the other hand, the divisional structure is regarding to dividing people into different products, customers or markets, “where various units are allowed to operate in a semiautonomous manner under general rather than detailed supervision and the control of those with ultimate authority” (Reveley 2018; Morgan 2006, p.21). Moreover, the matrix structure are based around cross-functional teams, where some employees have two bosses to report to and there are dual report lines exist in the organizational chart (Reveley 2018).
According to the organizational chart of Qantas, it is easily to indicate that Qantas has matrix organizational structure, as there are lots of dual report lines has been drawn in the chart. This means that some senior managers have two bosses to report to (Reveley 2018). For example, the HR manger right under the CEO of Qantas international departments has two bosses to report to, one is the CEO Alison and the other one is the group executive people ; culture director Lesley.
For vertical differentiation perspective, it is very clear from the graph that the CEO of Qantas has span of control of 11 (Morgan 2006, p.20). And this is quite wide span of control, thus the flatter organizational structure can be assumed (Robbins ; Barnwell 2006, p.107). The flatter organizational structure means that less vertical complex, and it is easier for the communication, as there are only few layers to deliver the message. Moreover, according to this kind of few layers, there is a possible for information over load and thus results in loss of control, the decentralized circumstance occurs (Reveley 2018).
The formalization refers to “the degree to which jobs and procedures within the organization are standardized” (Robbins ; Barnwell 2006, p.110).
According to the annual review of Qantas and safety, health, environmental ; security committee charter of Qantas, there are lots of formal written rules and procedures for the daily operation to maintain the safety (Qantas annual review 2017; Safety, health, environmental ; security committee charter 2017) .
For example, Qantas has world leading aviation security system, with the new innovation safety database, Qantas requires their employees and contractors to use mobile devices to communicate safety issues and identify possible deficiencies. Also for cyber safety educational purpose, Qantas requires its employees to complete stimulations to improve their awareness of cyber risks. Moreover, for the environmental perspective, Qantas requires all levels of the Qantas group to monitor and report environmental performance and risks. (Qantas annual review 2017, p.16-19)
Furthermore, the safety, health, environmental ; security committee charter of Qantas states the formal rules for the committee, such as responsibility, meeting regulations, safety procedures. For example, there are four responsibility descriptions that committee need to meet, such as the committee is responsible for the review and monitoring all kinds of risks include health, environment, security and risk management strategies (Safety, health, environmental ; security committee charter 2017, p.1-2).
Therefore, Qantas is a highly formalized organization. And those formal rules and procedures have been always followed, as Qantas has been named world safest airlines again in 2018 (Escape 2018). This is the results of the development of security management system and all the procedures and formal rules have been followed (Qantas annual review 2017, p.16). Moreover, the case discussed in code of ethics section also proved that Qantas was always following its rules and procedures.
Based on Robbins ; Barnwell (2006, p.115), the centralization is “the degree to which the formal authority to make discretionary choices is concentrated in an individual, a unit or a level, thus permitting employees minimum input into their work”.
Although the flatter organizational structure usually has decentralized circumstances as discussed above, Qantas is still a highly centralized organization. This can be approved by the clearly statement of CEO’s responsibility, the CEO of Qantas is responsible for implementing the operating strategies that set by the board, and for all other aspects of day to day management, CEO has all powers, discretions and delegations authorization (Board charter 2016, p.6).
Structural tension between differentiation and integration
According to week 3 lecture, the complexity is about differentiation, and centralization and formalization are about integration (Reveley 2018).
Even though the matrix structure is trying to balance the differentiation and integration, the structural tension of Qantas was still towards integration side first and then it is differentiation. As Airline Company is always a high risk industry, therefore it requires high degree of centralization and formalization to ensure the safety day to day operation. This means that high coordinating efforts among different roles and units were required first to ensure the daily operation safety. The differentiation is still important for Qantas, a good differentiation model allows Qantas operating in a very effective manner, and therefore information can be communicated very quickly and clearly (Reveley 2018).
Code of ethics
Qantas has a written code of ethics regarding to the documentation for the code of conduct and ethics, which was provided at official website (Code of conduct and ethics 2017).
The breaches of the code in Qantas is very rare, but it does happened before. For example, one of the Qantas crew member who works at Qantas for over 20 years attempted to stole an alcohol from Qantas Group, during the flight from Perth to Sydney in 2016. And Qantas alleged the employee made misleading claims when asking where does the alcohol come from, the employee claimed that the alcohol was coming from his wife. This is a clear breaches of the code ethics, and Qantas has followed its code of conduct and ethics procedure, dismissed employee with large compensation (Koehn 2017).
Political structure of organization
Organizational structure can be described as the system of authority and responsibilities that coordinate and control employee behavior and actions to achieve organizational goals (Jones, 2013).
The generally used organizational structure are either decentralized or centralized. Likewise, Qantas airlines has adopted either decentralized or centralized structure. The airlines organizational structure contains the characteristics of decentralized and centralized structure.
Centralization refers to the decision-making power at the top level of management of an organization (Jones, 2013). Decision making is done at the upper level in centralized organization, while in decentralization, decision making are assigned to lower management levels (Daft, 1995).
Qantas consist of the different subsidiaries led by several senior manager who have been given with responsibilities, roles and authority to be practice under their area of operations. Alternatively, Qantas workers have been positioned in such a way that the implementation of their responsibilities is in line with Qantas objectives and goals. Qantas administration is based on two separate businesses, Qantas international and domestic with each of these business being controlled by its CEO. Moreover, these two businesses have their operational and commercial functions. This organizational structure has been embraced as the method of concentrating on the strategies of improving the Qantas domestic and also International business.
From the analysis, it is certain that Qantas has implemented matrix style of structure. The company’s top management consist of the participants of the corporate governance along with upper management team. The top level management is accountable for initiating policies and practices to be take on and applied throughout the corporation. Below the upper level management, there are a number of departments such as functional management, administrative management, and project management. Each of these departments function with the different team to make sure the organization objectives and goals are attained (Qantas, 2018).
Types of Power
Power can be defined as the ability to control other individuals. It refers to the ability to change the subordinate behavior with the help of resources. There are different types of power. They are:
Reward power is the power based on giving rewards to the employees as a way to influence them to act.
Coercive power is the capability to influence an individual by taking away something as punishment. It is the power based on fear.
Legitimate power is the power an individual gets as a result of their position in the organizational formal hierarchy.
Expert power is influence exerted as a result of knowledge, special skills or expertise.
Referent power is the ability to influence an individual because of the individual’s respect, loyalty, affection or admiration. Bertram Raven and his colleagues in 1959.
Because of the deregulation in the airline business, CEO Alan Joyce needed to decide on becoming competitive in terms of low cost. He took decision to operate with Jetstar, a low cost airlines. The airlines proclaimed a restructure which would get 1,000 jobs cut, which would make easy for the executives to be more competitive and reduce cost.
As a result 3 unions decided to go on a strike and it caused around 80,000 travelers got affected, around 600 flights got cancelled. CEO of Qantas, Alan Joyce decided to ground the entire fleet of the airlines. This decision stranded around 68,000 travelers around the world.
Alan Joyce as the Chief Executive Officer of Qantas airlines, possesses the formal authority and legitimate power.
The CEO grounded the Qantas domestic and international fleets immediately (Daily telegraph, 2018). As a consequence of the suggested lock out of the Qantas worker in reply to continuous industrial action against Qantas. This caused grounding of more than hundred aircrafts at 22 international and domestic airports. It was projected to cost twenty million dollars daily. This can been viewed as the decision made by Alan Joyce based on his formal authority and legitimate power, which lead to the loss of revenue and goodwill. But, one can say that he took the decision in the best interest of the company.
Pluralistic nature of organisation
Pluralism in organization is seen as an organization is composed of different groups with their own interest, aim and leadership. The organization is perceived as multi structured in terms of leadership, group, loyalty and authority. Managers and workers are the two major group in pluralistic organization (Blyton and Turnbull, 2004).
As discussed earlier, 3 union group went on to strike against management because they wanted increased in pay and job security. As a result around 80,000 travelers got affected, around 600 flights got cancelled. This group had their own aim and interest. CEO of Qantas, Alan Joyce had to take decision and he decided to ground the entire fleet of the airlines and eventually the dispute was over after the government involvement.
Sources of resistance
Resistance can be defined as refusal to accept change or any new idea.
Change is unavoidable. Firms must bring change in themselves if they need to continue to exist in today’s business environment. Qantas over the times had to totally change its marketing, organizational structure and operations in response to external and internal influences.
The airlines have underwent industrial dispute because of joint unions asking for pay increase and job security. One resistance source can be the employees. Employees are people who earn salary and wages in return for the work they do in an organization. For successful change, it would be crucial for the management of Qantas to cut thousand job from lower and senior management. Employees and union resist the plan for future growth as it could create unemployment. Another resistance source could be Legislation. The airlines looks to increase its subsidiaries and customer emphasis to Asia, but the airlines subsidiaries is restricted only to 40 percentage of to Asia.
Protection for Whiste Blower
The Qantas airlines Whistleblower Policy persuades workers to report any issues linking to improper, unethical or illegal conduct in situations where employees may be worried about raising the issue because of fear of likely unfavorable consequences. The Whistleblower Team has been formed to run investigations and inform to the Audit committee and the Board. The Whistleblower program is available to all workers and is contained in the company’s Code of Conduct. The company’s Whistleblower program can help with protecting the employees identity (Qantas, 2018).
Organisation culture is an integral part of an organisational life. It helps in shaping the personal identity, behavior, and guides the organisations members. It enhances the stability of the organisation. Qantas is a strong, globally competitive aviation business which is the sum of its skilled, passionate and diverse workforce. Qantas encourages working together, collaboratively and maintaining high standards of ethics. Qantas as an organisation is multicultural; it aims to provide a workplace that is free from any discrimination. The organisation has set group policies, high values, and norms which are followed by all the employees. It promotes an inclusive and collaborative work culture.
What are the key components of the official corporate culture promoted by the organisation’s senior managers?
Qantas is known for its highly skilled, engaged workforce to deliver their strategy and foster innovation. Their people strategy aims to build a diverse, inclusive and resilient culture to maximize engagement and performance, and remain an employer of choice in Australia. The Qantas culture is framed by five group beliefs:
• Everyone has the right to return home safely;
• Customers determine our success;
• Being fit, agile and diverse organisation drives organisation, drives innovation and simplicity;
• Working together in an inclusive manner always delivers the best group outcome; and
• Each employee deserves respect, trust, and good leadership.
Strong employee relations are the foundation for constructive industrial relations, minimizing risk to operational stability, brand reputation, and future earnings.
Engagement Survey–Qantas Group Engagement Score History1 Engagement Score
The top management tries to create a platform to recruit fresh talent. Leadership, talent and succession planning is driven by our executive-led talent and leadership advisory group. Qantas value the diversity of thought and experience and believe in a collaborative culture.
2. How prominent are ethical norms in the organisation’s espoused values?
The Qantas group has eight board approved Non-Negotiable business principles which bring together the behaviors and values:
• The organisation is committed to safety as a first priority;
• It complies with laws and regulations;
• It treats people with respect;
• Qantas acts with honesty and integrity, upholding ethical standards;
• Qantas is committed to true and fair financial reporting;
• It is committed to environmental sustainability;
• Qantas is responsible for safeguarding Qantas group reputation, brands, property, assets, and information; and
• It proactively manages risks.
The principles of Qantas are the foundation for their group policies. Their supporting training programs ensure that group policies and principles are understood and constantly applied in the business.
Qantas’ values support the vision ‘to be a great airline those champions are the spirit of Australia and are: Together, Genuine, Inventive, optimistic; and Experienced. Qantas value system helps it to become the great airline. The Qantas group’s approach to creating and protecting long-term value rests on two strategic pillars: Foresight and accountability.
3. Where is the organisation situated on Mary Jo Hatch’s cultural ‘integration-differentiation’ continuum?
The integration perspective refers to the existence of consensus at the organisational level and also assumes the prevalent of consistency between the various levels of culture.
While differentiation perspective focuses on the study of different subcultures. The organisational structure is defined by the subcultures which are formed around pre-defined categories. The difference between integration and differentiation perspective is not on the level of analysis but the fact that the latter focuses on the more than one subculture, and also the relationship between them.
Qantas is situated more on the integration perspective and follows all the aspect of this view than of differentiation perspective. There is a consensus as it is assumed that everyone who is a part of the organisation will work n an inclusive and collaborative manner. Qantas has set values, beliefs, code of conduct and norms which all the employees have to follow to be able to fit into its culture.
In one of their compliance policies, it is made very clear that all their employees are expected to be well aware of and comply with the Qantas group and their other applicable policies. Employees are responsible for their own behavior and action at all times, acting in best interests of the Qantas group, being aware of and complying with applicable policies and should seek advice or authorization before undertaking any action. Breach of any applicable law can result in disciplinary action.
Are the subcultural values consistent with the organisation’s corporate culture? If there are no obvious subcultures, how has the organisation achieved a high level of cultural homogeneity?
A subculture is a subset of an organisation’s members who interact regularly with one another, identify themselves as a separate group within the organisation, share a common set of problems and take action on the basis of collective understanding unique to the group.
Qantas doesn’t have any obvious and prominent subculture as it has very clear, strict, and precise policies on treating everyone equally, promoting equal opportunities and working collaboratively within the organisation. This organisation works in an inclusive environment where employees of all the departments interact with each other, collaborate and work as one Qantas team.
Qantas is committed to building and fostering a culture a culture in which diversity is valued and provide a workplace that is free from discrimination, harassment, and inequality.
To achieve a high level of cultural homogeneity, Qantas has stringent policies and prohibitions. The nonnegotiable business principles and group beliefs ensure that all the values and norms are well understood by all the employees and constantly applied in the business. The employees are told about all the ethical code of conduct, policies and the organization’s culture which helps the employees to understand and fit into its culture to retain their position in the organisation. Qantas takes strict action if there is any breach of policy or misconduct.
Qantas aims to work towards a vision which takes all the people working for it and in it into consideration. It poses high values and norms which help the organisation to have standardized and uniform culture. It works on its policies which are set so that everyone can abide and work according to that fit in the organisations culture.
Currently Qantas has faced many key challenges with in domestic and international market. It has recently restructure its organization structure as a move to streamline its operations and make it easier to quantify and meet the problems in a particular areas. However it continues with its problem to meet the structural changes due to present organizational behaviour of employees with in organization and its culture.
Qantas has face a lot of critism due to power management and it has recently face the employee grounding of all Qantas operations. The recently repositioning of its competitor Virgin airline has alos increased the problems for Qantas.