Management in the Airline Industry

Geraint Harvey

• Publisher: Routledge
• Year: 2007
• ISBN:
  9781134167333
• Edition: 1
• Topic: Betriebswirtschaft
• Subtopic: Business allgemein

Combining contemporary HRM theory and practice with debates in critical management and in industrial relations, this book examines the peculiar challenge that civil aviation pilots present for management. As a highly educated, highly trained, and non-substitutable professional employee, the airline pilot wields considerable industrial power.Based o

1
Introduction

This book examines the management of people in the airline industry. More specifically, it focuses on the management of pilots in the UK airline industry and the impact that human resource management (HRM) has upon their attitudes towards their airline and their work. It is based on a study of flight crew, sponsored by the Economic and Social Research Council (ESRC) and conducted between 2001 and 2005. A study of airline pilots is timely. Despite the crucial importance of competent flight crew management (discussed at length in Chapter 2), the last major study of pilots in the UK was carried out in the late 1960s by A.N.J. Blain.¹ Pilots then, as now, enjoy(ed) considerable industrial strength. Consequently, any collective expression of discontent, such as threatened industrial action, can cost an airline dearly (e.g. the threat of industrial action by pilots in BA in 1996 cost the airline an estimated £15 million). At airlines that operate the seniority rule, which binds pilots to one airline as they accrue non-transferable benefits, pilots must resort to voicing any discontent,² which they are frequently prone to do in an adversarial manner,³ because they are effectively prevented from exiting the airline. In this context, pilots’ attitudes can be crucial to the survival of the airline. As exit is a more likely strategy for pilots employed at airlines that do not operate a seniority rule, therein management is confronted with the problem of pilot retention. As later chapters show, the growth of civil aviation has not been matched by a growth in pilot numbers and there has been widespread concern about a shortage of flight crew to meet demand. In this environment, pilot retention is a fundamental objective of management. Finally, pilots are among the highest-paid employees in any airline. With the necessity for airlines to reduce employee costs,⁴ the management of pilots is fraught with difficulties.

HRM offers airline management a potential ‘solution’ to these problems. Advocates claim that HRM engenders feelings of satisfaction with work and commitment to the organisation, thereby reducing intentions to leave and the propensity for recourse to industrial action. A promise like this is no doubt appealing to the beleaguered flight operations manager, especially when the literature is replete with HRM success stories drawn from civil aviation, for example British Airways (BA),⁵ Delta Airlines,⁶ Lufthansa,⁷ Singapore Airways,⁸ and, of course, Southwest Airlines.⁹

The lion’s share of HRM research throughout the 1990s investigated the correlation between the presence of HRM and the performance of the firm,¹⁰ rather than its impact on employees.¹¹ As a result of the problems in demonstrating the link between HRM and firm performance directly, research has been refocused to examine the impact of HRM on the attitudes of employees towards their work. For example, the recent Bath People and Performance model posits that HRM increases the ability of the employee to do the job; motivates the employee to go the extra mile for the firm; and offers the employee the opportunity to demonstrate enhanced ability and motivation.¹² It was usually assumed, rather than demonstrated, that HRM policies and practices led to higher levels of employee motivation and commitment to the firm.¹³ The analyses of the impact of HRM on the attitudes of employees that emerged at the very end of the twentieth century and into the new millennium offered far from conclusive findings.¹⁴

In a bid to explain the variation in findings, the focus of research has extended beyond the actual policies and practices implemented by the firm to variables that moderate the impact of the policies and practices, such as the process of HRM implementation.¹⁵ There is a tradition of conceptualising HRM in terms of elements other than tangible practices. In the early 1990s, Schuler categorised five components of HRM.¹⁶ Within this framework one component stands out: the HR philosophy, which is described as the guidelines about ‘how the organization regards its human resources, what role the resources play in the overall success of the business, and how they are to be treated and managed’.¹⁷ The notion of an overarching philosophy, which is the ‘moral foundation’ of the firm or ‘company culture’, is found in Pfeffer’s slightly later iteration.¹⁸ Most recently, in their comprehensive account of strategic HRM, Boxall and Purcell identify the underpinning layer of HRM, described as generic processes and general principles, which guides HR and indeed general employee relations activity within the firm.¹⁹ This theme permeates Purcell’s thinking on employee relations, from the notion of ‘good industrial relations’²⁰ through ‘management style’²¹ to underpinning HRM and the Bath People and Performance Model that highlights the necessity for management to generate a conducive environment of trust, encouragement and respect in order for other aspects of HRM, namely HRM policies and practices, to ‘work’.²²

In this book, HRM is presented as comprised of two components, which roughly equate to Boxall and Purcell’s surface and underpinning layers of HRM.²³ They describe the surface layer as consisting of the policies and practices implemented by the firm in the management of people. These policies and practices are labelled the content of HRM in this book as they represent the readily measurable component of HRM. The philosophy and processes of HRM, otherwise known as the underpinning layer of HRM, build on Purcell’s concept of ‘management style’. The second component of HRM as distinguished in this book is closely aligned with Purcell’s ‘management style’, but differs in some very important ways (see Chapter 3). Therefore, the label of HRM style is used. HRM style is expressed in management attitude and action towards employees as individuals (individualism), whereas collectivism in HRM style concerns the approach of management towards collective representation.

A primary aim of the study on which this book is based was to examine the relative impact of the two broad dimensions of HRM content and style on the attitudes of employees, airline pilots in this case.

The collective dimension of HRM style introduces another significant stakeholder group, the trade union, whose relationship with HRM is extremely important.²⁴ The way in which management deal with trade unions is seen as reflecting collectivism in HRM style. This book avers that a genuine union–management partnership occurs when cooperative collectivism in HRM style is matched by a moderate approach on the part of the trade union, for the purpose of achieving mutual gains. The study was also able to assess the attitudes of pilots towards the ‘new realism’ of the workplace.²⁵

The contribution of this study goes beyond facilitating our understanding of the way in which pilots in the UK are managed. More than this, it addresses two very important issues in employment relations. First, this study explores pilots’ attitudes towards work and clearly delineates the impact of HRM content and HRM style. Second, the impact of HRM on the trade union has been discussed widely and has generated numerous empirical studies in the UK. However, these have focused on the implications for trade unions and the outcomes for employees, such as job losses and wage reduction.²⁶ Research has only recently considered the views of members towards partnership or towards their union after it had embraced partnership. This study evaluates desire for partnership in principle, among pilots at non-partnership airlines, and desire for partnership in practice, among flight crew at the two airlines with which the pilots’ trade union, the British Air Line Pilots Association (BALPA), had engaged management in partnership at the time of study.

So that the research could best address the agenda identified above, attitudinal data were collected from a representative sample of unionised pilots at six airlines operating in the UK civil aviation industry, specifically the full-service airlines BA and bmi (British Midland International); easyJet and Go of the low-cost sub-sector; and the charter airlines Britan-nia and Air2000. BALPA representatives employed at each of the six sample airlines participated in focus groups conducted during BALPA Company Council Industrial Forums at the Association head office. Pilots and management employed at two of the airlines, easyJet and BA, were interviewed along with all senior officials at BALPA. A comprehensive questionnaire survey was distributed to a census of all flight crew who were members of BALPA and employed at all airlines in the sample other than BA. A stratified random sample comprised of one-third of BA-employed BALPA members also received the questionnaire. The response rate to the questionnaire at each of the airlines exceeded 25 per cent.

Whereas the airlines in the sample were operating with very different business strategies, the data show that pilots employed at the six airlines experienced very similar HRM policies and practices. These findings indicate convergence on HRM content among airlines in the UK. This is not surprising as each of the three pressures for isomorphism²⁷ (coercive, mimetic, and normative) is widespread in the UK civil aviation industry. An alternative way of describing this situation, which has more currency in the HRM literature, is to suggest that in the management of pilots, the ‘table stakes’²⁸ are very high.

Despite experiencing the same HRM policies and practices, the levels of job satisfaction and organisational commitment reported by pilots differed significantly between airlines. In the low-cost and charter subsectors, pilots employed at Go (low-cost sub-sector) and Britannia (charter sub-sector) were significantly more likely to report positive attitudes, whereas pilots employed at easyJet (low cost), and Air2000 (charter) were significantly more likely to be negative.

At Go and Britannia, the HRM style towards flight crew reflected cooperative collectivism and high individualism. At easyJet and Air2000, HRM style towards flight crew was marked by adversarial collectivism and low individualism. The data reveal that in contrast to convergence on HRM content, two very different HRM styles were apparent. Multivariate data analysis reveals that the HRM style pursued by airline management was strongly associated with pilots’ attitudes towards work. There was, however, no such nexus between the attitudes of pilots and of HRM content.

There are several reasons why pilots might favour partnership between BALPA and airline management (these are discussed fully in Chapter 8), and why pilots are more likely to be satisfied in their work and committed to the airline where management pursues cooperative collectivism. Unsurprisingly then, pilot response to the principle of the union adopting a cooperative approach towards airline management was very positive, with over three-quarters of respondents agreeable to a hypothetical partnership. However, at the two airlines where BALPA had, at the time of the study, engaged management in partnership, desire for partnership among flight crew differed significantly. Between these airlines, there was also a more extreme variation in pilot perception of union efficacy. The powerful association between perceived union efficacy and desire for partnership illustrates the widespread popularity of partnership in practice where the union was perceived to remain effective under partnership. The data show that partnership in practice must deliver, as desire was considerably less widespread where the union was perceived to have lost leverage.

Structure of the book

The subsequent chapters elaborate on this synopsis. Chapter 2 portrays the context of the civil aviation industry and the peculiarities of the work of airline pilots. Chapter 3 considers the HRM literature and emphasises the need to research the analytical distinction between the components of HRM. This chapter also presents a brief synopsis of the partnership debate and considers the arguments and evidence on the outcomes of such an arrangement. Chapter 4 outlines the study, discussing the methods employed in the collection of data and the techniques used in their analysis. Chapter 5 first assesses the content of HRM at the airlines and then explores the style adopted by airlines towards flight crew and BALPA. Chapter 6 considers the extent of job satisfaction among pilots at the six airlines. Data concerning overall job satisfaction and satisfaction with aspects of work are analysed in an approach consistent with previous job satisfaction research, and the effect of HRM content and style is assessed....