lc_u2.1rpl

Assignment Details:

Respond to at least two of your peers with any questions you have about their analysis and diagnosis and compare their answer to your own understanding of the case.

Peer One:

Hello!

I have chosen to become an ‘expert’ on the impact of the issues on Alaska Airlines. This part of the analysis requires me to identify how the problem came about and examine the effect it has on Alaska Airlines.

There are two main causes for the issues within the company. First is the long-standing culture where a less than exceptional performance is acceptable to management (Avolio, Patterson, & Baker, 2015). In this type of culture, there is no push for continuous improvement and existing issues are not addressed. The second cause of the problems is a sense of mistrust amongst employees and a high turnover rate throughout the organization (Avolio et al., 2015). Lack of both supportive and skilled employees creates an obstacle to any attempt to improve operations and more opportunities for poor performance.

These problems have significant impacts on Alaska Airlines. Operationally, less than half of flights departed on time and 20% of all luggage was mishandled (Avolio et al., 2015). This in turn creates dissatisfaction and anger for customers as they face delays and unacceptably long wait times (Avolio et al., 2015). Employees face increased pressure to train new hires and take on more work to fill staffing gaps, worsening turnover due to burn out (Avolio et al., 2015). Overall, these issues greatly harm the organization, ultimately creating a larger opportunity to fail if change is not made.

 

Avolio B., Patterson C., & Baker B. (2015). Alaska Airlines: Navigating Change. Richard Ivey School of Business Foundation.

Peer Two:

Hi everyone,

For the purpose of this discussion, I chose to be an expert on the problem. I need to address the problem and describe why there are forces to change these particular issues. According to the article, there are there main problems that need to be addressed (Avolio et al., 2017).

1. The Seattle Hub has large problems with on-time departures, poor ramp operations, and overall operational issues (Avolio et al., 2017)

2. The company is losing money

3. The company has a less than stellar reputation that is only getting worse among employees and customers

Although somewhat recovered, there had been large performance and operational issues that caused the company to have to reorganize its operations (Avolio et al., 2017). Many of these issues had been going on for years, but really came into note when coupled together over time. Primarily, the Seattle Hub had large issues, and being one of the largest hubs for the airline, this was an overarching issue. At one point, forty percent of flights were late. Out of every 1,000 passengers, 7 reported having mishandled lugged. Mishandled luggage is defined as being proliferated, lost, damaged, or delayed. Clearly, this led to customer outrage and poor customer reviews. To make things worse, the company laid off nearly 900 of its 10,000 employees in 2004.

There were issues long before this with the labor unions for different employment sectors in the company. Even pilots had contract negotiation issues and ended up taking a 16% plus decrease in pay. Then, at the Seattle Hub, the company replaced nearly 470 baggage handlers and outsourced them to a different company because of their low operational output. The outsourced company unfortunately was performing seemingly worse than the replaced employees because management was having issues with training. The outsourced company was mishandling 20 out of every 100 bags. Many employees were extremely upset because everyone was seemingly out of a job or not paid or trained sufficiently. So many layoffs led to other employees being overworked and feeling taken advantage of. Wait times were up to two hours and on-time departures were reported to be less than 50%.

Customer-facing staff members, couldn't help because they simply did not have any answers. The customer-facing employees then had morale hit an all-time low because they felt as though they had nowhere to turn. The company did try to fix operational issues using a task force called the MD Group. However, this group did not make enough change to the overall operations in order to really make a dent in the large issues. The company was lucky because of low fuel costs and a strong economy, making them profitable. Even so, there were too many other large-scale operational issues that could not be ignored. These large problems were taking a huge toll on employee morale, operational efficiency, and the customer experience. Therefore, the three main problems to address were issues with the Seattle Hub, losing money, and a less than stellar reputation among employees and customers. Changing overall operations could hopefully help address all of the company's issues.

References

Avolio, B., Patterson, C., & Baker, B. (2017). ALASKA AIRLINES: NAVIGATING CHANGE (W14722). Richard Ivey School of Business Foundation.  https://services.hbsp.harvard.edu/lti/links/content-launch