Etihad Airways’ Staffing Issues and Underperformance

Introduction

Etihad Airways is a national airline company in the United Arab Emirates that was established by a royal decree as the national carrier of UAE and first started commercial operations in 2003. Etihad Airways is considered as one of the most rapidly growing airlines around the world, with a fleet of 57 aircrafts operating about 1000 flights a week to 66 destinations in 44 countries from its hub in Abu Dhabi. With less than 12 years in operations, Etihad Airways received many global awards reflecting their position as the leading premium airline brand.

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The services of the airline are classified as Business Class, First Class, Economy Class, high end lounges, and limousine pick-up services in more than 20 destinations across the globe (Etihad Airways, 2016). The executive management of Etihad Airways is made up of five senior personnel. The number of employees of the organization is more than 17,000 direct personnel and 5,000 personnel in its subsidiaries. The employees of the incorporation work in the departments of cargo, passenger travel, marketing, human resource, logistics, and research and development. This team offers services in air travel, consultation, service delivery, and inspection services.

Indicated below is the list of the top management team at the Etihad Airways. The vision of Etihad Airways is to “reflect the best of Arabian hospitality – cultured, considerate, warm and generous – as well as enhance the prestige of Abu Dhabi as a centre of hospitality between East and West” (Etihad Airways, 2016, par. 3). The mission of Etihad Airways is to “forge long-term partnerships with key customers as an integral part of their strategy” (Etihad Airways, 2016, par. 3).

Staffing Issues

The Human Resource Department

The human resource department at Etihad consists of two thousand personnel who are managing more than twenty thousand employees. The department is one of the largest after the logistics section. The department is organized into sub-departments such as training, research, human resource, recruitment, and records (Etihad Airways, 2016). Etihad’s HR is very proactive and has been efficient in managing different needs in the organization.

Staffing Problems

Staffing is an essential part of firm’s value orientation. Value in a firm emanates from the employees’ satisfaction level since they develop loyalty. The satisfaction of the employees results from quality management practices, policies, and support services that enable them to satisfactorily serve customers (Saundry & Jones, 2011). A special leadership tool that emphasizes on employees’ satisfaction, customer satisfaction, and quality management practices are necessary to Etihad’s productivity and increase its performance.

The common staffing problems that affect Etihad and other firms in similar business category are inadequate employee training, underperformance, inability to balancing the remuneration and proposition structure, poor employee hiring and promotion strategy, and minimal skills in role execution (Griffin & Moorhead, 2013).

Problem Under Discussion

In relation to Etihad Airways, the staffing problem that leads to underperformance has been associated with inability to balance the relationship between “employee satisfaction, productivity, financial performance and customer satisfaction” (Biswas, 2011, p. 99). When this lacks in staffing process, the results are not satisfactory. Staffing involves establishment of attractive rewards and remuneration. Rewards increase employee satisfaction, which subsequently influences their performance.

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Reward is a management tool that contributes to the effectiveness of the firm by influencing group and individual behaviors. A common practice of most of the organizations today, is to use promotions, pay bonuses and other rewards to encourage and motivate high levels of employees’ performance. When this is absent in the staffing process, performance is likely to be below standards as is reported in some incidences within the labor force of Etihad Airways.

Detail of the Problem

Insufficient workforce capability, loyalty, and satisfaction make customers perceive value for their money as below expectations. When customers perceive value in services provided as substandard, “they become less satisfied and disloyal” (Weiss, 2011, p.23). In the end, the firm attains inverted growth as performance by the labor force crumbles. Therefore, proper staffing establishes the correlation between employees’ capability perception, satisfaction and customers’ satisfaction.

When the same is wanting, expected results might not be satisfactory since service delivery depends on proper integration of employees to their duties as has been captured within Etihad Airways’ work force. Thus, staffing appraisal procedure is all encompassing and it reflects the actual performance by the staff members since it involves both the line managers and the staff members. Besides, there is comparison of the actual and expected performance and any variances are noted and actions inform of trainings since development and disciplinary measures are taken to improve on future performance. In underperforming firms, as is sometimes the case at Etihad Airways, the hierarchical order is often inactive and lacks the link to coordinate professionalism between the workers and the management team.

Solutions Implemented

The appropriate strategies for addressing the above challenges include employee training, implementation of different motivational strategies, and executing performance contracting at Etihad Airways. The HR department opted for implementation of motivational strategies to reverse the above trend. The choice for motivational strategy was informed by the findings from a research by the department in the year 2013 on the strategies that would improve employee performance, which ranked employee motivation at the top (Etihad Airways, 2016).

Through this approach, employees have been empowered and they feel trusted and valued by the management personnel and the company as a whole. Naturally, human beings would wish for motivation through mutual consent and internalized empowerment and appreciation. Empowerment has unleashed plenty of energy and motivation at Etihad. Reflectively, the motivational and energy aspects of appreciation functions simultaneously at micro and macro levels to facilitate optimal functionality or productivity (Saundry & Jones, 2011).

Empowering employees by Etihad has ensured a stable and sustainable win-win situation as employees are motivated to work without much supervision from the management or their supervisors. This strategy has been properly incorporated within and without different departmental segmentations as an active component of the company goals and vision as evident in the complete merger between the management and other staff, which has contributed to value addition, good performance, and healthy working environment. Despite the success of this strategy, Etihad Airways has not completely eliminated underperformance. Thus, the need for the recommendations listed below.

Recommendations

  1. Etihad should create an environment of mutual trust between the employees and management team. This is achievable when the human resource department balances the three building blocks of organization learning such “as a supportive learning environment, concrete learning processes, and practices leadership are balanced to reinforce innovation” (Griffin & Moorhead, 2013, p. 25).
  2. Etihad should undertake several career development programs that are necessary for attracting and retaining human resource base. Workforce operating under this approach is likely to positively embrace change element that may be introduced in the organization (Brink, Fruytier, B, & Thunnissen, 2012). Irrespective of the consequences of the change element, the dynamic essence of change proponent would not facilitate any state of quagmire or conflict as the unnecessary pressure associated with change would be integrated.
  3. Etihad should also consider providing a job compensation structure that supports the organization as well as individuals’ growth and development perspectives. Through centralized and properly designed training procedures, talent promotion, and motivation, productive behavior internalization will be presented as the best alternative way of solving problems in role execution at the company.
  4. Etihad should evaluate employees and produce succession pipe-lines for vital job positions in the organization before assigning roles, especially in the sensitive customer care, logistics, and cabin crew sections. The employees will appreciate the need for free consultation rather than doing the same as a condition imposed on them by their superiors. In the process of carrying out consultative functionalism, the mind will be tuned to appreciate the need for flexibility in decision making science which is compatible with the goals and vision of the organization.
  5. Since Etihad operates in a volatile environment, training and development will facilitate comprehensive analysis of potential members of the staff since it will be possible for the firm to improve on staffing selection procedures and testing.
  6. Empowerment and leadership styles could be used by Etihad strategically to increase employees’ job satisfaction and subsequently performance. Upon empowering employees to participate more in the decision making process, culture of independence in reasoning and consultative approach when handling work related duties will be internalized.

References

Biswas, S. (2011). Commitment, involvement, and satisfaction as predictors of employee performance. South Asian Journal of Management, 18(2), 92-107.

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Brink, M., Fruytier, B., & Thunnissen, M. (2012). Talent management in academia: performance systems and HRM policies. Human Resource Management Journal, 22(2), 201-223.

Etihad Airways. (2016). About us. Web.

Griffin, R., & Moorhead, G. (2013). Organizational behavior: Managing people and organizations. New York, NY: Cengage Learning.

Saundry, R., & Jones, C. (2011). The practice of discipline: evaluating the roles and relationship between managers and HR professionals. Human Resource Management Journal, 29(3), 123-146.

Weiss, W. (2011). Building morale, motivating, and empowering employees. Supervision Journal, 72(9), 23-26.

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