Introduction
Established in 1927, Iberia is the Spanish flag carrier that operates a network of international flights from its bases situated in Barcelona El Prat Airport and Madrid-Barajas Airport. As a constituent of the Iberia Group, the air transport service provider concentrates on the transportation of passengers and freight besides other associated operations including airline maintenance, airport handling, in-flight catering, and information technology (IT).
The airline player operates a network of 109 destinations distributed in at least 39 countries with an additional 90 destinations that it serves in collaboration with other industry players through code-sharing agreements.
Over the years of its operations, Iberia has established an exceptional relationship with its customers due to the effectiveness of its human resources management. For instance, the corporate culture adopted by the company motivates its workforce to ensure the satisfaction of customers to maintain its competitiveness in the industry. Furthermore, the integration of efficient information systems into the operations of the company has enabled it to foster productivity as demonstrated by the continued satisfaction of customers. This paper analyzes Iberia’s human resources and information technology systems.
Iberia’s Human Resources Management
The human resources management (HRM) aspect of operations in any given airline company plays an integral role in bolstering its productivity, thus, enhancing its competitiveness in a particular industry. Importantly, the corporate culture adopted by Iberia has significantly influenced the perceptions of its customers regarding the image of the company. For instance, the airline has not concentrated much on developing profound customer relations thereby, undermining its competitiveness and thus, provide space for rivals such as Ryanair and Easy-jet to rise.
Furthermore, the hierarchical element of its organizational structure is considerably complex, but the management has implemented several strategies that seek to make it flexible to improve the efficiency of decision-making processes. Additionally, the remuneration structure that Iberia uses affects the motivation of its human resources. Besides, the code of ethics put in place by the management ensures that the employees execute their roles within the recommended standards that promote ethical behavior. Therefore, analyzing the various features of Iberia’s human resources is essential for the realization of an in-depth understanding of the Spanish flag carrier.
The Management Systems at Iberia
With a workforce of at least 21,293 employees, the management systems embraced by Iberia considers the needs of each of its employees to facilitate the enhancement of their productivity. Therefore, for the sake of ensuring streamlined management systems in the various departments, the top airline in the Spanish and Europe-Latin America market has prioritized setting up rules to govern the operations of its labor force. For this reason, the airline competitor has integrated a “Constitutional” management system to regulate its activities (Fageda and Perdiguero 94).
The constitutional management systems adopted at Iberia imply that the company regards its employees as an integral factor of production that ought to uphold particular provisions and standards that guide corporate operations. Furthermore, the systems assume the subordination aspect of HRM and thus, the management expects its employees to take full responsibility for their decisions and actions. Notably, in a bid to facilitate the provision of a platform where employees discuss issues that affect them, Iberia, the inevitability of unions to address the concerns and interests of its employees.
However, the management systems integrated at Iberia depict variance in different sectors and employee categories. Notably, as the pilots and attendants observe the constitutional provisions, other employees get influence by the individualistic approach of management. Furthermore, the management interferes with the activities of the employee unions thereby, undermining the efficiency of such associations (Fageda and Perdiguero 90). Therefore, inconsistent application of the constitutional management system at Iberia affects the airliner’s corporate governance since it lacks uniformity.
Formal Organization of Work and Remuneration Policies
Iberia breaks down the formal organization of the workforce and the role of its employees by factoring the aspects of the country of deployment, sex, type of contract, labor category, and business. Therefore, the job descriptions of the different and multiple experts working at Iberia consider not only their line of professionalism but also the factors that affect their productivity. For the sake of enhancing the formal organization of work, Iberia established two boards including the Flight Committee and the Ground Staff Inter-Workplace Committee to streamline.
Notably, the committees collaborate with the unions that ensure the protection of the rights of the employees in their line of duty. Thus, in Iberia pays attention to the different employee categories by the use of committees that monitor their formal duties and responsibilities.
Surprisingly, the managers at Iberia rarely intervene in the establishment and implementation of HR policy. Instead, the HR managers execute their roles as intervention “regulators” who rarely address critical HRM issues such as remuneration. For this reason, Iberia lacks a flexible reward structure, but it lets the trade unions determine the pay of its employees through a collective agreement.
In this light, despite the efficiency of trade unions in promoting the interests of the employees including fair remuneration, the HR managers fail to involve its employees to gain an understanding of their unique needs and expectations and thus, put in place the necessary reward systems. Consequently, the employee appraisal system adopted by Iberia is characterized by simplicity denoting its shallowness in addressing the rewards and benefits elements of HRM. In this regard, besides the integration of a staff recognition system in its HRM to reward exemplary employees, the failure to establish profound remuneration policies undermines its efficiency.
The Current Code of Ethics at Iberia
Iberia maintains a Code of Ethics that seeks to apply Global Compact fully, and thus, foster ethical behavior in its global operations. The current Code of Ethics adopted by the airline sector player ensures that its employees base their decisions and actions on the principles of responsibility and morality when performing their work. Therefore, in fostering ethical behavior in Iberia’s organizational environment, the HR managers also facilitate the application of the Global Compact principles. Notably, besides informing the employees of the relevance of observing the Global Compact provisions, Iberia also ensures that its employees situated various countries to adhere to its desirable code of conduct that also supplements other requisite ethical standards.
Additionally, Iberia has established several campaigns that seek to foster ethical behavior in various operations. The “IN-OUT” campaign established by the company focuses on the image of the employees particularly, their uniform since it influences the perceptions of its customers. Additionally, the “Why don’t you tell them?” campaign pursues to maintain the ethical behavior of its workers in the plane where in-flight messages inform on-board passengers that they chose the best professionals.
Moreover, in a bid to bolster the confidentiality and privacy aspects of ethics, Iberia introduced the “INFORMATION SECURITY is also YOUR business” initiative. Therefore, as part of its HRM strategy, Iberia has made remarkable steps through various campaigns besides promoting the application of the Global Compact to foster the ethical behavior of its employees.
The Employment Climate
Since the merger with British Airways, Iberia as experienced a significant rate of job cuts as a way of maintaining its profitability. Projections depicted that the 2011 merger would contribute 4,500 job losses by 2015 thereby, denoting the tensions that faced the human resources. For this reason, in 2013, Iberia’s employees engaged in demonstrations and strikes in February 2013 (Fageda and Perdiguero 90). Therefore, the significant termination of employment contracts demonstrated the airliner’s failure to integrate strategic HRM plans that would foster the sustainability of the workforce in the long-term.
In this regard, the restructuring program that took effect in 2012 affected the company’s employment climate as seen by the significant job cuts. Notably, the measures intended to restore the profitability of the airline player since the workforce facilitated the leaking of an average of €1.7 million on a daily basis (Belobaba, Odoni, and Barnhart 80). Therefore, the intervention of the unions and the International Airlines Group (IAG) implies that the company faced an HRM crisis. However, the company has announced several employment opportunities after gaining financial ground in the recent past.
Cultural Orientation
In the wake of a society that is characterized by cultural diversity, the adoption of an organizational culture that factors the varying background of employees and customers is essential. For this reason, Iberia upholds the treatment of its employees and clients in a way that is free from discrimination based on their race, ethnicity, sex, age, and religion among other aspects. For instance, despite the rigidity of Iberia’s remuneration structure, it shows commitment to rewarding its employees equally by considering, issues such as rank, seniority, and position.
Furthermore, to establish an organizational culture that respects the right of all individuals, Iberia established Equality Plans that aim at implementing the Organic Law 3/2007. As such, the HRM team at Iberia has shown its efforts of instilling a cultural orientation that embraces the diversity of modern society. In doing so, the player has been able to serve the clients from diverse cultures that use the Europe-Latin America route. Consequently, the adopted cultural orientation has enabled Iberia to secure its competitiveness while plying the said route (Ustaömer, Durmaz, and Lei 437).
Iberia’s Information Systems and Information Technology
For the pursuit of seamless customer experiences besides fostering operational efficiency, the integration of Information Technology in the airline industry is crucial. In this regard, Iberia has integrated several information systems that seek to bolster the company’s productivity. Earlier, the merger with British Airways created a challenge that necessitated the integration of the IT systems from the two players to a single system that would facilitate the fusion of their technological features (Fageda and Perdiguero 93).
Therefore, the airline has integrated the Agora platform, a software IT system characterized by various features that boost the efficiency of its operations in the highly competitive industry. The Agora platform constitutes a system of multi-service, multi-app, cross-platform, and integrated hardware that it has deployed at the several airports that it operates (Ustaömer, Durmaz, and Lei 433). Notably, the Agora technology transcends the electronic check-in terminals managed by virtual reps to provide an improvement of the airline’s on-board processes besides the integration of enhanced customer touchpoints (Cunningham and Fröschl 113). Therefore, the IT system facilitates the enhancement of efficiency in the processes experienced by customers and employees.
The customer touch-point terminals integrated into airports such as the ones situated at Terminal 4 of the Barajas airport enables its customers to access information that matters to them. Besides, Iberia incorporated the eVoucher systems that allow passengers to download electronic vouchers for restaurants and hotels on their personal electronic devices. Furthermore, the Agora platform provides a “smart-scale” system that permits its customers to check-in and [prints their luggage tags at home. In this regard, Iberia has made significant strides in improving the experiences of its passengers by integrating information systems that improve the self-service processes.
Moreover, Iberia seeks to automate its services further by partnering with Samsung to establish a near field communication (NFC) system that aims at fostering the boarding experience of its customers. The system works with Samsung devices where customers can access their boarding pass even after switching off their phones (Belobaba, Odoni, and Barnhart 56). Therefore, to a considerable extent, Iberia has concentrated on the development of its IT systems with the aim of improving customer experiences besides fostering the efficiency of its employees in attending to the unique needs of its customers.
Conclusion
Iberia demonstrates several strengths and weaknesses of its HRM systems. The “constitutional” management approach, Code of Ethics, and its profound cultural orientation stand out for the airliner. However, the unstable remuneration policies and job cuts have affected the HR aspect of the airline negatively. Additionally, through the integration of the Agora platform, Iberia has managed to foster the efficiency of its IT systems as depicted in the enhancement of its self-service processes.
Works Cited
Belobaba, Peter, Amedeo Odoni, and Cynthia Barnhart. The Global Airline Industry, Hoboken: John Wiley & Sons, 2015. Print.
Cunningham, Peter, and Friedrich Fröschl. Electronic Business Revolution: Opportunities and Challenges in the 21st Century. Berlin: Springer Science & Business Media, 2013. Print.
Fageda, Xavier, and Jordi Perdiguero. “An empirical analysis of a merger between a network and low-cost airlines.” Journal of Transport Economics and Policy (JTEP) 48.1 (2014): 81-96. Print.
Ustaömer, Caner, Vildan Durmaz, and Zheng Lei. “The Effect of Joint Ventures on Airline Competition: The Case of American Airlines, British Airways and Iberia Joint Business.” Procedia-Social and Behavioral Sciences 210.11 (2015): 430-439. Print.