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200740 Human Resource and Industrial Relations Editing Services
Virgin was planning to launch its new section of airlines called Virgin Blue. This was a no frill airlines whose main motto was to provide cheap but reasonable airline travel to the people of Australia. So there were no extra mediums for income for Virgin as it was not providing services like lounge services, meals in flights, class differentiation etc.
Providing such services is challenge for well renowned airlines like Virgin. The business strategy and HR policies required to run the business is complex. Initially company need to hire good employees who are passionate and have the willingness to learn and work with global brand of Virgin. As this is a low cost airlines service the company will not be able to match the salaries of other high cost airlines. Thus the employees who are willing to work for this airline need to understand this in their minds. It is always difficult to get the best in the industry without paying them well.
At the start CEO had to recruit the administrative staff and the senior management. This team would comprise of the core team needed to run the airlines. CEO took to the head hunting approach. He also recruited people from other industries to manage the airlines. Now this can be said to be a good strategy to bring in talented and enthusiastic people in the company. As Virgin Blue had limitations on the salaries of the employees it had to retain the people by offering more than the money aspect of the job. Thus companies have to build in environment which provides exciting opportunities to the people and give them different platforms for learning. Employees need to excited as well motivated when they come to work for the airlines. Company plans to build an exciting as well as rewarding culture at the airlines. Thus providing such culture to the employees so that the employees are willing to work in the organization in spite of being little less as compared to what competitors are paying their employees provides a challenging task for the HR.
Thus keeping the employees motivated to work, giving them an environment which keeps them excited and enthusiastic to work is one of the main challenges. As the employees are being little less as compared to their peers in other companies retaining the employees will be one of the key challenges. At the start company will invest a lot in the training and skill development of the employees, hence company should make sure that the employees stay with the company and they need to check the attrition if they want to make use of their investment in their employees (Hunter, 2006).
Other challenge apart from these internal challenges that the company has to face is to handle the unions. Australian airline industry is highly unionized and hence need to work amicably with the unions in order to get their employees with the required skill sets. Dealing with the unions is always an issue and it needs to be handled with care. Any conflicts with the unions could harm the company in long term as unity between the unions is very good.
Thus the above mentioned issues were the main issues identified by the company’s CEO which will have an impact on the overall HR policy of the company.
Company had decided on various strategies to tackle the issues identified. At the start, company turned to headhunting and looking people from other industry to hire for the core administration and strategy of the company. He also hired people from other industries. Hiring people from different industries will help the CEO get talented, enthusiastic employees as they will have the willingness and the hunger to learn, explore and perform. These people will be driven more by learning and performing than their paycheck. Thus CEO will be able to get right talent pool at relatively less cost as compared to the other expierence people in the industry.
Company formed an alliance with one of the unions to get the employees required by the company. This helped the company get the right staff and also deal with pressures and hassle of other unions. Thus company was able to handle the unionization problem in the airline industry of Australia.
Company invested a lot in training the employees. They designed an extensive induction program and trained their employees. They also introduced a rotating policy. Under this policy employees can work in different departments depending upon the required skills and qualification for the job. Thus employees will be able to learn and work in different departments if they want to. This will keep the employees engaged and if an employee is finding his or her work monotonous then they will be given an option to work for other department. This will encourage the employees and also motivate them to work in the airlines. This will give them a feeling that the company is willing to take care of the issues of the employees by providing them a learning platform where they can explore their talent, try out new things and also try to fit in among the departments (Teo, Ahmad & Rodwell, 2003)
If an individual doesn’t think he or she is fit for the department then they can choose to change their department and can work in the department which suits their aspirations and needs on the condition that they are qualified for that (Gittell & Bamber, 2010)
Thus Virgin Blue Airlines have thought of various strategies to counter the challenges faced by the HR in establishing the new airline business in Australia. For industries like airlines retaining staff is always an issue and company should strive to get the best talent as the customer emphasizes a lot on the services. Thus the employees should be willing and enthused about working the airlines which help Virgin Blue airlines to serve the customers better and thus expand their business.
- Hunter, L. (2006). Low Cost Airlines:: Business Model and Employment Relations. European Management Journal, 24(5), 315-321.
- Gittell, J. H., & Bamber, G. J. (2010). High-and low-road strategies for competing on costs and their implications for employment relations: international studies in the airline industry 1. The International Journal of Human Resource Management, 21(2), 165-179.
- Teo, S. T., Ahmad, T., & Rodwell, J. J. (2003). HR role effectiveness and organizational culture in Australian local government. Asia Pacific journal of human resource, 41(3), 298-315.