easyJet is an airline carrier based in London, the United Kingdom. It operates both domestic and international flights. easyJet’s parent company, easyJet Plc is listed on London stock exchange and is part of the FTSE 250 index. easyJet employs 8000 people all distributed across Europe but majority are based in England. It prides itself as being the second cheapest airline in Europe after Ryanair.
This essay will discuss which management organizational structure employed by easy jet, its influence on the success and failures of the company; it will also draw the line between the impacts of management ethics, corporate social responsibility and sustainable development on modern organizations. Finally it will categorize the factors affecting effective management in the global environment.
Management organization structure of easy jet
The organizational structure is based on an almost horizontal model to reduce administrative levels within the organization. At easyJet, there are no personal offices or secretaries unlike other business organizations. Since the airline is a low budget carrier, it has invested heavily in information communication technology. An example is the information communication (IT) section of easyJet. It is headed by an information technology director, under that post are six subordinates; heads of architecture, software delivery, system (operations of the company), systems (commercial), service delivery and operations (Brenkert, 2004).
Four managers work directly under the head of software delivery, the web development manager who is in charge of web developers, electronic resource manager in charge of electronic resource developers, quality manager heading the team in charge of testing and finally business information and integration manager who oversees the information systems developers. Under service delivery are; service delivery manager, applications support manager whose role is to head share point and information system developers and head of infrastructure who leads support engineers.
This form of organization has enabled easy jet to reduce its operating costs. The IT budget takes only 0.5 percent of total revenue and at its headquarters the company employs only 59 IT staff. The principle of operation that easy jet has adopted is one in which distance and geography does not become a obstacle to productive team work, its about one project, one team, and different locations. The company has also come to the understanding that excellent and efficient communications are paramount in paying back for distance. The company has also put into place skilled and well structured relationships facilitated by process and use of equipment. Thorough knowledge in the delivery process by understanding specific demands of coordinating divergent localities and cultures is also behind the success of this company.
Impacts of management ethics
Management ethics concerns itself about steps that a business entity can undertake to make sure that the rules and regulations of the company are adhered to by the directors and members of staff. Discipline, hard work and meticulousness are part of the ethical standards at easyJet. Staff at easyJet is required to treat clients and the public equally without favoritism. The above measures helps the company to boost its profitability, control its market share and staying relevant in a dynamic and competitive business environment whereas corporate social responsibility(CSR) concerns measures that businesses take to promote the wellbeing of the general public without making any profit.
easyJet has undertaken the following as part of its management ethics strategy. Strict procurement guidelines that facilitate openness and lowers the risk of conflict of interest emerging, clearly laid down frameworks on the acceptance of gifts and benefits from other businesses. Such gifts should not exceed a certain value.
Corporate social responsibility (CSR) and sustainable development
easyJet is committed to reduction in the pollution of the environment by running its business in a manner aimed at reducing the impact on the environment. The airline operates in Europe only and does not carry cargo which translates to less green house gas emissions to the environment. easyJet has made sure that all their planes comply with the international noise standard referred to as “chapter 4”.
Another policy of easyJet is to invest in the latest planes which are fuel efficient. To achieve this goal, they withdraw those which are older than ten years. The company participates in development and design of upcoming planes for example the ecojet. In terms of employment, easyJet is an equal opportunity employer and does not segregate based on gender, race, religion or nationality.
Donations to charitable organization are part of easyJet’s CSRs. The Anthony Nolan trust is an example of one beneficiary. It has also donated funds to bone marrow registries in Germany and Italy through its onboard collections.
Factors affecting effective management on the global environment
Size of the organization
Large organizations are more complex in management compared to small ones. In small organizations there is delegation of duty and employees tend to perform their duties basing on personal preference. In larger organization and businesses it is quite the opposite as it requires the delegation of duties basing on the ability of an individual. Communication flows in a sequential manner from the senior to the junior officers.
Life cycle of the organization
Organizations undergo four stages in its development; the birth when it is starting off. At this point it is always establishing itself and the founder is the decision maker. The next stage is the youth phase, here, it is trying to grow and a lot of emphasis is laid on expansion. At this point most of the structures of the organization are put into place. The founder no longer calls the shots but attention shifts to the needs of the clients. Next is the middle age stage. Here the organization is large and its structure more arranged. The founder is likely to lose control due to the offshoot of hierarchical structure in the chain of command. Maturity is the last phase where the firm becomes less creative but concerns itself with stability. This stage marks the beginning of the death of many firms (Wysocki, 2011).
It is the behavior of a firm in relation to its product in the market. There are two forms of strategy that can be employed; differentiation strategy where the firm is the first in launching of a new product or cost-leadership which entails producing the same product in the most effective way possible.
Many products have been rendered obsolete by shift in technology. Research and development is the core strategy of most firms and failure to invest in cutting edge technology leads to losses. EasyJet has invested heavily the use of information technology for example e-ticketing to reduce operating costs.
EasyJet is a low cost airline operating in Europe but has its headquarters in Luton England. It specializes only on passenger transport. Since it is a large firm easyJet’s management structure is one in which commands are passed on in a hierarchical manner. The firm also relies heavily on technology as it moves to paperless operations to reduce manpower, reduce pollution and increase effectiveness. Concerning management ethics, the airline demands from its employee’s the highest standards of discipline, hard work and efficiency. The procurement process at easyJet has strong restrictions to ensure that all contracts are above board and reduce conflicts. easyJet takes its corporate social responsibility seriously by involving itself in environmental conservation, donating to charity and participating in research to come up with efficient aircraft like ecojet.
Management in the global environment is affected by the size of the firm. Large firms have complex structures while small ones have simple or none. Life cycle is another factor and has four phases; birth, youth, middle and maturity. Strategy also affects management because it is about how a firm positions itself or products more effectively in the market. Lastly, technology comes in because we live in an environment influenced by the ever changing technological advances.
The airline industry is very competitive. Failure to conform to market trends may be counter productive to a firm. The ever rising cost of fuel has eaten into the profits of most airlines. The strategy behind the success of easyJet lies in increasing its volume and lowering ticket prices to beat most established players in the industry. The firm has also embraced technology e.g. using electronic tickets to lower expenditure. easyJet’s management structure is one in which authority is exercised in a hierarchical manner, commands flow from top to bottom.
On corporate responsibility, it has invested in conserving the environment by; limiting green house gas emissions, recycling waste and being part of research in developing aircrafts which are efficient. It also prides itself by donating to charity.
Management policies on the global environment is affected by; the size of the firm, its life cycle, strategies employed and technology.