Korean Air CEO Cho Yang-Ho had a challenging change situation facing him. He wanted to transform his
Question:
Korean Air CEO Cho Yang-Ho had a challenging change situation facing him. He wanted to transform his airline’s image of an accident-prone airline from a developing country to that of a strong international competitor.
The number of accidents has increased significantly, putting shades over the company ability to provide safe and secure services for its customers. His main focus was on improving safety above all else, which meant making significant changes to the organization’s culture. What made his task even more challenging was Korea’s hierarchical culture that teaches Koreans to be deferential toward their elders and superiors, which results in great hesitation from juniors to comment whenever elders violate safety and security instructions, besides the high degree of favors towards the elders manage always to cover their mistakes. The HR team is consider a part of the crime as it support this violation , protect the seniors and blocking the juniors’ complains to reach the top management.
The ratio of the employees over 40 years almost 60% the reason behind this the low turnover rate of the company and the aviation industry requires relatively long years of experience to be able to perform according to the international standards. Cho says, “It (the hierarchical culture) exists in all Oriental culture.” His approach to changing his company’s culture involved implementing a “systems approach aimed at minimizing the personality- driven, top-down culture that is a legacy of Korean business managers who place emphasis on intuition and responding to orders.”. Korean Air is now one of the world’s largest commercial cargo carriers, and it has earned a four-star rating (out of Five possible stars) from a London aviation firm that rates airlines on quality by applying their old culture.
The fact that an organization’s culture is made up of relatively stable and permanent characteristics tends to make it very resistant to change. A culture takes a long time to form, and once established it tends to become entrenched. Strong cultures are particularly resistant to change because employees have become so committed to them, although that young employees were trained intensively in the most elite aviation institute but still has no space to criticize, or suggest or even to express any solutions, because the level of empowerment is very limited.
The company develop a new vision (To be the world leader in safety and profitability), followed by new strategic objectives and strategies such as:
1. Reduce the safety violation incidents by 90% in the next 3 years
2. Increase sales volume by 60 % in the next 3 years
3. Increase the customer satisfaction by 50% in the next 2 years
4. Expand its operation in more 5 destinations in the middle east
5. Transform the HR into a more productive and customer oriented in the next year.
Analyze the mentioned case and answer the following question:
1. Identify the real problem behind the phenomena and the causes of this problem?
2. Design a strategic fit between the overall new strategic plan and human resources strategic plan, suggesting at least five decisions need to be done in order to achieve the strategic objectives from HR perspective?
Managing Business Ethics Making Ethical Decisions
ISBN: 9781506388595
1st Edition
Authors: Alfred A. Marcus, Timothy J. Hargrave