Business developmenet & Management Assignement help on : Business Analysis Report for Flight Centre Limited

1. Organizational Description

The low-cost travel specialist very well-known High Performing Organisation (HPO) started its operations in UK in 1995 and since then it has expanded very rapidly. It has been called “world’s most productive workplace” (Blake, 2001). According to Blake Flight Centre Limited (FCL) is the most rapidly growing Travel Company across the globe with over 1200 location retail stores in 2004 in various countries like Australia, New Zealand, UK, South Africa, Canada, USA and Hong Kong. FCL’s one retail outlet , new-one opens every 72 hours and with an increasing profit continuously for the past 8 years with profit after tax of almost 45%.It has been designated as number four amongst the 100 Best Companies to Work For by Sunday Times in the year 2004 (Kirby and Jones, 2004)

The main reason behind its success has been that it has created a community instead of simply creating an organization or company. It has realised the importance and created business as a living system and it does so by liberating the best in its human resources by letting them grow and discover themselves through the policy of equi-vocation (Blake 2001).

Size of workforce: 5500 employees

Business Strategy: Shared Profits and High-performance being one big global family and “One Best Way”.

FCL is the most famous travel retailer which caters to the most cost conscious traveller and at the same time specialises in discount retailing for the domestic as well as international airfares. It also offers the full-time one-stop shop for all travel services including accommodation, car hire and travel insurance too which can be checked at its official website: http://au.biz.yahoo.com/p/f/flt.ax.html

1.1Organisatinal Culture

The organisational values and the norms which are shared within the organization and that influence the behaviour of the employees of FCL are called the organisational culture.

Corporate mission statement

Flight Centre is primarily committed towards positive contribution towards community along with social responsibility within as well as outside the organization. Therefore the mission statement states:

“To open up the world for those who want to see.” The company strives to maintain its corporate leadership in the travel market and it tries to show its commitment to corporate social responsibility as well as the environmental responsibility and for this it has implemented two major programs related to environment which are:

Office Environmental Policy
Comprehensive Offsetting Policy

Vision Statement

Flight Centre along with its corporate division FCm Travel Solutions are very responsible corporate citizens and try to create least impact on the climate through their operations and all the time try to assist their customers to reduce the carbon footprints at the same time (Vision: Flight Centre Limited, 2012).

The visions of FCL is ‘to be the largest travel retailer in the world- whatever it takes’ and it follows the philosophies to achieve them which are listed below:

Treating customers as the paramount
Ownership in the hands of people
Believing in the promises which are advertised
Puttying common sense ahead of conventional wisdom

1.1.1Organisational values

Core Values

The successful value or core values at FCL are neither designed nor imposed rather them is drawn out of their own people and they are lived.

“The measurement of our spiritual applications will come in our results, in your bottom line.”

In FCL the spiritual aspects are very important as the physical aspects like marketing. FCL gives equal importance to self-esteem, team spirit, quality of leadership and morale. This helps in developing strong culture and attracts people who will make it much stronger.

The following principles or norms of corporate governance have been found prevailing in FCL:

Laying very sound foundations for the management as well as oversight
Safeguarding integrity in case of financial reporting
Recognition and a risk management
Remunerate the employees fairly and in responsible manner
Promotion of ethical and responsible decision making process
Respecting and protecting the rights of stakeholders
Encouraging high performance
Recognise the valid and legitimate interests of the stakeholders (FLIIGHT CENTRE’’S COMMIITMENT TO CORPORATE SOCIIAL RESPONSIIBIILIITY, n.d.)

1.3Elements of organisational culture:

Flight Centre has been featuring continuously three times in the Hewitt’s Best employers List. The culture followed in FCL is egalitarian culture where there is:

High level of information sharing
Performance-based rewards
High-autonomy job design
Egalitarian culture
Teamwork
Empowerment to employees
Involvement of staff in decisions-making
Individual recognitions and
Provides services like health or financial planning for all its employees (Palmer and Dunford, 2002).

AS per the findings of Hewitt it was found that FCL is able to motivate as well as engage two-thirds of its work force and this is the reason why it is able to deliver better results every time. Therefore motivation is an important factor or part of organisational culture which should and is not ignored in FCL by the managers (Murray, Poole and Jones, 2006). This motivational level upgrading environment prevailing in FCL believes in expanding their job skills and for this five predominant themes have emerged which are:

A recruitment and Selection Process
Strong Learning and Developing Culture
The Nature of the work
Link between the learning and development activities and the job skills
The clear distinction between the Upgrading and expansion of the job skills.

1.4 Benefits of Strong Corporate Culture

There is a very strong learning and development culture which is found to prevail in FCL. It is being created through a combination n of highly educated workers and the organisations by enhancing and promotion of multi skilling which is done through general training, multiple job tasks and giving the workers freedom to take decisions. It has been found that FCL has strong culture because it provides training, extensive information sharing and high level of autonomy in decision making which is quite evident in the retail outlets (Carnoy, 1998).

2. Identification of Organizational Culture

Basically there are Rituals and Ceremonies which are used for identification of organisational culture in FCL. It follows the “family, village, tribe strategy”. The village groups which are formed by clubbing certain number of family sized stores or teams in a specific geography are encouraged and then they select a nickname for themselves, thus creating a distinct identity for themselves within the organisational culture. Every year an annually primary recognition award is being given to the village group. Thus it uses the clan-size concept for fostering healthy rivalry amongst its employees rather than allowing it to emerge in unhealthy and, unmanageable and unplanned manner (O’Keeffe, 2011).

3. Managing Culture

In order to manage the culture the department leaders play a critical role and along with the divisional leader set the culture for the organisation and try to prevail, harmony within the organisation (O’Keeffe, 2011). For this the department leader needs to:

Know the names of all the employees
Know their own role and they should also be aware that the leader realises the importance of their role
Create a cordial environment where the leaders can pull together
Know the vital things which are capable of defining them as individuals
Ready to establish the goals, directions and the purpose of the clan
Convene the social functions so that the employees feel that they are part of community
Give coaching to the first-level managers so that the community-freeloaders can be addressed at the right time that might diminish the community interest or the efforts.

4. Organizational Design and Structure

4.1 Organisational Design

AT Flight Centre it has built as well as fostered and environment which creates and builds success for itself as organisations, employees and the shareholders as well. The Flight Centre Model does this by creating a set of principles and systems which create success for the people and through them only. And it has three main layers:

1. Manage for Profit , Growth and Change

Profits are being managed at Flight Centre through “Business Ownership Scheme” (BOS) according to which every single employee is responsible for the profit creation and then the ones who succeed are rewarded. It creates the change through supporting experimentation, personal development, and establishing a lean, team-based structure which provides organic unlimited growth.

2. Focus on Success Drivers : Vision, Leadership, People, Culture and Customers

Flight Centre is successful because of focussing on these success drivers that is visions, People, leadership, customers and culture.

3. Systems and The ‘Rules of the Game’

The pieces of puzzle are held very tightly by following a very deliberate approach by FCL and this is done by developing a set of cultural norms which is very strict while on the other hand the operational systems give people freedom to develop their own system under the guidance of clear principles.

4.2 Organisational Structure

FCL has developed four layered organisational Structure where the major portion of the workforce is being made up of “shop team”. In the shop team there is a Team Leader and the rest team is minimum of three and maximum of seven members. These four to 10 shops are being looked after by regional coordinator.

Several Regions combine to form a “country” which is supported by “country business leadership team” which consists of technical and operational support personnel. Then the “countries” in turn are being supported by “national leadership team” which consists of managers who look after the national operations. The “global leadership team” takes care of the international aspects of the business.

It has more or less “anthropological” business model where the whole staff is divided into, “families”, “villages” and “tribes” and the theory which rules this structure is that the primitive social units are still holding place in the inherent human psyche.

The organisational structure of FCL is very simple, lean and team based as well. It has found organisational layers:

The shop or the business team
The country business leadership team
The national Leadership Team
The global Leadership team

The lean structure of the organisations makes it very easy for FCL to move in faster manner and to gain a competitive edge against its competitors. It also helps in easier flow of communication and in quick manner too. Since the teams are self-sufficient there is no requirement of an extra; layer of decision makers in FCL.

The personal responsibility is being promoted at FCL which is good for the company as well as for the individuals too that is why the phrase ‘no externalising’ is a refrained commonly in the FCL offices. It also follows very stringent recruitment criteria. Goal setting is also found to be playing vital role in Flight Centre. The basic structure of Flight Centre can be analysed from the diagram shown below:

5. Leadership

In FCL the leaders are supposed to posses special qualities which are:

Passionate in whatever they do
Create aspiring visions and sharing it with others
Set as well as achieve challenging goals and celebrating success as they are accomplished
Lead by example and self-discipline
Empathise and to get the best out of the team
Right way of sharing the information with team members and involving them in decisions making.
Taking responsibility of their own results and ensuring the team objectives should be met
Desire to learn and evolve continuously
Great sense of business
Intensity to energise the team
Aversion towards bureaucracy (Blake, 2010)

The main focus in FCL is on inspirational leadership and not on just management focused leadership by developing emotional connections with the members of team. FCL encourages personal leadership personal leadership and that too at all the levels.

6. Techniques for making Company Profitable

The main philosophy of FCL is to make achieving profits a challenge for everyone in the team. Profit sharing brings personal commitment to profitability in case of every team member and this is achieved through techniques like:

Following standard system for success

(a) Morning Meetings

(b) Directorships

(d) Conferences

(e) One-on-Ones

(f) Team Incentives

(g) Promotion Systems

Following equality and egalatarism in the company

From the internal analysis of Flight Centre it is evident that it has become a true story of success which has been achieved by following simple corporate philosophies, structure and management style and inspirational leadership.