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I worked as a flight attendant in the United States during a time of massive change in the airline industry. Previous to the mid 1970's the airline industry in the United States operated under strict market regulations that provided protections to airlines and shielded them from competition. They were granted market power by the government and thus life was pretty cozy for airlines big and small. Job security for all. And then, in the mid 1970's, in order to make air travel more accessible and affordable, the market regulations were removed. Thus ensued a 40 year war for market dominance that has only just begun to die down. Today, 4 legacy airlines hold about 70% of the US airline market. The remaining 30% is held by small and medium sized carriers that cater to niche markets. If you've ever wondered why US airlines have a reputation for bad service, it's because competition in the domestic market was so fierce, a constant "race to the bottom" in terms of costs and prices, that they were never really able to compete with overseas airlines (many of which enjoyed protections and subsidies by their respective governments).  Today, however, with the domestic market finally settled, US carriers are starting to turn their sites toward international competition. They're offering better products and services and, more importantly from my perspective, they're able to offer higher pay and better job security for their employees.

That last part highlights the main point of my journal this week. In my study of organizational behavior I've made some previous assumptions that may have been wrong. One such assumption has been that "Big is bad". In previous management classes we've talked about things like the "iron cage" of bureaucracy and normative control, characteristics which tend to owe themselves to larger organizations that depend on a high level of rationality to function. These "flaws" in organizations reinforced my preconceptions that big is bad and that there are too many large corporations in our lives messing up our societies (and our environment).

However, I've been reflecting on the recent spectacular failure of our team in the Mike's Bike's simulation in terms of how it has affected our stakeholders, especially our employees. We had to fire almost all of our workers this last rollover because we could not afford to keep them. Suddenly, all of my beliefs about how an organization should treat its workers became moot. High wages and good benefits sounds like a great thing that all employers should give their workers. However, the reality is that weak companies that aren't able to compete can't even provide a job to people, let alone provide high pay. And so, I've come to rethink my previous assumptions about big organizations. The theories and criticisms that we've learned about are not flaws of organizations but, rather, they are challenges. Indeed, bigger organizations might be more capable of addressing said challenges because they have more resources.

A close friend of mine was a flight attendant for several years for United Airlines, one of the worlds largest carriers. He was laid off earlier this year along with many of his colleagues. However, in an unprecedented turn-around United secured an agreement with the flight attendant's union to hire back all of those who were previously laid off and instead offer early retirements to more seasoned workers with a very handsome (and also unprecedented) severance package. Through size and scope, the airline industry has been able to provide security to their employees in a way that they never previously were able to do. I will have to start investigating this new found appreciation and start to think about ways that large organizations can better deal with the challenges that come with size so that they can extend their wealth to all their stakeholders.


  1. Hi Jeremy,

    Firstly, your journal was quiet intriguing to read, especially having that kind of insight and I'm wondering, what the hell have I been doing with my life. 

    Anyways, it's great that you've challenged your own preconceptions about 'big organisations'. I can't say I don't agree because I do. As I recall from Accounting, 'large' or 'big' in the XRB financial standards means a company has to  have more than least 30m of profit or more than 60m worth of assets-well its one of the requirements. With that being said, it's difficult to identify whether these big organisations have many job opportunities and pay their workers at high (I guess above minimum wage) rates. I would suggest that maybe you should look more into how these organisations compete and capture value. I feel as if you're focusing on the value of workers perhaps because that was somewhat a culture created within your Mikes Bikes company. However, it can be complicated when companies have to compete in vigorous industries/markets like the Airline Industry and have value captured at the workers' level. I think in industries like the Airline Industry, the market and resources used by various airlines are almost similar and it's hard to gain competitive advantage. I think their workers have to be resilient people to react as these airlines do to the market they're competing in. The size and scope of the industry certainly makes it more complicated for them to be centered around workers but rather, heavily competing in capturing values of their customers. I guess your theory is true if we look at Southwest Airlines in the US where basically they've created a culture within their company that, if the workers are happy, it'll transcend onto customers and that was perhaps their somewhat competitive advantage was the relationships they had. However, seeing as you are going to look further into this, it will be interesting to see what you have to say about large organisations and the way they deal with the challenges that come with size.

    All the best (smile) 

  2. Hello Jeremy,

    I particularly liked how you started with an insightful past experience which encourages the reader to read on and then linked it to a present experience with
    Mikes Bikes. This illustrates great analytical skills as mentioned within the Bloom's Taxonomy model. However, I would suggest that you use Daudelin's model to structure your reflection. Your problem was clearly stated and you have explained why you came across the problem, however you did not discuss how you could have done it differently (better) and discussed your future action(s). Also, it would be great seeing you apply the readings to your journal entry to illustrate your critical thinking skills. One of the readings discussed that administrators learn best from experiences, this could have fit perfectly into your journal entry. From your experience with Mikes Bikes you have learnt that Big is not bad. However, great work! (smile)


    Charity (smile)