This is the seventh of a series of articles which focus on managerial challenges in the aviation and aerospace industries. The following brief scenario / case study which is meant to illustrate the problems. Part 1 will outline the problem; Part 2 will discuss the issues and possible options; Part 3 discusses the short term and long-term actions needed to make the organization more resilient

Part 1 – The scenario

As George the operations manager from Greenstar aviation watched his partner Justin storm out of the building in a fit of rage, he wondered how the partnership had become so dysfunctional.

Justin had stormed out when George and three of the other minor shareholders had indicated that they did not agree to go along with plan for expansion that Justin had been promoting. Justin had given the other partners an ultimatum either go forward with his expansion plan or he would resign from his role as President of the company.

Background

Greenstar Aviation was a small executive charter aviation company which had been established by four aviation professionals approximately 10 years previously. All four of the partners had previously worked together in the flight department of a regional forestry company. In an effort to shed some non core business expenses the forestry company had decided to shut down the flight department and contract out all flight operations. Justin, the company Chief pilot saw the shut down of the flight department as an opportunity. He had been the one who approached his co workers with the idea of taking over the flight department as a partnership. Most employees saw the venture as being too risky but three other employees agreed to become partners with Justin in this venture. They included George – pilot, Don – pilot, and Casey the chief engineer. Each of the partners agreed to invest into the venture, and received shares commensurate with the investment made by each. As a result, Justin and George ended up with equal ownership and of 33% each with Don and Casey sharing the remaining 33% equally.

Justin was also the partner who built the business plan which he presented to the CEO of the forestry company. The forestry company saw this as a viable option and entered into a contract with the newly formed Greenstar Aviation. The fleet at the time comprised an older Citation II and a newer Sovereign. The new aviation entrepreneurs entered into a vendor financed purchase contract with the forestry company for the two aircraft. This allowed the forestry company to move the aircraft from being a liability to being an asset on the balance sheet but also allowed the Greenstar to start up with very limited resources.

Over the years the company slowly grew to a fleet of 6 aircraft. Justin held the role of company president but also held onto the Chief pilot role. As time went on Justin consistently pushed for growth and expansion into other geographic areas. Greenstar had 4 aircraft based in their home base and had established another base in another city with the other 2 aircraft. Operations were running ok but the company had leveraged itself highly and the lease charges on the aircraft were becoming an issue. As a Canadian company most revenue coming in was in Canadian dollars but the leases were in US dollars and the Canadian currency had recently dropped.

Justin had recently come across an opportunity to take over the 4 aircraft flight department for another corporation and he had approached the other partners with a plan to go forward with this latest expansion. Justin saw growth as a means of moving the company forward and resolving the financial challenges, but the other partners were less convinced. The reality is that the last expansion had not gone smoothly. Setting up another base in another city would challenge Greenstar’s Operations, QA, and Maintenance structure. And the reality was that every time a difficult decision came up it seemed like Justin would be out flying. George had been approached by Don and Casey who indicated that they were not in favour of another expansion right now.

In an effort to try to resolve the problem George had called an informal shareholders meeting where the four partners could discuss the potential expansion opportunity. Unfortunately, Justin had made it clear at the start of the meeting that as the founder and president of the company it was his decision and if the proposed expansion was not approved “you can go ahead and find another president and another chief pilot because I will leave this company”.  The three remaining partners indicated that prior to any discussion regarding the expansion this ultimatum needed to be withdrawn. George tried to get Justin to withdraw the demand. But in the end Justin did not like having his initiative questioned and stormed out of the office in a fit of rage indicating that he was the reason that the company existed and that without him the company would not exist.
 
What would you do if you were in George’s shoes?
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When reviewing a scenario, we ask a few questions like: who are the players? What are the primary / secondary issues here? What could happen? And what are the possible solutions to the problem? Take some time to write down some of the challenges and ideas for correcting the challenges.

Part 2 – Problem Identification
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When reviewing a scenario, we ask a few questions like: who are the players?  What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)

Players / Stakeholders; Justin – one of the partners, president, chief pilot, George - one of the partners, operations manager, Don - one of the partners, Casey - one of the partners and Chief engineer. The rest of the employees, lenders, customers, and other suppliers.

Primary / Secondary issues – root causes?

Partnerships are relationships between people – all relationships have challenges from time to time these can be caused by a number of issues such as:
Financial pressures
Perhaps a lack of a shared vision for the company
Different risk tolerances across the ownership group

What could possibly happen? What is at stake for the company and for the players?

In reviewing this case we could do a basic risk assessment using likelihood and severity as the two factors at play. In this case we have a possibility of a partnership breakup which could lead to the failure of the company as a worst-case scenario.  If Justin decides to stick to his guns and resign, the company would be without the president but would also be without the Chief pilot. This could lead the company having their operating certificate withdrawn

What could possibly happen? 

1. The unexpected loss of the company president could cause confusion among loyal staff members – this could lead to people not focusing on their job duties – ultimately leading to a potential safety hazard
2. Sudden departures of key people like the Chief pilot raise concerns with the regulator and with clients – do clients seek other service providers – leading to potential revenue issues.
3. The Chief pilot position would need to filled rapidly in order to stay in regulatory compliance

4.Increased scrutiny by lenders
5.A possible legal battle which destroys the company
 
What options exist?

1. Reach out to Justin and agree to his terms (the short-term solution)
2. Do nothing and hope that Justin will come to his senses
3. Hire a company lawyer and sue Justin the for his breaching fiduciary duty to the company
4. Find a replacement for the Chief Pilot position and enter into mediation with Justin to seek a mutually agreeable resolution

 
Part 3 Building a Solution
We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible options. Now what should partners do at this point / and in the long term to correct the current challenge?

Short term action

When an emergency pops up in an aircraft we are told to AVIATE, NAVIGATE, and then COMMUNICATE In the short term – keep your eyes on running the company don’t be distracted by the emotions associated with a partnership dispute.

• Identify who will fill the Chief pilot position on an interim or longer term and be ready to notify the regulator of your nominee if Justin actually resigns
• In a small company like Greenstar the rumor mill will be working at overtime – Remind everyone that safety is their primary concern and to focus safe operations.
• Proactive communications help to prevent the rumours from getting a foothold.
• Identity someone who could act as an intermediary to reach out to Justin
• Notify the corporate lawyer of the partnership dispute and seek advice (if the lawyer had been doing his job a partnership agreement would already exist)

Longer term corrective action

In reviewing this scenario, we see a situation which did not happen overnight and, in all reality, will not be solved easily. Building a small company requires a team that will work together. In the initial stages an idea, along with good intentions may be enough to move a partnership forward. As the emergent company grows in size and complexity good intentions prove to be inadequate when solving disagreements between partners. The resolution of this partnership dispute will require a dispassionate level headed approach that balances all the facts and can find a fair resolution. This is the work of a professional mediator.
Possible outcomes could be the normalization of the partnership and a getting back to business or it could result in a buy out and separation agreement. In this scenario it is possible that Justin comes back and indicates he wants to buy out the shares in the company or the remaining partners could enter into an agreement to buy out Justin’s shares. In either case it would be wise to bring in a professional who has experience negotiating such a separation agreement.
Regardless of who ends up in control of the organization remember that the ownership group is only one stakeholder and consideration must be given to ensure all relationships are maintained.

Summary

Building a new company is exciting, we enjoy working together to build something. That common goal is easy to identify and agreement is easily found as the group moves forward together. As time goes on the initial vision for the organization may shift or the reality of how difficult the goal is to achieve may set in. Building a company is tough work, when this reality sets in, what was once a shared vision can become a quagmire of conflict and emotion. Throw in some financial or family problems and the partnership can disintegrate. The reality is that partnerships are made up of people and people do have disputes from time to time. A wise group will ensure that a partnership agreement is established at the beginning of the partnership – when everyone is on the same page. This partnership agreement will help guide the rules of engagement when things are going smoothly but more importantly guide resolution of disputes in a fair and transparent manner if and when they go off the rails. After all nothing is forever and at one time or another every partner step away from the partnership eventually. 

This is the sixth of a series of articles which focus on managerial challenges in the aviation and aerospace industries. The following brief scenario / case study which is meant to illustrate the problems Part 1 will outline the problem Part 2 will discuss the issues and possible options Part 3 discusses the short term and long-term actions needed to make the organization more resilient

Part 1 – The scenario

Paul, the production manager at Eveready Aircraft Services was trying to decide what to do – he had a real dilemma on his hands.

Paul had just been notified by Karen the project manager for a Heavy check in progress for Allegra Air of a potential problem. Karen suspected the parameters used to inspect the flight control actuators were incorrect. As a result, some of the actuators could actually be at the point where they should be replaced. But the lead time for replacement actuators was 2 weeks. As she left Paul’s office, Karen indicated that she had not informed Carlos the rep from Allegra of her suspicion about the actuators.

Eveready Aircraft was a growing heavy maintenance shop which specialized in regional aircraft. The facility was in the final stages of completing the non routine repairs which had surfaced during the inspection phase. With only 4 days to go, the schedule was tight but until this moment Paul felt confident that the aircraft would be finished on time and on budget.

Securing this heavy check was a significant opportunity for Eveready aircraft. After years of work by the Eveready team this was the first aircraft from Allegra Air, a regional operator with a fleet of 75 aircraft. The Eveready sales team had really stressed on time, and on budget completion in their pitch to the Allegra Air executive team. Allegra had agreed to send this aircraft to Eveready with the understanding that if all went well it could lead to a 5-year heavy check contract. There was a lot riding on this.

As Paul looked out his office window onto the hangar floor, he considered his options.
 
What would you do if you were in Paul’s shoes or in a senior management role?
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When reviewing a scenario, we ask a few questions like: who are the players? What are the primary / secondary issues here? What could happen? And what are the possible solutions to the problem? Take some time to write down some of the challenges and ideas for correcting the challenges.

Part 2 – Problem identification

When reviewing a scenario, we ask a few questions like: who are the players?  What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)
 
Players / Stakeholders; Paul – the production manager, Karen – the project manager, Carlos – the airline rep. Other stakeholders include the employees and shareholders of Eveready aircraft – if they lose the contact, the loss of work will directly affect them, Employees and shareholders, passengers of Allegra Air – obviously the safety of their passengers and crews are of paramount importance.
 
What could possibly happen? What is at stake for the company and for the players?
In reviewing this case we could do a basic risk assessment using likelihood and severity as the two factors at play. From a likelihood perspective Paul needs to ensure that the data being used to asses the actuators is correct. When looking at flight control systems any anomaly can lead to severe consequences. So, at this point it may be too early to asses likelihood but the fact that the concern is tied to a flight control system would definitely make this a critical issue.
On the other hand, this aircraft could be the first of a multi million dollar 5-year contract for Eveready. If an issue is raised this late in the inspection that will cause a delay that 5-year - the contract could be put in jeopardy.
What could possibly happen? 

1. A loss of control of an aircraft by the loss of a primary flight control with a resultant high probability of loss of life. - worst case scenario
2. There is a margin of error built into the inspection criteria – it is doubtful that an actuator would fail
3. It could turn out that the data used to inspect the actuators was correct – in which case the only negative could be a potential for loss of reputation – if the client found out

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What options exist?

1. Do nothing until you have confirmed that what Karen has found is correct
2. Bring Carlos to the table now and explain the situation and work on finding a solution
3. Tell Karen that the data she was using was wrong and that there is nothing wrong with the actuators – and after all this contract is too important to start raising issues at this point.

 
Part 3 - Building a Solution

We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible options. Now what should Paul / or the leadership group do at this point / and in the long term to correct the current challenge?

Short term action

In reading this case and looking at the options the solution may appear to be obvious. Many of us would look at this case and say – the solution is easy – tell the truth. Reach out to Carlos and let him know that there is a potential for a delay to the heavy check. Then start working through the problem with the client in the picture. This would probably be the best answer – from a professional standard, an ethical, and good business practice perspective.

But why is it that we often see organizations making decisions that appear on the surface to be unethical or unprofessional. Are the people in the organization unethical – probably not, is the corporation unethical – probably not, but perhaps the values of the organization are not clear or they are misguided and this lack of clarity allows for lapses in judgement.

Look at your own organization – What are the values that drive your organization? And when we are talking about the values which drive your organization, we really are talking about the values that are demonstrated not just put onto a value statement which hangs on a wall. Do you feel that decisions are made simply out of expediency or cost containment or do the decisions truly reflect your organizations stated values?
 
Longer term corrective action

In the long term how do you build an organization in which everyone not only talks about doing the right thing, but actually does do what is right even when the stakes are high. These are the organizations which have a reputation for doing the right thing.

As many companies have found out too late reputation is hard earned but very easily lost. People like Paul make decisions every day which can affect the organization’s reputation. How do you build a culture which supports and builds the companies reputation? And allows its people to make the right decision.

One way to incorporate corporate values into the decision process. In the case of an organization like Eveready aircraft we could assume they would have values such as Quality, Integrity, and Safety as corporate values. The challenge is actually using those stated values. In this case we could use Paul’s dilemma and the three options that were identified.

Incorporation of the corporate values is as simple as using the value in a question such as; Which option demonstrates quality work? Or Which option demonstrates integrity? Or which option provides the highest level of safety?  By challenging ourselves to look at our dilemmas through the corporate values these values move from wall hangings to actual guiding values.
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Summary

The reality is we work in a highly competitive world where we need to compete on the basis of turn time, service, price, and reputation. Reputation can easily be destroyed when decisions are made for the wrong reason. Through the use of value-based decision making your organizations reputation is less likely to be tarnished by a poor short-term decision.

This is the fifth of a series of short case studies which focus on managerial challenges in the aviation and aerospace industries. The following brief scenario / case study which is meant to illustrate some of the challenges around organizational change. As you work through the case think about your own organization – do you see similar challenges?  Part 1 will outline the problem Part 2 will discuss the issues and possible solutions.

Part 1 – the scenario

Terry shook his head, based on his observations he suspected things were not great when he accepted the job as CEO of Northwest Aero Manufacturing Ltd (NAM) but after his meeting with Andrea the CFO.  She indicated that revenue was falling and that the company had not been successful in winning any new production contracts for some time now. Terry realized that he needed to move faster than he had planned. The writing was on the wall, he had just inherited an organization that was at one time an industry leader, but was now very much living-off its past reputation. 

Background: The company was formed in 1978 as a supplier of airframe components and sub assemblies for large airframe manufacturers. NAM earned its reputation by producing quality components on time and on budget. The company was founded by Garry Little. His connections in the aerospace community were legendary. He served on a number of industry advocacy groups but in reality his reputation was a key part of the company’s success.

The company production focused almost entirely on traditional sheet metal and machined components. Garry had realized that the aerospace industry was shifting to more and more composite work along with additive machining but his workforce were skilled metalworkers who lacked the knowledge to make the transition.

Unfortunately, two years ago, Garry had come down with a medical condition which prevented him from being involved in the company any longer. Since that time Garry’s family had attempted to continue running the company but, in the end, realized they needed to hire a new CEO. This is where Terry came in. Terry had spent years in the aviation manufacturing sector as an operations manager. He had been headhunted by an executive recruitment company into the role but the reality was that this was his first CEO level position.

Terry had spent time on the production floor and noticed two things – The production processes were dated and the workforce was definitely closer to retirement than he would have liked to see. But in speaking to the frontline workers he definitely noticed a pride in their work which was demonstrated by an incredibly low rejection rate during the final inspection.

During the meeting with the Andrea, Terry learned that there was an important meeting with the company’s primary financial institution next month. The company was using its line of credit more often and Andrea was worried that the bank was going to seek some sort of increased security – something which would be difficult with reducing revenues.  Terry realized that he needed to do something quickly – but what?

What should Terry do?
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When reviewing a scenario, we ask a few questions like: who are the players? What are the primary / secondary issues here? What could happen? And what are the possible solutions to the problem? Take some time to write down some of the challenges and ideas for correcting the challenges.

Part 2 – Problem identification

When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)

Players; Terry – the new CEO, Andrea – CFO, Garry – company founder, Garry’s Family – the shareholders, employees, Customers

On the surface the issues /challenge here appears to be based around a few themes:

1. The company has not adapted to technological changes in the aerospace manufacturing industry.
2. The company is facing a cash crunch in the near future.
3. The company lacks the ability to change?
4. The company lacks the knowledge and the equipment to be able to bid on technologically advanced work.
5. Succession planning, what is the plan for the replacement of key personnel

All organizations need to be constantly strategically scanning for changes to their competitive landscape. Change is a reality for all organizations, an organization that cannot adapt to change will not survive.

What could possibly happen? What is at stake for the company and for the players?

The writing is on the wall for Northwest Aero Manufacturing the company needs to adapt or it will disappear. Think of all the organizations which used to be household names which just don’t exist today due to technological change or more likely the failure to adapt to technological change. If change does not happen rapidly it is likely that the one of three option will occur;

1. The company fails financially and ceases to exist
2. The weakened company is purchased by a rival at a discounted price and stripped of any remaining value
3. The company continues to struggle along in a much smaller and weakened state where much of the company is laid off

Part 3 Building a Solution

We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible issues. Now what should Terry or the leadership group do at this point / and in the long term to correct the current challenge?

Terry has a challenge, he needs the organization to adapt to a changing competitive landscape. In reading the case it appears that NAM is a stable company that produces high quality products but has not adapted to technological changes within the aerospace industry.

He also has the challenge of decreasing revenue and a financial partner who is starting to become concerned with falling revenues.

Through any process of organizational change, it will be completely normal to encounter resistance to change from individual members of the team as well as from the organization itself. Identifying the sources of resistance will be important – he needs to carefully think through the possible implications.

Resistance to change can come from a lack of trust, or lack of understanding of why the change is necessary or perhaps the individual just does not like change. On an organizational level perhaps one department sees change as a threat to resource allocation, perhaps there is group inertia, or in this case perhaps a change of technology is seen as a threat to expertise.

Moving forward rapidly without identifying the challenges could easily result in an early failure which will give the naysayers evidence for not changing.

 Before Terry leaps into making rapid changes with the organization, he would be wise to do some research into how to make changes to the organization.

Management theorists such as Kurt Lewin (Lewin’s three step model) and John Kotter (Kotter’s Eight Step Plan for Implementing change) offer us some insight into how organizations can make changes. Looking at what the theorists offer can help us to build a plan for moving forward. Kotter’s model provides a bit more guidance for the manager and would be appropriate in this scenario. The following is a brief summary of Kotter’s Eight step plan for implementing change from his 1996 book Leading Change.
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1. Establish a sense of urgency by creating a compelling reason for why change is needed.
   • Bring the employees to the table, let them know why the changes need to happen, give them the big picture of where the company needs to be.
   • Include the financial challenges , employees need to know the truth
2. Form a coalition with enough power to lead the change
   • Identify who your biggest naysayers will be, get them on board and the others will follow
3. Create a new vision to direct the change and strategies for achieving the vision
   • Build a culture that focuses on the future
4. Communicate the vision through the organization
5. Empower others to act on the vision by removing barriers to change and encouraging risk taking and creative problem solving
6. Celebrate the short-term gains and improvement.
7. Consolidate improvements, reassess changes, and fine tune the changes
8. Reinforce the changes by showing how the changes positively benefit the organization

 
Terry has his work cut out for himself and for the entire company. This organization has a strong history and an excellent reputation if the organization can adapt to the changing technologies it should be able leverage its positive attributes into a great future.
This plan speaks to how the organization can make changes but don’t forget the other stakeholders. The customers and the financial institutions need to be factored in as well. Bring them to the table earlier than later – your customers can help drive your future vision and your finance people will be more likely to be supportive if they see a successful turnaround plan in action.
 
Summary

Change is a reality for any business. Change can be driven by a number of areas such as: Technological change, Competition, Social trends, Regulation, Generational workforce changes, or Economic shocks. Any organization needs to build resiliency and adaptability to these changes into their corporate culture – this can be accomplished through a number of ways. Build resiliency into your teams by building a learning culture that seeks out knowledge and uses it to adapt to change.  Welcome new ideas, don’t fear changes – identify how your organization can use new tech. Some enjoy change some fear it but the reality is change will occur regardless so let’s get the team onboard.
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Hierarchies by nature are designed to maintain the status quo – in a world of constant change we need to remove barriers to change – what structure will allow your organization to adapt to a changing world. 

Part 2 – Problem identification
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When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)

Players; Bob – Shipping supervisor, Graham – Bobs boss and Manufacturing manager, Mark – company founder, Andrea – CEO, Other employees, the Company itself.

On the surface the issues /challenge here appears to be based around a few themes:

1. The company has grown in size and complexity – does the old structure and culture support this growth?
2. A new leader is making changes to the organizations culture – perhaps trying to instill a culture that they are more familiar with?
3. What should an employee do when being asked to do something that they are not in agreement with.
4. How does effective communication occur in complex, siloed organization?

As is the case with most challenges, this case touches on a couple of key issues around communication, culture, formal vs informal company structure and leadership style.

What could possibly happen? What is at stake for the company and for the players?

How an organization communicates is a reflection of its culture and organizational structure. An ill thought out initiative can impact an organizations ability in ways that are unexpected. In this case, Andrea the new CEO feels that the company needs to reinforce its formal structure in order to become more professional. Unfortunately, she may have given the wrong message to her managers and they feel that they need to formalize communication thus limiting the informal communication structure. 

Corporate Silos; Many organizations due to the nature of the business they are in naturally develop silos. These silos exist where groups of employees work together on shared work. The challenge with a silo is that communication between silos can be a challenge yet these silos and the people within the silos must work together to achieve corporate objectives. The classic aviation silo being the flight crew vs the maintenance crew – these two groups need to work together to achieve corporate objectives but sometimes conflict can occur when the groups focus on their own individual objectives such as on time performance vs the challenges associated with troubleshooting a complex aircraft.

Unfortunately, shutting down informal communication between groups reinforces silos and leads to reduced corporate effectiveness. In this case the monthly supervisor lunch is a great opportunity for these supervisors to share information in an informal forum but more importantly it reinforces relationships across work groups.  The result on the bottom line could be very detrimental if work units fail to work together to achieve corporate objectives.

Formal communication and Informal communications, and Formal structure vs the informal structure

Formal communication is necessary but managers that forget the informal communication channels and the informal structure do so at their peril. In the old days it was the chat around the coffee machine where information really flowed in organizations – now its through social media. A wise manager knows who are the informal leaders are and ensures that they are an important part of any communications strategy.
 
Part 3 Building a Solution

We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible issues. Now what should Bob, Graham or the leadership group do at this point / and in the long term to correct the current challenge?

Bob’s first reaction to Grahams request to avoid discussing work over lunch should not be discounted. But what should he do, a failure to follow a directive from your supervisor is insubordination? As with any problem Bob needs to step back and asses the situation and look at the options, he has available.

Bob really sees three main options,

• Ignore Graham – Bob ends up being insubordinate
• Comply – which in all reality would mean not attending the lunch
• Or speak to Graham about the request – this is probably the best option

Questioning your supervisor’s direction is something which should be handled delicately. But that being said a good manager will listen to the concern. This is a sign of leadership – listening to your people when they have a concern. Engaged employees are ones who think critically and ask questions – a wise leader will take the time to listen to concerns. If Bob takes the time to remind Graham of the benefits of sharing information with his fellow supervisors, Graham will probably see the benefit.
 
Summary:
This case is designed to illustrate a few managerial realities around structure, communication, culture and how these areas are linked together. Any organization is as complex as those who work in it, the wise leader is aware of the constant balance that any organization needs to meet to survive. The other message in this story is around the need for managers to develop a culture which supports critical thinking and corporate growth. In a world which is changing rapidly we need to develop strategies which ensure everyone is engaged in thinking about how to do what they do better. We need people that question why we do what we do, as opposed to accepting the status quo.

Hierarchies by nature are designed to maintain the status quo – in a world of constant change we need to remove barriers to change – what structure will allow your organization to adapt to a changing world. 

These articles may only be used for used for not-for-profit educational purposes.
Copyright © 2020.​

This is the third of a series of articles which focus on managerial challenges in the aviation and aerospace industries. The following brief scenario / case study which is meant to illustrate the problems associated with employee evaluations – why we would use them how they should be used. Part 1 will outline the problem Part 2 will discuss the issues and possible solutions.

Part 1 – the scenario

Hassan’s first thought upon reading the email from Shawn, the Production Manager who was Hassan’s boss at HeavyFlight International (HFI) was – oh no “its that time of the year again”. The last time he had gone through the performance review with is boss the whole episode was almost enough for Hassan to quit.

As the senior lead in the coatings shop Hassan took his job seriously. He did his best to ensure that a quality product always exited his area. He worked with three other painters and they all got along quite well most of the time, but as with any group there was friction from time to time. But overall Hassan and his co workers took pride in their work and did a good job – or at least that is what they thought.

How performance reviews worked at HFI:

• The HR dept tracked all performance reviews and would notify each department head or manager 3 weeks before the due date of the performance review
• Performance reviews were conducted annually and coincided with the employee’s date of hire
• A standard performance review form was prepared by HR and submitted to the manager to complete prior to the official performance review meeting with the employee
• Employees were required to sign off that they had received their review with the signed copy going to HR for insertion in the employee’s HR file
• Managers would receive a letter on their file if any of the performance reviews were late

The last performance review

As it turned out Hassan’s last performance review coincided with what was the busiest time of the production cycle. Although the production line was always busy there were times of increased activity such as just before or after major holidays or when the sales group just overcommitted and projects collided. Further to this was the fact that Shawn the production manger was really unsure why he was even doing these performance reviews. Recently Shawn has made the statement to a fellow manager that regarding his feelings about performance reviews.

 “I don’t know about you, but why is it that we are letting HR dictate how we do our jobs as managers? We know our people need a bit of a prodding from time to time – this whole performance review stuff just gets in the way and delays giving the needed jolt”

Due to the production pressures, the last performance review had been done in a hurry. Basically, what had happened was Shawn tracked down Hassan during his Friday lunch and said “we need to get through this performance review thing today – are you free right now?” As it was a busy time there really was no where for a private meeting so they held the review in the lunchroom with everyone coming and going. Shawn started with “As you know you are required to participate in performance reviews in order to ensure that you know where you have not been living up to expectations” This opening line had already put Hassan at unease. Shawn then went on and touched on a number of minor issues which had taken place in the Coatings Shop over the last 12 months. It was obvious that Shawn had been collecting a list of any deficiencies and had been saving them up for this meeting. He even noted a time when Hassan had been late for work 6 months earlier. (As it turned out Hassan had had a flat tire on his car that morning) Some of the problems that Shawn brought up involved issues which were out of Hassan’s control – for instance Hassan was reprimanded for a late delivery on one aircraft (the customer had made a last-minute colour change). Hassan came from a culture where respect for your superiors was important, but these allegations were untrue and Hassan wanted to speak up. Unfortunately, Shawn said he was already late for another meeting as he thrust the review at Hassan and told him to sign it so he could submit the report into HR before the Friday afternoon timeline.

That last performance review was so badly handled, Hassan had seriously considered quitting – it was only his co workers who had convinced him that Shawn wasn’t that bad and that he should stay – after all they all said he did a good job. Hassan wondered what is the purpose of this performance review system anyway. Shawn also walked away from the last review feeling like this exercise was not really achieving anything other than checking off a box – could there be a better way to approach these reviews?
 
What would you do if you were in Hassan or Shawn’s shoes?
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When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here? What could happen? And what are the possible solutions to the problem? Take some time to write down some of the challenges and ideas for correcting the challenges.

Part 2 – Problem identification

When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)

Players; Hassan – Coating shop lead, primary subject 1 Shawn – Production Manager, Primary subject 2, Other employees in the coating shop, The HR department, the Company itself.

What could possibly happen? What is at stake for the company and for the players?

Regardless of size, organizations require employees to do their job. But if employees do not feel valued their contributions to the organization can suffer. In this case a management tool is being used incorrectly with the potential results being a workforce who is not engaged or worse. The company could lose highly skilled employees. The loss of enough employees can result in an organization which cannot earn enough revenue to survive.

On the surface the issues /challenge here appears to be based around a few themes:
1.Lack of training for managers regarding performance reviews
2.An inflexible compliance-based performance review system
3.Lack of a strategic HR plan?

Performance reviews have earned a bad reputation in many organizations for good reason – this case illustrates an extreme case where a performance review has gone off the rails. Many of us have seen or been party to poorly conceived performance review systems – the next section looks at the purpose behind performance reviews and suggests some ideas for how they can be effectively used.
 
Part 3 - Building a Solution

We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible causes. Now what should Hassan, Shawn or the leadership group do at this point / and in the long term to correct the current challenge?

When troubleshooting any problem, the first action should always be to take a step back and assess the situation. Leaping into action without fully understanding the situation or having all the information could result in doing more damage.

First action that should be taken by both Hassan and Shawn in this case if they are feeling that the performance review process is not working is to get all the information. Do some research and find out the purpose of a performance review is. Instead of complaining about a process, equip yourself with knowledge. So here we go.

Purpose of a performance review system – Every organization is made up of individuals. (bit of an obvious statement) So, for an organization to grow and move forward in capability or knowledge the individual members of the organization need to grow and move forward. The performance review system is actually a part of a systemic means of moving the entire organization forward – one person at a time.

Performance review systems are meant to give feedback to employees on what they doing well and where they need to improve – thus allowing the entire organization to improve.  Any performance review system should work on the following 4 principals

1. The primary role of any manager is to develop their staff so that each employee contributes their best to the organization
2. Managers who only give positive feedback, hold back their staff by not letting them know where they employees need to improve
3. Performance reviews are DEVELOPMENTAL tools NOT Discipline tools
4. Mutually agreed upon measurable goals are a key component of a performance review

Performance Review Best Practices

1. Include the employee in the process – share the performance review documents with the employee ahead of the formal meeting and ask them to take the time to do a self review. This is an indicator of whether the manager and employee are on the same page. In most situations the employee will rate themselves harder than the manager. If not, this may be an indication that expectations have not been clearly communicated to the employee. Don’t assume – be clear
2. Customize the performance review process based on the job description – Take the time to ensure that the review documents are appropriate for the job characteristics. Asking questions in a review that are not relevant to the position discredit the process. Not asking the right questions may not guide improvement.
3. Don’t save up problems for the performance review – remember performance appraisal programs are DEVELOPMENTAL not Discipline. If there is a problem with an employee let them know when the event happens. For instance, if you see someone showing up for work late – ask them at the time, don’t wait months to find out. Negative behavior or performance need to be addressed when it occurs.
4. Demonstrate the importance of this process – As a manager the best way to demonstrate your commitment to the employee evaluation is to set time aside with the employee. Silence your phone, turn off the computer screen, let the employee know that this time is focused on them and their development.
5. Be respectful of the employee – Remember that most employees want to do a good job. As long as you equip them with the tools to do their job they will do it to the best of their ability. Managers must remember that most people’s identity is tied to what they do – self identity and self worth are closely linked. The manager who fails to recognize this will do so at their own peril.
6. Improvement is an ongoing process – As with any continuous improvement process performance evaluations should be part of an ongoing process. Although an annual review is important there should be scheduled opportunities to touch base on the progress of the employee throughout the year. Touch base monthly or quarterly depending upon your needs but always schedule the meetings – otherwise they won’t happen. Celebrate the successes and offer a nudge or a reminder to the employee when needed.
7. Agreed upon and measurable suggestions for improvement should be part of the performance review – without measurable goals we cannot build a strategy for achieving. These goals need to be agreed upon but more importantly they should challenge while still being achievable.

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Summary

As with any tool, employee evaluations can be used correctly or they can be misused. Employee evaluations are an essential tool for organizations who want to grow and become more adaptable. Integrating employee evaluation programs must be done for the right reason – it should not be used as a proxy for managing non-performance.  What it should be used for is, developing your employees -which will benefit your organization in the long run. Integration of an effective evaluation program starts with a plan for getting the management team on board.  Take the time to explain and get buy in from your managers – without support, the program will be doomed. Senior management need to start by mentoring those who report directly to them, then expand the program through the ranks. 

Remember – an organization grows when the individuals within it grow – support growth and learning of your team members and you will reap the rewards of a more resilient organization.

​These articles may only be used for used for not-for-profit educational purposes.
Copyright © 2020.​

This is the second of a series of articles which focus on managerial challenges in the aviation and aerospace industries. The following brief scenario / case study which is meant to illustrate the problems associated with succession planning, career development and a changing workforce. Part 1 will outline the problem Part 2 will discuss the issues and possible solutions.

Part 1 – The Scenario

Bob was beside himself, Marnie, the sales manager for the organization had just reminded Bob that a potential client’s auditing team would be on site next week.  This was part of a standard pre-qualification audit to determine if the company would be approved as a qualified vendor for an upcoming multimillion dollar RFP (Request for Proposal). The company was trying to secure the contract to supply the air transportation needs for an upcoming multibillion dollar resource project.

As the maintenance manager for the air carrier, Bob had delegated Suzanne, one of the crew chiefs to ensure that the facility would be ready for the inspection. But the reality was that the external audit could not be scheduled for a more inconvenient time. A heavy check was in progress on one aircraft and the company had recently started operating another aircraft type which was causing some unexpected challenges – diverting Suzanne’s attention during her shifts. Add to this, the fact that it was summer and a number of key personnel had taken vacation.

Bob was done – he wanted to throw his hands up in despair – he was busy enough managing the maintenance department, fulfilling his primary responsibility of keeping the aircraft in the air – Why was he now having to pander to the requests from the sales manager? As he looked around the facility he realized that Suzanne had not managed to make any progress on getting the hangar ready for the external audit. Well it looked like the family would have to take a back seat again – As usual, I will have to organize the job myself, and Bob muttered “delegation never works!” - As he stormed back to his office.
 
What would you do if you were in Bob’s shoes or in a senior management role?
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When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here? What could happen? And what are the possible solutions to the problem? Take some time to write down some of the challenges and ideas for correcting the challenges.

Part 2 – Problem identification
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When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)
 
 
Players; Bob – Maintenance Manager -primary subject. Suzanne – Crew chief, Marnie – Sales manager, The Company itself, the potential customer, and the management and employees of the company would be seen as the primary players.

What could possibly happen? What is at stake for the company and for the players?
At the macro level, all companies’ need to generate revenue in order to at least stand a chance of making a profit. An inability to secure work through a competitive bidding process puts everyone’s job at stake. At the personal level Bob’s reputation and reputation of the maintenance department is at stake from both internal and external customers. In a relatively tightly knit but highly competitive industry such as aviation, the reputation of the company and its employees is critical to its long term success.  What about Bob’s Personal wellbeing – if he continues to try to personally solve every challenge?

On the surface the issues /challenge here appears to be based around a few themes:

1. Workload / Resource Management (Project Management) and,  
2. Leadership / Management in regards to Bob’s perceived need to step forward and take control
3. Organizational silos / perhaps this site visit is not seen as a priority by Bob
4. A lack of an integrated quality culture?

The reality is that you probably have seen a situation like this occur or you have played one of the roles in this classic workplace challenge. We are often asked to do more with less, within a time constraint set by others. Companies exist in order to make a profit and have finite resources. (Trying not to sound too much like the master of the obvious here.)  WE know this, then why are these workplace challenges common – why does it seem like organizations go from one crisis to another?

Part 3 Building a Solution

We have reviewed the scenario, identified the players, what is at stake, and proposed a couple possible causes. Now what should Bob / or the leadership group do at this point / and in the long term to correct the current challenge?

Short term action

 n this particular scenario the timeline is relatively short – the external auditors will be here in the next week – at this point we have no choice but an immediate call to action. A sense of urgency needs to be communicated to the front line. In a situation like this where the stakes are this high, be truthful. Bob needs to let the team know what is at stake here.  If everyone understands that this inspection could lead to an important contract they will probably come together and get the work done. Don’t just tell people to do something – engage them – take the time to explain why this is important.
 
Longer term corrective action

Is it possible to build an organization that is able to withstand commercial pressures while thriving in an environment of constant change? There is a direct link between a resilient culture and a culture which supports a quality mandate. The connection is an engaged workforce.  But what does it mean to have an engaged workforce? For the purpose of this case engagement means a workforce which shows up physically, mentally, and emotionally. Meaning they actually are showing up for more than just a pay cheque.
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Although not foolproof, the following suggestion may assist your organization and your people to be more resilient and engaged when the inevitable happens and projects collide.

• Build organizations which support teams - Teams are much more resilient than individuals. How you organize and reward your work groups can contribute to the team effectiveness. Ask yourself are you rewarding individual effort or team effort. (The classic example being the commission sales person who is focused on one objective alone)
• Build a culture which supports innovative thinking – listen to front line staff, reward ideas, celebrate new ideas, remember that innovation can sometimes involve taking a chance – not all ideas succeed – don’t dwell on failure
• Every member of your organization needs to know what their role is in the organization and how their input can affect others – this helps break down barriers and silos within organizations – Silo’s detract from teamwork. 
• Encourage initiative within your work groups but  beware of the lone ranger 
• Model the behavior you want to see – managers need to work collaboratively
• Set clear expectations  - Then hold individuals and groups accountable to agreed expectations
• Remember motivated people and teams will achieve more – and more importantly - learn how intrinsic motivators work.
• Set goals that are measurable and have an agreed completion time – then hold the group or the individual accountable ( a goal that is not measurable is not a goal it is an aspiration)
• Celebrate the group successes
• Trust your people
• Say thanks – a lot

These are all great points but without buy in from the leadership team any initiatives will be doomed – The first step would probably be determining if Bob is willing to change his approach to management. Senior management will have to make a decision based on what they know about Bob. Perhaps the first step would be set up a mentoring program for Bob. Or alternately removing Bob.

Summary

In a rapidly changing world where market conditions and competition is constantly shifting, organizations need to be able to adapt. Managers need to sharpen their leadership skills. The traditional management role was seen as maintaining the “Status Quo” – this approach does not support a resilient organization that can rapidly adapt to changing market conditions nor support a quality focused culture.

Building the organizational culture that you desire or changing an existing organizational culture does not just happen. Management needs to be very deliberate and disciplined when developing the organization which meets the organizations objectives.

Remember: “Nature abhors a Vacuum” an organizational culture will form in any organization. If management is not deliberate, the organizations cultural vacuum will be filled with something – unfortunately it may not be the culture that supports your organizational objectives. 

Part 2 – Problem Identification

When reviewing a scenario we ask a few questions like: who are the players? What are the primary / secondary issues here – root causes? What could happen? And what are the possible solutions to the problem? (Not unlike doing a corrective action plan)
Players; Terry – outgoing QA manager, Peter – Incoming QA manager, The Company itself including senior management and other employees, Transport Canada, Internal and external customers

What could possibly happen if Peter fails in this position?
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The reality is a fully functioning QA department is critical to a modern aerospace entity. The results could be catastrophic for the organization, starting with the loss of reputation right through to the suspension of a licence by Transport Canada – this is a big deal!

On the surface the issues /challenge here appears to be twofold: retention and replacement but there is another issue around assisting Peter to be successful in this new position.

This scenario is not that uncommon, many of us have either witnessed or been part of a situation like this. The reality is people come and go all the time in organizations, Terry is no exception. One thing that may be different in today’s world may be the level of loyalty and devotion to the company.  Today’s workforce tends to be more focused on work life balance along with life experiences. Another consideration, in most families both partners are working. The traditional 1950’s family model is long gone. Although it is doubtful that there is anything specific that could have been done to persuade Terry to stay, as a manager what are some of the things you can do to enhance retention among your staff.

• building a culture where all employees matter (this is a case study all in itself)
• Each member of your team has a development plan in place
• Ensure you have a clear set of objectives for your group and celebrate every success
• As a manager be authentic! do what you say, and say what you do  
• And remember, pay is only one reason why people work

If you develop a culture where people feel they are part of the team and they feel that their contributions matter, you will reduce but not eliminate turnover. So onto the other challenge - replacement.

Traditionally in many small to medium enterprises the process of employee replacement does not start until the employee announces their pending departure. This is not good enough and we need to do better. Here are some best practices that should be adopted to ensure that your organization is better prepared for employee turnover.

• Have a current job description for every position within the organization – the description should include job duties and key attributes necessary to be successful in that position
• Transparency in hiring and posting – linking hiring decisions back to the job description – this assists employees to know what they need to do to move forward in the organization ( helps retention)
• Identify key positions and ensure that a succession plan is in place for each – this may include who else in the organization has the ability to assume the role in an interim basis (Very important for positions which require the regulators’ approval) A 30 day notice of suspension goes by very quickly
• Every employee needs to have a development plan in place – these could be tied to positions within the company that the employee would like to aim for
• Keep employee profiles updated – this helps you identify possible internal candidates
• Ensure that you have a robust recruitment and selection policy which ensures that employees are selected with a balance of technical skills, and attributes that are in alignment with your company values

We just touched on some long term strategies for helping to build an organization which is more proactive around retention and replacement. A company with a strong Human resources strategy will be more resilient when the unexpected departure occurs. 

But, what do we do now that Peter is in a situation in which he feels unqualified for? 

In reviewing the case we see that Peter has strong technical skills but lacks experience in managing a team. Now what sometimes happens in a situation like this is the new manager without training tries to emulate the managers that he has experienced in the past. Well, if Peter has had experienced good management he may do fine, but alternately – you see where this is going. Leaving Peters’ management training up to chance is not an option. Managerial training should be consistent across an organization and for this reason HR is a good starting point when creating a development plan for a new manager.
A couple suggestions that could be considered in Peter’s case:

• Identify a managerial mentor – preferably someone from within who understands your organizations unique culture.  Schedule regular mentoring session’s offsite otherwise work gets in the way – and if you don’t actually schedule the session they don’t actually happen.
• Work with Peter to do a bit of a personal reflection and managerial gap analysis then build a plan which focuses on identifying the managerial skills that Peter needs to focus on first, second, etc.
• Based on the exercise above have Peter research some managerial courses he could take – avoid the one day managerial course – look to courses from public institutions with a bit more rigour.
• Sign up for some managerial podcasts such as Harvard idea casts or Manager tools
• Read some management books by recognized management experts such as Henry Mintzberg, Michael Porter, or Dan Pink – and set some time aside to actually read and digest the information.
• Ensure regular check-ins occur with the managerial mentor and with Peter’s direct supervisor –feedback is essential.

 
Summary
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People are not usually born as good managers. Management is a skill or a craft, and as with any craft it takes practice and hard work to learn it well. A good manager is one whose main focus is on developing their team while meeting organizational goals in a positive manner. Preparing someone for a managerial position takes time and effort – if left to chance the outcomes can be disastrous. Our current workforce is aging rapidly, companies need to embrace strategic Human Resource policies which will provide for the recruitment and selection of solid candidates.
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A quick analogy – Every essential system on a modern transport category aircraft has redundancy built in – ask yourself – What is my redundancy system for key positions in our company? ​