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GSBS6040 Human Resource Management Trimester 3, 2019
PBL Exercise 1: Case study
“We need to make tough but important decisions”
https://www.theage.com.au/business/companies/dark-skies-virgin-australia-reports-315m-loss-flags-750-job-cuts20190827-p52law.html
You are a newly appointed Human Resource Manager for Virgin Australia.
One of the reasons you were recruited is your interest in strategic human resource management! You like a challenge, and one of the more significant challenges in this new job is the recent announcement at its shareholder’s meeting that Virgin Australia will sack 750 office workers as part of a plan to cut costs and pull the ailing airline out of its financial nosedive. The airline lost $315 million in the year ended June 30th.
The new CEO, Paul Scurrah, who in March 2019 was brought in to replace long-time boss John Borghetti, said that while he was -acutely aware- of the impact the job cuts would have on staff, the result showed the airline must improve its financial performance. -I regret the need to reduce the size of our workforce so quickly. However, today’s financial results tell us loud and clear that we need to reduce costs,- he said.
-We need to make tough but important decisions that are in the long-term interests of the group.-
Under Borghetti, the airline was obsessed with reacting to Qantas rather than developing its own strategy. When Scurrah was appointed, he immediately commenced work on developing a robust strategic plan to present to shareholders at the recent meeting. On top of the planned job cuts, it was announced that Virgin Australia would also overhaul its corporate structure, which Mr Scurrah said had grown -overly complex over time-. The running of Virgin's three divisions - Virgin Australia, Virgin Australia Regional Airlines and Tigerair - will be combined into a single corporate team.
When you applied for the position, you read up on the airline, including accessing the Virgin Australia website for information on the organisation, including its history from its establishment as Virgin Blue in 2000: https://www.virginaustralia.com/au/en/about-us/.
When you undertook your Master of Human Resource Management program, you were particularly interested in matching the business strategies of organisations to their internal resources and competitive capabilities. One academic article you found particularly helpful was an article by Buller and McEvoy, (2011),
“Strategy, human resource management and performance: Sharpening line of sight”, Human Resource
Management Review, Volume 22, Issue 1, March 2012, Pages 43-56 (this is available in the Reading Materials folder on Blackboard)
YOUR TASK
Your boss, the Group Executive, People, at Virgin Australia, has asked you to prepare a briefing paper for the HR management team, to assist them in developing a human resource plan that reflects the new business strategy. She specifically wants you to identify key issues in developing a HR plan for the airline.
Your task is to consider the issues and challenges for designing a successful strategic human resource plan, that meets your boss’ objectives.
Specifically, identify three issues it would be critical to address in developing such a plan, and explain why these would be necessary to ensure that the proposed HR plan supports Virgin Australia’s business strategy. In choosing these issues, you might consider questions like:
• Who should be responsible, and what should be the process, for redesigning the divisional management structure?
• During the change process, how will you make sure you keep or recruit people with the skills you need for the future?
• How will you help Virgin Australia staff become more efficient and more innovative?
• What other organisations have been successful in changing their business strategy and associated HR strategy, and what did they do?
Present your findings in the form of a briefing paper for your boss. The briefing should comprise an introduction and the ‘scoping’ of the problem, and a brief statement of the main arguments of the paper. It should then provide substantive content on each of the three issues that reflects depth and breadth of research as well as practical understanding of the problem, and critical analysis of the issues in presenting solutions to the problems. A conclusion should draw together the identified issues, analysis and solutions.
Possible variations:
In writing up this exercise, you may prefer to use another variation on this scenario. Any variation must be agreed in writing with your Course Co-ordinator before proceeding:
- you are a consultant for a recruitment firm (rather than an HR Manager);
- you work for another airline, in a country other than Australia, which also faces strategic challenges.
SUBMISSION REQUIREMENTS
Due date: Sunday 6 October 2019 11:59pm AEDST – Submit to the Turnitin drop-box on your Blackboard site. Please aim to submit a draft version of your essay to Turnitin at least 2 days before the due date. This will give you time to view the similarity report, and make any necessary changes.
Length: 2000 words (+/- 10%). The word count is based on your introduction, body and conclusion, and does not include your title page, list of references at the end of your paper or any appendices.
Format: 12 point font; 1.5 line spacing (not single spacing, not double spacing); Times New Roman or Calibri Light font.
Paragraph format; No bullet points, no number lists – this is an essay, not a report and not a set of notes; no tables, charts, diagrams in the main body of your essay - put these in and appendix if you feel you need to use them.
The reference list should be presented as a separate page, and formatted using the APA 6th style.

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