Low Cost Model For Long Haul Airlines

Low Cost Model For Long Haul Airlines As most industries reach a stage of maturation, the changing nature of the airline industry is evolving to integrate novel strategies and business models needed to comply with consumer needs. The low-cost airline sector is a model that generated large financial gains but saturation is observed, leading companies to discover new opportunities in the long-haul low-cost market. The article explains the principles behind the idea, justifying the failure of previous attempts and proposing a novel business model that can be adjusted to todays economy. 1. Introduction The airline industry is characterized by instability and unpredictability making it one of the most risky to invest in, succeeded only by the hospitality industry. Due to significant exposure to external factors, the airlines are subject to financial losses and damages, with the most recent being the terrorist attack on the US on September 11th in 2001. The global airline industry suffered greatly and any financial stability plummeted reports show losses of $10 billion only by US airlines in 2002 (Wensveen et al., 2007) In order to adapt with the continuously changing environment, airlines employed a cost-reduction policy by reducing capacity, in-flight amenities and management expenditure. The effectiveness of this method urged many companies to reconstruct their strategy to comply with consumer demand and lifestyle (Taneja, 2005). As a result, passengers were starting to prefer the more cost-effective approach of Low-cost carriers (LCCs) than conventional methods. A form of low-cost travelling had already emerged in the 1970s by Southwest Airlines, who kept low-unit costs by reducing aircraft turn-around time at the gate which inspired current companies follow its business strategy (Bamber, 2009). Today modern development of the strategy lead to a low-cost revolution with LCCs controlling 30 and 40% of the market capacity in the US and UK respectively since 2005 (Taneja, 2005). Due to the success of the model and the inevitable future saturation of the short-haul LCCs, companies focused their interest in converting the same business model for long-haul flights and turning it into a profitable business plan. However the concept of a low-cost long-haul airline is not new but previous attempts have not been successful. The earliest example is Freddie Lakers Skytrain which offered no frills transatlantic flights from London Gatwick to New York with single class tickets costing only  £59 one-way. The competitive pricing from established airlines that ensured after the relaxation of transatlantic market fare regulations, lead to debt accumulation of  £270 million and the company ultimately failed in 1982 (Calder, 2006). This review will examine the issues raised by the entrance of low-cost airlines to the long-haul route market and assess the factors that lead that prevented growth and establishment of such companies. By assessing how the elements of low-cost travelling are transferable to long-haul operations and the sustainability of such projects, solutions to building a successful business model could be found. 2. Other LCCs and proposals Shortly after the demise of Lakers venture, a US based low cost airline named People Express commenced flights from New York to London Gatwick in 1983 and later added Brussels. By providing connecting flights at its Newark hub and charging $3 for checked baggage, the company proceeded to expand from a successful low-cost carrier to offering economical long-haul flights. However, due to over-expansion and management problems the company was terminated in 1987. Recent attempts to adopt the Skytrain model of low-budget travelling include Oasis and Zoom Airlines. Oasis, based in Hong Kong, offered non-stop service between Hong Kong and London Gatwick in 2007, generating huge success due to the low cost of  £75 for one-way flights. Due to growing competition by leading airlines which landed in the more centrally located Heathrow and rapid accumulation of losses due to the unsustainable fares, the company failed just after 18 months. On the other hand, Zoom Airlines which operated between Toronto and several UK airports since 2006, had a longer lifespan but was forced to shut down after outstanding debts and bankruptcy were reported. A variety of ideas and proposals for long-haul travelling were suggested but were unable to raise the necessary finance. One of the most controversial cases is Civair, which was scheduled to start up a low cost flight between Cape Town and London Stansted in March 2004. However in December of that year, 7,400 passengers were left stranded when the company did not have an aircraft for the flight and no alternatives could be funded leading to closure. 2.1 Long-haul vs. short-haul flying Low-cost carriers have inherent differences in various factors when distinguishing between short-haul and long-haul flights. These include crew and security requirements, turn-around times, airport facilities, route authorities and route density. The competitive advantage acquired in short-haul LCCS cannot be transferred to long-haul, low-cost carriers because the only means of being profitable is optimizing aircraft capacity. Theories that could possibly create revenue by using the low-cost, long-haul model fall in two categories: either using a long haul airbus, charging higher baggage fees, buy-in food and beverages and fly to secondary airports or acquiring many cheap long-haul aircrafts with two-class service and secondary airport bases which will conduct multiple flights per week(Wensveen and Leick, 2009). The former theory would only be viable in practice if high volume city pairs could fill all the seats in the aircraft while the latter relies solely on getting cheap aircraft . However before developing hypotheses and specifications, attention should be given on the business side of airline operation. Judging from previous attempts, despite the original promising profits, most companies failed due to improper business planning. 3. Airline business planning and airline failure Every attempt of an airline entering the low-cost, long-haul flight market lead in failure, despite all the positive indications in the beginning. While there are hundreds of reasons leading in an airline failure, several common errors in business planning are shared between all of the cases. 3.1. Inability to maintain competitive advantage A company should be able to establish a sustainable, competitive advantage by analyzing and targeting the correct market while having the ability to compete with other carriers in the long-term. In the case of Skytrain, where Laker Airways entered the market of LCLH market without any competitors, it generated significant gains which were quickly diminished after the introduction of other airlines in the market. Uniqueness of an airlines business concept is important as it sets it apart from the competition otherwise will fail to raise necessary funds. 3.2. Inadequate income growth and profitability In most cases, many airlines business often dont demonstrate income growth and profitability. By displaying unrealistic financial projections in order to sell the business concept, the airline will fail. Bottom line growth is vital for the financial establishment of a company and that growth should be based on valid financial assumptions which can be backed up by quality measurements. 3.3 Incompetent leadership While the importance of a capable management team is underestimated, its one of the most imperative factors I gaining the interest of potential investors, as its believed that an average idea can be made profitable by the correct mindset. In most airlines the management team is overlooked in the business plan and this discourages investors from investing money. On the contrary, a good team is able to highlight any risks involved in the strategic objectives of the company and create a business plan that will ensure growth. A prime example is the introduction of Gordon Bethune as a new Chief Executive Officer of Continental Airlines the company had already filed for bankruptcy but Mr. Bethunes actions reinstated the fading airline into the most thriving carriers(Bethune et al., 1998). 3.4 Limited initial funding Most airlines require large funding throughout their development which cannot be obtained easily and combined with poor business plans lead to untimely failing. Airlines such as Oasis and Zoom were closed due to inadequate funding while competition by other companies was rising (Bradsher, 2008) . Correct estimations of the funding required and also taking into account the money lost during setup and initial operations, will lure investors for money investment as the potential for profitability will be significantly displayed. 3.5. Overexpansion and lacking flexibility Airlines often tend to expand their destination and aircraft base, with the impression that it will increase income revenue. In most of the cases, it was the limiting-step towards failure. Moderate growth and balanced route frequency can prevent overexpansion and sustain optimal gains. Additionally, the ability to compromise and adjust to the changing economical and social environment can subsequently increase the popularity of an airline among passengers. Continuous operation will lead to dependence on financial support from loans or subsidies and eventually bankruptcy. 4. Can the long-haul, low-cost model work? Studies have examined the possibility of the low-cost model integrating in long-haul flight business and clear advantages and disadvantages have been noted. At first, due to the absence of direct substitute for long-haul flights as well as the already competitive prices, there isnt adequate evidences that lower fares can increase demand in the same manner as in short-haul flights. Moreover, secondary airports cannot be used for the landing of large-aircrafts due to size and time limitations and also cost-effectiveness (Maertens, 2010). However, a cost advantage of 20 to 25% is possible if a carrier can offer online booking to reduce distribution costs and only point-to-point services where connective flights to the desired destination can be arranged by the individual passenger. Today, companies such as AirAsia X and Jet Star have managed to find a balance between price and service in order to provide low-cost flight opportunities. 4.1 Jetstar The Australian airline has managed to become one of the most successful start-ups in the recent years. While being a fully owned subsidiary of a legacy carrier, Quantas, is managed and operated separately. After commencing flights in the domestic Australian market in 2004, Jetstar operated its first international flight to from Melbourne to Singapore on December 2010, marking a new era for economical long-haul flights. Their low fares are based on the notion of offering point-to-point routes between Australia, Asia and the Pacific, in order to complement Quantas main international flight schedule. The company also offers choice between two ticket types, economy and premium economy, which various in-flight meals and snacks can be purchased or complimentary, respectively. 4.2 AirAsia X The Malaysian AirAsia which was the pioneer of low-cost carrier operations across Asia introduced the long-haul service AirAsia X in 2007 to provide more options and greater affordability to a wider marketing spectrum. Based in Kuala Lumpur, the worlds biggest low-cost hub, it has covered many destinations in Australia, Europe and Asia. A key principle in order to keep costs low is high frequency of flights and providing point-to-point medium or long haul services. As a true no-frills service it includes lots of seats and passengers purchasing in-flight meals and entertainment. It also offers a premium class which is similar to economy fare of legacy carriers while in June 2010, a US$10 million refurbishment was introduced introducing flat beds in the premium area with a small rise in the ticket fare (Anonymous, 2010). 5. Building an efficient low-cost long haul airline By evaluating the facts and figures of the previously mentioned airlines, Jetstar and AirAsia X, its evident that that reasonably priced long-haul travel can become a reality by utilizing specific cost-effective methods and business strategies. While this increase in long-haul travelling maybe attributed to the expanding economy in Asia (Hooper, 2005) and the rapidly increasing competition among emerging low-cost airlines in the continent, it has been shown that intercontinental travel as demonstrated by AirAsia can be profitable while maintaining low fares. These techniques can also be employed for any up-and-coming LCLH airline in Europe or US, to ensure their development. 5.1. Ensure faster turnaround of aircraft Short-hauls are considered to have more cost-advantage than long-hauls due to landing at secondary and less congested airports which allows higher crew and aircraft utilisation. Long-haul flights usually require more time refuelling and servicing, therefore less rotations can be performed compared to short-hauls. However, by landing at a specifically designated low-cost hub, such as Kuala Lumpur, can minimize refuelling times and costs of servicing while providing adequate support for larger aircrafts. 5.2. No frills services All-economy seating and in-flight food and beverage which can be purchased can aid in the revenue of sales while pre-booked in-flight entertainment such as hand-held devices could be useful in long-haul flights. 5.3. Point-to-point travelling only This method employed in short-haul flights ensures short turnaround times and prevention of time-consuming services which would affect timetables. Modern long-haul airlines could seek interline partners to expand their flight capabilities, similar to the co-operation of the Australian company Jetstar with its partner company Quantas (Jetstar, 2007). 5.4 High density cabins and lower input prices Gains from the long-haul flights will be possible if high seat densities exist which could make up for the low ticket fare, as more passengers equal to increased revenue. Also by importing dual-seating system with premium seats which can be charged at higher prices and have extra amenities, a market for passengers requiring conditions similar to business flights can be created resulting in more profit. New entries in the airline industry are benefited from very low unit aircraft prices in large orders as well as hiring younger and cheaper pilots. Moreover, costs of advertisings and website/call centres can be avoided to cut down expenses, since the low price is a sufficient reason for passengers to choose those companies. 6. Novel business models Because of the limited solutions and benefits on directly developing a low-cost, long-haul airline, new business models have been developed for potential exploitation into a low-cost model. 6.1. Network specialists These companies cater mainly to business passengers and are specifically operated as a corporate shuttle for routes with high-yield. A prime example is PrivatAir, a Geneva-based airline which has survived through contracts with major corporations to transport their employees between locations (Wensveen and Leick, 2009). It offers business class seating on trans-Atlantic flights using several Airbus and Boeing planes. It can also operate as an operator for existing airlines such as Lufthansa and KLM which utilize the company for their business class services in Germany. 6.2. Product specialists Airlines which focus on business and affluent leisure travel and are all-business class, all first class or both. These types of airlines are on par with legacy airline yields and offer premium cabins for long-haul flights. Companies in this market include Eos Airlines, MAXjet Airways, Silverjet and LAvion. While the first three carriers had gone bankrupt, LAvion which seemed promising and was recently acquired by British Airways did not make any profit as well (Lagrorce, 2008). Eos and Maxjet airways both operated between London Stansted and New York JFK using Boeing 757-200 while Silverjet operated between London Luton and Newark as well as Dubai. All three airlines ceased operations in 2008. LAvion operated between Paris Orly and Newark and is currently a subsidiary of British Airways OpenSkies unit. While the original offer of low fares and premium facilities seemed promising, all four companies filed for bankruptcy, citing rising fuel and oil prizes, limited funding resources an d newly formed competition on the specific routes by legacy carriers. While this business problem does not seem to be problematic, adjustments should be made in order to give motives to increase passenger preference. 6.3. Price specialists These airlines mainly adopt lower-costing strategies to compete with existing companies solely on price. This includes the low-cost, long haul flight plan which has been employed by various airlines such as Oasis Hong Kong, Zoom, Jetstar, Viva Macau and AirAsia X. In order to compete with legacy companies, larger aircrafts with high-seating configuration should be used to make profit. With the exception of Oasis and Zoom, which were bankrupt, the rest of the companies flourished with expanding their flight schedule beyond Asia and Australia. The problems leading to failure in the two named companies mainly involve insufficient business planning as discussed in a previous section. However long-term effects of the plan remain to be seen as sustaining low prices can be proven difficult with the current economy. 6.4. Long-haul charter carriers While unit costs for charter carriers is 10-20% more expensive than LCCs (Teckentrup, 2007), their increasing use for long-haul travelling made them an attractive alternative to network airlines, usually for summer destinations. Many European charter companies now target specifically long-haul destinations, such as Corsair which operates an all-economy Boeing 747-400 between Paris and Overseas French territories in the Caribbean; such high density planes are not used on other long-haul international travel by the company. Due to competition and projects bearing no success such as Britannia Airways, which discontinued flights from UK to Australia, charter airline long-haul flights have been restricted to limited time frames and leisure destinations. However, charter flights represent a large percentage of long-haul market and could potentially be exploited beneficially. 7. Sustainability of the low-cost model and future projects As the long-haul market becomes successfully grown and becomes profitable for major carriers again, it is likely that other carriers will be interested to obtain a share of the market. Due to the over-saturation of the low-cost short-haul airline industry in Europe, established LCCs such as Easyjet may utilize point-to-point flights by co-operating with long-haul flight companies to lower prices for distant travelling. Employing new aircraft types such as Airbus A350 and Boeing 787 can fly longer distances offer denser seating that would be possible to fit 800 seats flying between main hubs such as London-New York. Deregulation can also create a potential increase in new services, as many markets are limited to one or two national carriers. As this breaks down, the introduction of new entrants, such as Virgin Atlantic in the India-UK and India-USA markets can spur new competition and lower prices in international travel (Phadnis, 2012). For now, the low-cost, long-haul market appears to be decreasing as one of the pioneers of this sector AirAsia X pulled its European services citing the damaged economy of European countries and exorbitant government taxes affecting its ability to offer low-cost fares (Thomas, 2012). Even Ryanair, which declared that will commence transatlantic flights in 2007, has recently confirmed that long-haul flights are not happening for some years (Olorenshaw and Sturke, 2007). 8. Conclusions The substantial success of certain LCCs has certainly led to the perception of an attractive business model and its implementation is being utilised by various long-haul operators. Established LCCs are reluctant to join the long-haul market due to the dangers present but that is rapidly changing. Experience and expertise gained by short-haul markets can be transcribed successfully in the long-haul operating scheme, which will greatly compensate to the losses that will occur as the markets become saturated with myriads of low-cost carriers. On the other had, traditional airlines are equipped with an array of qualities such as established clientele, reducing economy seat fares to attract new passenger and experience in international flights puts the beginner low-cost carrier in a disadvantageous position. By employing a long haul point-to-point model to promote cross-selling and service integration with more established, traditional companies allow passengers to fly from smaller markets in other regions via LCCs. As with any new business model, achieving cost advantages is not enough to deem it successful. Theres a long history of competitors which offered subsidised low fares to combat new entrants in the long-haul market, leading them to financial difficulties and bankruptcy. Continuous innovation is needed in the evolving air transport market and adjusting to emerging carrier types could be beneficial. Combining a solid business plan which is flexible, manageable and competitive with a long term vision will guarantee a successful transition to the long-haul business.

Personal Narrative- Most Memorable Christmas :: Personal Narrative

Personal Narrative- Most Memorable Christmas Ever since I could remember, I have spent Christmas at my grandmother’s house, a house which is full of comfort, warmth, and happiness. At Christmas, I have always been able to escape the cold and dark real world allowing myself to truly enjoy just several moments in time. These moments have left impressionable memories from my childhood making Christmas a holiday that is special to me and my family. It is a time for my family to get together, share stories, laugh, and even cry. My most memorable Christmas is one from my past. I was about six years old. I clearly remember sitting in class on the last day of school before Christmas vacation anticipating the bell to ring and signify that the classes were finally over. As the bell rang, I ran out of that class, and once I got home I was ready in an instant to leave for my grandmother’s where I would spend my holidays. It was a two hour drive to my grandmother’s house. I was very impatient throughout the entire drive. I couldn’t wait to see my grandma, my cousin, and my aunts. To make things better, however, snow started to fall filling me with hopes of a snowball fight the next day. Finally, we arrived at our destination. I left the car leaving my parents and little brother behind and ran up the steps to my grandma’s house. I just had to be the first one to knock on her door, so I did. She opened the door for me, and I went inside parting with the bitter cold and darkness surrounding me. Inside the house I was immediately encircled with the aromas of her Christmas cooking and baking. A real fresh Christmas tree which was already beautifully adorned with old family ornaments perforated the air with more holiday aromas. I went into the kitchen with my mom, and together we helped my grandma finish preparing the Christmas Eve dinner. Soon, we all sat around the dinner table enjoying my grandma’s culinary specialties. There was one dish that had stuck in my mind though, possibly because it was the last dish served that night.

Comparison of Abigail Williams and Elizabeth Proctor in Millers The Cr

Comparison of Abigail Williams and Elizabeth Proctor in Miller's The Crucible The Crucible is play that helps to show human nature through a series of events linked through the Salem witch trials. In this play, a group of young teenagers would undermine the religious government and make a mockery of the Salem judicial system. Miller also shows human nature through the development of characters. Abigail Williams and Elizabeth Proctor are foils of each other and have many differences; they would also develop many similar traits. One of the main links between the two women is their love for John Proctor. This would create much animosity between the two women and would lead to much strife between the two. While Abigail Williams saw Elizabeth Proctor as an old witch that only wished to blacken her name to the community, Elizabeth saw Abigail as a whore that only wished to steal her husband away. I am convinced that Abigail’s beauty and youth also served to create a hostile atmosphere as Elizabeth is threatened by this. Another reason that Elizabeth is threatened by Abigail is the fact that she believes that Abigail still has feelings for her husband. Even though Elizabeth eventually comes to the realization that her husband has no feelings for Abigail, she continues to hold on to the notion that they did share something, which becomes evident when John Proctor is forced to state â€Å"Then how do you charge me with such a promise? The promise that a stallion gives a mare I gave...

Comparing the Gothic Revival in England Before and After 1820 Essay

Comparing the Gothic Revival in England Before and After 1820 The Gothic revival in England before and after 1820 was very different in many ways. Before the start of the Gothic revival the mediaeval style, since the last Gothic structure in 1509 of Henry VII ’s chapel, was seen as irrational and illogical and as one man described it as barbaric. This was one of the main causes that the mediaeval buildings of the 18th century fell into disrepair. During the Cromwellian period many Gothic buildings were classical in the interior and church interiors in the 17th century became increasingly boring and plain. Many statues, altars and windows were destroyed. Some attempts at gothic architecture were made in 17th century but many were a mix-match of ideas. Even though in the early1600’s there was an early flowering of mediaeval architecture with the Kings College in Cambridge. This carried on in to the 18th century where more and more people dabbled in the gothic style with out a full understanding of how gothic architecture worked as a structural system. They confused stages of the gothic period, which were later defined by Thomas Rickman in is writing, and also used Classical forms such as pilaster and venetian windows. Many interiors were of a classical form a layout and some times other style were thrown in. Some gothic forms were even used on the exterior of building where they didn’t perform the function they were meant to. This shows how little the architects of the 18th century studied the mediaeval and how little they understood it. The interest of Gothic grew more and more as gothic was seen to stimulate the imagination. It was seen as part of English romantic tradition, which sparked off an interest in artificial ruins in landscape design of the 18th century. Which was used as a means of heightening the atmosphere of the garden. An example of some artificial ruins is that of Wimpole hall designed by James Essex in 1768. Another inspirational architect in this time was William Kent. His designs using ogee pointed arches with a classical cornice inspired Batty Langley to produce a study in which he analyzed Gothic in terms of classical orders. A comparison with true mediaeval and Gothic architecture at this time shows that at this time all Gothic architecture was a decorative style to be applied as ornament to regular structures and s... .... After the houses of parliament burnt down the chosen style was Gothic not Classical. Pugin undertook all of the interior work. Another example was Scarisbirck Hall in Southport built in 1837 the great hall was with a timber framed roof with no classical plaster ceilings and it was all based on knowledge of the mediaeval architecture and all materials used were true. Pugin’s own house in St. Marie’s Grange built in1835 is based mediaeval vernacular forms it is stone built simplified Gothic and it used the theory of fitness for purpose. With regard to his house and his other works he said ‘a picturesque that arises out of strict utility’. John Ruskin(1819-1900) was very influential, his writings ‘Seven Lamps of Architecture’ influenced many people he had many similar view to Pugin apart from the fact he was Anglican and he led the way it their Gothic Revival. He also had a hope that there may be an acceptable style of iron architecture which may be developed so that Gothic could get a new lease of life. Works Cited: The Story of Architecture, Patrick Nuggins ,1996 History of Architecture Settings & Rituals, Spiro Kosof, 1985 Gothic Revival, Georg Germann, 1972

Utopian Dreams Essays -- Utopia Perfect World Essays

Throughout the ages, man has come to idealize a word that is most commonly related to ‘heavenly’ or ‘perfect’ without actually picking up the book and realizing for themselves that there is no such thing. A Utopian society could never exist because man is made to want, to desire success. Man is competitive by nature and would never be happy in a society where everyone is equal and there is no chance of advancement. Sir Thomas More dreamt of a land that was much like England but could never surpass time. He opened the eyes of a nation and made its people desire something new. Views were significantly changed and the world would never be the same. Sir Thomas More inspired dramatic changes in religion, community life and even paved the way for communism. And he did all of this through one simple book about one simple society. In a perfect utopian society, there is no official religion. The people are allowed freedom of belief. â€Å"Some worship for god the sun, some the moon, some some other of the planets† (117). The only thing that they all believe in is that there is one supreme ruler that creates miracles and brings them such joy. This is all quite contrary to the beliefs held in 1516 England. Their opinions resemble those of Christianity: their priestly caste, their high standard of morality, their prayers, and their hymns. However, in England the Roman Catholic Church allowed no freedom of beliefs. In fact, the church was firm in its insistence upon the principle of one church and one authoritative doctrine. More even went so far as to poke fun at the idea of the priests of Utopia being men of eminent piety. This remark, under normal circumstances, should be taken as a matter of course. However, in Europe at the time there were many outcries against the laxity and corruption among the clergy. Therefore, many saw this as an indirect thrust at the Christian priesthood. The fact that Utopian priests could marry represents a significant difference from the Catholic vow of celibacy. This was shocking to the citizens and especially clergy of England and Europe. The idea of a married priest was not something that they were quite ready for but were willing to think about. Another surprising contrast to Christian rule was that in Utopia, women were appointed to the priesthood occasionally. Although there were many contrasts, there was o... ...topian society everyone works the same amount of time, at the same job and for no money. In a Utopian society, everyone shares everything and no one gets ahead. In a Utopian society, very few are able to explore their talents and dreams, they are required to work if visiting another city for too long and do not even know what vacations are. In a Utopian society a true American would commit suicide after realizing that they could no longer be individuals. In a Utopian society ... there is no such thing. Utopia is England with no specific jobs. It is England with more structure and a little bit more freedom. Utopia is England if Sir Thomas More was ruling England. Utopia is not an idealistic place to live. It is a trap for those who can not get ahead in the real world and for those who just want to belong. Utopia changed the eyes of a nation and opened the minds of millions. It gave light into what perhaps the world should be like without forcing it upon anyone. It has crept into most governments and lands and has remained there ever since. It is Utopia and its presence is immense. Utopia may not be the perfect society but some of its traits could help to create one.

The Moon :: essays research papers

The Moon is Down Chapter One: Here we learn that a small town has been taken over by one of the many Nazi groups during World War Two. Mr. Corell â€Å" The town good guy†, the way I view it, sent the town postmen and policemen on a boating trip, keeping them from the invasion (we learn later that â€Å"The town good guy† is really a back-stabber later in the book). After the invasion, the Nazis request a meeting with the town’s Mayor, Mayor Orden. Joseph and Doctor Winter, two of Mayor Orden’s colleagues, await the arrival of Nazis too. The two meet Captain Bentick, a rank lower than Colonel Lanser who is the one who had requested the meeting. Bentick searches the home. During the meeting Annie, Mayor Orden’s cook, becomes very aggravated by the soldiers who wait outside the front porch of the Mayor’s home, and throws a pot of boiling water at them. Chapter Two: In this chapter, Steinbeck explains the characteristics of each of the Nazis. Major Hunter, an engineer, â€Å"arithmatician†, and seemingly indifferent to the fact that he is a soldier. Captain Bentick, a family man, was old and kind. Bentick also has certain admiration to the English. Captain Loft, a young man, took much pride in the fact that he was a soldier. He dreams of his own death on the battlefield, where he is respected. â€Å"Lieutenants Prackle and Tonder were snot noses, undergraduates, lieutenants, trained in the politics of the day† (Quoted out of the book; there seemed to be no sense putting it in my own words since it was right there, and couldn’t have been worded any better). Colonel Lanser takes much pride in what he does. To me, he sees life as an order given by a higher rank that must be taken out. It is also in this chapter that Captain Bentick dies by one Alexander Morden, a town dweller. Chapter Three: The chapter begins with a discussion between Annie and Joseph, who are talking about Alexander Morden and the death of Captain Bentick. Joseph reveals to Annie what he surely thinks will happen... â€Å"They’ll shoot him†. Annie is rejecting the awful thought. Unfortunately it is true and Alex will be tried. Molly Morden, Alex’s wife, met with the Mayor because of a rumor that had been circulating in the town. â€Å"You wouldn’t convict Alex would you?†, the replies, â€Å"No†. To the Mayor’s anger he found that he did have to sentence Alex to death; luckily he managed to shirk the awful duty. Chapter Four: This Chapter is very brief, it simply goes into Alex’s trial, where he IS convicted, and shot in a public area.

Individual Differences

http://www. flatworldknowledge. com/pub/1. 0/organizational-behavior/34685#web-34687 Why Individual Differences Are Important: * Individual differences have a direct effect on behavior * People who perceive things differently behave differently * People with different attitudes respond differently to directives * People with different personalities interact differently with bosses, coworkers, subordinates, and customers * Individual differences help explain: Why some people embrace change and others are fearful of it * Why some employees will be productive only if they are closely supervised, while others will be productive if they are not * Why some workers learn new tasks more effectively than others Attraction-Selection-Attrition (ASA) Cycle * Different people are attracted to different careers and organizations as a function of their own: * abilities * interests * personalities * Organizations select employees on the basis of the needs the organization has * skills and abilities individual attributes such as values and personality * Attrition occurs when: * individuals discover they do not like being part of the organization and elect to resign, or * the organization determines an individual is not succeeding and elects to terminate * Each phase of the ASA cycle is significantly influenced by the individual differences of each person The Basis for Understanding Work Behavior: * To understand individual differences a manager must: 1. observe and recognize the differences and . study relationships between variables that influence behavior Individual Differences Influencing Work Behavior: 1. Hereditary and Diversity Factors 2. Personality 3. Ability and Skills 4. Perception 5. Attitudes Diversity Factors Primary Dimensions (stable) * Age * Ethnicity * Gender * Physical attributes * Race * Sexual / affectional orientation Secondary Dimensions (changeable) * Educational background * Marital status * Religious beliefs * Health * Work experience Abilities and Skil ls Ability – a person’s talent to perform a mental or physical task * Skill – a learned talent that a person has acquired to perform a task KEY ABILITIES: 1. Mental Ability 2. Emotional Intelligence 3. Tacit Knowledge Attitudes * Are determinates of behavior because they are linked with perception, personality, feelings, and motivation * Attitude – a mental state of readiness * learned and organized through experience * exerting a specific response to people, objects, and situations with which it is related Attitudes: Implications for the Manager . Attitudes are learned 2. Attitudes define one’s predispositions toward given aspects of the world 3. Attitudes provide the emotional basis of one’s interpersonal relations and identification with others 4. Attitudes are organized and are close to the core of personality The Three (3) Components of Attitude: 1. Cognition (Beliefs and Values) – My supervisor is unfair. 2. Affect (Feelings and emotions) – I don’t like my supervisor. 3. Behavior (Intended behavior) – I’ve submitted a formal request to transfer. Cognition * What individuals know about themselves and their environment * Implies a conscious process of acquiring knowledge * Evaluative beliefs – favorable or unfavorable impressions that a person holds toward an object or person Affect * The emotional component of an attitude * Often learned from * parents * teachers * peer group members * The part of an attitude that is associated with â€Å"feeling† a certain way about a person, group, or situation Cognitive Dissonance * A discrepancy between attitudes and behaviors A mental state of anxiety * Occurs when there is a conflict among an individual’s various cognitions after a decision has been made Personality * A relatively stable set of feelings and behaviors that have been significantly formed by genetic and environmental factors * The relationship between behavior and personality is one of the most complex matters that managers have to understand * Set of characteristics that underlie a relatively stable p attern of behavior in response to ideas, objects, or people in the environment * Some Major Forces influencing Personality 1. Cultural forces 2. Social class/group membership forces 3. Hereditary forces 4. Family relationship forces PERSONALITY AND BEHAVIOR IN ORGANIZATIONS The Big Five Personality Dimensions 1. Extroversion 2. Agreeableness 3. Conscientiousness 4. Emotional Stability 5. Openness to Experience How to Identify the Big Five Personality Traits * Extraversion * An extravert is talkative, comfortable, and confident in interpersonal relationships; an introvert is more private, withdrawn and reserved. * Agreeableness An agreeable person is trusting, courteous and helpful, getting along well with others; a disagreeable person is self-serving, skeptical and tough, creating discomfort for others. * Conscientiousness * A conscientious person is dependable, organized, and focused on getting things done; a person who lacks conscientiousness is careless, impulsive, and not achievement oriented. * Emotional Stability * A person who is emotionally stable is secu re, calm, steady, and self-confident; a person lacking emotional stability is excitable, anxious, nervous, and tense. Openness to Experience * A person open to experience is broad-minded, imaginative, and open to new ideas; a person who lacks openness is narrow-minded, has few interests, and resists change. * Authoritarianism * the degree to which a person defers to authority and accepts status differences. * Machiavellianism * the degree to which someone uses power manipulatively. * Locus of control * the extent to which one believes that what happens is within one’s control. * Self-monitoring * the degree to which someone is able to adjust behavior in response to xternal factors. Emotional Intelligence (EQ) Basic Components * Self-awareness: basis for all other components, being aware of what you are feeling * Self-management: control disruptive or harmful emotions and balance one’s moods so they do not cloud thinking * Social awareness: understand others and practic e empathy * Relationship awareness: connect to others, build positive relationships, respond to emotions of others, and influence others Locus of Control * Locus of control of individuals – Determines the degree to which they believe their behaviors influence what happens to them * Internals – believe they are masters of their own fate * Externals – believe they are helpless pawns of fate, success is due to luck or ease of task * Tendency to place primary responsibility for one’s success or failure either within oneself (internally) or on outside forces (externally) * Internal locus of control- your actions influence what happens to you * External locus of control- represents pawns of fate Self-Efficacy Feelings of self-efficacy have managerial and organizational implications: * Selection decisions * Training programs * Goal setting and performance Behaviors Influenced by Personality Authoritarianism = belief that power and status differences should exist within the organization * Machiavellianism = tendency to direct much of one’s behavior toward the acquisition of power and the manipulation of other people for personal gain Individual Differences: Values and Personality ————————————————- LEARNING OBJECTIVES . Understand what values are. 2. Describe the link between values and individual behavior. 3. Identify the major personality traits that are relevant to organizational behavior. 4. Explain the link between personality, work behavior, and work attitudes. 5. Explain the potential pitfalls of personality testing. Values Values  refer to stable life goals that people have, reflecting what is most important to them. Values are established throughout one’s life as a result of the accumulating life experiences and tend to be relatively stable. 138]  The values that are important to people tend to affect the types of decisions they make, how they perceive their environment, and their actual behaviors. Moreover, people are more likely to accept job offers when the company possesses the values people care about. [139]  Value attainment is one reason why people stay in a company, and when an organization does not help them attain their values, they are more likely to decide to leave if they are dissatisfied with the job itself. [140] What are the values people care about? There are many typologies of values. One of the most established surveys to assess individual values is the Rokeach Value Survey. [141]  This survey lists 18 terminal and 18 instrumental values in alphabetical order. Terminal values  refer to end states people desire in life, such as leading a prosperous life and a world at peace. Instrumental values  deal with views on acceptable modes of conduct, such as being honest and ethical, and being ambitious. According to Rokeach, values are arranged in hierarchical fashion. In other words, an accurate way of assessing someone’s values is to ask them to rank the 36 values in order of importance. By comparing these values, people develop a sense of which value can be sacrificed to achieve the other, and the individual priority of each value emerges. Where do values come from? Research indicates that they are shaped early in life and show stability over the course of a lifetime. Early family experiences are important influences over the dominant values. People who were raised in families with low socioeconomic status and those who experienced restrictive parenting often display conformity values when they are adults, while those who were raised by parents who were cold toward their children would likely alue and desire security. [142] Values of a generation also change and evolve in response to the historical context that the generation grows up in. Research comparing the values of different generations resulted in interesting findings. For example, Generation Xers (those born between the mid-1960s and 1980s) are more individualistic and are interested in working toward organi zational goals so long as they coincide with their personal goals. This group, compared to the baby boomers (born between the 1940s and 1960s), is also less likely to see work as central to their life and more likely to desire a quick promotion. 143] Values will affect the choices people make. For example, someone who has a strong stimulation orientation may pursue extreme sports and be drawn to risky business ventures with a high potential for payoff. The values a person holds will affect his or her employment. For example, someone who has an orientation toward strong stimulation may pursue extreme sports and select an occupation that involves fast action and high risk, such as fire fighter, police officer, or emergency medical doctor. Someone who has a drive for achievement may more readily act as an entrepreneur. Moreover, whether individuals will be satisfied at a given job may depend on whether the job provides a way to satisfy their dominant values. Therefore, understanding employees at work requires understanding the value orientations of employees. Personality Personality  encompasses the relatively stable feelings, thoughts, and behavioral patterns a person has. Our personality differentiates us from other people, and understanding someone’s personality gives us clues about how that person is likely to act and feel in a variety of situations. In order to effectively manage organizational behavior, an understanding of different employees’ personalities is helpful. Having this knowledge is also useful for placing people in jobs and organizations. If personality is stable, does this mean that it does not change? You probably remember how you have changed and evolved as a result of your own life experiences, attention you received in early childhood, the style of parenting you were exposed to, successes and failures you had in high school, and other life events. In fact, our personality changes over long periods of time. For example, we tend to become more socially dominant, more conscientious (organized and dependable), and more emotionally stable between the ages of 20 and 40, whereas openness to new experiences may begin to decline during this same time. [144]  In other words, even though we treat personality as relatively stable, changes occur. Moreover, even in childhood, our personality shapes who we are and has lasting consequences for us. For example, studies show that part of our career success and job satisfaction later in life can be explained by our childhood personality. 145] Is our behavior in organizations dependent on our personality? To some extent, yes, and to some extent, no. While we will discuss the effects of personality for employee behavior, you must remember that the relationships we describe are modest correlations. For example, having a sociable and outgoing personality may encourage people to seek friends and prefer social situations. This does not mean that their person ality will immediately affect their work behavior. At work, we have a job to do and a role to perform. Therefore, our behavior may be more strongly affected by what is expected of us, as opposed to how we want to behave. When people have a lot of freedom at work, their personality will become a stronger influence over their behavior. [146] Big Five Personality Traits How many personality traits are there? How do we even know? In every language, there are many words describing a person’s personality. In fact, in the English language, more than 15,000 words describing personality have been identified. When researchers analyzed the terms describing personality characteristics, they realized that there were many words that were pointing to each dimension of personality. When these words were grouped, five dimensions seemed to emerge that explain a lot of the variation in our personalities. [147]  Keep in mind that these five are not necessarily the only traits out there. There are other, specific traits that represent dimensions not captured by the Big Five. Still, understanding the main five traits gives us a good start for describing personality. A summary of the Big Five traits is presented in  Figure  3. , â€Å"Big Five Personality Traits†. Openness  is the degree to which a person is curious, original, intellectual, creative, and open to new ideas. People high in openness seem to thrive in situations that require being flexible and learning new things. They are highly motivated to learn new skills, and they do well in training settings. [148]  They also have a n advantage when they enter into a new organization. Their open-mindedness leads them to seek a lot of information and feedback about how they are doing and to build relationships, which leads to quicker adjustment to the new job. 149]When supported, they tend to be creative. [150]  Open people are highly adaptable to change, and teams that experience unforeseen changes in their tasks do well if they are populated with people high in openness. [151]  Compared to people low in openness, they are also more likely to start their own business. [152] Conscientiousness  refers to the degree to which a person is organized, systematic, punctual, achievement oriented, and dependable. Conscientiousness is the one personality trait that uniformly predicts how high a person’s performance will be, across a variety of occupations and jobs. 153]  In fact, conscientiousness is the trait most desired by recruiters and results in the most success in interviews. [154]  This is not a s urprise, because in addition to their high performance, conscientious people have higher levels of motivation to perform, lower levels of turnover, lower levels of absenteeism, and higher levels of safety performance at work. [155]One’s conscientiousness is related to career success and being satisfied with one’s career over time. [156]  Finally, it seems that conscientiousness is a good trait to have for entrepreneurs. Highly conscientious people are more likely to start their own business compared to those who are not conscientious, and their firms have longer survival rates. [157] Extraversion  is the degree to which a person is outgoing, talkative, and sociable, and enjoys being in social situations. One of the established findings is that they tend to be effective in jobs involving sales. [158]  Moreover, they tend to be effective as managers and they demonstrate inspirational leadership behaviors. [159]  Extraverts do well in social situations, and as a result they tend to be effective in job interviews. Part of their success comes from how they prepare for the job interview, as they are likely to use their social network. [160]  Extraverts have an easier time than introverts when adjusting to a new job. They actively seek information and feedback, and build effective relationships, which helps with their adjustment. [161]Interestingly, extraverts are also found to be happier at work, which may be because of the relationships they build with the people around them and their relative ease in adjusting to a new job. 162]  However, they do not necessarily perform well in all jobs, and jobs depriving them of social interaction may be a poor fit. Moreover, they are not necessarily model employees. For example, they tend to have higher levels of absenteeism at work, potentially because they may miss work to hang out with or attend to the needs of their friends. [163] Agreeableness  is the degree to which a person is nice, tolerant, sensitive, trusting, kind, and warm. In other words, people who are high in agreeableness are likeable people who get along with others. Not surprisingly, agreeable people help others at work consistently, and this helping behavior is not dependent on being in a good mood. [164]  They are also less likely to retaliate when other people treat them unfairly. [165]  This may reflect their ability to show empathy and give people the benefit of the doubt. Agreeable people may be a valuable addition to their teams and may be effective leaders because they create a fair environment when they are in leadership positions. [166]  At the other end of the spectrum, people low in agreeableness are less likely to show these positive behaviors. Moreover, people who are not agreeable are shown to quit their jobs unexpectedly, perhaps in response to a conflict they engage with a boss or a peer. [167]  If agreeable people are so nice, does this mean that we should only look for agreeable people when hiring? Some jobs may actually be a better fit for someone with a low level of agreeableness. Think about it: When hiring a lawyer, would you prefer a kind and gentle person, or a pit bull? Also, high agreeableness has a downside: Agreeable people are less likely to engage in constructive and change-oriented communication. 168]  Disagreeing with the status quo may create conflict and agreeable people will likely avoid creating such conflict, missing an opportunity for constructive change. Neuroticism  refers to the degree to which a person is anxious, irritable, aggressive, temperamental, and moody. These people have a tendency to have emotional adjustment problems and experience stress and depression on a habitual basis. Peo ple very high in neuroticism experience a number of problems at work. For example, they are less likely to be someone people go to for advice and friendship. 169]  In other words, they may experience relationship difficulties. They tend to be habitually unhappy in their jobs and report high intentions to leave, but they do not necessarily actually leave their jobs. [170]  Being high in neuroticism seems to be harmful to one’s career, as they have lower levels of career success (measured with income and occupational status achieved in one’s career). Finally, if they achieve managerial jobs, they tend to create an unfair climate at work. [171] Myers-Briggs Type Indicator Aside from the Big Five personality traits, perhaps the most well-known and most often used personality assessment is the Myers-Briggs Type Indicator (MBTI). Unlike the Big Five, which assesses traits, MBTI measures types. Assessments of the Big Five do not classify people as neurotic or extravert: It is all a matter of degrees. MBTI on the other hand, classifies people as one of 16 types. [172]  In MBTI, people are grouped using four dimensions. Based on how a person is classified on these four dimensions, it is possible to talk about 16 unique personality types, such as ESTJ and ISTP. MBTI was developed in 1943 by a mother–daughter team, Isabel Myers and Katherine Cook Briggs. Its objective at the time was to aid World War II veterans in identifying the occupation that would suit their personalities. Since that time, MBTI has become immensely popular, and according to one estimate, around 2. 5 million people take the test annually. The survey is criticized because it relies on types as opposed to traits, but organizations who use the survey find it very useful for training and team-building purposes. More than eighty of the  Fortune  100 companies used Myers-Briggs tests in some form. One distinguishing characteristic of this test is that it is explicitly designed for learning, not for employee selection purposes. In fact, the Myers & Briggs Foundation has strict guidelines against the use of the test for employee selection. Instead, the test is used to provide mutual understanding within the team and to gain a better understanding of the working styles of team members. [173] Positive and Negative Affectivity You may have noticed that behavior is also a function of moods. When people are in a good mood, they may be more cooperative, smile more, and act friendly. When these same people are in a bad mood, they may have a tendency to be picky, irritable, and less tolerant of different opinions. Yet, some people seem to be in a good mood most of the time, and others seem to be in a bad mood most of the time regardless of what is actually going on in their lives. This distinction is manifested by positive and negative affectivity traits. Positive affective people  experience positive moods more frequently, whereas  negative affective peopleexperience negative moods with greater frequency. Negative affective people focus on the â€Å"glass half empty† and experience more anxiety and nervousness. [174]  Positive affective people tend to be happier at work,[175]  and their happiness spreads to the rest of the work environment. As may be expected, this personality trait sets the tone in the work atmosphere. When a team comprises mostly negative affective people, there tend to be fewer instances of helping and cooperation. Teams dominated by positive affective people experience lower levels of absenteeism. 176]  When people with a lot of power are also high in positive affectivity, the work environment is affected in a positive manner and can lead to greater levels of cooperation and finding mutually agreeable solutions to problems. [177] Self-Monitoring Self-monitoring  refers to the extent to which a person is capable of monitoring his or her actions and appearance in social situations. In other words, people who are social monitors are social chameleons w ho understand what the situation demands and act accordingly, while low social monitors tend to act the way they feel. 178]  High social monitors are sensitive to the types of behaviors the social environment expects from them. Their greater ability to modify their behavior according to the demands of the situation and to manage their impressions effectively is a great advantage for them. [179]  In general, they tend to be more successful in their careers. They are more likely to get cross-company promotions, and even when they stay with one company, they are more likely to advance. [180]  Social monitors also become the â€Å"go to† person in their company and they enjoy central positions in their social networks. 181]  They are rated as higher performers, and emerge as leaders. [182]  While they are effective in influencing other people and get things done by managing their impressions, this personality trait has some challenges that need to be addressed. First, w hen evaluating the performance of other employees, they tend to be less accurate. It seems that while trying to manage their impressions, they may avoid giving accurate feedback to their subordinates to avoid confrontations. [183]  This tendency may create problems for them if they are managers. Second, high social monitors tend to experience higher levels of tress, probably caused by behaving in ways that conflict with their true feelings. In situations that demand positive emotions, they may act happy although they are not feeling happy, which puts an emotional burden on them. Finally, high social monitors tend to be less committed to their companies. They may see their jobs as a stepping-stone for greater things, which may prevent them from forming strong attachments and loyalty to their current employer. [184] Proactive Personality Proactive personality  refers to a person’s inclination to fix what is perceived as wrong, change the status quo, and use initiative to so lve problems. Instead of waiting to be told what to do, proactive people take action to initiate meaningful change and remove the obstacles they face along the way. In general, having a proactive personality has a number of advantages for these people. For example, they tend to be more successful in their job searches. [185]  They are also more successful over the course of their careers, because they use initiative and acquire greater understanding of the politics within the organization. [186]  Proactive people are valuable assets to their companies because they may have higher levels of performance. 187]They adjust to their new jobs quickly because they understand the political environment better and often make friends more quickly. [188]  Proactive people are eager to learn and engage in many developmental activities to improve their skills. [189]  Despite all their potential, under some circumstances a proactive personality may be a liability for an individual or an organization. Imag ine a person who is proactive but is perceived as being too pushy, trying to change things other people are not willing to let go, or using their initiative to make decisions that do not serve a company’s best interests. Research shows that the success of proactive people depends on their understanding of a company’s core values, their ability and skills to perform their jobs, and their ability to assess situational demands correctly. [190] Self-Esteem Self-esteem  is the degree to which a person has overall positive feelings about his or herself. People with high self-esteem view themselves in a positive light, are confident, and respect themselves. On the other hand, people with low self-esteem experience high levels of self-doubt and uestion their self-worth. High self-esteem is related to higher levels of satisfaction with one’s job and higher levels of performance on the job. [191]  People with low self-esteem are attracted to situations in which they will be relatively invisible, such as large companies. [192]Managing employees with low self-esteem may be challenging at times, because negative feedback given with the intention to improve performance may be viewed as a judgment on their worth as an employee. Therefore, effectively managing employees with relatively low self-esteem requires tact and providing lots of positive feedback when discussing performance incidents. Self-Efficacy Self-efficacy  is a belief that one can perform a specific task successfully. Research shows that the belief that we can do something is a good predictor of whether we can actually do it. Self-efficacy is different from other personality traits in that it is job specific. You may have high self-efficacy in being successful academically, but low self-efficacy in relation to your ability to fix your car. At the same time, people have a certain level of generalized self-efficacy and they have the belief that whatever task or hobby they tackle, they are likely to be successful in it. Research shows that self-efficacy at work is related to job performance. [193]  This relationship is probably a result of people with high self-efficacy setting higher goals for themselves and being more committed to these goals, whereas people with low self-efficacy tend to procrastinate. [194]  Academic self-efficacy is a good predictor of your GPA, whether you persist in your studies, or drop out of college. 195] Is there a way of increasing employees’ self-efficacy? Hiring people who are capable of performing their tasks and training people to increase their self-efficacy may be effective. Some people may also respond well to verbal encouragement. By showing that you believe they can be successful and effectively playing the role of a cheerleader, you may be able to increase self-efficacy. G iving people opportunities to test their skills so that they can see what they are capable of doing (or empowering them) is also a good way of increasing self-efficacy. 196] Locus of Control Locus of control deals with the degree to which people feel accountable for their own behaviors. Individuals with high  internal locus of control  believe that they control their own destiny and what happens to them is their own doing, while those with high  external locus of control  feel that things happen to them because of other people, luck, or a powerful being. Internals feel greater control over their own lives and therefore they act in ways that will increase their chances of success. For example, they take the initiative to start mentor-protege relationships. They are more involved with their jobs. They demonstrate higher levels of motivation and have more positive experiences at work. [197]  Interestingly, internal locus is also related to one’s subjective well-being and happiness in life, while being high in external locus is related to a higher rate of depression. [198]  The connection between internal locus of control and health is interesting, but perhaps not surprising. In fact, one study showed that having internal locus of control at the age of ten was related to a number of health outcomes, such as lower obesity and lower blood pressure later in life. [199]  It is possible that internals take more responsibility for their health and adopt healthier habits, while externals may see less of a connection between how they live and their health. Internals thrive in contexts in which they have the ability to influence their own behavior. Successful entrepreneurs tend to have high levels of internal locus of control. [200] Key point: Values and personality traits are two dimensions on which people differ. Values are stable life goals. When seeking jobs, employees are more likely to accept a job that provides opportunities for value attainment, and they are more likely to remain in situations that satisfy their values. Personality comprises the stable feelings, thoughts, and behavioral patterns people have. The Big Five personality traits (openness, conscientiousness, extraversion, agreeableness, and neuroticism) are important traits that seem to be stable and can be generalized to other cultures. Other important traits for work behavior include self-efficacy, self-esteem, social monitoring, proactive personality, positive and negative affectivity, and locus of control. It is important to remember that a person’s behavior depends on the match between the person and the situation. While personality is a strong influence on job attitudes, its relation to job performance is weaker. Some companies use personality testing to screen out candidates. This method has certain limitations, and companies using personality tests