BUS707 Report: Analyzing Jet Airways' Cross-Cultural Challenges

This report delves into the cross-cultural management issues faced by Jet Airways, examining the airline's international business context. It analyzes the financial issues, human resource management problems, and operational challenges that contributed to the airline's downfall. The report explores the impact of cultural differences on employee relations, communication, and business strategy. It also investigates the role of global culture and its influence on the airline's performance, including the effects of aviation turbine fuel costs and competition from low-cost carriers. The analysis highlights specific instances of cross-cultural missteps and their consequences. The report concludes with recommendations for addressing the identified challenges and improving the airline's management practices, offering insights into how Jet Airways could have better navigated the complexities of operating in a globalized environment. The report also includes a discussion of the assignment's scope, purpose, and limitations.

Running Head: JET AIRWAYS 0
Managing across Global Culture

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Contents
Introduction...........................................................................................................................................3
Purpose..................................................................................................................................................3
Scope.....................................................................................................................................................3
Cross cultural management issue: overview..........................................................................................4
Human resource management issues caused in Jet Airways: cross cultural issues that occurred due to
this.........................................................................................................................................................5
Other issues...........................................................................................................................................6
Financial issue in Jet Airways...............................................................................................................6
Losses that Jet Airways faced................................................................................................................6
Aviation turbine fuel burden..................................................................................................................7
Reasons behind rising of the operation cost...........................................................................................7
Recommendations.................................................................................................................................7
Conclusion.............................................................................................................................................8
References.............................................................................................................................................9

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Introduction
Global Culture is the exchanging of meaning, ideas, and values all over the world in such a
way that intensify as well as extend the social relations. The process is further move by the
consumption of common culture consumption that is being diffused by popular culture
media, internet, and international travel.
Jet Airways is one of the biggest airlines of India including hubs at Delhi, Mumbai,
Amsterdam airports, and Chennai. It also operates the regional as well as domestic network
within the subcontinent. It previously operated the services to Middle East, Europe, North
America, and Southwest Asia. It has recently closed the reservations to the international
services on 12 April 2019. From the October 2017, it was the second largest airline after the
Indigo. The Naresh Goyal started it in 1993. It has undertaken the last flight from the
Mumbai to Amritsar. In the news report, it is found that it has debt of billion dollars. The
closing of the company is affecting more than 60,000 people and 20,000 employees.
Government is also pushing the banks to save the company by having bankruptcy. It is
because the bankruptcy of the company has caused the loss of around 20,000 employees.
Several employees also committed the suicide in Mumbai due to loss of their job.
Moreover, aviation is quite underpenetrated market in India. Even though the demand is
increasing to a larger extent, aircraft is not as per the demand. In the 1.3 billion populations, it
has only 565 commercial aircraft. In the report, further discussion is carried on the issue that
Jet Airways is recently facing.
Purpose
The purpose of the study is to know the global culture issues in the international business.
The task is carried on the recent issue occurred in Jet Airways.
Scope
The scope of the task is to properly analysis the international business issue. The
understanding of the cultural issue has been undertaken in the task.

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Cross cultural management issue: overview
It means the behaviour of the organisation within countries and cultures of one country to
behaviour across other culture or country. It also seeks to improve the interaction of
managers, co-workers, clients, executives, alliance partners and suppliers all over the world.
Due to the increasing internationalization of every business, teams are increasing to be
multicultural. Therefore, managers are facing several issues related to communication. In
addition to this, founder emotional outburst as well as the failure of Jet airways to pay the
promise amount has led to the breaking of relationship between lessors and airline to the
breaking point (Tummers, Kruyen, Vijverberg and Voesenek, 2015). Due to this, it had to
cancel the hundreds of flight. Several clients have faced the issue due to delayed of flights. In
this issue, there were people who were from the business class.
Considering Jet Airways, there are cultural differences in aviation too such as Geert Hofstede
classified national cultures into four dimensions and this two of which can be implemented to
the flight deck i.e. power distance, which describes the “nature of relations between superiors
and subordinates”. In western culture, there is low power distance; however, in Latin or
Asian culture where Jet Airways is operating, they are shown on the other side of spectrum.
Moreover, low power distance in Western culture is backed as better safety record than in
India and Taiwan. In addition, generally, the power of distance is low in western society,
“formulating decisions, executing them, and taking account of their concerns’ is part of their
life and this also makes specific decision easier (Henrich, Heine and Norenzayan, 2010).
While forming out culture decisions in an effective way, some organisational changes can
also be incorporated in a better way by deliberately influencing the corporate culture of Jet
Airways. For instance, the company may emphasis on new top management team to deal with
the situation from new perspectives, may initiate corporate-wide training programme to
gather all employees together within the same practices towards achieving strategic objective
of reduction in turnover (Stahl et al, 2012). From future perspectives, the company may also
plan changes in employee appraisal so as to improve loyalty rate towards the company. All
this will influence the artefact level since things involving the look-and-feel of Jet Airways
induce considering the level of corporate culture at Jet Airways (Rahman, Balakrishnan, &
Bergin, 2012).
Other than this, long-term orientation can also be considered as fifth cultural dimension
describe and due to increasing globalization and cultural differences are bound to be found in

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workforce (Ang and Inkpen, 2008). Moreover, in the article, it was found that Jet Airways
did not consider top talent of the firm while knowing that business was going down and thus
this exempt leader to not fulfil their roles proactively and thus they also became the part of
unsuccessful decision of the company. The resources and potentials of the enterprise could be
exploited optimum when there are no such differences (Sharma & Salvato, 2011); however,
another big impact was related to savings as Jet owes Rs 8,500 crore to lenders and now
potential investors were now demanding them to take an up to 80 per cent haircut concerning
the debt.
The managers at Jet Airways could deal with their staffs with sound delegation and
coordination as it may probably take a big hit. In many multinational organizations, the
cultural differences are taken as positive factor and help in building synergies (Gomes et al,
2013), however, in case of Jet Airways, several cultural aspects are move out in wrong way
bringing conflict resolution in an unfair and unacceptable manner. Once the managers
manage the cultural differences in proper way, it will become easy for Jet Airways to flourish
in all way of their business. In addition, this will also bring out various difficulties to their
local competitors such as SpiceJet and IndiGo. Hence, all this provide culture glimpse of Jet
Airways in relation to that case leaving employees unpaid.
Human resource management issues caused in Jet Airways: cross cultural issues that
occurred due to this
It is found that Jet Airways has around 20,000 employees. Among them, most of the
employees did not received the salary from last many months. Moreover it is also found that
many of the workers were also from outside. The outside workers were also linked to their
operation that are now out from job. This staffs does never have their pending salaries. This is
also one such cross cultural issue as company was not able to pay and communicate to their
staff members properly. In addition to this, it has lower down the employment of various
other businesses also such as hotels, in-flight vendors, as well as vendors. The another issue
that is being seen is that the export of various fresh produce has been reduced due to this. The
shutdown has suddenly stopped the around 50 tonnes of veggies that were sued to shipped
from Mumbai to London. In this way, it was unable to manage the exporting of goods to
other countries. This proves to be the reason of cross cultural management issue. It is also
found that pilots had to cancel the 14 flights due to falling sick. In addition to this, it was also
not having the proper future business strategy. This is the reason that its finance was

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mismanaged. As a result, it put the negative impact on the company in case of financial crisis.
If it will have the strong human resource team, it will definitely assist the company regarding
the payment of banks, investors, employees as well as other stakeholders. In addition to this,
the mismanagement of its finance department was the significant team that caused this
problem (Noe, Hollenbeck, Gerhart and Wright, 2017).
Other issues
India’s most successful airline Indigo equity shareholders have also faced the issue. The issue
was related to the knowing their differences in their stake. In addition to this, both were
different from each other in terms of country as well as culture. Therefore, they have decided
to hire one lawyer in order to solve their issue. In addition to this, it is also facing several
other issues such as lack of assistance as well as lack of expansion in other countries (Clark,
2017).
Financial issue in Jet Airways
Jet Airways has swabbed around 250 Crore by the advance selling of tickets to the customers
loyalty programme named Jet Privilege. In the last October, it is seen that Jet Airways
received the 258 crore by ensuring the advance selling of the tickets. Due to the issue of non-
payment of the amounts, four planes of the Jet Airways have grounded. However, company
was regularly updating the people regarding their efforts to improve the issue of liquidity.
The airline has also made payment to some of its delayed payment members (Kaul, 2019).
Recently, it has around $1.2bn net debt. Besides this, it has also demanded the fund of around
Rs7.5 bn debt from the Abu Dhabi airways. Many of the Indian banks have also arranged the
fund for Jet Airways.
Losses that Jet Airways faced
The premium airline has suffered several losses from the starting of the January. It has the
massive loss of Rs, 1045 crore. In the quarter of April-June where it come across the loss of
around 13,23 Crore. In addition to this, it also faced the loss of 1297.5 Crore in the quarter of
July September (Rajput, 2019).

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Aviation turbine fuel burden
The increasing cost of the aviation fuel has taken the heavy toll on several airlines. It has also
taken the heavy toll against Jet Airways that also provided its services internationally.
Between the period of June to September in the year 2018, the significant hike occurred in
the oil prices that was forcing the airline to increase their spending on the ATF.
Reasons behind rising of the operation cost
The biggest reason besides this issue is the lost cost model followed by most of the Indian
airlines. Similarly, Jet Airways is one who gets deeply hurt by the budgeted airline such as
Spicejet and Indigo. Hey tends to offer the high discount to the customers on the booking of
their flight tickets. Many of the experts have also criticised this reason behind the slumps in
the airline industry.
Reasons of pressure in the Jet Airways
Jet Airways is the perfect example of the loss of pricing power due to the competition in the
market. As the full service carrier, Jet airways also has the high cost structure as compare to
the low cost airlines such as Spice jet and Indigo. As per the data of BSE, it has been found
that Jet airways has received the profit only thrice in the year ending of 2016 and 2017.
Therefore, due to its negative worth of Rs 7,242 Crore, airline is not able to repay its payment
to the aircraft and banks on time. However, stakeholders are keeping patience in order to get
their money back. Previously Tata was also trying to buy the airline but it also step back.
After not getting the payment for long tune, the lenders have took the airline to the court
(Financial Time, 2019).
In addition to this, the merger with Sahara Airways is also one such mistake of the Jet
Airways. In addition to this, Sahara was acquired by the Jet airways for $500 million that did
not proved to be suitable price for the Jet Airways. It has also rebranded the Sahara Airways
as JetLite. Additionally, mismanagement was caused at the Jet Airways by taking various bad
decisions for the company.
Recommendations
The first and foremost initiative that Jet Airways can take is to implement the change
management programme. This programme will help the Jet Airways in improving its image.
By implementing this strategy, it can check the areas where the improvements are necessary.

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By considering the areas where change is required, it can take into account the problems.
After the deep analysis of the problem, it can find out the root cause of the problem and then
appoint the expert to find out the solutions for the problem. It is true that several alternatives
will come out that needs to be present before the manager (Hayes, 2018). After analysing all
the alternatives effectively, it can search out the solution to its problem. It is true that it must
have some savings from its past record. Therefore, it can sue those savings to find out the
possible solution. In addition to this, the company in some of its strategy can also use
savings. The proper layout is also essential to be prepared by the company for finding out the
debts that company is required to pay exactly. By doing this, it should find out the least
payment persons. Therefore, it should start paying to the persons who have to take the less
payment for the company. This will also help the company in some way because will get the
people image in mind that company has started paying. In addition to this, it can also
formulate the strong target for its future changes. By presenting this strategy to the
government, it can also take their assistance. If government will provide it some of the
amount, it will be able to pay out some of the debt and the remaining amount can be utilised
for taking necessary action.
Conclusion
In the limelight of above discussion, it can be concluded that Jet Airways was one the
growing airline industry. However, Jet airways has faced the issue of insolvency recently due
to the increasing debt on the airline from various banks, shareholders and customers. In spite
of the largest and fastest growing airline of the world, it cancelled the several flights. Due to
this, it has faced the debt of around $1.2 billion. Therefore, Jet airways is on the way of
bankruptcy. However, still people have some hope for the Jet Airways. Due to the issue in Jet
Airways, various other entrepreneurs has taken the initiative to provide jobs to various
people. Besides this, if any of the company will become ready to buy the jet airways, it might
be possible that the employees of Jet Airways will receive their due salaries and payment.

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