Thomas Cook: Leadership, Management and Organisational Structure

This report provides a detailed analysis of Thomas Cook's management practices, organizational structure, and leadership styles. It examines the management style, principles, and functions employed by the company, including the directive strategy used by CEO Peter Fankhauser. The report explores the organizational structure of Thomas Cook, highlighting the importance of customer engagement and the impact of the company's culture on decision-making. It also delves into various leadership styles, such as inspirational, transformational, and autocratic leadership, and their effects on the company's performance. Furthermore, the report discusses the effects of power, influence, and conflict within the organization, analyzing how these factors impacted employee performance and overall business outcomes. The report concludes with recommendations for improvement and insights into the factors that contributed to Thomas Cook's success and eventual collapse. This report is contributed by a student to be published on the website Desklib. Desklib is a platform which provides all the necessary AI based study tools for students.

ORGANISATIONAL
THEORY AND
PRACTICES

Table of Contents
INTRODUCTION...........................................................................................................................3
Examination of management style, principles and functions.................................................3
Organisational structure and steps taken to achieve high performance.................................4
Leadership style......................................................................................................................5
Various motivation strategies used by Thomas Cook............................................................7
Examples of corporate............................................................................................................8
Recommendations..................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................10

INTRODUCTION
Due to the fast-paced changing world and increase in competition organisations are forced to
develop with time and create such a structure which is flexible enough so that the changing needs
can be embedded in the system. Flexibility has become an important characteristic which will
help the organisation in adopting various changes occurring in market conditions. It is the duty of
manager to handle various functions and control as well as manage the processes in an
organisation (Kontinen, 2018). Thomas Cook was a British travel group. It was formed on 19
June 2007. There were two different segments of the groups which were a tour operator and an
airline. The following report consist of management style and principles as well as functions of
management which were used by the CEO of Thomas Cook. Along with it the organisational
structure so that high-performance can be adopted in the organisational culture of Thomas Cook
and also various impacts on employs is also discussed in the following report. The report
consists of leadership style used by CEO of Thomas Cook so that he can bring in organisational
effectiveness in the organisation. Various types of motivational theories as well as the analysis of
effect of power, influence and conflict in Thomas Cook are also discussed in the report.
Examination of management style, principles and functions
Management refers to planning, organising and working efforts in order to achieve the
goals of in business organisation. A management style is a way used by managers in a business
to accomplish all their objectives and goals (Dahlmann and Ward-Grosvold, 2017). Principle of
management refers to the activities involved in management such as planning, organising and
controlling various operations and activities in a business which includes materials, resources
and methods. It is the duty of a manager in an organisation to look after various aspects of
principles of management and choose the best way to be applied to an organisation. The major
functions of management include planning, organising, leading and controlling. These are the
four major processes and functions which are built in order to carry out the activities in an
organisation. It is the duty of an effective leader to carry out all these activities which will
include developing of a management style, choosing the principles of management and also
differentiating various functions of management which will be included in an organisation.
Thomas Cook’s CEO Peter Fankhauser used directive strategy for management (Waterson,
2018). The aim of this strategy is to unify different processes in an organisation and it majorly

focuses on developing unique system which can be implemented on an organisation effectively.
In the following process all these trends present with an organisation are used and focused on
delivering the high quality of service to the customers. The directive management strategy
usually depends upon qualities, skills, abilities as well as the experience of a manager who
directs employees in an organisation and also ensures that the best quality of product and
services provided to customer (Mullins, 2019).
Another example for management style can be affiliate management style which primarily
focuses on achieving the goals and also creating a harmonious environment in the business. This
refers to the values of mutual benefit, trust, respect as well as cooperation in a business.
Basically, this style of management focuses on creating a positive working environment and
bond between various employs engaged in an organisation. Sainsbury uses this management
style by its CEO Simon Roberts (Reeve, 2019).
Another management style used by a number of organisations is persuasive management
style. This is a management style just like autocratic style in which various characteristics are
strong and centralised control of decision-making in a business. The managers following
persuasive managers trial take the decisions themselves but also spend most of their times with
the employs rather than purely using autocratic style of management. This management style is
used in Tesco by CEO Dave John Lewis (Greco and De Jong, 2018).
Organisational structure and steps taken to achieve high performance
Organisational structure refers to a system which states how different activities and tasks
are allocated, coordinated and supervised and directed towards the achievement of goals and
objectives in an organisation. These includes rules, rules as well as responsibilities of various
human resource working in an organisation (Romero-Silva, Santos and Hurtado, 2018). The
organisational structure also determines the flow of information in an organisation between
different levels in an organisation.
The organisational structure at Thomas Cook was based on its function. There were
different functions such as finance, marketing, sales and human resources which formed the
organisational structure of Thomas Cook (Harris and et. al., 2016).
Thomas Cook success as well as quality of service which they provided for customer
satisfaction what a great reason for the success of company. The organisational culture of
company helped in taking proper decisions and evaluating them effectively. Its culture consisted

of various departments, teams as well as sub- groups. This also encourages employees in
organisation as they are trained and developed in order to provide proper satisfaction to
consumer. It is effective for both organisation as well as employs along with increasing
productivity for organisation (Metcalfe, 2018).
The organisational structure of Thomas Cook also focused on committing towards
maintaining strong relationships and customer engagement in every department. They made
effective communication with customers. They aimed at providing high quality services in order
to attain maximum customer satisfaction. There were a number of social networking websites
developed by them in order to engage customers and build deeper bond with them understanding
them effectively (Turner, 2019).
Another organisational structure used by a number of companies is divisional structure. It
is usually used by a large company which operates in various geographic area and have a number
of smaller organisations covered in it (Alsted and Haslund, 2019). Due to this structure it is
possible for organisations to grow rapidly and specifically taking care of each department and
division of company effectively. However, following this structure of organisation may bring
problems in communication as different divisions do not work cooperating with each other and it
can also cost a lot to the organisation due to the size and scope of business (Clarke and
Campbell, 2018). Walmart is a huge organisation with its branches spread worldwide. It is one of
the largest companies dealing in retail market and uses divisional structure effectively in order to
manage all the businesses and various divisions of it throughout the world.
The major reason behind collapsing of Thomas Cook were its debt. Also, the structure of
organisation was not built flexibly to adapt changing market needs which led to fall down of
company. There were a number of competitions arising in market from which Thomas Cook lost
its shares (Hayes, 2018).
Leadership style
The leadership style refers to a style in which the leader of an organisation decides to run
the entire organisation motivating and encouraging all the employees in order to fulfil the
required objectives and goals of an organisation in stipulated time period (Stenvall and Virtanen,
2017). There were a number of changes in leadership style seen in Thomas Cook by its last CEO
Peter Fankhauser. One of the major characteristic of its leadership style was inspirational
leadership which helped in updating with the changes required for business according to the

changes taking place in the external environment of business. In order to ensure continuous
improvement and development in the organisation the leaders have paid special emphasis on
making its workforce skilled and imparting various skill and knowledge development
programmes along with training to them (D'amato and Kim, 2016). This have also helped the
company in adding efficiency in execution of various process.
There are various other leadership styles such as transformational leadership style which
helps in navigating the organisation towards improvement through changing a number of various
existing processes and culture in the organisation (Al-Emadi, 2019). The managers of Tesco,
Dave john Lewis efficiently use this style of leadership so that they can favour the organisation
by bringing in more efficient and effective strategies in it.
Another most commonly used leadership style is autocratic leadership style. In this the
autocratic leader hold all the authorities in an organisation (Shahid and Muchiri, 2018). This is
an effective leadership style used by many organisations which empowers them to take decisions
quickly. They do not need to discuss regarding decision making process with all the employees
in the organisation. Majorly the functional managers of the organisation are provided with
autocratic leadership style so that they can effectively take decisions for their function (Blanc-
Serrier, Ducq and Vallespir, 2018). Jim Hackett CEO in Ford uses this management style of
autocratic leadership in order to make sure that all the decisions in various departments such as
operations, manufacturing, sales, marketing and human resource is done effectively.
Transactional leadership style is also the best leadership style which helps in order to
succeed for an organisation. The roles and responsibilities in a transactional leadership style are
strictly defined (Joinson and van Steen, 2018). The job of a leader in this style of leadership is to
make sure that all the roles of an employee and individual are divided equally and effectively so
that positive results can be produced out of them. There are a number of rivers as well as penalty
is used in this leadership style in order to grow distance and read out the weaknesses present in
an individual working in organisation. CEO of Michael O’Leary Ryanair uses this style of
leadership in their organisation.
Effects of power, influence and conflicts
Power refers to the ability of an individual with the help of which they can influence
other people in order to do what they want. It is often thought that power is good and ideal but
there are a number of issues which can be developed in an organisation due to power (Chauhan,

Goel and Arora, 2018). It is often seen that power might change the people as the rise to the top
of organisation and also the priorities of their goals and desires regarding the organisation
changes. It is often seen due to much power individuals fails to understand the perspective of
other people and also disregard the feelings of other people by being less polite. Also, when
someone in power faces threatening by someone else, they act aggressively and dramatically in
order to preserve the position of their power. Conflict usually arises in an organisation due to
need for power by various individuals working in an organisation. There are a number of
unnecessary issues taking place in an organisation due to conflict which have various negative
effect on the quality as well as productivity of the work in an organisation (Horberry, Regan and
Stevens, 2018). It is the duty of a manager in an organisation to effectively work and make sure
there are no conflicts and even if any conflict arises in the organisation it is their duty to make
sure that it is resolved significantly (Yawar and Kauppi, 2018).
The manager said Thomas Cook make sure that no one is taking advantage of the power
allotted by company to them. In order to do so they keep on performance management plan in
order to make sure that power is not driving anyone from fulfilling their respective duties. They
manage the performances on a quarterly basis in order to rank the employs and control their
performance. In order to carry out the plans effectively Thomas cook needed proper management
of its plans (Gherardi, 2016).
Also, the managers in Thomas Cook make sure there are no conflicts arising between
employees working in the organisation. In order to do so they maintain proper communication in
the organisation between employs at every level. The ideas and innovations brought in by every
employee is given equal importance and they are allowed to help in decision making process in
the organisation. Equality and diversity were needed in organisation to carry out work and build
a positive working relationship in organisation.
They make sure that employees in the organisation keep in mind the view of other people
so that there are no conflicts between them. The roles and responsibilities are divided efficiently
in the organisation in order to make sure that an employee can individually perform all the duties
without interference of anyone else (Berry, Broadbent and Otley, 2019). In the following manner
managers in Thomas Cook make sure there are no advantages used by employers out of their
power and influence which may raise conflicts in organisation.

Various motivation strategies used by Thomas Cook
Motivation is necessary for attaining, department in every organisation in order to make
sure that all the employs and human resource of a company are effectively working and fulfilling
all the task. It is the duty of a manager to make sure that motivation level of employs is always
kept up. The motivational skills of a manager also help to deter mine the commitment of various
human resource of the organisation to words their work (Carvalho and et. al., 2019). There are a
number of motivational factors used by the managers that Thomas Cook to make sure that the
employs remain motivated.
Manager at Thomas Cook provide faith and confidence in their employs to motivate them.
They show mutual trust and cooperation with all the employees so that they can remain
motivated. The leadership in Thomas Cook takes great care in motivating the employs and also
creating a positive environment in the organisation. This helps the employee to keep up with
their work and also take participation in decision-making process of organisation. Due to
motivation provided by managers employers are never threatened or nervous to put forward their
ideas (Jack, 2016). This also helps in encouraging the feeling of belongingness in employs
towards the organisation.
Another way used by managers at Thomas Cook to motivate their employees is by
motivating them through setting examples. They make sure that they strongly indicate various
skills and capabilities that are required by an employee (Sawan, Jeon and Chen, 2018). The
leaders make efforts to demonstrate the work which is to be performed by employees through
setting out all their skills and experience. This encourages employees and motivates them to
move in the path of manager or leader and achieve the same experience and goals which they
have achieved throughout their life in the organisation.
Another method used by Thomas Cook in order to motivate their employees by providing
them a number of non-monitory benefits. These include positive working environment in an
organisation. Feedbacks, ideas and perceptions of every employee regarding the functions and
activities in an organisation is collected through managers which helps them in encouraging and
motivating. This shows that employees turned to become more committed to words their work as
well as goals of organisation. The process helps in building good relationship between employers
and organisations encouraging them, nurturing and bringing cooperation in the organisation
through building mutual trust and benefit between all the employs (ARAS and Williams, 2016).

Examples of corporate
There are a number of corporate examples which can be seen to follow the same style of
management, leadership as well as motivational theories used by Thomas Cook in order to run
their organisation effectively. Below mentioned are some examples of such organisations:
Thomas Cook uses directive strategy of management in order to unify various processes in the
organisation and also focus on developing different systems so that various strategies can be
implemented effectively in the organisation. Unilever also uses the same management style in
order to make sure that qualities, abilities, skills and experiences of managers can be used in
order to make sure that all the employees of an organisation are focusing on productivity as well
as best quality in order to bring customer satisfaction to the organisation (Sinha and Dhall,
2018).
Thomas Cook uses inspirational leadership style in order to make sure that the leader is
paying attention on imparting various skills and knowledge through various development
programmes and training to the employees working under them. Toyota also uses this leadership
style because the major motive of companies to provide quality service to their customers. In
order to do so the leaders make sure that all the operations in the company are completed
successfully using various tools such as total quality management, lean operation, and six Sigma.
It is the duty of manager to train their employs effectively in order to successfully apply this
leadership style in the organisation (Singh and Rani, 2017).
The motivational strategy used by Thomas Cook make sure that all the employees are
motivated and their objectives can be aligned with the organisational objectives. Google uses the
same methods of motivating the employs working under them so that productivity of
organisation can be increased resulting in increase of revenues and profits for the company. It is
done through providing the employs with various monitory as well as non-monitory benefits
(Kashif, Zarkada and Thurasamy, 2017).
Maslow’s hierarchy Theory
Maslow’s need hierarchy theory consists of 5 stages of needs of every individual those 5 stages
are mentioned below:
Physiological needs: The managers in Thomas Cook provides basic pay to their employees
which may fulfil all their basic needs such as food, shelter, clothes, air and water.

Safety and security needs: After physiological needs safety and security needs arise. In order to
provide this, Thomas Cook provided insurance, pension plans, various perquisites and benefits to
them.
Social needs: Social needs refers to providing social status to employees. The managers in
Thomas Cook provide informal meetings and gatherings for employees to fulfil their social
needs.
Self-esteem needs: Self-esteem needs are needs of individuals when they feel superior from
others. In order to do this manager in Thomas Cook provides promotion to their employees.
They also provide awards like employee of the year and so on.
Self- actualization needs: In order to satisfy these needs the managers of Thomas Cook provided
proper training and development to their employees in order to develop them personally and
professionally. This also helps them in their career growth (Reeves, 2019).
Recommendations
Although all the management methods used by Thomas Cook is this effective in running
the company effectively and generating revenues and profit for company. However there is
always scope for improvement in company. Below mentioned are some of the recommendations
which can be followed by Thomas Cook in order to make sure that the organisational
performance in the company can be improved:
 Company should use bottom to top approach for communication so that employees have the
right to share their views and ideas about various functions and activities taking place in the
organisation. It is often seen that there are a number of issues taking place in the organisation
which do not reach to the top authorities of an organisation and also employs in the
organisations get demotivated due to this. Using bottom to top approach for communication
will help in enhancing employee’s performance in the organisation.
 Company can use a different leadership styles such as transformational leadership style
which is used by the CEO of Amazon. This leadership style believes in bringing continuous
improvement in the employees of an organisation. In this leadership style the leader works
with the team and identifies various changes needed and also guides the team effectively. It
will be beneficial for Thomas Cook in increasing their organisational performance with the
help of this leadership style.

 Thomas Cook can use marshmallows hierarchy theory of needs in order to motivate their
employees. This will help the company in understanding various level of needs of an
employee and the hierarchy in which they are required to be fulfilled by the organisation.
Along with providing non-monetary and non-monetary benefits company should focus on
providing various social, esteem and self -actualisation needs to employees which will help
in motivating them and result in increase in organisational performance.
Bringing all these changes in Thomas Cook must have helped company to carry on in the
market with profits. If they changed their policies related to structure, leadership and culture in
time they might have functioned better and sustained in the market for a longer period of time.
CONCLUSION
It is often said that with great powers comes great responsibilities. There for them being
appointed as Chief Executive Officer of a big firm like Thomas Cook brought a lot of
responsibilities on the shoulder of Mr. Peter Fankhauser. There are a number of different context
and aspects which a manager needs to look into in order to enhance the performance of an
organisation. There are various powers as well as several benefits which a manager can bring in
for employers as well as organisations facing a number of challenges. It is needed to analyse the
changing external environment around organisation and take effective decisions to adapt the
changes in environment by a manager. With the help of effective leadership style and proper
strategy a manager can guide the organisation on the required path and also direct it to achieve
all the objectives and goals set.

REFERENCES
Books and Journals:
Kontinen, T., 2018. Learning and Forgetting in Development NGOs: Insights from
Organisational Theory. Routledge.
Waterson, P. ed., 2018. Patient safety culture: theory, methods and application. CRC Press.
Romero-Silva, R., Santos, J. and Hurtado, M., 2018. A note on defining organisational systems
for contingency theory in OM. Production Planning & Control, 29(16), pp.1343-
1348.
Clarke, P.K. and Campbell, L., 2018. Coordination in theory, coordination in practice: the case
of the Clusters. Disasters, 42(4), pp.655-673.
Yawar, S.A. and Kauppi, K., 2018. Understanding the adoption of socially responsible supplier
development practices using institutional theory: Dairy supply chains in
India. Journal of Purchasing and Supply Management, 24(2), pp.164-176.
Carvalho, A.M. and et. al., 2019. Operational excellence, organisational culture and agility: the
missing link?. Total Quality Management & Business Excellence, 30(13-14),
pp.1495-1514.
Sawan, M., Jeon, Y.H. and Chen, T.F., 2018. Shaping the use of psychotropic medicines in
nursing homes: a qualitative study on organisational culture. Social science &
medicine, 202, pp.70-78.
Sinha, N. and Dhall, N., 2018. Mediating effect of TQM on relationship between organisational
culture and performance: evidence from Indian SMEs. Total Quality Management &
Business Excellence, pp.1-25.
Turnnidge, J. and Côté, J., 2018. Applying transformational leadership theory to coaching
research in youth sport: A systematic literature review. International Journal of Sport
and Exercise Psychology, 16(3), pp.327-342.
Dahlmann, F. and Ward-Grosvold, J., 2017, July. Environmental managers and organisational
ambidexterity. In Proceedings of the International Association for Business and
Society (Vol. 28, pp. 6-14).
Mullins, L.J., 2019. Mullins: Organisational Behaviour in the Workplace. Pearson Higher Ed.
Reeve, A., 2019. Exercising Control at the Urban Scale: Towards a Theory of Spatial
Organisation and Surveillance. In Surveillance, Architecture and Control (pp. 19-56).
Palgrave Macmillan, Cham.
Greco, A. and De Jong, G., 2018, July. Organisational inertia for positive social change: Theory
and Evidence from a Housing Association. In Academy of Management
Proceedings (Vol. 2018, No. 1, p. 12353). Briarcliff Manor, NY 10510: Academy of
Management.
Harris, E.P., Northcott, D., Elmassri, M.M. and Huikku, J., 2016. Theorising strategic investment
decision-making using strong structuration theory. Accounting, auditing &
accountability journal.
Metcalfe, S. ed., 2018. Evolutionary theories of economic and technological change: present
status and future prospects (Vol. 44). Routledge.
Turner, P., 2019. Understanding Organisational Dynamics. In Leadership in Healthcare (pp.
203-231). Palgrave Macmillan, Cham.
Alsted, J. and Haslund, D., 2019. Psychodynamic Organisational Theory: Key Concepts and
Case Studies. Routledge.