The PESTEL analysis revolves around the airline industry since the company under consideration operates within this field. This is an industry that has gone through ups and downs in the past as it is heavily influenced by varied external factors. These factors are usually environmental, political, economic, legal, social and technological.

Political

The airline industry tends to be highly regulated based on the risks that are usually prevalent. The politics involved have created an environment that tends to favour passengers more at the expense of the airline companies involved. Passenger safety has been given paramount importance hence the prevalence of strict regulations (Bazargan, 2016). This aspect has an impact on HR practices since the employees will be tasked with the responsibility of ensuring that these regulations have been upheld. This means that HR will have to conduct rigorous training to ensure that the employees are well prepared for the task ahead. There will also be an increased supervision by the HR to ensure that the employees comply with the designated regulations. This is because failure to comply with the set regulations would result in stiff penalties or maybe suspension.

Economic

The recent recession was a huge blow to the airline industry. This aspect has not been helped by an imminent global slowdown and fluctuations in oil prices. The aspects are making it difficult for companies within the industry to make immense profits. Competition from the small and cheaper airlines is also stiff. The company also has to cope with the declining number of passengers and increased operating and maintenance costs. Things like operating costs cannot be avoided, or the company will not be operating. The aspect has an impact on HR practices with regards to employees’ remuneration. The wages of employees have to be in line with the prevailing economic conditions. Nonetheless, HR struggles with this issue since the labour demands from the employees are usually high. There is a dilemma on this aspect since paying employees higher wages when the economic conditions are not favourable might result in bankruptcy. However, failure to remunerate employees accordingly would result in reduced morale hence reduced efficiency and productivity (Mello, 2015).

Social

In the current generation, the nature of passengers that use air travel has really changed. Most changes are being viewed with regards to terms of service; where the consumers have become more demanding. In order to meet the demands of the changing consumers, the airline is tasked with the responsibility of stabilizing costs. Passengers have also become more economic-minded. This is to say that the number of passengers using the business class is reducing at the moment. The actualization of globalization has resulted in the expansion of businesses in cross borders. This aspect was expected to come up with increased travels for business managers and CEOs. However, this has not been the case due to the emergence of different technologies (Bazargan, 2016). This is because people can easily hold Skype meetings or conference calls instead of travelling. The increased cost associated with the changes in social aspects affects the HR negatively. This is because there is a need to stabilize the costs associated with business operations. This means trying to cut costs in all the departments, and HR department is involved too. Reducing resources in the HR department with the objective of overall cost reduction would mean that resources used to manage the workforce have reduced hence resulting to inefficiency in some areas.

Technological

Competition within the industry has prompted most airline companies to adapt varied technological aspects to help survive the tough environment. Using up to date technology is helping the company to save on some operations costs. There are technologies that are helping airplanes to consume less fuel than it was in the past. Overall, technology is helping to increase efficiency even on the side of employees (Bazargan, 2016). Adoption of top-notch technology has impacted the HR department in that it has become possible to supervise employees without having to monitor them closely. This has necessitated the employment of personnel with varied technological skills. This adds to the number of company’s employees. Such employees are usually highly compensated given the skills that they have. This impacts the organization’s wage bill, which is managed by the HR department.

Legal

Different lawsuits are usually logged against the company. The lawsuits usually emanate from both the customers and the employees. Most of them revolve around the displeasure that has been experienced while interacting with the company. There is a need for the organisation to be cautious with these issues since there is the probability of increased costs and negative publicity as a result of the lawsuits. The aspect affects HR since most the issues that customers might bring forward are likely to be caused by the employees. There is a need for the HR to ensure that every employee is aware of the do’s and don’ts of the company while executing their duties. When everyone operates as it is expected of them, the probability of customer dissatisfaction is low. HR should also ensure that senior employees handle junior employees appropriately in order to avoid lawsuits that might come as a result of mistreatment of the junior employees by the senior employees (Mello, 2015).

Environmental

Many passengers have become conscious about the climate change in light of the awareness that is being created by different stakeholders. There is now a tendency of passengers taking into account their carbon footprint since they are environmentally conscious. This together with calls from the authority has prompted airline companies to adopt “green flying” and become more responsive to the concerns being raised by environmentalists (Bazargan, 2016). Social responsibility initiatives are also becoming more pronounced as activists and consumers are becoming critical towards airlines on issues to do with corporate social responsibility. However, this issue does not have a lot of impact on HR as it is more of a holistic organisational issue. It is just more of the HR trying to educate the employees on the need of “green flying” to ensure that they satisfy their customers.

References

Bazargan, M. (2016). Airline Operations and Scheduling. Abingdon: Routledge.

Mello, J. (2015). Strategic human resource management (4th ed.). Stamford, CT: Cengage Learning

 
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