British Airways (BA) must dread the summer. It seems that every year BA has an industrial dispute of one type or another. Each year the cause is different and each year BA says it has solved the problem and it won’t happen again. What is not clear this time round is exactly what the problem is.
At first glance, it looks like BA has been caught up in someone else’s dispute. The unofficial sympathy action by BA members of the Transport & General Workers’ Union (T&G) in support of their 600 T&G colleagues sacked by American-owned airline catering firm Gate Gourmet is the stuff of trade union legend. But it graphically demonstrates how an outsourcing contract can have huge repercussions for all concerned.
What Gate Gourmet has or has not done and on what advice it was acting is another matter all together. What is clear is that the disastrous handling of traditional industrial relations problems (company losing money, need for restructuring, etc) escalated quickly and ended up with one of the biggest mass sackings in recent years.
Once again, unofficial ‘wildcat’ action has brought BA to its knees – so what was wrong this time?
Could it be outsourcing? The straightforward answer is no, but there are issues around the processes and implementation that need addressing.
I’d very much like to see the original documentation, but I’ll wager that the seed of the problem was planted when the decision was made to ‘single source’ and that there was little or no practical contingency for what would happen if Gate Gourmet was unable to fulfil its contract.
When you depend solely on one supplier for anything you are vulnerable. When you have no control over how that business is run or its people management strategy – when it views its workforce differently from how you view yours – disaster is inevitable.
Could BA have foreseen that when its sole catering supplier had an industrial dispute it would become involved? You bet it could have. Not only is the T&G involved in both, it understands both and, more importantly, understands the dependence and synergy between the two. In fact, the
T&G members understood it quicker and better than perhaps even the union hierarchy did.
By scrutinising not only the proposal to outsource, but the potential impact and the medium- to long-term consequences of when it goes right and wrong, companies can avoid getting tied up in other people’s disputes.
Outsourcing contracts cover a myriad of different service levels and performance indicators, but what seems to have been missing in this case – right from the beginning of the process – was the active involvement of HR.
HR’s role is often about implementation – putting what has already been decided into practice, or rescuing the mess when meltdown occurs.
What the BA case demonstrates is the need for good old-fashioned HR advice at the ‘check in’ stage of any outsourcing deal – not when it’s ‘airborne’ and you can’t turn around and go back.