The Need for Organisational Resilience - Chapter 3

cancelled. The problems with the airline’s IT systems, not just its operations planning but

also its customer call centres and website continued for three days.

Apart from the damage to its reputation, BA can now expect a compensation bill of up to

a £150million. The root cause of the IT crash is still being investigated:

Willie Walsh, chief executive of IAG, BA’s parent company, attributed the problem to a back-

up system known as an “uninterruptible power supply” — essentially a big battery connected

to the mains power — that is supposed to ensure that IT systems and data centres can

continue to function even if there is a power outage. (Powley and Thomas 2017)

Regardless of whether this incident is down to human error or a mechanical fault, BA

has been on a cost-cutting binge to compete with low-cost carriers. On some flights, for

example, meals were axed. Such measures may have little impact on customer satisfaction

as the driving factor in the airline industry remains the ticket price. However, critical functions

had also been scrutinised to cut costs even further, among them BA’s data centres which

have been largely outsourced to India.

In a world of digitisation, technology replaces human interaction with a customer. To

ensure reliable functioning, the technological interface with the customer (e.g. booking and

checking-in via the Internet) is of critical importance for an airline. However those functions

are also subject to being stripped of expertise and to (social) redundancy in order to reduce

operational costs. In 2016, an electrical fault at the American airline Delta grounded more

than a 1500 flights. It is not that airlines are unaware of their vulnerabilities. Increased

competition does not appear to leave much wriggle room to increase the robustness of

critical functions. It is not so much a question of if, but rather of how much redundancy can

be stripped away; before such vulnerabilities threaten the viability of an organisation.

Limitations in Dispersion

In modern times consumers’ expectations have become more ‘complex’ and thus ‘riskier’.

The delivery of solutions needs to be close to perfect, and wholly reliable in terms of

providing a constant state of satisfaction. For example, mobile networks need to provide a

range of services. Being cut off from internet access, for example, has already generated a

range of lawsuits against mobile operators. Customer tolerance of failure is decreasing

quickly.

It is no surprise that organisations try to ‘manage everything’, to switch to a defensive

mode, to protect every function that is customer facing and to increase their operational

reliability across the entire range of their activity. Everyone in an organisation becomes more

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