Behavioral approach to management, generally based upon the conclusions drawn from the Hawthorne
Donald Burr was the founder and chairperson of people express. He has been credited with building a humane kind of organization where employees were given a great deal of freedom of operation. Since every employee was a part owner of the company, there was no class distinction between the managers and the workers. Managers helped workers in carrying out their duties, pilots helped out in handling the baggage and passenger comfort was given the top priority. Every Employee was given the opportunity and encouraged to know the company well. Even Top executive rotated from job to job to learn the major aspects of the business.
People Express was expanding its operations very fast, within 5 years of its formation; it acquired frontier airlines and become the fifth largest airline in the country. Since the infrastructure and operational resources didn’t match the fast expansion. People Express experienced its first losses and with it, its managerial style changed. It changed from participative style of management and a family type organization to a more traditional style. Donald Burr took charge of the airline and began dictating policies and it become risky for employees to speak out, which was the one of the ordinal architects of life time employment at People Express. Lori Dubose was fired when she started asking questions and speaking critically about some aspects of operations. Similarly, another director of the company, Harold Parety who was told to report work at and stay until , irrespective of whether there was enough work for him to do or not felt it to be an insult to his integrity and quit his job and formed his own airline.
Eventually People Express declared bankruptcy because it could not generate enough revenues to meet the operating expenses and other debts.
Questions
Q1. Do you think that the change from participating management style to a more classic one contributed towards the final collapse of People Express? Explain your reasons.
Q2. What do you think Donald Burr changed his managerial style? Was he justified in firing Lori Dubose because she disagreed with his managerial policies?