Product details

AI was the merged body of Air India Limited (AIL) and Indian Airlines Limited (IAL). The merger was approved in 2007 and the merged body was called the National Aviation Company of India Limited (NACIL). The merger was initiated with the aim of making profits and gaining high market share for the airlines. In 2007, the merged company had more than 30,000 employees ie 256 employees per plane. This figure was twice the global standard. The merged company was spending almost one fifth of its revenue on employee pay and benefits where as other airlines such as Jet Airways spend almost half of this cost. The employee-to-aircraft ratio stood at one to 120 in 2015, which is still more than the global average of 100 employees per plane. There were differences between the two companies in terms of work culture, areas of operation, compensation, working conditions, entitlements etc. The merger resulted in massive discontent and frustration amongst the employees. There had been wide difference in the pay and the benefits of the employees of 'Indian Airlines' and 'Air India'. These factors caused low employee morals’ in the organization. In addition to the above the existing organizational culture which was built upon HR culture, the HR Philosophy, the Leadership style and the Union management style had been the root causes for the organization’s debacle, resulting a failed merger.