Sources of decline, turnaround strategy and HR strategies and practices: The case of Iberia Airlines

Abstract

This study investigates the coevolution of the sources of decline, the turnaround strategy and the human resource strategy (HRS) at Iberia Airlines, together with the influence of employee responses to these strategies. The analysis of several moments of organisational decline at Iberia, comparing measures adopted in pre- and post-financial crisis periods, shows that, in a sector experiencing a fiercely competitive transformation that negatively affects established companies, the use of downsizing in an organisation with internal deficiencies may create further problems within the company, while an HRS based on flexibility-oriented practices and a fostering approach to strategic negotiations will improve the requisite recovery strategy.