SummaryQantas Ltd is one of the largest airline operating organizations in the world (Qantas, 2013), with declining profitability and revenue of Qantas. The organization implements outsourcing of a function because its strategy is to compensate for losses and maximize profits. According to Gilley (2004), outsourcing is a specific delegation of non-essential jobs or processes from internal production to an external entity specialized in this operation. Through comprehensive analysis, outsourcing the maintenance service to Hong Kong and closing the heavy maintenance facility in Geelong will save approximately $14 million in operational costs (Lucas, 2013). Secondly, it improves internal efficiency as Avalon aircraft will no longer need to return to Geelong in Victoria from Asia Pacific for maintenance. Qantas can also focus more on other organizational objectives by outsourcing part of the sales department to a third party. Therefore, the company plans to implement an outsourcing strategy to maintain competitive advantages in the market. However, the strategy may lead to three potential problems, namely union interference, leakage of confidential information, and quality control, respectively. This strategy will result in around 300 engineers losing their jobs when Geelong's maintenance facilities close. If the enterprise agreement cannot be reached between Qantas and the Licensed Aircraft Engineers Association (ALAEA), the union, unions can take various protected industrial actions to prevent Qantas from laying off their engineers. In this case, a complete satisfaction survey can be developed by HR which includes managers to analyze what the needs of the 300 employees are...... middle of paper ......y: History. Retrieved from: http://www.qantas.com.au/travel/airlines/company/global/enQantas Strategy Update. (2013). Qantas Group Strategy Update: Key Points. Retrieved from: http://www.qantasnewsroom.com.au/media-releases/qantas-group-strategy-update -2Qantas Annual Report. (2013). Financial overview. Retrieved from: http://www.qantas2013.reportonline.com.au/Rouget, R. (2009) Ensuring quality in outsourcing. Retrieved from: http://www.tcworld.info/e-magazine/outsourcing/article/ensuring-quality-in-outso urcing/Strambi, L. (2014). Speech: Lyell Strambi, CEO of Qantas Domestic. Retrieved from: http://www.qantasnewsroom.com.au/media-releases/qantas-announces-outcome-o-avalo n-maintenance-reviewThe Australian Workers' Union. (2012). Industrial action: what is industrial action. Retrieved from: http://www.awu.net.au/industrial-action