UNSAFE AT SPACEX 1

Unsafe at SpaceX

Ivette K. Sanchez

ORGL-4361-V02-Capstone II

DR. Patricia Blanco

06/28/2023
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Introduction. There are different foundational theories that lead to the success of many

organizations. The purpose of these theories is to improve the efficiency of the leaders of the

companies, or management teams so they can lead and guide the rest of the employees correctly.

All theories are technically based on how a business should be run, how to act as a leader, what

to expect from the employees and how to deal with changes within the organization. The

Administrative Theory by Henri Fayol, the Bureaucratic Theory by Max Weber and the X & Y

Theory by Douglas Mc Gregor give an extensive explanation on how the managerial ways of an

organization define the structure of it and how it relates to its achievement. Each theory has

different perspectives on how an organization should act in order to survive and reach beneficial

goals for the organizations. Another point that all theories defend is the behavior on humans and

the exposure of it in the workplace.

Administrative Management Theory. The Administrative Theory of Henry Fayol was

based on the 5 functions that represent management, which are planning, organizing, command,

coordination and control. He mostly focused on how management and workers were organized in

a business and how this leads to the completion of tasks or goals of each. The chain of

Administrative Management Theory by Henri Fayol starts with the argument that every

organization performs 6 activities which include technical, commercial, managerial, financial,

security and accounting. These 6 activities are followed by the five functions of management or

managerial activity which are planning, organizing, commanding, coordinating and controlling.

After the managerial activity we see the 14 principles of management starting with division of

work, authority and responsibility, initiative, centralization, unity of command, unity of

direction, stability of tenure, discipline, remuneration or pay, subordination of individual interest

to general interest, order, equity, spirit de corps and scaler chain. All these together represents
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the concept that Fayol shared about the success of every organization will reach if followed

correctly. According to Fayol, every organization should perform 6 activities. The first one of

these activities is technical, which relate to the production. The second activity is commercial,

the third one is financial, the next one consists on security followed by accounting. The last step

of these activities is managerial (Wren, 2002).

P-O-L-C Framework. On the P-O-L-C framework or managerial functions, the

responsibilities of a manager are represented, no matter the task or industry type. With these you

get an idea of the different situations a manager may face in all types of organizations. The first

stage is planning, where the manager sets the objectives and forecasts future conditions. With

organizing Fayol defined structuring activities and organizing individuals with the firm, which

include recruiting, equipping, and training individuals. On the commanding stage, a managerial

function concerned of direct supervision of employees and it was motivating their efforts

towards a command objective. Fayol recognized the need for managers to recognize and

understand the behavior of employees and to set an example for them. With coordinating, he

identified it as arranging and scheduling all activities carried out by subordinates. This allows for

the collective accomplishment of plans. Finally, on controlling is the concern on the constant

supervision of the individuals doing what they are expected to and following the rules. It is

designed to ensure compliance with everything that happens in the organization with previous

plans and goals, making sure they are being accomplished.

The Fourteen Principles of Management. Fayol’s 14 principles of management also

contribute to achieving the goals of the organization. These are division of work, authority and

responsibility, initiative, centralization, unity of command, unity of direction, stability of tenure,

discipline, remuneration or pay, subordination of individual interest to general interests, order,

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equity, espirit de corps, and scaler chain (Lynch, 2023). The administrative management theory

by Henri Fayol has helped many organizations maintain themselves in the market and it has

shown an important way of surviving. All organizations must follow rules and be well structured,

have a group of people that make the important decisions, and in that group a CEO should be

included. The organization must have supervisors or managers so they can oversee making sure

everyone is following the rules. A company that has followed Henri Fayol’s administrative

management theory and has been successful for many years is Coca Cola company. This

company was created since 1886 and has worked throughout the years by following the right

managerial theories as needed, to continue being one of the most favorite brands of people.

Bureaucratic Management Theory. Max Weber believed the large-scale organizations

such as factories and government departments were a characteristic of capitalist economies and

came to the United States to study its economy in 1904. Max Weber developed the Bureaucratic

management theory, which includes 2 essential elements, including structuring and organization

into a hierarchy. According to Weber, this management approach emphasized the necessity of

organizations to operate in a rational way instead of following the arbitrary whims or irrational

emotions and intentions of owners and managers. He emphasized his bureaucratic management

approach by describing it using 6 principles which are hierarchical management structure,

division of labor, formal selection process, career orientation, formal rules and regulations, and

impersonality (Yilmaz, 2021).

Max Weber believed that these rules of a bureaucracy would various organizations reach

success while at the same time allowing them to reach the highest level of efficiency, rationality,

and worker satisfaction. He also felt that bureaucracy was so logical, and it would make sense to

all organizations that would transform the whole society. With division of labor leading to
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specialized and highly skilled workers, the organizations will have a more stable team and the

capability of increasing sales, contracts and most likely avoid having a high turnover. The

“pyramid” organizational structure will allow the organizations to split into divisions,

departments and teams, which is basically based on the different principles of bureaucracy.

Today, the idea of hiring and promoting people in an organization based on their qualifications

and not in their social status is what is built into U.S. labor laws and how companies based

themselves when hiring (Yilmaz, 2021).

X & Y Theory. In addition, Douglas McGregor focused himself on working on his

motivation theory at the end of 1950s and in the early 1960s. Theory X theory Y outlines two

opposing views on human behavior in the workplace, where each of the viewpoints addresses a

different way of meeting each individual’s motivational needs. He believed that a manager’s

assumptions about their employees determined their leadership style in the workplace. These two

views on the different behaviors of the workers show the supposed difference on the motivations

of the employees and their actions. It is a way of determining the reason why an employee acts a

certain way and what they need to be successful in the organization. It also explains the reasons

on how managerial treatment influences on this type of behaviors and what the managers should

be doing to try to look for the company’s success (Prottas, 2008).

On the first part of McGregor’s theory X, he emphasizes that workers dislike their jobs,

and they are inherently lazy. Workers have little motivation and prefer direction from their

superiors. They need consistent rewards and punishments to ensure their task is completed, and

they do not have a desire to grow or achieve personal or professional goals. In other words, when

theory X is used, it refers to workers that are not really interested in working, but just in letting

hours pass by to be able to earn a paycheck. They are not motivated enough on something with
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their career and they don’t like their job. These types of assumptions are based on basic physical

needs. The organizations or businesses who utilize theory X approach often to have multiple

levels of management with a low rate of delegation. Workers have very little autonomy in the

organization, is a central authority base and managers follow authoritative leadership. On the

second part of McGregor’s theory Y, workers are willing to accept challenges and are proud of

the work they do. They do not need to be micromanaged and are self-directed, they are eager to

participate in decision-making and are happy to contribute and feel internally satisfied with their

jobs.

Theory X and Theory Y Implemented. Both theory X theory Y are usually applied in

different organizations. However; the best recommendation McGregor had was to adopt more of

a theory Y leadership style to increase the chances of being successful in the organization. This

theory is more decentralized and requires more participation from the management team. It

assumes that workers would also be committed to the long-term goals of the company and he

believed that by following this theory, supervisors cold motivate their workers to achieve their

highest potential. In this theory the employees feel they are being part of something and feel

important. They feel part of the organization and gladly contribute to its success by being

positive, working hard, and trying to achieve the company goals as making them part of them

too. Today, McGregor’s theory X theory Y is used in the school system. They can be applied to

classroom environments to determine if motivation has any correlation to student learning. It has

been discovered that the feedback given in the classroom setting has the greatest effect on

motivation and learning. These two theories can be applied to all types of organizations and can

allow them to succeed.

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SpaceX Starbase. A very important organization that has gained popularity in the last

years is SpaceX. This organization founded by Elon Musk is an American spacecraft

manufacturer, launcher and satellite communications company that was founded in 2002 with the

goal of reducing space transportation costs and to colonize Mars. There are several SpaceX

locations, and Starbase, the one in Boca Chica, Tx has been under construction since 2010. On

this location, there are more than 1,600 direct employees, to which more than 70% are Rio

Grande Valley residents (Mercadal, 2022). This has bought a lot of business to the Texas valley,

however, not everything is as positive as these numbers. The main worry about this type of

organization, having millions of dollars invested in their projects and even paying a fair high

amount of money to the employees, it’s their safety.

SpaceX has three different types of workers in their facilities, the ones that are directly

hired by the company, the contractors and the subcontractors. The SpaceX direct employees are

constantly working on their own shops, inside the buildings and working in building the rockets.

These employees have a white batch that will give them access to enter the facilities by showing

it at the star gate. SpaceX personnel rarely interacts with the contractors or subcontractors. The

contractors are company owners that make beats when there is a chance to get a contract with

SpaceX for a certain job and compete with other contractors. SpaceX usually makes the decision

on who to hire based on experience, pricing and time to finish the project. SpaceX pays the

contractor company directly the whole amount for the project, and the contractors pay their own

employees based on their offered salary.

These contractors or companies have their own employees, who they make sign a

confidentially paper about not telling what goes on at the facilities and a paper specifying that no

one is responsible for any accident with themselves or with their belonging like tools or working
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vehicles. In other words, they work at their own risk and with God’s blessing only. These

contractors must choose one or two persons depending on the size of the group to give access of

entrance to the rest employees by giving them a yellow batch to show at the star gate. The

subcontractors on the other hand, are companies hired by the contractors, not by SpaceX. They

are not allowed to get their own batch for entrance, but SpaceX assign them a red batch. This red

batch is just for identity purposes and the employees with yellow batch must escort them when

they get in or out of the facilities. The job of contractors and subcontractors are outside, never in

the shops or among the direct company hires. There is a sense of exclusion since there is no

benefits for these types of workers and no safety when they do risky tasks. SpaceX is direct hires

have benefits like health insurance, dental insurance, disability insurance, vision insurance, life

insurance, flexible spending accounts, team workouts and wellness programs. While contractors’

employees and subcontractors are independent workers that do not get any benefits and no tax

are deducted from their paychecks either.

OSHA at SpaceX. Even though a lot of accidents have happened in this facility, not all

of them are reported as they are supposed to. There have been several accidents that had

happened, but OSHA rarely gets involved since this is a private agency and they can keep things

low unless something extreme happens. For example, in February 23, 2020, an OSHA inspection

opened up for starship in Brownsville after an incident testing a Raptor V2 Engine caused an

employee to be in a coma for several months. This caused the open of the investigation, but the

facility was not closed, just fined with almost 20,000 dollars (Grimes, 2022). This out of all the

minor incidents was a big notice since the OSHA rarely checks on SpaceX. There have been

accidents outside the shops of metal items falling from the very high top where there are people

working and hurting people at the bottom. These are not reported since the contract and
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subcontract workers have clear that they need to be responsible for their own lives at the working

station. This is the big difference on how the structure differentiates between a SpaceX direct

hired from a contractor and a subcontractor employee.

Solving the Issue. The primary foundation theory that will help solve this problem of

working conditions in SpaceX if applied correctly will be Henri Fayol’s P-O-L-C framework,

Planning, organizing, commanding, coordinating and controlling. With planning, objectives

could be set for future conditions and for expected accidents that could happen in the facility.

With this, there could be a plan on what to do after each incident. With organizing, tools required

could be gathered to be prepared in case any accident occurs. Individuals could also get trained

on first aid so they could be aware if anything happens and so they can help control the situation.

With commanding, there is a direct supervision of the employees and a motivation to their efforts

towards a command objective. This command objective could be the employee’s safety, which

will lead to having employees follow the safety rules to prevent accidents. With coordinating,

there could be a schedule on who will oversee safety, checking things are running under control

and the preventing of accidents while doing a routine daily. The last step that will help solve this

problem is controlling. Having a supervisor controlling the situation and making sure that the

people assigned with the checklist’s and the rest of the prevention issues are doing their part.

Controlling on how things are running and how each employee is helping improve safety.

Leadership skills are important on this area because they are the ones that will help the

organization reach the goal. The organization is composed of several employees, not only the

leader, and this leader should help the rest of the employees work the best they can and follow

the expected rules so things can come out good. As a future leader, I would implement my

leadership skills by providing training to the rest of the employees. Participating with them on
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example situations that could be happening in the organization. The employees need to feel that

the leader is part of the team and they need to rely on them with confidence and with respect.

The leader must show that same confidence and respect to the employees so these employees can

feel good at work and happily contribute to the success of the organization.

Conclusion. We can conclude that with the different foundational theories we can take an

organization to success if they are applied correctly and with good leadership. The three theories

Administrative Management Theory by Henri Fayol, The Bureaucratic Management Theory by

Max Weber and the X & Y Theory by Douglas McGregor have helped so many organizations

survive along the way and have helped so many others start. The base these theories offer is very

straightforward and requires good management from the supervisors. The employees also feel

the need of being represented by authority and to find the right way of achieving goals for the

organization. These is a step that must be covered by the management team with the right

training and skills.

The different organizations in the world are going to need help along the way, not

everything will be perfect and here is when the theories can rescue them. When an organization

has areas of improvement, it needs to be studied and revised by the right team so make it survive.

The different theories are steps that can be followed to rescue them from failure and make the

organization better. These includes things like increasing sales, increasing revenue, prioritizing

employees, changing rules, maintaining safety and so on. In the case of SpaceX, the area of

improvement is the safety for workers and the equality between the same workers, which could

be changed if one of these theories is followed.

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REFERENCES:

Wren, D. A. (2002a). The foundations of Henri Fayol’s administrative theory (Vol. 40).

Lynch, R. G. (2023). Fayol Publishes General and Industrial Management.

Yilmaz, V. (2021). Authority and Bureaucracy from Weber’s Perspective. Authority and
Bureaucracy from Weber’s Perspective.

Prottas, R. E., & Davis, D. J. (2008). Douglas McGregor’s Theory X and Y: toward a construct
valid method. Douglas McGregor’s Theory X and Y: Toward a Construct Valid Measure.

Mercadal, T. (2022). SpaceX.

Grimes, M. (2022, October 19). Osha case still open. Space Explored.
https://spaceexplored.com/2022/10/19/spacex-osha-case/