Can American Airlines Leadership Get It Right This Time?
About a year ago, I wrote an open letter to Tom Horton, CEO of American Airlines. They had just filed for bankruptcy, and as a long-time, loyal American flyer, I was hoping that he would take the opportunity to engage his employees in his fight to save the airline.
As it turned out, Horton's relationship with his employees and the unions remained chilly. So much so that they went around him to negotiate directly with US Airways in the hopes that a merger will bring positive change.
So here we are again. The merger is happening and there is a new sheriff in town. Doug Parker will emerge as the CEO of the combined airline, and just in the nick of time. While he is a finance guy like Horton, and these types often don't succeed in the CEO role, I was impressed during their recent press conference. Parker focused on worker benefits; that's a good sign.
Horton is to be applauded for getting American to this point, but their future will be defined by one word: leadership.
Every company culture is a close reflection of the personality of the leader. Look at Southwest Airlines--the only major airline that has never filed for bankruptcy. They had a founder and leader in Herb Kelleher who had a multi-stakeholder approach to business, and he put employees first. That resulted in a better customer experience and consistent financial success.
The employees of American Airlines should be recognized for the incredible sacrifices they've made over the last decade. In 2003, they took cuts in compensation and benefits to keep American out of bankruptcy. American eventually filed anyway, and the employees stepped up again to help them get through it. I have flown hundreds of thousands of miles on American during this period, and you can tell that the employees are not generally a happy lot. Loyal? Yes. (Though they may have different reasons for that.) But feeling valued? Not from the conversations I have and letters I get.
Mr. Parker--this is your chance. Your nearly 95,000 employees will be hopeful but uncertain about their futures. Will I keep my job? Will seniority change? Will I have to move? Customers can switch airlines and investors can take their money in or out. But your most important stakeholders--with the least amount of choice--are the employees actually doing the work day in and day out.
I know you have a lot to deal with. But if you focus first on your coworkers, they will reward you with better customer service. That will put more money in the coffers.
I like the new logo, and I hear the employees are going to get new uniforms, but I will take more than a new coat of paint on the airplanes to make things better. It will take a deliberate, consistent effort to show the employees that you genuinely care about them. This only comes with trust, and you have to earn it.
If you can make your employees and your customers smile, you'll have a competitive advantage for years to come.