The news of a 69-year-old physician being forcibly removed from a United Airlines flight has shocked the world and captured headlines around the clock. Millions have now watched passenger-taken videos of Dr. David Dao being brutally dragged off the plane to make room for United employees. His frequent flyer bonus was a broken nose, concussion, and two missing teeth. Not exactly "flying the friendly skies."
Dr. Dao isn't the only one who has suffered injury. United's stock price took a massive fall too, losing $1 billion in market value. The company has become a punch line for late night comedians, an Internet meme, and the target of fury and outrage around the world. The tens of millions in hard costs from lawsuits, refunded tickets, investigations, and penalties will pale in comparison to the massive long-term hit to the brand. It would be hard to imagine a more costly and damaging episode for the airline. Yet these are self-inflicted wounds, caused by a Jumbo Jet-sized breakdown in the company's approach to business.
When you examine the root cause of this mess, United blew it by violating two of the most important operating philosophies of today's business climate. Here's what they got wrong:
1) Company-Focused instead of Customer-Focused. The disaster began for United when they prioritized the transfer of employees over customers. The company forgot their primary reason for being is to serve customers, not their own needs. A customer-focused company such as Nordstrom or Ritz Carlton would never even consider diminishing a customers' experience in favor of an employee's. In this case, the airline determined that customers were second, which ended up biting them back in a huge way.
2) Policies and Procedures instead of Empowered Employees. United CEO Oscar Muñoz first praised his team for properly following protocol, yet blindly following policy is a disastrous approach. Had the company shaped its culture around empowering employees to make smart decisions in real-time, the massive snafu could have easily been avoided. The cost to transport four crew members by private aircraft would have been a tiny fraction of what United is paying up now. Or why not just keep increasing the monetary offer to passengers until someone said yes? There is a price at which other passengers would have happily forfeited their seat. I'm guessing $2,500 would have handily done the trick. Mr. Muñoz surely wishes he'd built an empowered culture, especially now that he's losing his $500,000 bonus from this enormous snafu.
As you build your own business, team, or organization, embrace the powerful lessons from United's mistakes. Center your operating philosophy on caring deeply for customers and empowering employees to make real-time decisions. You'll not only avoid crash landings but will also enjoy high-altitude success as a result.
Talk about a first class outcome.