We all have to choose, someone once said, between perfection of life and perfection of work. At People Express Airlines Inc., the founding father wants both -- for everybody.
Of all the legends of recent American entrepreneurship, Donald Burr's is one of the most astonishing. In four years, he has built an airline, the ninth largest in the United States, which last spring reached the $1-billion mark in annualized revenues. Starting with 250 employees, the airline now has about 4,000. Starting with 3 used Boeing 737s, the airline now has 22 737s, 45 727s, and four 747s, which carry a million passengers a month to 39 cities in America and to one abroad, London. Starting with a verminous, empty terminal in Newark, N.J., the carrier now boasts a facility that, if not the most elegant in the industry, is certainly the most colorful, teeming with mobile Americans of every description, all eager to take advantage of Donald Burr's realization of a great idea: the discount airline.
Growth like that would be dizzying in Silicon Valley; in the transportation industry, it approaches the miraculous. Yet even so, the legend of Donald Burr only begins with growth. The rest of it, fittingly, is about people, and the transformation Burr is trying to bring about in the way people work together. People Express has been called an "aerial 'Love Boat," because so many of its employees seem to strike up relationships there, and because so many of its customers seem to be traveling to see their loved ones. Putting it less romantically, one employee recently said of his job with People Express, "This is my road to self-actualization."
Such fervor is unlikely to be stimulated by a no-frills pricing policy, or even by unprecedented success in the marketplace. Where it comes from, Donald Burr believes, is an approach to human resources that enshrines self-management and voluntary cooperation. At People Express, every effort is made to eradicate or suppress the two most sacrosanct characteristics of organized work: hierarchy and specialization. There is no working class at People Express, no executive class. Everyone is a manager, and everyone (even the pilots, who are called "flight managers") does a regularly scheduled turn at everyone else's work. With this policy, called "cross utilization," Burr seems to be trying to reinstate the ancient ideal of the well-rounded man. With the company's stock-participation policy -- every employee is required to purchase some stock, if necessary with a no-interest loan from the company itself -- he seems to be trying to realize the equally ancient ideal of a commonwealth, in which each member acquires the pride and energy of an owner. Thirty-three percent of the airline is employee-owned, and the rags-to-riches stories that its success has made possible among the employees are all part of Burr's legend.
Burr denies that he is conducting a "social experiment" at People Express. "It's a hard-driving, capitalist business," he says to everyone, celebrant and skeptic alike. And there is no reason to doubt his sincerity about this, or his fiercely competitive concern for the bottom line. Yet the adjectives Burr seems to attract are not those favorites of the typical hard-driving capitalist: ruthless, shrewd, or hard-nosed. Much more often, he is called "charismatic," "messianic," or "fervent." And he does nothing to contradict these judgments when he avows (as he did recently in Time magazine's "Man of the Year" profile), "You don't just want to make a buck. You want people to become better people."
The skeptics have become more numerous recently -- in the media, on Wall Street, and even within the great people-centered undertaking of People Express itself. Doubts seem to have been triggered by the late 1984-early 1985 operating losses, followed by a plunge in the company's stock price from a high of 25 to below 10. The setback stemmed in large part from an inevitable ratcheting-up of the competition, as the more traditional airlines learned to slash prices almost as well as People Express. Nevertheless, there was an edge to the skepticism, a note of jeering raillery, that caught INC.'s attention. Contributing editor Lucien Rhodes had written about People Express a year and a half ago, long before Burr achieved the status of a legend (see "That Daring Young Man and His Flying Machines," January 1984); so we felt somewhat solicitous of this new turn in the entrepreneur's reputation. In June -- in the midst of a strike at United Airlines Inc. and intense bidding for Trans World Airlines Inc. -- George Gendron, INC. editor, dropped in on Burr at his Newark, N.J., office. His report follows.
One wall of Burr's office is a large window looking out on the runway. Alone among airline presidents, I imagine, he can actually see his customers lining up for the service he provides. The travelers who fly from Newark must still walk onto the runway before boarding, and some flights still use those old-fashioned ladders that unfold out of the belly of the aircraft. He can even see customers through the other window in his office. It overlooks the lobby of the North Terminal, the scene of those now-famous crowds waiting for the London flight. And far in the distance, beyond the runways, he can see the site of the new People Express terminal that, when finished, will be the largest single-airline facility in the country.
INC.: People Express has had a couple of pretty tough innings on Wall Street recently, which must have had an enormous impact on morale. Does that concern you?
BURR: It kills me. I want people to love this place. It drives me nuts walking around seeing people unhappy. But there are several clear reasons for it. For two quarters in a row now -- the last of 1984 and the first of 1985 -- we've lost money, and in the last quarter we didn't pay any profit sharing. It's a transition we're going through. We've always made money in every full year of our existence, and I don't think this is the year we're going to break our stride. The second quarter of 1985 is going to be strong enough to offset the first quarter. But when we lost money and didn't pay profit sharing, it broke the mystique.
BURR: People Express has a mystique; we couldn't do anything wrong. We just bought planes, hired people, and put them in the air. Grow, grow, grow. "Oh, you're not a team manager yet," people would say. "You've been here a whole year and you're not a team manager? You must be a dumb ass." That kind of stuff. The expectations at this place are colossal. And self-generated.We went around telling everybody that we're going to be great, do great, and conquer the world. At some level, we have -- in the airline business -- but people are never satisfied. Then, too, the competitive environment had become sophisticated. The good old guys, the well-managed old companies, had spent the time to learn how to compete with us better.They were competing with us better. So we had to adapt our tactics and strategy. But any time you introduce large-scale change, it causes morale problems. You have to explain it all to everybody, and a lot of people don't get it right away. So I have to tell them again, and again, and again. It causes disruption, anxiety, uncertainty. Don't forget, too, that this is an airline. And one of the problems you have in an airline business from a morale point of view is that we work seven days a week, 24 hours a day. So a lot of these folks are working Sunday night, Saturday morning, Christmas. Routinely. People don't like that much: They'd really rather work nine to five, Monday through Friday. And this could be a union problem. A union could come in here and say to them, "Hey, we'll get a seniority structure started for you, so that when you've been here five years, you'll be able to bid for the Monday through Friday trips only."
INC.: How do you combat that?
BURR: You try to share the vision with them. But it's really hard to articulate the vision so that people will get with it. There's a constant, constant battle over the question, "Are you doing enough for me? I don't think you are, so we're getting a union." The flight managers [pilots] have had a history of unionization throughout the world, and it's almost an article of faith with them that they've got to have a union. So there's a constant back pressure here. I'm sure it's everywhere, but you'd think you'd be able to set an objective and a structure clear enough so that people generally would be able to accept it and not do so much carping. It's frustrating to see large numbers of people not get it. I suppose our expectations are much too high. We ought to be able to say, "Look, this is a pretty beautiful vision. It's got you at the center of it. Isn't that great? Let's get it done." People ought to pick it up real quick, but, unfortunately, they don't.
INC.: So what do you do?
BURR: You don't do much. Given the nature of People Express, what you do is keep trying and trying to help them get it. My belief is that over time, the carpers will go somewhere else; they will become increasingly uncomfortable with the peer pressure from people ho do get it. But that's a battle that People Express has been in since the day we opened our doors. Ther are the people who get it and are intent on making sure that this thing is what it ought to be, and they constantly work on those folks who don't get it. And these folks over here are trying to rip up these people over here. One of the things I think is really important in this battle between good and bad is that you gotta keep telling people what's good, because the bad folks are out there telling them what's bad. You have to keep working against that. They're constantly saying to people, "This is bad, this is awful, this is terrible, we've got a screwed-up deal here, we've got to change it, blah, blah, blah. . . ." If you don't do something, they've got the floor, so you've got to keep taking the floor away from them. It doesn't end.
INC.: What amazes me is the number of people who look at what you're doing here and say to themselves, "Isn't this a beautiful vision." They have the impression that things just peacefully fall into place.
BURR: They do. And at some level, they're right. You look at the American democracy. You look at New York City. The sun comes up, and overall, there's a healthy glow to everything. But underneath, there's just a cauldron of vicious fights going on. In this country, it's abortion. In the airline business, it's TWA, where the mechanics and the management are at such bitter odds that they sabotage the trucks and blow up the gear while TWA keeps flying. You don't know that, but I do. There's warfare, real warfare: slashed tires, burned trucks. Not Lebanon, TWA! And the pilots. They take pictures of a guy who flew for Continental. When he was recalled to United or TWA, they had a picture of him in the cockpit. And when the guy sits down in the third seat, they won't talk to him, they spit at him, they won't let him eat. I've watched it. These are unions. These are people out to protect people. I've watched how our people at Texas International were driven crazy. They lost their minds.
INC.: You hate unions, don't you?
BURR: I think they're pretty bad.
BURR: Because they're animalistic; they're tribalistic. They go back to value systems that you learned in the jungles. "We'll kill you if you don't do it." They are pretty powerful things. No one is crossing the line out there in Chicago [where United was on strike]. They are about to lose their jobs for the rest of their lives, and they won't go to work. Now, why would you not go to work if you were about to lose your job? There's only one reason, and that is because there's a greater fear.That fear is that they'll kill you.
INC.: What happens if People Express is unionized?
BURR: If it is, I won't be here. If the pilots were to vote for a union, then they don't need me. The union can run them. They're welcome to try.
INC.: I didn't realize you felt so strongly about it.
BURR: Life's too short. I'm not going to spend the rest of my life trying to battle this kind of thing.People are literally trying to steal, and will stop at nothing to do it. Unions don't create wealth. Unions don't in any way generate wealth or in any way guarantee jobs. Only economic performance does that. The only thing that unions attempt to do is to get more wealth for one particular constituency. A pilot's union doesn't give a damn about the other people in an airline: the ones who do the flight attending or the groundwork, the people who do everything except fly. There are thousands of these folks, all vibrant, beautiful young people. But the pilots don't seem to care. All they care about is how much they can get for themselves. The whole objective of the union is antithetical to the competitive business strategy of People Express, which is to provide an environment for all of us to do better on the same team. A pilot's union is absolutely divisive. "Give me more than anybody else. I'm more important than anybody else. Give me more, more, more!" Well, I don't give a damn about them.
INC.: You've been talking about people not "getting it." What is it exactly that you want them to understand?
BURR: The six precepts, the goals of People Express -- those six items that we live by. The first one, of course, is service, growth, and development of people. The second one is to be the best provider of transportation for people. The third is to develop the best leadership. The fourth is to be a role model. The fifth is simplicity; and the sixth is to maximize profits. Those are the things we teach everybody here. That is our objective. If people ask, "Where are we going, where are we headed?" that's it.
Why can't you teach this? What is it that prevents people from seeing these things? Why wouldn't you want to see these precepts? They're absolutely gorgeous. They're pristine in their beauty and clarity. But I've got a lot of pilots around here that call them Kool-Aid. "Have you had your Kool-Aid today?"
INC.: They call the precepts Kool-Aid?
BURR: Some of them -- the ones that don't get it. They'll sit in the cockpit and someone will say, "Gee, it's great we have real strong direction," and they'll say, "Aw, you Kool-Aid freak. Shut up." There are guys who absolutely resist the notion.
INC.: But isn't this just growing pains? You've gone from 250 to 4,000 employees, after all, in four years.
BURR: You start out with a set of ideals. Really lofty ideals. You believe that things ought to be done this way, and you get a bunch of people together who say, "Yeah, right on, let's creat this great environment where people are going to live together and we'll all work together and we'll make a great family." And you start out with 10 people and then go to 15. They see it. They might not be able to articulate it the way you can, but they're coming along, and over the months and years, they're getting able to say it in pretty nice ways and even add some nuances. But now you hire 100 people, and then you hire another 100, and another 100, and now you get a lot of people saying, "What is this Kool-Aid stuff?"
Actually, it's the antithesis of Kool-Aid. You have two parameters at People Express: Take care of people; take care of customers. How could you be more free? I tell everyone, "Make all the mistakes you want, fly the planes upside down. No problem. But just remember, we're always guided by those precepts. We take care of each other. And we take care of customers. Within those bounds, you can do just about anything."
But then you get people coming around saying, "I don't like you, I don't like this place. I'm going to get into a union, and we're going to force you to pay us more to work less." So the water drip starts, and your brain and your soul listen, and you wonder what you've done to deserve this. Here we've provided people with 8 million shares of stock, 100% medical/dental, profit sharing. . . . We've done everything we could to provide people with this environment to have some fun and do well. And they don't like it, I guess. So this garbage starts to seep into your brain, and you say, "What the hell did I do that I shouldn't have done? Where did it go wrong? Why is it people can't see?" And so you're very tempted to start adopting procedures to seek out that bad stuff and eradicate it.
INC.: But you haven't adopted those procedures at People Express. What makes you pull back?
BURR: It's a constant battle, but you have to keep reminding yourself that you're not going to let the bad forces defeat you. And what do bad forces want you to do? They want you to act badly. They want you to lash out. To go crucify someone. And in so doing, you've joined them.
INC.: But a pilot's inability to understand what People Express is all about does not make him a bad person. Maybe he's the type that needs structure, which People Express doesn't provide. You yourself have pointed out that most other organizations don't govern themselves the way you do. So it's not necessarily a battle between good and evil, or is it?
BURR: Well, I think it is. I can't prove it, but I think that there are well-meaning, well-intentioned, good-spirited people oiut there who, at all levels of intellect, can understand and accept good direction. Then there are other people out there, at all levels of intellect, who not only cannot accept it, they can't understand it, or won't understand it, or don't want to have anything to do with it. Now, are they evil? I don't know. But what explains why they can't move with good direction? Why do they keep trying to tear it down?
INC.: Well, let's say you've got a pilot who has seen Continental pull a stunt that many people thought raised lots of ethical questions: using Chapter 11 to break a union. I'd be distrustful, too. Wouldn't you? Then there's the fact that you have been adding people at a rate of three or four every working day! Now, I know organizations that add an employee once a month and have a hard time communicating the company's direction.
BURR: Clearly, that kind of growth rate contributes to the lack of understanding. Look, there's a whole body of people out there who simply didn't get enough communication. If they had gotten it, well and good, they'd be fine. I'm not talking about those folks. They're basically well meaning and well intentioned, and once they get clear about what's happening, they have no problem. But there's a whole other set of folks that don't get it, and they work hard to frustrate what you're trying to do. They set up a wave of antagonism, both for the people around them and for people like me who are trying to provide effective leadership.
We've had four distinct attacks on People Express by ALPA [the Air Line Pilots Association]. They're not going to give up. They have guys working here at People Express who are actively assisting them in trying to get people unhappy here, telling them why this place is terrible, and why Don Burr is a Kool-Aid King, what a terrible man he is, screwing you and abusing you and making life awful for you, and why you have to get a union to resist it, to get Burr to pay attention. I would say there are at least 20, 30, 40 of those guys here.
INC.: How many pilots do you have altogether?
BURR: One thousand.
INC.: So the dissidents make up a relatively small number.
BURR: It's a small number, but they are very dangerous and effective people, because they are driven to get a union. But they've never gotten enough cards over the five years that they've been able to come on the property to solicit votes. They're a business, too, and it would cost them millions to organize. We'll fight it with every stick and stone and bone in our bodies, and they know it. It would take them years.
INC.: Many people would look at your situation and say, "Burr, he's established the ninth-largest carrier in the country in four years. He must have a lot to be happy about. He must get a lot of satisfaction."
BURR: Well, the sun comes up in the morning and everything is beautiful. But it's not. I know it's not, and I don't like it. I don't like the garbage.
INC.: What are you going to do about it, though?
BURR: Well, I keep working at getting people to understand what we're trying to do and be involved with it. You know, one of the real issues today is that more of our great leaders don't continue to lead. They leave. They quit. We ask ourselves many times, "Why is it that so-and-so, who was a great leader, didn't decide to run for governor?" We read about people who have decided to do other things and we say, "Gee, what did they do that for?" People break down, can't keep up, can't cope, and they opt out. They quit. They quit trying. The Presidency of the United States, for example. Why would you want the job? The pressures are wild! Reagan, he's got congressmen, well-meaning people, saying he's a dictator, and a killer, and a mean-spirited, nasty guy who's screwing these poor people in El Savador, and so forth. All these guys are just calling him an international criminal in The New York Times . . . day after day after day. What does he need that for? Why would he run for office? It's obviously very painful to him. Some people would say, "Look, Senator Asshole, I'm going to go to Santa Barbara and enjoy my ranch." The really good people who would figure out wht to do in El Salvador didn't run for office. So we got stuck with Reagan; so we've got a mess.
INC.: Is money an issue with you? Although you have substantial holdings in People Express stock, you pay yourself a salary of only $63,000 a year. Is this part of the frustration?
BURR: No. The other day this guy says to me, "Look, we have to be concerned about how we keep you at People Express," and I said to myself, "Gee, this guy doesn't know how right he is!" If you said to me today, "I'll tell you what, Don, we'll give you a million dollars. Would that make a difference?" No, it wouldn't make any difference to me at all.
INC.: Maybe your vision for the company, your expectations, will always exceed people's abilities to live up to them.
BURR: Well, I think that's a real problem for leaders. I think an issue of our times is how we develop new leadership and keep in going. How do we support good leadership? We talk about supporting our people here at People Express. Coaching and helping and teaching all of the people who are doing work of various kinds. But we don't talk much at all, anywhere, about how we support good leaders. In fact, across the whole of American society, there's a sort of back pressure that leaders are somehow to be distrusted. It's kind of like entrepreneurs 20 years ago. Entrepreneurs 20 years ago were promoters. Dirty capitalistic promoters. Today, all of a sudden, entrepreneur is a golden word.
But what is the key to entrepreneurial behavior? It's not thinking up some incredible idea. Is People Express some incredible idea? Yeah, at some level it is. Hundreds of airlines were started after deregulation, hundreds of them. They're all bankrupt. They're all blown away. People Express is one of a handful of companies that started up on the basis of a discount idea. Almost all the others were started up on the basis of added value: a free limo, a bigger seat, whatever. All bankrupt ideas. But the discount idea, People Express, saves people billions of dollars. That's pretty incredible. But what's really incredible about it is the leadership. Leadership made it happen, OK? And nobody else has it. I don't mean to brag, but it's a reality. Everywhere we go, there's one thing that happens -- leadership. If a hospital is great, if a restaurant is great, if a garbage company is great, it's because there's some individual there who makes it that way.
INC.: That's you, but you don't sound terribly happy about it all.
BURR: It's hard work. I look at my wife. She's doing great. She plays tennis. She's more relaxed than I am.
INC.: Happier than you are?
BURR: Yeah, she's happy as hell. She's not building airlines or making some contribution to making a better world. All the ideals begin and end with making a better world; she's not involved with that. My wife is not a person who is driven to work. She loves to play tennis and take care of the kids. We've been married for 25 years, four kids, one an entrepreneur. She's happy and I'm not.
INC.: Well, what could make you happier? For instance, do you have any plans to expand?
BURR: We need to be able to take on other entities, either develop them ourselves or acquire them, anything from Twin Otters, say, to a TWA. Our systems are becoming more and more McDonaldish, and as they become more and more replicable, it's my view that we could, relatively simply, install them on other properties. But quite honestly, I have no idea at this time as to whether we will ever do anything like that. Because it depends on the human-resource strategy being able to accommodate it. Physicially, financially, we could be out there bidding for a TWA today. But the human-resource strategy won't allow it as of today.
INC.: What do you mean?
BURR: We have not yet proven out our concepts of behavior in an airline setting. Not so we're confident enough to be able to replicate them in another setting. We haven't yet proven to ourselves that they work at People Express consistently.
INC.: Maybe you haven't proven it conclusively, but you've proven that you're as capable as anybody else of filling an airplane, of getting it off the ground at point A and landing it at point B.
BURR: Oh, yeah, but we have not proven that the unique productivity of People Express is based on our people systems. My financial officer, Bob McAdoo, sits there and says, "Yeah, Don, give me a break. If we didn't do all those other things that you had us do in terms of the equipment and the seats and the rest of it, all that people stuff wouldn't be worth anything." There's a kernel of truth to that. But I really believe that we would never have been able to grow to a billion dollars in annualized revenues in just under four years without our particular type of organization. If we had not put in the flat structure and the free environment, we never would have made it.
INC.: There are people who say that you are so lost in your vision of what the company can be, in human terms, that you forget what it must be as a business.
BURR: On the contrary, I happen to think that the vision is directly transmitted to the customer. To the extent we can get everybody on board knowing where we're headed and why, and to the extent that they buy it, to that extent they're going to be better motivated and better able to cope with the customer demands out there. It doesn't mean we don't have to go around doing a lot of things like sweeping the ramp and keeping the planes clean. Specific operational problems. But the specific operational problems get done relatively better by people who know what they're doing and why they're doing it than they do by people who don't. Take TWA, or whoever; their people don't know why the hell they're at TWA, they don't know what TWA is doing, what it cares about, or if it cares about anything. I find those people generally mean-spirited, down-in-the-mouth, downtrodden, unhappy people. You go fly in their airlines and you bump into it repeatedly. They just don't give a damn.
INC.: Perhaps the problem with your human-resource approach is that the real dividends, the business dividends are more long-term than short-term. I'm not sure your people have been around long enough for the company to really begin to experience the benefits of your approach to human resources.
BURR: I couldn't agree with you more.I think you're absolutely right on the money. Wall Street, of course, wants you to produce it all two or three yers ago. Wall Street is very impatient. I've told them over and over again, you've got to wait. We can't create a billion-dollar company in four years and make a hundred million dollars in the process. It doesn't happen that way. I fervently hope a part of the disease that's at People Express today is just a matter of time.
INC.: Your equity-participation policy must have created problems for you; all those employees whose stock has been taking a beating lately.
BURR: I get remarkably little back pressure on the stock. I warned everybody who came to People Express about the stock when they walked in. Every single class that I've taught, I've said, "Hey, this stuff goes up and it goes down. So be happy when it's up, because you're going to be miserable when it's down. That's the nature of stock." But are our people happy about it? No. Obviously they're unhappy about it, but I don't think it's that big a deal. Now we're all waiting for it to go back up again. We're going to have a very big quarter, as I think I told you earlier.
INC.: Which competitors of yours do you admire the most?
BURR: I don't respect any of them at our level, except Delta a little bit. But Delta I don't respect much, because their idea of the human condition is an old Deep South paternalism. You know: Pat the little kid on the head and wipe his nose and tell him to be a good boy and go fix the plane. That's a better system than American's, I guess, because there's more humanity in it. Robert Crandall [president of American Airlines Inc.] -- who's running American very well -- his idea is that he's the hightech airline. He's got the most advanced computers and so on. And he's a well known people beater.
They all hate us. I think it's because they just can't figure us out, and they're frightened by what they don't understand. The human condition really hates not understanding. For the longest time, we had people calling us Moonies. That has died down, but for the longest time, people ascribed to us certain other worldly types of ambitions. I mean, if you know that Don Burr is out to make millions of dollars tomorrow morning, well, you can deal with that. That's black-and-white and American and real, and you can deal with those motivations. But if you've got your troops all goosed up over some kind of wild, romantic dream to take over the world . . .
INC.: What about Frank Borman?
BURR: Same thing. He's a military man. He's sitting there saying, "What is my enemy?" I met him out at the Bohemian Grove in San Francisco. Somebody told me I ought to go say hello. I said, "Great." So I went over to his camp and went in with this guy, who is an old friend, and shook his hand. Borman said, "Hi, Don, how are you doing?" And I said, "Oh fine, blah, blah, blah." We talked and talked for 5 or 10 minutes, and then all of a sudden he said, "I gotta go." And he just vanished. He couldn't get away from me fast enough. Now, maybe he was just moving away rapidly because he was hungry or something, but it was like a guy in flight.
INC.: One of the fundamental components of your human-resource approach is job rotation. Do you still have a high commitment to it?
BURR: Yes. The worst problems with the job rotation came early on. The problem was just getting enough people trained to be able to do everything. There were constant complaints that we didn't have consistent behavior, consistent performance. Checking people in properly, doing the rights things on the planes. Everywhere you looked, people were moaning and dying over inconsistent performance. Everybody was saying, "This will never work. We're telling you, Don, we've got to have the same person at the same job every day." We said, "Bear with us, it will work." And now you don't hear that anymore.
INC.: What do you do with the pilots, who have real resistance to job rotation?
BURR: What we're trying to do is to get a better fit between what the guys want, what each individual guy wants to do, and what he can do. It is not really that flight managers don't want to do other things. There's a tiny minority of guys who only want to fly -- real tiny. But none of them wants to do make-work. They are the first guys to love to do something useful. So what we have to do is fashion a realistic, useful thing that they can really bite into. And we have not done that successfully with all the guys. A lot of them are deep into important stuff, from buying our fuel to training our people. A broad array of stuff. The fact is that flight managers run this place at some level. But there's hundreds of them that are wandering around doing nothing. And we need to find useful work for them to do that's similar to what these other guys do, and it's not easy.
INC.: It would be a lot easier to let them specialize.
BURR: Yeah, there's no problem if you say, "Go fly the plane." But these are really highly productive, highly talented people, and we think that in the long term, it's very disruptive to have them only fly planes. It doesn't fully use their talents; therefore, they get unhappy. Then they end up buying a real estate company, being a stockbroker or whatever, on the side. And then the airline becomes an afterthought, a toy, a vacation. And then they're not really productively involved in what's going on here. They become bad employees, bad managers.
INC.: I understand that you farmed out some of the work that airlines traditionally do in-house; baggage, for example.
BURR: Reservations. We have always contracted baggage, but we used to do telephone reservations ourselves. And we've now contracted it out. It's blue-collar work. Reservations is a factory environment, nd we are having enough trouble trying to manage a professional enviornment without taking on the risk of trying to figure out how to run a factory at the same time. Now in due course, if we do get our systems routinized and we've got real trust and confidence in our ability to duplicate them, then it will be time for us to look at the reservations people, the baggage people, the maintenance people, and extend the system to those kinds of folks. But the fact is that the blue-collar value system is very prone to unionization. It just is. And unions are antithetical to the competitive business strategy of People Express, which depends on freely able people producing in a freely able environment. You don't have that with a union.
INC.: What about the people at the terminal, the ticket checkers?
BURR: You don't want to do that kind of work for more than three or four hours a day. It's dog work. It's demanding, stinko work. You want young, vibrant, aggressive student-types, who are physically very strong and can stand behind the counter on their legs for 3 or 4 hours a day. You don't want competent full-time people doing that 8 or 10 hours a day. It's exhausting and boring.
INC.: Is this something you're going to subcontract as well?
BURR: No, we'll hire the students.
INC.: Will they be regular People Express employees?
BURR: No, they will be part-time college students. We will try and select the very finest ones that we can find, and we will tell them that after a 9-or 10-year education program, we may hire them full-time at People Express. Not all of them; they all probably won't be good enough. But we'll tell them that they'll certainly have a shot at it. If we get them when they're seniors, and they're real good, maybe we'll have them work for us for a year or two full-time before we send them off for MBAs. With that type of person, [training] might be as short as four years. And in that way, we'll get some really good people coming down the pike.
INC.: What is it you are looking for in an employee?
BURR: We look for all the ordinary things that everybody else looks for. I guess the one area where I think we've had some success is in looking for service-oriented people, people who are a little more likely than the average person to go out of their way to help you out.
INC.: How do you try to find that in people?
BURR: I'm not an expert, but the test we use screens them, not for that quality, but against its obverse, which is your antisocial, negative, cynical, downbeat character. That type of person isn't normally prone to be overly helpful to other people.
INC.: Do you try to screen out certain kinds of pilots, because of possible union tendencies?
BURR: No, we never did attempt to do that. If a guy walked in the door and said, "I love unions; I'm going to work hard to get one here," we would have screened him out. But nobody walks into an airline talking like that, especially now. They all come in saying, "I wouldn't join a union if you paid me." So I don't know how to screen for that. It's our view, though, that the negative, cynical guy, which the test does screen for, is more likely to want the protection of a union.
INC.: Let me ask you another question. Do you ever think that maybe you're faced with a difficult choice here? You want the company to slow down, consolidate. But are you the best person to oversee that process? You seem to get excited only when talking about the future. On the other hand, if you leave . . . well, the human-resource policy is your vision, and without you to sustain it, how long will it last?
BURR: Well, I never thought of it quite that way. That's a nice formulation. I'm reasonably well convinced that the place really does need to take a breather.But I hadn't thought that I might not be interested in sitting around nursemaiding it. That had not occurred to me. But I'm the one who slowed it down, not the board, not Wall Street. I'm the one who said, "Hey, look, let's sell a couple planes, let's slow down and tidy the place up a little bit." That's my direction, and I'm doing it because I really believe it needs to be slowed down. On the other hand, having come through the fear and trembling of February, when we were losing our ass, and having straightened it out, it's remarkable how quickly I've begun to think that mybe we could speed it back up again. Lately I have been kind of wondering a little bit if we couldn't shorten that period of time so that we could move a little more rapidly. The TWA thing sitting over there, that's a pretty unique property which we could probably find a way to do something with. On the other hand, the older you get, the less willing you are to set off across the river. When I was a little kid, there was nothing I feared about setting across a river. You'd take any kind of risk to get to the other side. Didn't matter. But now, when I think about taking on the kinds of risks to go do whatever, I think more about them now.
INC.: One of the things that strikes me, just walking around this place, is how tangible the signs of your accomplishments are. I mean, you just look out your window, and there they are, every day, big planes that are dramatic, physical reminders of what you guys have been able to accomplish. You can look out your window in either direction and you can see your customers, you can see them consuming your product. You can see them getting on the airplanes. I mean, this whole thing, sitting at your desk, must give you an enormous sense of satisfaction.
BURR: You know, I actually don't get to look out the windows that often. It seems as if we're always holding a meeting of some sort in here, and I get stuck in the chair with its back to the window. Everybody else gets the good views. They get to look out and see the planes taking off, and I just don't get to see that much. In fact, one of the things I'm enjoying about talking to you right now is that I'm sitting here in a seat with a view and I get a chance to look at it all.
INC.: But doesn't it give you an extraordinary sense of achievement, a thrill?
BURR: You know, it used to. When the first planes were delivered here, three whole planes, now that was a thrill. Watching the first People Express flight ever take off; that was something. Now when I look out there, I don't know, there are just so damn many planes out there. It's just not the same anymore.