United shouldn’t waste crisis: Air NZ chief
Air New Zealand chief executive Christopher Luxon says United Airlines “shouldn’t waste a good crisis” created when a passenger was dragged from an overbooked plane.
He said the US airline’s “abysmal failure” to handle the situation was a great opportunity to completely turn around its culture.
“When you see big failures in customer service like that, it i s really linked to the failure of a development of a culture over 20 or 30 years,” said Luxon.
United now had a very clear “burning platform” to use as a catalyst for changing the organisation’s culture.
“I think a good crisis like that should never be wasted and as a catalyst for completely u- turning it.”
Air New Zealand has just been named as the country’s most attractive employer in a survey by worldwide recruitment and human resources specialist Randstad.
Luxon said the airline had recovered from its near collapse in 2001 by building up a strong culture.
“Air New Zealand knows what that’s like.
“We’ve been on a big turnaround in our business for the last 15 years or so — it’s possible to get a turnaround in a culture very quickly but it starts from leadership,” he said.
United — which is an alliance partner with Air New Zealand — has been hurt financially, suffered massive brand damage and has been forced to apologise repeatedly after passenger David Dao was dragged from a plane in Chicago to make room for airline staff on an overbooked flight. Outside contractors were involved in the inci- dent and airline staff in the US are notorious for sticking to strict rules.
Luxon said Air New Zealand staff had some basic rules, but it trusted its people to do the right thing.
“They’ve got to feel really supported from their leadership from the top down. What we’ve said to them is exercise your best judgment and we trust you and know you’ll make the right decision and they do,” he said.
“We want to empower people; we’ve said treat our customers as you would a friend or a family member. We’re backing people up with principles instead of rules.” Airline staff were under increased scrutiny by passengers, most of whom can put smartphone footage of incidents on planes on social media if they want.
Luxon said the airline talked to staff about that high profile.
“We tell our people that ‘ you hold the position 24 hours a day so it’s important that you keep to that because the public is looking at you’,” he said.
“I think Air New Zealand is held to a higher standard by the New Zealand public than other companies.”
Luxon said talk about culture was not “kumbuya” or soft and fuzzy.
If management and leadership was detached from the front line of the organisation and not in daily contact with the issues and what the day job was like, then staff became highly disengaged. This would have wider fallout. “Before you know, that is having a disproportionately negative impact on your commercial performance — there is a real interdependency,” he said.
Luxon said turnover among its 12,000 staff was low, at about 7 per cent. About 85 staff this year would mark 40 years with the company.
The airline deliberately avoided using consultants wherever it could. “It’s not our natural default.” The airline had enough smart people who were closer to the business and able to work through problems.
“I’ve seen organisations that have brought a lot of consultants in and sometimes it means that the strategic capability isn’t built.
“We’ve found every single time the answers lie from within our own business.”