How not to manage a national carrier, in three easy steps

The strike by crew and ground staff at SAA, which enters its third day today, could not have come at a worse time for the airline or the country. Just two weeks ago President Cyril Ramaphosa hosted his second investment summit, using it to assure potential investors that SA was open for business. They embraced his message, committing to invest R363bn. Last year Ramaphosa appointed a team of envoys, including former Treasury stalwarts Trevor Manuel and Mcebisi Jonas, and sent them out into the world to attract investment and boost our ailing economy. The team has been preaching to whoever cares to listen that Ramaphosa’s administration is hard at work creating a favourable environment for doing business in this country.

They have been assisted by tourism minister Mmamoloko Kubayi-Ngubane, who is raking up air miles as she sells SA to the world as a tourism destination of choice. She has the almost impossible mandate of helping economic growth by attracting 21-million foreign tourists by 2030.

This will not be achieved if we cannot fix SAA. Wherever this team went they have faced a barrage of complaints about our notoriously unreliable national carrier.

Ironically perhaps, one of the opportunities being offered to investors is that same national carrier. Speaking in parliament in June, public enterprises minister Pravin Gordhan revealed that the government is putting together an investment case for the troubled airline. “We have been working on a new investment case, if you can call it that, for SAA — in order that we prepare the airline for a partnership with a strategic equity partner,” he said.

The biggest problem for SAA is that it has been mismanaged for far too long. If Gordhan and his team are to package a compelling and commercially viable investment case, urgent changes are needed in how the airline is managed. Just look at how the strike was managed this week. This mess could have been avoided.

Even a layman could have told SAA how to manage the crisis this week with better results.

If you are already making an estimated R500m loss every month, why fret about another R50m a day once all your planes have been grounded? If you’ve already upset the unions by giving your pilots a 5.9% increase, while offering everyone else a round 0%, why not also announce that about one-fifth of your workforce will be affected by retrenchments?

And then, if you quietly hope you can still avert a disastrous strike by pulling a brandnew wage offer out of the hat (without knowing where you will get the money), why not still cancel flights for a full two days anyway? Or perhaps by then you had realised it was game over.

The National Union of Metalworkers of SA and the South African Cabin Crew Association knew it on Monday already. By that time, pilots had been awarded their 5.9%, as part of a rolling 10-year agreement that regulates their conditions of service. The unions had secured strike certificates and were in the process of balloting their members.

As this was unfolding, acting CEO Zuks Ramasia’s media statement announcing an estimated 900 retrenchments arrived: “These hard decisions were necessary to put SAA on a more sustainable footing while ensuring we continue to offer customers the best service. It is a matter of great regret that we will part ways with some loyal colleagues.”

But Zanele Sabela, spokesperson for the South African Transport and Allied Workers Union, said the planned retrenchments were a bolt from the blue. “The first we heard of it was when we heard it in the media.” It just added fuel to the fire. The strike was announced. The carrier scrambled and came up with a new wage offer for all workers: 5.9%, backdated to April 2019.

But by now, the unions had smelt blood. And it won’t be their members who have to mop it up from the floor.

The unions have smelt blood and it won’t be them who mop it up