Wednesday, 30 December 2020

Airline Leadership: The Way Forward

It is now certain that things we cannot control will take some time to settle. As much as it is not easy to live with uncertainty, this time gap is giving us an opportunity to adapt to new ways of thinking about our work. As we have already experienced, the way we used to define strategies, to plan and make decisions, will no longer work. We are dependent on feedback from the real world for which we found ourselves unprepared.  

The thing is that we have to find our own way out of this crisis. There is a lot of great advice around on what and why we need to change. But what is really missing is HOW to do that amidst the heightened state of uncertainty and complexity that have, to a lesser extent, always been a part of the airline business. So, the question is how to build a more resilient organisation that can survive the forthcoming adversities?

The answer is actually relatively simple, as demonstrated through my years long work, and explained more comprehensively in my book Beyond Airline Disruptions-Thinking and Managing Anew.  

On this occasion, I would like to share with you an excerpt from the closing chapter of this book. It points to the benefits that can be expected when we make it possible for strategy and operations to work in sync for the benefit of our customers. And also, when we start focusing on work that matters while taking good care of our employees.  

“-Instead of managing people, we should manage problems that cause our passengers to leave us even when our price is lower than our competitors.

-Instead of relying on predictions based on the past we should keep reconfiguring and adapting, fine tuning our operations to best meet passenger needs.

-Instead of traditional planning and forecasting based on aggregate historical figures which tell nothing about their interconnectedness and true origins, we should focus on resolving the complex emerging problems that are threatening the system performance while aware about their deeper causes.

-When we think about new ideas, we will have a better sense if they are going to work well for us and what we have to do to adapt when circumstances change. We will know better what to offer and how to assist our passengers travelling to and from disruption-prone airports and airspace.

-We will be more aware of what an airline is capable of doing and what cannot be done. And if we decide to do what we cannot deliver at our best, we will know that this is a calculated risk measured against other known benefits but will ensure that the negative impact of such decisions on customers, partners, and employees is minimal. 

This game-changing approach to management creates a shift in culture. And as a result, trust and care about the core purpose strengthen, the service improves and cost is reduced.

This new approach to management is simple to implement and, from the very beginning, starts to inspire people across the organisation to engage their ingenuity in understanding and improving their work while sharing common goals. It is accessible to all those with a mind open to new ideas, those who seek long-lasting success, those willing to build their business based on trust and cooperation, caring for employees and through them for customers.

Let’s challenge ourselves to evolve, innovate, and experiment, to create a better future.”


With this in mind, I wish you and yours a happier, healthier, and more prosperous new year.


Saturday, 28 November 2020

Wednesday, 18 November 2020

Systems Design and the Front Line, As Seen by Seth Godin

If you experience lousy service or poor quality, it’s probably not solely the fault of the person who talked to you on the phone, dealt with you at the counter or assembled your product.

It’s the boss.

The boss didn’t design the system properly, didn’t align incentives, didn’t invest in training. The boss isn’t thinking hard about hiring the right people. And the boss isn’t listening.

As a result, the frontline workers are often undertrained, underresourced and overscheduled.

But, and it’s a huge but, those very same frontline workers don’t have to suffer in silence. They can provide a useful conduit of information and feedback. They can model how it could work better and establish a model for those around them. Not because it’s easy, but because it’s important.

The top-down nature of the industrial entity is rapidly being replaced by the power of peer-to-peer learning and leadership. There’s no top and no bottom. Simply the ranks of people who care enough to make things better.

Thursday, 12 November 2020

Time For a Reality Check

A sobering big picture overview of the industry and where it will be in the next decade, by CAPA Chairman Peter Harbison. 






A new platform for the future. Time for a reality check.





Sunday, 8 November 2020

Why Do We Wilfully Ignore Obvious Pitfalls in Management?

This is a rare opportunity to hear an experienced CEO talking openly about well known but wilfully ignored pitfalls in management.

Margaret Heffernan, the CEO, management expert, and author questions why we ignore the obvious and suggests that if you want to see the full picture you need to have people around the board table who inhabit different kinds of mindsets. 

In an age of complexity the failure to take account of multiple perspectives is really dangerous. We understand the complex systems are impossible to see in a kind of a single view. So we need those multiple views if we are going to understand the world we are living in.





The question is how can we put these multiple perspectives together in airline management?

 

The process is not difficult to implement. It doesn't require organisational changes or structural transformations - it is about enabling the natural flow of work across organisation. And also, about access to relevant data and group insights in support of decision making that benefits the entire organisation. Things that require facilitators with real skills based on the wide industry knowledge and experience.

 

The process is refreshing and regenerative. The time is ripe for its implementation. 

 

Wednesday, 7 October 2020

Furloughs and Layoffs - the Southwest Airlines Way

Gary Kelly, chairman and CEO of Southwest Airlines Co., outlined steps Monday the company plans to take in attempt to prevent furloughs and layoffs through 2021.

Includes: 'Effective immediately, Kelly's salary is reduced to $0. It will be that way through the end of 2021.'



Any such example around the industry? 


Read more about the essence of Southwest Airline culture:
https://beyonddisruptions.blogspot.com/2020/08/what-can-be-learned-from-sustainable.html

Sunday, 4 October 2020

Old Habits die Hard - The Pike Syndrome Revisited

A dark cloud is hanging over the airline industry. 'Extreme uncertainty' coupled with 'complexity' have become words that keep many paralyzed and even content with old habits that offer them security, however false.

Without seeing the way out in hard to predict situations, we restrain ourselves from taking actions that can assists us with going through this hard time without making the future of our organisation too risky or potentially unsustainable.

This kind of paralysis resembles the condition named the Pike Syndrome - the analogy used to remind us of what happens when we remain blind to our habits and in denial of reality, even when they start threatening our existence.

Time to revisit The Pike Syndrome.

Sunday, 30 August 2020

A Leader’s Framework for Decision Making

If you are a leader at any level struggling to understand why your best intended decisions don’t work as expected, the chances are that you are mixing up the contexts in which you are making these decisions.

You certainly know that your actions depend on the situation, and that you can make better decisions by adapting your approach to changing circumstances. The question is which approach to use in a particular situation to avoid making the wrong decision when faced with systemic complexity and extreme uncertainty?

In their timeless article “A Leader’s Framework for Decision Making” David Snowden and Mary Boon provide some 7answers. Helpful for freeing yourself from habitual thinking driven by traditional management paradigms.


"A Leader's Framework for Decision Making"




Sunday, 23 August 2020

Rethinking Monopolies and Their Profit Taking

Isn't it time to rethink the monopolies and their profit taking? What are the alternatives? Seth Godin explains:
"Once an organization reaches scale, particularly if it feels like a monopoly, it’s tempting to “take profits.”
This means less investment, fewer staff and a lot less care. Those things are expensive. Easier to simply keep the money.
And those things involve emotional effort. Easier to simply point to the bottom line, as if that’s the point.
Lazy managers dump the emotional labor on overworked frontline staff instead of creating systems that create value for everyone.
And lazy shareholders reward quarterly earnings instead of understanding the long-term ramifications of failing to serve customers.
“We don’t care, we don’t have to,” is often the last slogan once-great institutions have emblazoned on their door."

Tuesday, 18 August 2020

What can be learned from the sustainable success of Southwest Airlines that retained its superior investment-grade ratings in times of extreme uncertainty

Southwest, Ryanair and easyJet are the only three airlines that retained investment-grade ratings from S&P Global Ratings, after the credit rating agency downgraded a host of carriers and slowed the pace of its air travel recovery forecast. In a report published last week, S&P analysts said that superior ratings come from the low-cost model, “robust liquidity”, and greater relative exposure to healthier short-haul and leisure markets. 

What these kind of ratings don’t tell us is that the superior ratings come mostly from immeasurable values which are beyond hard facts, things that drive sustainable growth and success, like leadership, culture, relationships with employees and passengers. This is what the unwavering success of Southwest is made of. Unlike any other airline, it has been profitable every single year between 1972 and 2019, and this year it tops the league of the most successful airlines in times of extreme uncertainty.  

These are the kinds of things that cannot be copied or enforced by any kind rules. It is all about setting the overall framework and the right tone that radiates from true leaders. Herb Kelleher, ex CEO and co-founder of Southwest Airlines and his team have shown us the way and generously shared their experiences.  

Here are some quotes from Herb’s interviews that I hope will be more deeply heard at this unsettled time. And more importantly, inspire so much needed actions to adapt to the new circumstances in the way that will speed up the recovery:


On strategy 
Herb Kelleher liked to say, “We have a strategic plan. It’s called ‘doing
things.” He never allowed himself to become bogged down by too much strategic thinking or analysis paralysis. He believed that all he needed was an overall framework. Nothing more. And he came up with something very basic. For Southwest Airlines, his vision and the basis for this framework was simple; low cost, superior service, people first.

"This framework approach gives a long-term horizon. It liberates from the contingencies of the moment. At a time when everything is created, deployed, and measured in real time, strategy and execution are one. Sequential thinking, which requires putting strategy first and execution second, is becoming more and more outdated, even irrelevant. Today’s business relies on a constant back and forth between the two."

"Because you can’t really be disciplined in what you do unless you are humble and open-minded. Humility breeds open-mindedness — and really, what we try to do is establish a clear and simple set of values that we understand. That simplifies things; that expedites things. It enables the extreme discipline. When an issue comes up, we don’t say we’re going to study it for two and a half years. We just say, “Southwest Airlines doesn’t do that. Maybe somebody else does, but we don’t.” It greatly facilitates the operation of the company. "

"When planning became big in the airline community, one of the analysts came up to me and said, “Herb, I understand you don’t have a plan.” I said that we have the most unusual plan in the industry: Doing things. That’s our plan. What we do by way of strategic planning is we define ourselves and then we redefine ourselves." 


On leadership
“As far as leadership is concerned, I think that everybody needs to be a leader in order to have a successful company. Because everybody, by example, sets a leadership standard. I don’t care whether you’re checking bags or loading them in the bin or no matter what you’re doing.  You’re setting a standard for other people and we want people to all, all our people to be leaders. We think everybody is a leader no matter what their job is. We want everyone to be a leader. They’re setting an example by their conduct and they should be inspirational.” 

On who comes first 
“Employees came first, customers second, shareholders third.  If the employees serve the customer well, the customer comes back, and that makes the shareholders happy.  It’s simple, it’s not a conflict, it’s a chain. If you treated the employees well, if you cared for them, if you value them as people, if you gave them psychic satisfaction in their jobs, they would really do a great job for the customers and the customers would come back, which would be good for the shareholders. Most companies didn’t operate that way. So, we turned the pyramid upside down, in effect, and said the employees come first and they always have.  Not just in our minds but in our hearts as well.”



On Focus
“You have to focus intently upon what’s important and what’s unimportant, not be trapped in bureaucracy and hierarchy. Be results- and mission-oriented. Keep it as simple as they possibly can, so that the values and the destination of the organization    are well understood by all the people that are part of it — so that they can feel that they are truly participants in it. The business of business is not business. We’ve always said, “The business of business is people.”
           
On three main things
“We basically said to our people, there are three things that we’re interested in. The lowest costs in the industry — that can’t hurt you, having the lowest costs. The best customer service — that’s a very important element of value. We said beyond that we’re interested in intangibles — a spiritual infusion — because they are the hardest things for your competitors to replicate. The tangible things your competitors can go out and buy. But they can’t buy your spirit. So, it’s the most powerful thing of all... 
How do we get low costs? Through a lot of things, including the inspiration that you give your people, their productivity, the fact that they feel that they’re doing something that is really significant and that they enjoy.”

On talking jargon and labelling
"We have never used the fancy titles for empowerment, total quality, etc. Every time you talk jargon you find that people assume that they have the same thing in mind when they really don’t. We don’t apply labels to things because they prevent you from thinking expansively."

On culture as a competitive advantage
“The intangibles are far more important than the tangibles in the competitive world because, obviously, you can replicate the tangibles. You can get the same airplane. You can get the same ticket counters. You can get the same computers. But the hardest thing for a competitor to match is your culture and the spirit of your people and their focus on customer service because that isn’t something you can do overnight and it isn’t something that you can do without a great deal of attention every day in a thousand different ways. This is why I can say our employees are our competitive protection.”

On keeping the culture values alive
“We decided that we had to institute another limitation on expansion, one which is cultural in nature. We simply cannot increase our staff by 10% per year and expect to maintain the same kind of environment and culture we have, and that is important to us.”

“We were a little concerned as we got bigger that maybe some of our early culture might be lost, so we set up a culture committee, whose only purpose is to keep the Southwest Airlines culture alive.”

On empowering people 
“If you create an environment where the people truly participate, you don’t need control. They know what needs to be done and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchies and control mechanisms you need.” 

“Provide guidelines only, not rules. Give your employees the flexibility to make decisions on the spot.”

On relationship between employees’ pay and productivity 
“We’re perfectly happy with having, generally speaking, the highest pay for employees in the domestic industry. They reward us with tremendous productivity, which lessens the effect. And the other airlines disadvantaged their people. I’m not saying they didn’t have to, in the sense of “either we do this or we fail,” so it’s not a criticism. I’m just talking about the economic effects of it.”

On company mission
"The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit."

On learning it by doing it
"I learned it by doing it, and I was scared to death." 


So, here we are, facing the biggest leadership challenge ever! The question is, can we get anywhere close to this kind of culture with minds stuck in the legacy world? 

Of course, we can start moving towards it if we become open to rechannelling the work and information to their natural flow. The opening starts with the engagement of employees through creation of space for collaborative hubs and opportunity scans supported by latest technologies. These are the things that have been at the heart of my consulting work, that I have written and talked about and described in my book






Friday, 7 August 2020

Connect and Collaborate to Disrupt Disruptions - my presentation during the Virtual OPS 2020/IBS

Here is the link to my presentation during the Virtual OPS 2020 organised by IBS Software. I was talking about how we can better connect and collaborate to disrupt both strategic and operational disruptions. I sincerely thank Daniel for the opportunity.

I explained what it takes to establish the missing links between strategy and operations, the process that engages people from around organisation to resolve the complex, real-life problems, and a new role of technology to make this happen.

The process revolves around Opportunity Scanning technique that combines near real time data and insights essential for validating strategies. It also helps with understanding the emerging patterns that need concerted action to prevent avoidable losses.

https://lnkd.in/dhaU-nJ




#airlines #StrategyOperations #innovation #futureofwork


Monday, 27 July 2020

Connect and Collaborate to Disrupt Disruptions

I am inviting you to join me on 4 August during Virtual OPS 2020 organised by IBS Software when I will be talking about how we can better connect and collaborate to disrupt both strategic and operational disruptions at times of extreme uncertainty and growing indebtedness.

Here are some highlights.

The profile of operational disruptions is changing. This time they are dominated by frequent strategic adjustments resulting in unknown, yet avoidable losses generated by slow and often less than appropriate response to changes in market demand. So far, the way we used to connect and collaborate to reduce disruptions haven't been successful and this needs to change. 

The question is, how can we reinvent collaboration and become the co-creators of the new connected, resilient organisation where strategy and operations become closely linked? What is the role of people and technology in making this happen?


You can register at http://ops2020.ibsplc.com/