Air Transport World

Identity crisis: network airlines must change their corporate cultures to survive and prosper in the new world; it won't be easy but it has to happen.(Analysis)

Charles Darwin wrote, "It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change." British Airways CEO Rod Eddington warns that achieving that responsiveness is extremely difficult--"Changing airline culture is like trying to perform an engine change inflight," he maintains. While not all legacy airline CEOs have to face as daunting a task as that, the magnitude of reform required to meet the actual or threatened competition from low-cost carriers is enormous, and for many airlines seemingly impossible to achieve.

The reasons for the reluctance to change culture are numerous and varied. In some cases, staff believe that the launch of a distinct low-fare brand will mitigate or eliminate the need for further adjustments at the mainline. Top management at state-owned carriers often must deal with political intrusion on behalf of well-connected appointees and entrenched unions.

Surveys have shown that another reason for the resistance to change is that although employees agree change is needed, they don't believe they themselves need to change. For example, at an American Airlines management conference in the late 1990s, all participants were polled on a series of questions. More than 90% responded positively to the proposition that management, colleagues and subordinates needed to change, but 90% responded in the negative to the item "I need to change how I work with people."

British Airways was among the first legacy carriers in Europe to launch a standalone low-fare airline, but when Eddington arrived in 2000 he made the decision to sell Go Fly to resolve the issue of whether further change was needed at the mainline. "My staff told me that Go was the solution," he says. "I said I could possibly accept that if Go was making 300 million [pounds sterling] a year, which is what our European division was losing. …

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