The elusive qualities needed for leadership February 2004

There are a myriad of ways to lead an airline. Michael O'Leary is quoted as saying that it is just like running a bus company — do it efficiently and more cheaply than the competitors and you should prosper unless you come up against the machinations of the EC. Others, such as Jean–Cyrille Spinetta of Air France, point out that airlines are deceptively difficult to manage as a unified whole — but keep the staff motivated and supporting each other with the costs under control and big airlines can compete successfully.

Such differences are particularly relevant in today’s markets. Cost is high on the management agenda, but so are delivering safe, secure and reliable operations, concluding successful international negotiations, gaining airport access and services, exploiting new and old distribution channels, and sound asset management. Staff, meanwhile might add having the tools to do their job, being recognised for what they do, and — in many major airlines — reassurance on their pensions.

Yet airline leaders have to engage with this complexity and hold to a purpose that makes sense for their airline, within the current market context.

When one is facing a dangerous competitor decisions have to be made with reference to the outside market.

To strategist Kenichi Ohmae author of The Mind of the Strategist, being fit is not enough, you have to be fit for the purpose of the enterprise — "it is the difference between going into battle and going on a diet".

So airlines need to provide leadership in cost reduction and simultaneously improve operational performance. They do need to outsource services whilst ensuring there is fast and joined up disaster recovery management. Current commercial relationships have to be maintained at the same time as competitive new ones are built. An unwavering bottom- line focus has to recognise that safety is never compromised. To communicate and act these complex messages, making sense of trade–offs and ambiguity, is the stuff of leadership. The environment is too dynamic for them to be managed away.

As we see the first signs of a general economic recovery in the sector, so we are also seeing an increase in staff reminding their leaders that they may not always be being well led. While many airlines face a fundamental problem with their business models that will not be resolved by a cyclical upturn, some of their staff are becoming less receptive to constant crisis management. Disputes involving pilots, cabin crew, terminal and airport staff, have all affected airlines over the last six months, and caused them great damage. In these competitive times airline leaders will need to demonstrate that cost driven measures are in response to still dangerous competitors, that success is possible, and that there will be recognition and reward for all.

Such leadership does not have to be loud and charismatic. Recent studies suggest that many very successful corporate leaders are quiet and self–effacing yet massively ambitious for the company — not themselves. Gary Hamel, a leading academic, takes this a stage further. He argues that the need to have a great leader who rescues a company from adversity is in itself an admission that the management of the company has failed — what is needed is the constant preparation of the company so that it anticipates and meets new challenges without first being disadvantaged. This means leadership throughout an airline, not just at the top.

Markets can turn nasty, and terrorism, SARS and economics have certainly affected airlines recently. But as the months of financial challenge turn into years, the willingness of staff to accept more work and change may become tempered by a growing doubt as to the management’s ability to get ahead of the game. In all airlines pilots remain one touchstone of how the leadership is perceived.

They are usually intelligent and highly skilled, yet by the demands of their profession divorced from the managerial side of the airline, with minimal contact with executives and may not always understand economic models. Yet they are a often a touchstone of staff emotion and all airlines should remind themselves that when pilots take action, the root cause may actually be about perceived recognition and respect, not about money, schedules or safety.

These are often the symptoms, not the causes. In this environment airlines may look to improve their leadership. To often, however, 'leadership initiatives' produce an intellectual interest and perhaps a 'feel–good' factor, but few sustained improvements in performance. Airlines are emotional working environments and rational discussion provides poor preparation for a ramp operations room on a cold and wet day when the schedule starts to slip, or in the crew room or hangar when one demand too many is made on tired and dispirited professionals.

But is here that airline leadership is demonstrated and tested.

Is the top team leadership demonstrably different?

For most airlines four basic questions provide some insight as to their current standing. Executive management is not the same as functional management and too many airlines have had their cutting edge blunted by false teamwork. Top teams have to make difficult decisions and consensus is not always achievable. It may also take too long. At the end of the day most people are swayed by what the top people do, not by what they say.

The self–presentation of constant harmony at the top rarely accords with others' views as to what is happening, or what is needed. Most airline staff expect there to be tension between pilots and scheduling, between engineers and ground operations, between finance and marketing. As long as a workable solution is provided, then knowing the issues can provide valuable guidance as to the local actions to take when plans starts to falter under the pressure of the operation and the market.

Is all training rooted in the business purpose, dealing simultaneously with group and individual actions and relationships?

Separating 'hard' business and professional skills development from 'soft' behavioural skills training may suit the trainers but may not benefit the airline.

One indication of good leadership is when managers sometimes find it more effective to "follow" their subordinates. Such behaviour can feel risky, however, so any leadership discussions need to be firmly rooted in the purpose of the organisation and constantly ask 'why are we doing this and how could we improve?' dealing with group and individual issues simultaneously. The missing link is often the market and the competitor. Having lower costs is painful and begs the question why? Gaining an extra rotation out of an aircraft, thus allowing an extra frequency on a key route, and increasing the likelihood of more passengers using the airline is a compelling story; especially with the added spice of disadvantaging a competitor — but it means the trainers have to understand the business, not merely how to train.

Is there a strong link between business planning and human resource planning, with both focused on the future?

Without this it is hard to engage with staff and to ensure the both are open agenda topics, not preserved and hidden by experts. Change may be driven by amongst other factors, growth, technologies, customer demands, competitors or the impact of regulation. Leaders need to constantly assess what future skills will be needed to embrace such change, and then manage the development of these.

Even low cost airlines need to ensure that there will be sufficient pilots to fly an expanding fleet, and sufficient people to handle more passengers at airports. Economic cycles do move, and people do age. If the planned airline growth in Europe is to take place in the next five years then the current demography suggests that finding qualified and skilled airline people will quickly become an issue, and will demand manpower policies that go beyond simple pay settlements.

Is there strong cross-departmental management, rooted in the commercial reality?

Leadership improves more effectively when the work is at unit level, but improved performance in one may cause new tensions elsewhere. It is in reconciling these that leadership has to live with management, and the leader’s speech, behaviour and action have to be aligned. Shorter turn–rounds demand significantly greater efforts by maintenance, in the terminals and on the ramp, and problems demand resolution in the interests of the airline, not merely exporting the problem to someone else — such as angry passengers to captive cabin crew. Similarly delivering network service promises, especially those dependent upon partners and suppliers demands great attention to process and system integration and immediate commercially based decisions when problems occur.

It is the sum of these tactical decisions, often by first line supervisors, that form the leadership culture of the airline, not the PowerPoint slide presentations.

As airline competition continues to intensify, success may well be dependent on the performance of every member of staff, every day, especially when things do not quite go to plan. Such performance over the longer term will not be accidental and will require many skilled, quiet, possibly even self–effacing people, all of whom are massively ambitious for their airline. They will need to found, to be well managed, and to be led.