That's how I felt about the title of this thread -- bereft. As bereft as Robert Milton iss of ideas about how to revitalize an airline. Right now, I'm stunned, demoralized, and completely without hope. For perhaps the first time ever, I have sympathy for those working at Air Canada as I never had before.









I had seen the other thread about 2 million passengers without a complaint. Other than being mildly amused by it, particularly the semantics, I didn't think about it. Until I read today's Vancouver Province over dinner, and stumbled upon an article titled "Pay cuts key to airline's survival". It was an article about RM's speech to the Vancouver Board of Trade.

Even then, as reading the article, I began to feel a sinking feeling. I started to become aware that RM was completely befert of new ideas. The best he could come up with was to copy WestJet, to be just like them in fact. Rather than come up with new ideas, take chances, lead with bold steps, his only avenue was to "do what they did." How uninspiring.

I'd have liked to posted a lot of stuff a few weeks ago when he was in the news, but being in Egypt, internet access was difficult. I had intended to follow up when I got home, but it seemed to have lost it's timeliness, and I lost interest. But it seems that lack of vision is always timely.

Here's a few quotes (and not quite quotes, paraphrases, perhaps) from the article:

'Concessions from Air Canada's unions are the key to the national airline's survival'

'Air Canada must reinvent itself as a low-cost carrier along the lines of WestJet'

"To do this, we must address labour costs"

I suppose that there's not a lot new or surprising here, but it was depressing to see that RM himself thinks that Air Canada should become WestJet. But then I went looking for the on-line version, and found something else. This: Milton ticked off as questions on airline accentuate negative.

This was even more depressing. It's clear to me that RM is completely without vision, that he thinks for the most part everything is fine, and that really, Air Canada's problems are its customers. Here are a few more quote: Understand?

We, that's you and me and everyone else, "don't understand what airline service is like". We also "don't understand, perhaps, how competitive Air Canada really is." Perhaps we're thick, or just downright stupid. Or maybe it really is "Because we're a small country," or maybe even "because there is not a lot of choice" in Canada.

[I've got news for him. I have choices, and I do understand what airline service is like, to the tune of eleven thousand dollars.]

Milton's response? Apparently he really believes it. Notwithstanding that the methodolgy is questionable (to be kind) and that OAG doesn't realize that Canada is in North America, he continues to believe that he has a great airline. And if it's great, it obviously doesn't need fixing, does it? So what was with those two audience questions? (And what can you say about a survey run by an alleged travel industry company that doesn't understand the simple political geography of North America?)
Sure... we'll just copy them, and by the way, we need to extract massive concessions from our employees. If that isn't "old-style airline management" I don't know what is. How he can say these things with a straight face simply boggles my mind.
He seems blind that people want value, and they perceive that they are getting from the likes of WestJet. Charging 10 or 20 times the price for 50% more space and a few drinks isn't good value.

There's an old saying that one should "lead, follow or get out of the way." Air Canada right now needs more than anything else a bold leader with vision, and all they have is a copycat. He dismisses doing things "the old way" yet carries on as everyone before him has, complaining about labour costs. He looks at a sucessful competitor, and just says "let's do what they do."

Air Canada needs a leader that inspires everyone, customers, shareholders, and most of all employees. Because inspired employees that can make a difference like nothing else. Because inspired customers can be the best sales force a company can have. And because inspired shareholders will be prepared to stick with a plan, an inspired plan, through the thick and thin of it.


I feel I should apologize for the lack of coherency in this post. But I'm just so bewildered by these two articles and RM's statements, I find I can't think straight. And I'm completely demoralized.

[This message has been edited by Ken hAAmer (edited 02-21-2003).]

I read your post Ken a few hours ago and thought about it. The valid points you raise are nothing new. Milton hasn't done anything in his tenure to make AC successful. He simply inherited an airline form Hollis, had a few good economic years (crazy tech sector) where if you couldn't make money, you had to be dead, at very least not working in technology. Now that there we are in a downturn, they are failing again.

His strategy to mimic WJ seems silly. While it is true Canadians do want to travel cheaply, they also like to travel well. WJ may do for a YYC-YVR, and there are many that still would go YEG-YHM or longer. I also know of many more who would gladly pay a little more for full service. However AC is providing at best, unreliable service. Your chances of getting bad service, or no service are twice as good as being treated well. Thats not to say there aren't stars working at AC, they are just being outshadowed.

So, Canadians given a choice of A) great service, cheap price, and marginal comfort on WJ

Or B)Crappy service, high price, and better comfort on AC

To say a low cost model is what AC needs to follow would only provide

C)Crappy service, low price, marginal seating (all eco-737 or A320).

Is that going to be successful is changing people's minds from AC? Of course not.

What if perhaps this was offered?

D)Outstanding customer relations, the customer is always right and we want to help as best we can, anywhere we can.

Fair pricing: YWG-YYZ 400-600 R/T max.

Awesome aircraft configuration of perhaps
2-3 seating in the Y cabin instead of 3-3

So you lose 23 or seats on every plane, most aren't gonna get filled anyway (130 seats available -23 is still and 82% load factor, is AC operating at 82% now . NOT.They will be making more $$ on regular fares of 400+ instead of 200-300 now charged.

If I was offered the choice to fly my family in comfort to YYZ for 200 more than WJ , I would do it everytime. So would most Mid-upper class Canadians.

Now imagine J class had sleeper seats like BA CLUB in a 2-2 config. J fares were 600-800 on a YWG-YYZ route, maybe 1400 or so YVR-YYZ RT. They would be sold out every time.

They would be offering an actual product that was clearly, visibly better, for a price that one would actually consider for a trip with the better half. Better yet, have seat sales that included J that would lower the cross country J price to 999.00 RT a couple of times a year and everyone would clamour to book for their holiday.

I suspect that the above would be successful. If not, well atleast it is something different that has not been tried. That's better than mimicing what Clive's doing in YYC.

Note all my suggested fares were in excess of 100 dollars a flight hour per passenger, if that isn't enough to make money they their cost are too out of control to even continue operating. May as well close the doors tommorow.

Be a proud Canadian Airline that is known worldwide for service and style, not a broken up jumble of stupidly named smaller companies and poorly painted aircraft.

Marc

[This message has been edited by mtacchi (edited 02-22-2003).]

[This message has been edited by mtacchi (edited 02-22-2003).]

The linked Business Week article echoes your comments...

"Listen Up, Execs: Playing It Safe Won't Cut It"

United Airlines Inc. (UAL ) and other carriers are suffering under pressure from cheaper, no-frills rivals such as Southwest Airlines Co. (LUV )...

Why are so many industries in a slump, their strategies confined to shedding operations, employees, and research? Why are their business models either uninspiring or deeply troubled?...

...Chief executives have to reduce expenses, he said, but some of those savings have to be invested in new possibilities for growth. "You can never come out of a downturn with only the same products that you had when you went into it. Leaders have to understand--at a gut level--the new possibilities that are out there."

etc."

http://www.businessweek.com/print/ma...2021_mz007.htm

Interesting read and an all too well known gripe from RM. What he is REALLY saying is "If you want to keep AC alive, Canadian Govt. has to come up with more subsidy, customers have to stop complaining and everybody has to believe implicitly that RM is the true saviour of the airline industry in Canada.". He's, also, implying that if these are not forthcoming he'll change the name of AC to WJ2 and provide worse service. Not an unexpected response given that he got AC handed to him on a plate and expected everything will remain the same for years to come and he'll not need to have VISION. A truly sorry state of affairs when the CEO of a supposedly world class airline says that survival depends on copying and not innovation. Maybe RM should start listening to its customers and not to WJ.

KH: As usual you are right on the money. Senior management and the BoD at AC are completely unimaginative, afraid and narrow minded. There are alternatives (including multi-branding if done correctly) out there to simply copying WJ.

------------------
Saturday nights should be spent with family.

Perception is reality in the world of public relations. If people think that AC has less than ideal customer service, then AC has a serious customer service problem.
Arrogance and brushing off concerns of the travelling public is only compounding the problem.
Milton may be skilled in certain areas in the governence of AC, he is definitly not skilled when dealing with the public.
If I were a member of the BOD, he would have to answer some tough questions on this latest outburst. No...I would go further and ask questions about the validity of the vision or lack thereof

I too am loosing hope in the survival of AC.
I am sad for the employees who care about the airline and daily try to deliver a good product. I have come to the point were 2004 will be the last year that I hold status on AC. I am now in a shopping mode for alternatives.

...and this in today's G&M under the stock Stars and Dogs.

"Among the great mathematical conundrums -- Xeno's paradox, "the unexpected egg," and our favourite, "whoever knows the least earns the most" -- lies the questions of why Air Canada's shares are still worth anything at all? Free upgrade coupons to the genius who can figure it out"

The BOD love Robert and think he is just great! Time to clean the entire house starting with the board and making their way down.

Re - RM & the AC Board, all I can say is: "they made their bed"

On with the show.

The Big Six in the US are in deep trouble, domestically AC's not much better off. Desperate times result in failed companies.

Other "revolutionary" ideas that would increase the publics opinion of AC.

Allow 24hr period where any ticket could be changed or cancelled without fee or restriction regardless of fare. That way if I book over the phone then get an email from AC showing the wrong day/right flight, I can get it corrected without an the new agent calling me a liar on the phone.

Yes, but then AC would miss the opportunity to extract more money from you.

It is money they have already lost by people not booking because of this handy feature offered by other carriers.

It's a different way of thinking, don't nickle and dime the customer, don't piss off the customer, and garner greater revenues from increased business instead of a few bucks from a pissed off customer that won't come back.

And I thought you were announcing a new intra-BC Air Canada unit called "Bereft"!

And so it is.

You know, I gotta say I really like your post, Ken. It cuts to the heart of the matter on a variety of fronts.

I, too, am sick of the "same old same old" whenever a business is faced with a challenge. So either get someone in charge that can "think outside the box", or get lost....