American Airlines Succession Plan? New CEO?
 

Apparently the blogs have revealed that AA is in the midst of a multi-year succession plan. I guess Doug Parker's days as CEO are numbered. Good thing or bad thing?

Neutral...new management or not, I don't see anything groundbreaking upcoming for AA, as much as we might hope.

Not while the industry is struggling to stay alive. Not to mention me thinks the price of oil (jet fuel) will be spiking as domestic production is forced to shut down. Another ulcer to contend with for airline senior management. It would not surprise me that Parker would not want to go through another reorganization and just hit the golf course instead.

I mean, Parker is by default better than Bastian at this point, and whatever mess at UA that currently qualifies as leadership.

Domestic production isn't being shut down. The issue remaining is where new drilling can happen, not old production sites.
The most recent oil increase is due to Saudi Arabia's recently announced production cuts.

I teach a class that touches on resource consumption trends, and one of the weirdest things that students have a hard time learning is that domestic oil/gas production expanded dramatically during the Obama years. Believe it or not, the thing is that what the president controls with regards to oil/gas production is limited to relatively fringe oil/gas reserves. The world's oil market is in a glut, and will be for quite some time, even if domestic production gradually wanes off. The efficiencies of the entire consumption side of the equation, including new aircraft engines, make it difficult for oil to even spike that far (barring any major international production side disruption).

I think coming out of a pandemic lead travel decline is the main thing on the AA agenda now not a CEO replacement.

No kidding. Bastian was crushing it and then COVID took all of their investments in LATAM, Aeromexico, VS etc. and obliterated them.

UA is just a basket case.

Doug flying off into the sunset is already being downplayed by AA in the local newspapers. They are saying the search target is an HR #2.

I miss Bob Crandell

Who doesn't? But the industry in which he led AA is not the industry of today or even 5 years ago.

Unfortunately a bean counter focus is what AA or any airline needs at the moment, just to hang on during the current crisis. AA does seem to be navigating around the financial and health restrictions reasonably well, certainly better than its competitors, so one has to give DP some credit there. However, AA needs a CEO for the longer term who can think beyond cramming more people on planes, cheapening amenities, and manipulating the share price. Someone who can figure out how to make real improvements in the product, make front line employees more consistent and accountable, and improve reliability. Not someone who seems to look at Spirit as the model for the future.

If the board is engaging in "succession planning" because they agree there needs to be a long term strategic change in direction that's good. But if it's just to ensure that, if DP gets hit by a bus, they can fill his shoes with someone like him, then not so good.

(RED and underlining mine)
Defense Secretary Robert McNamara (Kennedy administration) was once described as "Someone who knew the PRICE of everything, but the Value of nothing.". Managers who come out of finance, IMHO, tend to be lacking the ability to see the "people" part of the business.

Merrill Lynch was the finest retail brokerage firm on the planet. The culture revolved around the brokers, who drove phenominal revenue through sales. Merrill Lynch was the envy, and the class, of Wall Street. Every senior manager for 40+ years started as a broker, and worked his way up.

Until Stan O'Neill, from finance, became CEO. He didn't have ANY IDEA, COMPREHENSION, or UNDERSTANDING of how his clients (the revenue generators/brokers) worked in the real world. To him, they were easily replaceable cogs in a wheel.

He singlehandedly destroyed the best esprit de corps and customer service in the industry, solely to drive profits/share price, at the the expense of the revenue generators. Thus began a viscious cycle. As brokers left for better places, revenues dropped, resulting in more draconian policies and pay cuts, which led to more leaving, etc..

Now Merrill is a faint shadow of its former world dominating self, and a red headed step child of Bank of America.

Draw your own analogies.

OBTW- I never worked for Merrill Lynch.

I vote much a do about nothing.

It’s a best practice that most corporations have already built succession plans for most, if not all senior executives.

I'll take up for Parker in AA's response to COVID. Other than being too slow at re-opening the ACs (good god ATL is still closed) I was very impressed with the way AA handled the situation, including:

1. Reintroducing food on flights of over 900 miles in F-what was the previous meal window anyway
2. Maintaining a full beverage service in F (come on DL can't have ice?)
3. Quickly re-establishing full food offerings in the ACs (LAX <redacted> excluded).
4. Not giving in <redacted> to blocking middle seats, which does nothing <redacted>
5. Lowering elite earning requirements and extending the elite period and for AC members membership by 6 months
6. More willing to offer much more reasonable upfaring. I like the idea that on many routes that I can now buy F for what was in many cases a previous Y price, not have to play upgrade roulette, pick my own seat ahead of time and if I need to be re-accommodated far likely remain in F.

Yeah I don't like the idea of the PTV being ripped out but using my tablet isn't the end of the world. I usually read instead anyway. Most movies suck today.

My real gripe with Parker and team is to get much better at managing and recovering from irregular operations. This is where DL blows AA away.

Which blogs? It's not hard to post a link.

I wouldn't say his days are numbered in the way you imply. Of course he'll retire at some point but it's hardly imminent and there isn't a countdown clock ticking away!

All companies should be engaging in sucession planning for very senior roles. Looking at who to promote from within and at those from outside to bring in a new perspective.

This speculation has come from an advert to recruit a Chief Human Resources Officer and no other post

see e,g https://onemileatatime.com/american-airlines-new-ceo/ and I think he's over egging the pudding.

There's also a pretty comprehensive quote from Elise Eberwein there too.