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"Can United Continental Beat Its Bad Reputation?" - Investopedia

"Can United Continental Beat Its Bad Reputation?" - Investopedia

Old Mar 18, 15, 9:23 am
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"Can United Continental Beat Its Bad Reputation?" - Investopedia

Interesting read on how United Continental Holdings is trying to turn its bad reputation:

Can United Continental turn the tide? - Investopedia

United Continental understands that its underperformance compared to its peers results in part from its customer service reputation, and it has taken steps to try to improve its operations. In January, Chief Operating Officer Greg Hart detailed a number of projects geared toward improving on-time arrival and departure performance, which plays a huge role in ensuring passengers make connecting flights and don't have to deal with the hassles of rebooking entire itineraries on the fly."


At least it seems they're starting to acknowledge their underperformance.
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Old Mar 18, 15, 10:01 am
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That's nice, but I've already checked out.
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Old Mar 18, 15, 10:26 am
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Originally Posted by channa View Post
At least it seems they're starting to acknowledge their underperformance.
The company must change its policy of institutionalizing sanctioned, deliberate underperformance (80% OT threshold, DEN baggage meltdown, replacing competent empowered employees with inept, powerless, cheap contract hires, etc.) in the name of "running the airline like a business."

That is a long comeback trail and in the meantime there is major self-inflicted brand damage and who knows how many travel patterns permanently changed to avoid UA.
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Old Mar 18, 15, 11:09 am
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This article cites evidence of poor performance, including this one pointing to poor customer satisfaction:

"Yet even by more objective measures, United Continental has done a poorer job of addressing its passengers' needs than have its rivals. Last year, J.D. Power & Associates gave United the second-worst customer satisfaction score among six major North American traditional carriers ..."

And this one, which points to policy:

"Yet United Continental also has other unusual issues cited by the ACSI survey. The number of passengers who were involuntarily denied boarding was particularly high, at nearly 1 in every 4,000. That doesn't sound like much, but compared to the 1-in-250,000 figure at one of its better-performing rivals, United clearly has some questions to answer."

And, then, it quotes United Continental management:

"United Continental understands that its underperformance compared to its peers results in part from its customer service reputation, and it has taken steps to try to improve its operations. In January, Chief Operating Officer Greg Hart detailed a number of projects geared toward improving on-time arrival and departure performance, which ... "

So, the article posits that United Continental is underperforming due to poor customer satisfaction and hostile policies, and then it quotes United Continental management saying that they're trying to do better about on-time performance, which Smisek has already been quoted as saying that 80% is "good enough" and that there are "diminishing returns" to doing better.

Reads to me like a total disconnect at the top.

I don't have any hope for improvement until there is a significant change at the C level.
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Old Mar 18, 15, 11:18 am
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To be slightly contrary, I don't think it will be hard for UA to improve, and improvement will, in the fullness of time, result in a better reputation - but it has to recognise that there is a significant time lag, and its reputation amongst the public is still declining.

Metrics such as OT performance are important but not, in my view, vital as long as it's not way out of line. What's important is the customer interface - the treatment of people at bag drop, at the gate, on the plane etc. I know I sit in a privileged position as a 1K, but I find the phone agents generally to be very polite and, whilst their competence varies, they tend to leave a positive impression - I don't think OALs are much better.

Where UA totally fails is in its front-line staff. The bag drop situation is stressful even for a 1K, with staff who would be more comfortable directing traffic, or working the curbside no parking regulations. What it's like in the GM section, where people are less familiar with procedures, I dread to think. I don't experience anything like this when I travel with other airlines with no status. Even EZ are a delight in comparison.

But it only gets worse. The boarding gate experience is truly horrible. I'm not sure that I entirely blame the GAs for losing their tempers on a regular basis, and for being even more traffic cop-ish than the bag drop staff, because they have been handed an impossible job by management. But I find I walk on to the plane seething after having dealt with that lot - at pretty well any US station. DUB and LHR are fine IME.

And then, on the flight, half the staff have clearly been trained by ex-Aeroflot staff from the old days. I know of no normal airline in the West which has staff who are so off-hand to the passengers. There are good FAs but they are few and far between. Again, contrast with EZ, even FR, and they are streets ahead of UA in C.

This is what needs tackling. If they can weed out the bad apples, re-train the rest, put in place procedures which minimise conflict with passengers and re-launch the customer experience, then within a few years they'll be able to reverse the reputational issues. If they can't, then there'll be blood when we have the next downturn.
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Old Mar 18, 15, 11:20 am
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Originally Posted by BearX220 View Post
The company must change its policy of institutionalizing sanctioned, deliberate underperformance (80% OT threshold, DEN baggage meltdown, replacing competent empowered employees with inept, powerless, cheap contract hires, etc.) in the name of "running the airline like a business."
Another area of deliberate under-performance: Complimentary Premier Upgrades (aka Unlimited Domestic Upgrades). This idea was flawed from the beginning and should be scrapped in favor of a paid upgrade system where the paid upgrades get priority over last minute sales. Sort of like the 500 mile certificate system that UA used to have (or the coupon system that AA has)
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Old Mar 18, 15, 11:22 am
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It's pretty scary when the leader of a service business relies 100% on metrics and claims a specific threshold is "good enough" and there is no incentive to do better - on just that point alone, it seems Mr Smisek does not possess the correct leadership qualities or vision to be running a service business. I was actually shocked that he would say that, but given the number of comments from Rainey ("whiny Elites", Global First is useless, etc etc), it seems all of these people are in over their heads and don't have a clue.
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Old Mar 18, 15, 11:38 am
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It's pretty scary when the leader of a service business relies 100% on metrics and claims a specific threshold is "good enough" and there is no incentive to do better - on just that point alone, it seems Mr Smisek does not possess the correct leadership qualities or vision to be running a service business. I was actually shocked that he would say that, but given the number of comments from Rainey ("whiny Elites", Global First is useless, etc etc), it seems all of these people are in over their heads and don't have a clue.
Metrics? Like the customer surveys they only send to nonstop passengers on non-delayed flights?

management has their head in the sand, they've been lucky enough to ride a relatively strong economy, consolidation, and the gift from the tanking oil prices. Relative to their peers, they're doing terribly.
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Old Mar 18, 15, 11:40 am
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Originally Posted by StingWest View Post
Another area of deliberate under-performance: Complimentary Premier Upgrades (aka Unlimited Domestic Upgrades). This idea was flawed from the beginning and should be scrapped in favor of a paid upgrade system where the paid upgrades get priority over last minute sales. Sort of like the 500 mile certificate system that UA used to have (or the coupon system that AA has)
UA already has a paid upgrade system: it's called TODs.

It's just that Kettles get them for less than elites because UA already owns its elites.

If it's not already, the destruction of UA will make a good business school project of what not to do.
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Old Mar 18, 15, 11:42 am
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The end of the following paragraph in that article does not make sense to me. Should the last "Continental" be "United?"

"The biggest issue cited in the ACSI survey was that United has done a bad job of integrating Continental's operations into the post-merger company. To gain cost savings from the merger, United has made changes to the way Continental did business, and that has annoyed former Continental customers who grew used to the advantages the airline gave them. "
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Old Mar 18, 15, 11:54 am
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Originally Posted by bocastephen View Post
It's pretty scary when the leader of a service business relies 100% on metrics and claims a specific threshold is "good enough" and there is no incentive to do better - on just that point alone, it seems Mr Smisek does not possess the correct leadership qualities or vision to be running a service business.
No KPI target is ever 100%; that's wishful thinking and ignoring reality. That said, I think 80% OT is a bit too low of a target for OT%. Furthermore, you don't go around telling people that your OT KPI target is 80%. *That* is bad management of a service industry. That sort of talk should stay upstairs.
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Old Mar 18, 15, 11:59 am
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Originally Posted by lhrsfo View Post
Where UA totally fails is in its front-line staff. The bag drop situation is stressful even for a 1K, with staff who would be more comfortable directing traffic, or working the curbside no parking regulations. What it's like in the GM section, where people are less familiar with procedures, I dread to think. I don't experience anything like this when I travel with other airlines with no status. Even EZ are a delight in comparison.

But it only gets worse. The boarding gate experience is truly horrible. I'm not sure that I entirely blame the GAs for losing their tempers on a regular basis, and for being even more traffic cop-ish than the bag drop staff, because they have been handed an impossible job by management. But I find I walk on to the plane seething after having dealt with that lot - at pretty well any US station. DUB and LHR are fine IME.

And then, on the flight, half the staff have clearly been trained by ex-Aeroflot staff from the old days. I know of no normal airline in the West which has staff who are so off-hand to the passengers. There are good FAs but they are few and far between. Again, contrast with EZ, even FR, and they are streets ahead of UA in C.

This is what needs tackling. If they can weed out the bad apples, re-train the rest, put in place procedures which minimise conflict with passengers and re-launch the customer experience, then within a few years they'll be able to reverse the reputational issues. If they can't, then there'll be blood when we have the next downturn.
Re-training and weeding out the bad apples won't work, as employees will not change their attitudes as long as they are treated by management as minimum wage slaves.
Simply said: Front line employees have ZERO incentive to by nice, hardworking and forthcoming.
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Old Mar 18, 15, 12:04 pm
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Originally Posted by Boo_Radley View Post
No KPI target is ever 100%; that's wishful thinking and ignoring reality. That said, I think 80% OT is a bit too low of a target for OT%. Furthermore, you don't go around telling people that your OT KPI target is 80%. *That* is bad management of a service industry. That sort of talk should stay upstairs.
That's the problem right there - metrics are a scorecard, not a business driver. They should be used to measure goal achievement and identify problems - not be a goal in of itself.

What management is doing here is failing to communicate the overall value proposition and attainment strategy of a best in class US domestic airline. Gordon Bethune, love or hate him, had a very clear, concise, written document "Go Forward Plan" that set specific goals, attainment timeframes and laid out a framework for achieving those goals (or exceeding them) and made sure employees were empowered, equipped and trained to make the GFP a success.

Today's management has no such plan and finds it easier to point fingers and blame others for their failure, be it customers, gulf state carriers, employees, the weather, Delta, or pie in the sky.

If anyone can find me a management book that demonstrates how success can come from such a plan, I'm all ears - but to date, I haven't read one and frankly I am growing rather aggravated because I want the company to succeed, to do well and be a best in class airline - but any chance of that is being thwarted by incompetent or uncaring management and one of the worst Board of Director groups in any US company.
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Old Mar 18, 15, 12:08 pm
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Originally Posted by dieuwer2 View Post
Re-training and weeding out the bad apples won't work, as employees will not change their attitudes as long as they are treated by management as minimum wage slaves.
Simply said: Front line employees have ZERO incentive to by nice, hardworking and forthcoming.
...and this is what made Southwest a well respected product in the minds of so many customers. The simple fact that Herb Kelleher could have cared less about angry stockholders or idiots like Hunter Keays, and instead made sure his employees were the number 1 priority so they could take care of customers, and allow everything to fall naturally into place as a result....which for so many years it did just that with stellar financial, operational and satisfaction performance scores.
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Old Mar 18, 15, 12:19 pm
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Originally Posted by bocastephen View Post
...and this is what made Southwest a well respected product in the minds of so many customers. The simple fact that Herb Kelleher could have cared less about angry stockholders or idiots like Hunter Keays, and instead made sure his employees were the number 1 priority so they could take care of customers, and allow everything to fall naturally into place as a result....which for so many years it did just that with stellar financial, operational and satisfaction performance scores.
...and this is why United will never change as long as greedy, egoist, narcissists run the show.
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