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Building a stronger Qantas
At the AHRI HRizon Conference I attended a session with Alan Joyce and Jon Scriven. This session was conducted as an interview style, so the notes are more a stream of consciousness than a more structured report. I was keen to get an insight to what has been occurring at Qantas over the past 12 months with the Emirates deal, the growth of domestic coupled with the loss in international and the post industrial action impact on the business. Jon is the Group Executive People, Alan is the CEO. Here are my notes:
Airline Industry & Qantas
- airline industry goes through a constant shock syndrome
- need to set up your team to manage crisis as they happen
- 14 exec crisis meetings last year...only 8 board meetings!
- strength is the brand & the people are passionate. Wisdom of experience
- Jetstar is bigger than Ryanair at the same time (8 years)
- key initiates is the frequent flyer program - makes $
- Qantas international is struggling. $1m revenue, costs $500k to fly a flight to London!
- focus is to turn around Qantas international, maintain domestic, expand Asia & use FF as the glue to hold these all together
Focus on Customer Engagement
- first focus was engagement with staff to focus on exceptional customer service. Wants consistency. Have the infrastructure & capital of new aircraft to provide the service, but all for not if they don't fix customer service
- increasing use of technology to drive customer service & productivity
- key HR priorities
- 1 senior leadership – to provide direction
- 2 managers managing – rather than pushing issues up the line, or in some cases to the Union
- 3 frontline focus to garner engagement – focus on the customer through engagement to the company
- need diversity in people for different thinking. Open, honest & frank discussions about the strategy. Once the debate finishes they need collaboration & solidarity
Culture & Leadership
- safety culture, need to put up your hand when you see something wrong, take responsibility and fix it
- helping new managers to learn how to manage. Not always managing in the line, are changing this culture
- reinvented the leadership process inclusive of KPIs, performance reviews, training etc
- moving to total open plan at the Qantas HQ
- communication is hard in the business, but did a major process to educate leaders on how to communicate & have a strong, robust process
- have trained cabin crew on what consistent customer service means
- have allowed staff to decide whether they charge for excess baggage or not, empowerment
- empower your people to make decisions and to work through issues that can fix issues for customers
Net Promoter Score as a Tool
- Another company using NPS. Has driven change and increases the score as the staff will be motivated by the score and help them to change to drive the score
- It is a key tool to measure the success
Industrial Dispute Comment
- The dispute drove -$20m in sales per week over 3 months because they couldn't guarantee a schedule.
- Choice 1, give in to the demands that wouldn't help Qantas to adapt or be agile, also restrictions that would lead to a higher cost base on a loss making part of the business.
- Second option keep going on as is with wildcat strikes damaging the brand and reducing revenue.
- Or to bring it to an end by locking out the striking workforce & ground the airline to bring it to an end. Regrets the impact to the customer, but needed to contain it.
- Once finalized booking went back to pre-strike metrics. Most employees were relieved when it all finished, especially the customer facing staff.
- change of branding, you're the reason we fly...need to move & evolve brands, renewal, still on a journey, trying to get it right most of the time
What did I learn?
Once again you need to have a clear strategy and be passionate about it. You need to develop a culture of leadership and accountability. Engage with your customers and measure your success through tools such as NPS to ensure that you are delivering on the promise.