Flying the flag…half mast?

Willie no mates
Willie Walsh is having a bad time at BA at the moment, surrounded by fallouts. Not just the recurring ash fallouts from Eyjafjallajoekull but the very public fallouts he is having with his closest mates: Fallouts with government over air tax duty and the third runway at Heathrow; fallouts with his cabin crew over wages and perks; fallouts with the regulator over flight bans; and fallouts with the unions. They are all threatening to lead to ultimate fallouts with his customers and shareholders.
I don’t want to criticise his approach to union negotiations, regulatory affairs and government relations but I do wonder what key messages his bullish standoff position sends out to the wider audience, especially his employees. There is definitely an air of “My business would be better off without all these people getting in my way” Be careful what you wish for Willie.

Anti-social media
When you look at what Derek Simpson’s tweeted during negotiations they were pretty innocuous, why did Willie chose to take great issue with them? Was it because he was angry that nobody in his team was monitoring and knocking on the door to warn him what was happening? Or was it because it highlighted that the unions tend to be adept at getting out simple messages in a timely way to their members, and social media tools is allowing them to be even more sophisticated? An employee of another company in the transport sector told us that during a strike in the US they all joined and followed the union’s social media stuff because that was where they got the most up to date information.
Euan Semple holds a more sympathetic view “increasingly there is a gap between those who adopt social media tools and those who don’t. There will always be a gap, what’s importnat is how we deal with it, respecting whatever camp people are in. Just as we shouldn’t rubbish the early adopters (even if they make a few mistakes along the way) we should respect those people who don’t get it, not rub their noses in it but help them to catch up”.
He recalls his experience of meetings at the BBC five years ago where “one half of the room were alluding to extra information, back stories and context that they were aware of due to following online conversations while the other half of the room had no idea what we were talking about. Unlike Unite , the BBC unions were slow to get involved, maybe they had too much to lose by upsetting the cosy dance they had enjoyed for years with HR!”

Changes…turn and face the strain
From an external perspective, if only half of what you read and hear is valid much needs to change. James Harkness believes that “the BA workforce appear isolated from what has gone on in the outside world and particularly the aviation industry since the fallout from 9/11. This recent dispute though has illustrated how far back the airline has fallen.” The strong heritage of the BA brand is not enough to pull them through. “Whilst there will always be a huge fondness for the national carrier that does not necessarily correlate into revenue for the airline. For many passengers there is not the allegiance to BA that there was even a few years ago. The brand has been tarnished and seems to have lost focus. Working for a struggling organisation can only have negative repercussions for employee morale”
James believes Willie Walsh cannot and should not back down. “Willie’s battle with the unions is a legacy issue which the previous leadership had not tackled. He has no choice but to take them on and drive through change, he is right in his view that BA’s future will only be secured with major revisions to perks, pay and working practices. The challenge for Willie going forward is to begin a process of genuine dialogue to ensure he is bringing his people with him. He needs to be aware that this is not some quick-fix campaign or sheep-dip programme but a long term strategic plan to make people at all levels feel they can make a personal contribution to the airlines’ success.

It’s about winning hearts and minds, not court cases
Staff engagement clearly is an issue within BA, winning court orders to ban strikes isn’t exactly winning hearts and minds it just seems to be exacerbating and accentuating poor employee relations. The court cases must be costing an order of magnitude more than the cost of bringing his people along with him. When Unite finally won their appeal he was left with egg on his face and resorted to a belated campaign for employees to boycott the strike, too little too late? That’s not to say BA hasn’t invested heavily in high-profile employee campaigns over the years, it appears the campaigns of the past have failed to make a sustainable difference.
Ian Buckingham believes a large part of BA’s challenge is their seemingly “schizophrenic battle between gargantuan commercial brand status and the perception of being a “de-facto” national institution about which everyone has an opinion”. This is a large challenge for employees who are expected to deliver the customer experience.
Ian is in little doubt that BA employees see their brand significantly different from the view of their leadership. “This has serious repercussions for customers both in terms of what the brand delivers and whether employees will eventually bring the brand to its knees by refusing to “fly the flag” for the brand they don’t believe in or trust anymore”
When staff choose industrial action, it signals a fundamental disconnect between employees and the representation of the brand itself by their leadership. Employee engagement has broken down. “You can rebuild high levels of engagement” says Ian, “but only when you rebuild trust and create a culture of communications focussed more on listening and less on pushing messages, that’s a leadership issue” Does Walsh, and by implication his leadership team, come across as leaders who listen?
The time has come for BA to get to the core of their brand in the context of a fresh Vision; Mission; employee engagement strategy and most importantly a set of values that embraces the challenges of the changing marketplace. Walsh and his colleagues need to re-engage with their staff to define what the BA brand stands for or the increasingly empowered customers will continue to vote with their feet.

He’ll get by with a little help from his friends
Despite the bookmaker’s predictions of an exit before the end of the year, I hope Willie stays and makes the necessary changes, but he needs allies. The unions need to get behind the changes necessary to engage their members and build a strong company in difficult times, the government need to consult with the industry to ensure a level playing field on regulation and taxes, and employees need to remain focussed on the customer, seeing them through the turbulence. This isn’t the right time to be turning their backs on the only guy that can realistically be the true saviour of a great British brand.
Wishing you the “best of British” Willie, good luck.

8 Comments

  1. Sean, poisonous employee relations! Of course there is the matter of whether anything could be done to filter the well. Unions see a binary quality to every interaction; if previous administrations won concessions, the union wants to restore prior to bargaining. And mgt wants more concessions as a start to negotiations. The new reality of business seems to prize labor cost reductions and should include managerial cost reductions too. If the leaders cull their ranks and take cuts, this codifies the strategic reality. Otherwise, all the listening in the world won’t help.

  2. peterburton says:

    In the 1980s, BA famously transformed itself from a hierarchical civil service type of organisation to a people-centred customer-friendly one. A key factor in this process was a programme called ‘Putting People First’. The then CEO, Colin Marshall, personally devoted much of his time and energy to the programme. The transformation was heavily influenced by the HR Director Nick Georgiades, a former academic whom today we would call a business psychologist. Georgiades and his colleague Richard Macdonell, according to their book ‘Leadership for Competitive Advantage’, (1998), Wiley, held views on leadership that we would recognise as those necessary to fully engage employees.

    Somewhere along the way, BA seems to have lost sight of putting people first. Many of their employees are not only disengaged, but apparently hostile to the company, hence their willingness to vote for strike action despite the obvious damage being caused to the company. You can’t blame the union. If management doesn’t care for them, the people will turn to another ally.

    Willy Walsh has the passion to repeat what Colin Marshall did, but as noted above, he needs allies and advisors to help him craft another ‘putting people first’ strategy. He needs another Georgiades rather than his present HR chief who I believe came to BA from Royal Mail!

  3. Great comments Peter

    I don’t believe BA has ever truly differentiated itself in a way that is either:

    – conducive to change
    – fleet of foot enough to adapt to the market

    The brand has benefitted from the classic characteristics that we would associate with conservatism. Nothing wrong with that in theory, but it does rather tend to alienate much of the post low cost market.

    The “Putting People First” initiative was great. An employee engagement “totem” within the industry. But that was then……

    Walsh clearly has a tough, modernising agenda. But he is undoubtedly clashing with the core, innately conservative culture at BA.

    The BA leadership clearly need to take a more inclusive, engaging approach to connecting with the employees.

    I also believe the BA brand needs an urgent refresh to clarify whether the Vision and Mission and values are still fit for purpose and whether the culture is conducive to supporting change.

    Passion is great. But it can easily be destructive. Branson has passion, but he famously has a fantastic team of pragmatists surrounding him who focus and channel it.

  4. @Peter, Interesting reference to Royal Mail.
    Too many parallels between BA and Royal Mail to mention here. Adam Crozier eventually realised the power of the unions reaching agreement before “moving on”
    Maybe history will repeat itself but, if it does, I doubt Willie will leave with a £1.5million bonus for underperformance.

    @ Ian, Branson has passion but does he have compassion? I’m not sure who the CEO role models are when it comes to employee engagement. Are there any? While we all see the compelling evidence to support employee engagement is directly proportional to business performance, CEO remuneration appears to be directly proportional to employee dissatisfaction.

    I feel a new industry award coming on…

    • @Sean – your “compassion” comment is interesting. Do you have anything to sugest he doesn’t? I would actually see Branson as an engagement role model, albeit I don’t believe CEOs are the primary “engagers”. I believe their job is a little like that of the Queen i.e. “it smells of fresh paint wherever they go”!

      Good point about Crozier. He “moved on” but took £2.5m with him for essentially wrecking a national institution brand without enabling it to become fully “modernised”.

      • My opinion of Branson is that he is bigger than the Virgin brand, he hasn’t grown it from within. I wonder how strong the Virgin brand would be without him at the helm? Now compare that to Terry Leahy at Tesco – although a tough act to follow, he has built a sustainable brand that Phil Clarke will be able to carry.

      • Leahy and Branson are like chalk and cheese. The former famously goes unrecognised in his branches and can’t be accused of being extroverted. Branson famously is a huge personality with a very hands on, follow me style. Both, however, are surrounded by an executive team which complements them rather than being in their own image.

        Leahy has created systems and processes which mean engagement rests predominantly with line managers and supervisors/local leaders. Branson has focused on creating a Virgin culture and small teams, maintaining the sense of entrepreneurship that is part of their differentiator. They focus on recruiting Virgin people whereas Tesco focus on developing Tesco people.

        The comparison proves that the engagement journey doesn’t come with a single route map. The CEO has to be an engagement fan but isn’t necessarily the great, charismatic showman.

        • With all generalisations Ian, there ae some exceptions to the rule.
          Think Virgin trains, think Virgin media. Failing brands before takeover. No mass recruitment drive. Can’t say either have proved to be entreupreneurial or innovative since takeover. In both cases the consumer’s money has been diverted to livery and branding with little improvement in customer service. What’s the expression? You can’t polish turds?

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