BA -"Peace in our Time?". Where now?

The settlement of the long running dispute between BA and its cabin crew BASSA,a sub union of Unite, was welcomed by many last week. What really was the outcome and who came off best? After 18 or more months of this dispute BA pretty much had the union on the ropes with nowhere to go other than to call another strike which would probably have been largely ineffective thanks to a combination of its non unionised New or Mixed Fleet of recent recruits, strike breakers and volunteers from across the airline. The origins of the dispute were many and went far back into the history and culture of the airline's relationships with its cabin crew and BASSA rather than being solely about the issues of late 2009.

At first sight BA has come off best from the settlement and indeed it has achieved its immediate objectives of reducing the number of crew on most flights and setting up an entirely new group of cabin staff working to much more market related terms and conditions. Over time, though not quickly enough, this group will become the majority and thereby the airline's cabin crew costs will move closer to those of the short haul low cost carriers and the Asian and Gulf long haul ones.So far so good.

Unite though, and its new leader Len McClusky, have been in the business for a long time and unsurprisingly took advantage of the company's preoccupation with its short term objectives to obtain very significant strategic gains for the themselves. The cumbersome and expensive terms and conditions, restrictive practices, layover agreements,and many of the plethora of allowances for things ranging from long sectors to going to destinations they don't like remain in place. For those who want to join a union, the hitherto non unionised New Fleet now becomes the domain of Unite. This gives them more members, more subscriptions, improved finances and greater dominance at Heathrow, probably the last big single site of unionised labour in the UK. BA has not therefore moved into the world of simple, straightforward labour agreements in which the assumption is that having signed on as employees , people come to work ready to be flexible, do whatever it takes to deliver the best product with whatever resources turn out to be available. In other words, old fashioned prescriptive agreements based more on the practice of heavy industry than a fleet footed worldwide transportation and service business stay in place. Sweeping that concept away should have been a top priority and it is a major opportunity lost.

McClusky has also succeeded in binding BA's new Chief Executive, Keith Williams into a three monthly meeting, something a CEO is unwise to do as it disempowers managers lower down the organisation and risks him or her becoming embroiled in all sorts of distractions from their own strategic role. It would not be surprising if, with the genie out of the bottle, leaders of BA's other unions sought the same top level access.

Putting the industrial issues aside, where does BA go now? In the last 15 or so years its overwheming focus on the transatlantic market and its unwillingness to expand its long haul fleet so as not to increase its debt in the form of forward leasing obligations, has meant that its has shrunk its global network to much of Asia including Japan and the Far East,and Australasia and at best marked time in Africa and the Middle East. Faced with rising costs and yields constrained by the rapid expansion of new competition in the Middle East and Asia it has thrifted its costs including some of the very visible ones such as catering and customer contact particulary overseas and at airports. It seems to have retreated into its HQ at Waterside near Heathrow and mentally and physically pulled up the drawbridge on non IT based communication with its customers, suppliers and many of its staff. Inter departmental and external communication began to decline at least 13 years ago when the rather chaotic but very clearly aviation industry Hatton Cross Headquarters site which catered for almost everybody and where all the various components of the business intermingled was abandoned in favour of the near but far and difficult to get to or park at brown field development at Waterside. Hatton Cross' easy Underground and public transport access for anyone who wanted to see BA people was also lost. The move meant that the constituent parts of the airline became more scattered, some seeing very little of the others. The drawbridge having gone up ,everyone paid a price for it even if they didnt realise it at the time. Since then there has further withdrawal to behind electonic barricades and to many the airline is not easily accessible. Even its websites, which tell a lot about cheap fares and the like, say little about the airline or even who its Directors and senior managers are or how to contact them. "Policies" cover almost every interaction with customers and compliance with them rather than customer friendliness has become the watchword. Staff are judged on how they enforce compliance rather than how happy they make the customers. Flexibility has largely gone. Late for your flight? Your low cost ticket has gone. As long as you do show up at the airport within 3 hours Easyjet will put you on the next one if you have been held up en route. Who would you rather do business with if you had encountered that sort of problem? BA therefore needs to seriously rethink where it is, what they want its previously aspirational brand to represent and the values that go with it. At the moment it is rather wandering in the wilderness.

There are though some optimistic signs. With the cabin crew dispute put to bed for the time being and some thinking being done with added outside help about underlying problems and Keith Williams , the soft man to Willie Walsh's hard man, in place as CEO there an opportunity for a renaissance. First of all there will soon be a new iteration of a five year business plan, which will hopefully give BA's people a new sense of direction and moving ahead. Managing what seems to be a static or declining business is miserable for anyone so given some imagination and a few bold strokes there is a real opportunity here. Secondly ,a relaunch of the brand is planned for the autumn. This is a great opportunity to re-energise and remotivate people at all levels across the airline, as well as to reinvogorate customer loyalty. A very good development has been the appointment of a man from the hotel and hospitality industry as head of customer experience (a ghastly title but never mind). Major hotel groups have achieved service delivery and operational wonders almost everywhere, sometimes against seemingly impossible odds. If the BA brand can gain some of the same sort of magic and become consistently excellent as a service as well as a transportation business it could both put in and extract much more value. It also needs to excel and be global reaching in its own right and not be over reliant on the One World alliance to fill in its gaps.

Foremost amongst needs of a brand relaunch will be to replace its mechanistic, systems driven, hard nosed tone of voice with something far more cuddly. FIFO just doesn't work. The brand has to be the customer's proactive friend driven by an ethos of going out of its way to value, embrace and look after them, rather than being a frowning obstacle in the way of customers getting where, what and how they want. For a long time one of BA's predecessor airlines had the simple all encompassing tagline-"All over the world we take good care of you". Not a bad re-starting point in 2011 either.