The Low Cost Trap (aka, The Demise of CX)

[Lions Gate]

For the past 25 years, CX has been enmeshed in a strategy to reduce cost. Initially it was legitimately focused on efficiency, fleet renewal and expansion. In the past 15 years, the management became overtly tempted by personal greed, and has allowed what was once a justified and necessary program to morph into something that is now putting the very existence of the airline in question. Their strategy is attacking and corroding the very foundations of their company, their staff.

At some point in the early 2000’s, the management shifted their focus inwards, when there came a realization that the generations of treating their employees as valued and according them respect and commensurate remuneration was in fact diverting profits away from their own precious salaries and bonuses. From that realization grew the inevitable self-justifications based on envy and selfishness, that created the framework of the present day strategy, that marginalizes the employee at the expense and benefit of the management and executive ranks.The problem with this is now becoming clearer by the month, and it is no longer possible to deny the realization of the damage done to the employees career expectations, and by extension, the possible ultimate failure of CX herself. The true ‘stakeholders’ in the company, the employees, have been laid waste.

The incessant and frantic drive by management to keep reducing cost is done as a means to an end. There is no accounting of a ‘bigger picture’, one that would equally weight the career expectations and remuneration deserved as a pilot for a ‘major airline’. Through incompetent, greedy and willful acts of malice, CX has now reduced the airline to that of a LCC, but with the expectations that they can convince the public we are still seen as premier carrier. It is now quite apparent that the façade is collapsing, and the soft underbelly of CX is showing, visible through the questionable interiors, substandard food, indifferent service, an unreliable operation, and surly and demotivated staff. With all of those facts in place, the operation becomes more and more established in the eyes of the public as no better than other low cost carriers, but we are now at that service level trying to compete on premium fares. Hence the deterioration of our market share and yield.

In America, the majors are increasing their employees salaries and benefits, knowing that it is imperative that they not only secure their long term loyalty, but reward them in such a way that they become the best brand ambassadors the company could have. CX is again going about that in the exact opposite way, ensuring thousands of disgruntled employees who are going out of their way to talk down the airline, both to the public, but in particular to perspective pilots who were considering applying. At the same time convincing the current pilot workforce that their career aspirations and security of their family’s future are elsewhere.

CX has effectively achieved their goal of becoming an LCC, but they still seem to think that the damage done to reach that goal has no bearing on their lily gilded vision of the airline. In fact, no such airline exists anymore. In its place is a broken, unhappy, chaotic and failing company, which gets worse each day. The fact that management are blind to this is no better represented than their recent attempt to censor their staff through the ‘Social Media Policy’ (how’s that working out for you AT?).

There is no recognition from our management as to the damage they have caused, or the consequences that have already been manifested, and the even more serious ones that are certainly heading our way. Our management are not fit for purpose, having lost the ability to appreciate the intangibles that make up the substance of really great airlines (SW/AS/DL) who respect their employees and the efforts they make, and reward them accordingly. Those airlines have management who are there to serve their employees, and not the other way around. That is the fundamental difference between a great airline and an imposter.

CX was a great premium airline at one time, and now they are a poor LCC. They have lost their soul, their purpose and their vision. They are now losing their employees (and have already lost them in spirit). This current management are incapable of recognizing what is wrong, and because of that are wholly unsuited to fixing her before she fails. We are so very close to that outcome, one that draws nearer every day. A preventable tragedy.