Boards, Management, Employees and Shareholders.

[Sunfish]

I have forgotten something in our discussions of the behaviour of Boards and management of companies that I now wish to remedy ASAP.

In discussing the state of Qantas, I neglected to apply Occams Razor in proposing a variety of conspiracy theories and speculations about the behaviour of the Qantas Board during the APA bid. I think it also addresses the reason why ASIC does not appear to be involved.

It's the simplest concept there is.

"Why didn't the Board provide more information and why did they support the APA bid?"

Simplest answer is that they have no F***ing idea how to run an airline, period.

Seriously, as a Director, you need have no experience or qualifications related to the industry or company you direct. That is not required of any company officer. Functional skills are desirable perhaps a degree in accounting or law for example.

Guess what? Not one of the Qantas Directors has an aviation qualification


Now the benefit of having industry experience is simple - you develop a bull**** detector capability pretty quickly. People like Reg Ansett and others had this ability, plenty of people still have it. Simply walking into a busy hangar and watching what is going on tells you plenty, you don't need an army of consultants or efficiency experts. I'm sure the same must run true for pilots and cabin crew - do you know an efficient operation when you see one?

Having the bull**** detector means you can't be snowed. Having technical knowledge means you can find out facts for yourself, and you also know whats critical to your business success. The Qantas Board does not have this capability at all. It must rely on management and hope to Christ that Corporate Governance (which of course the Board is expert at) will keep it safe.

So if the Board doesn't have the expertise then who does? The answer is the management, and since the Board has no technical expertise, it is entirely dependent on management to provide it with predigested, sifted, selected information.

So I guess I have to give the Board a clean bill of health over their behaviour during the APA bid. They simply had no way of knowing about the hidden value in Qantas, that has since been released (or is about to be released).

As to why they didn't know - I'm not going to speculate.

Something is also funny at Qantas. Management seems to be doing their level best to keep their staff in a permanent state of uncertainty and fear. This is highly unwise.

It's unwise because while their is an optimum stress level for maximum performance, what Qantas is doing is way over the top. Exhibits (1) Treatment of engineers and (2) Treatment of cabin crew - especially those "performance management" interviews.

Its dumb for two reasons.

(a) It reduces performance.

(b) If the staff get annoyed enough, they can make more trouble for the company than the company can make for them.

Elsewhere on Pprune you can read about Air New Zealand and the behaviour of its senior management team. You can read about similar companies where the Board totally immerses itself in the company.

However I don't expect the godlike beings who inhabit the upper reaches of Qantas wish to be reminded of that, although its about time the shareholders made the obvious comparison and took appropriate action.

[DEFCON4]

For someone who is not an employee but a well informed observer you are right on the money.
Dixon has always kept the board in the dark.
Jackson was always compliant
What they(the Board) dont know they cant be held accountable for.
The war declared on employees is way over the top.
Most of us are now numb to this treatment and are therefore no longer intimidated.
The treatment is now no longer effective so why bother continuing with it?
We all just want to see TVDD(The Viagra Driven Dwarf) out and hope to God someone with a bit of nouse takes over.
We wont hold our collective breathes.

[Spaz Modic]

:D:DDicko and his mates including Turbie would like to thank all you cheapie QF pilots for the full wallet you presented.:ok:

[Alien Role]

JUST LUUUVVE THOSE NUMBERS !!
Todays "Australian " business section - 27% payrise for Geoff :yuk::yuk:

[Chimbu chuckles]

Don't know that the ENTIRE board should be let off so easily...Packer's rapid exit combined his links to Mac Bank and with what we know about past tilts at QF when his father was alive leaves me to suspect he was up to his bollocks in the thing.

Agree with everything else you say.

[QFinsider]

Dear Sunfish,
Thank you for putting rather well into words what many of us feel!

I have watched my affinity for my employer fall to less than zero. I used to think it was me, becoming frustrated, getting older and tired. It is universal. It is across the company and no amount of "dear Colleague" will fix it. No one believes a word eminating from the huge amount of bull**** driven ego.

I recently heard that the CP always saw himself as John Borghetti in waiting. Now whilst a great thug in this industrial climate, the CP has always worked for QF being a product of the fully funded cadet program. He has never generated an income outside Qantas. As a pilot maybe he was a good operator (I haven't flown/nor would fly with him) but other than a huge ego, what in hell does he know about business, economics, business cycles, reading an extremely volatile industry...Maybe he should look higher and grab a seat on the board...

The problem is the intimidatory culture has permeated all levels of (mis) management. Even after the much awaited departure of Dixon that culture will take a long time to change. Our mistrust of them is buried deep mistrust will take a whole lot longer to dissipate. The problem for them is we no longer listen.
There is so much passive resistence to anything management suggest. They cant gauge it becuase the data capture is historical and not really fitting into an excel spreadsheet. As an intangible, the pencil pushers don't know how much it costs, but it costs a fortune.

For example, the implied threats about Christmas leave being reduced due sickness eminating from last year will be only produce more sickness this year! (IMO) It is across the departments and only getting worse.
We save $60million in fuel, they commit possible price fixing and "set aside" $40million....What's the point? Commands disappearing, fleet getting older all new aircraft to the polished turd of Jetstar, yet the real revenue comes from yield. Yield is premium product where margin is established. J* has no bloody margin and an illusive mystical cost base...
Ever noticed how Emirates keep pinching 1% of traffic per annum. These guys are so J* focused they don't notice thier market share continues to fall whilst more money gets spent on an airline with a rubbery set of non-existant figures.

The maintenance debarcle grows in size. A persistent story involves 4 D checks not being able to be done. Singapore is charging more money now and Heavy maintenance is no more in Sydney...Genius

Shareholders will only see real return on investment and a magical release of value when this culture is expunged from the top.
We need an overhaul of culture from the top.
Gordon Bethune did it at Continental, Ralph Norris at Air NZ. They simply do not possess the humility to do it with the current bunch at Q.
The sad reality for those of us there, is a once proud airline is merely chugging along.
....

[QFinsider]

Have a read of Alan Kohler's article about Project Suzie and Packer Senior's involvement in 1995. Again with the Donut punching bank...

I simply do not believe Dixon, Strong et al didn't know.
They were there then, they are now and stood to gain..
It reeks

[surfside6]

Any idiot can cut costs but it requires real business skill to grow revenue and improve yields.
QF Insider is correct we are all now affected by industrial deafness.
The waste/cost is escalating and so is passive resistance.
When the APA bid fell over I began to believe that there is justice in this life.

[Cactusjack]

Guess what? Not one of the Qantas Directors has an aviation qualification

Nothing has changed in 4 years !

[rodchucker]

Defcon,

Wise words indeed.

Just a minor correction Boards can be held accountable for things they didn't know if they should have known.

There is a now a wide and diverse publication of a whole range of issues re the Rat so I suspect it is getting harder for any director to say I didn't know.

On another issue if there was a commitment of 60% staff commitment within 2 years and as stated elsewhere it is still at 20% how is that going to be explained away. Surely someone will ask why??

If any CEO or senior management commit to a Board on a key issue then if it isn't delivered then I suspect there could be serious ramifications should things go pear shaped. The problem is directors get away with it if they do not and ASIC have no balls as proven by APA events.

As also stated elsewhere if the 787 falls in a heap that will be such a significant an event that the Risk Management framework must be dealing with that now at the highest level.

Then again you get Executive spin and it can last for a long time.

[Worrals in the wilds]

The quality of the QF board has been highly questionable for some time. As you've said before, many Australian businesses run efficiently, profitably and below the radar. Why can't Qantas?

Is it because it's a converted government entity? Certainly Telstra, Airservices, Australia Post and some (but by no means all) private airport operators have also been unable to make the transition from government to private without a whole lot of consultants, budget blowouts, wailing and gnashing of teeth. Telstra stays profitable, but given that they still basically control the nation's communications infrastructure you'd be worried if they didn't. Of course ASA and Aus Post are government owned corporations rather than fully public companies, but their employees continually complain about similar issues to those at Qantas.

Having survived Air India and Turkish Airlines I'm no proponent of government owned airlines, but I wonder if the conversion process from OHMS Airlines to Qantas the publiically listed company has caused some of the problems. Its international product competes with companies that are either openly or privately backed by government (such as SQ and EK) or fully competitive commercial products (such as Cathay and Virgin) and its domestic product competes with a new and fully commercial publically listed airline. Qantas sits in the middle with none of the advantages of its government competitors, but none of the flexibillity of the corporate airlines. As a company, it's neither fish nor fowl.

The added complication with Qantas has been its relentless swallowing of smaller carriers, from TAA, Australian, the Qantaslink 'family' (and don't they fight like a family after one too many bottles of wine at a hot summer barbeque :E) and Impulse, where they made a half-arssed attempt to absorb more than five separate corporate cultures, company ideologies and groups of staff that weren't neccesarily co-operative. I spent a relatively short time as a Qantas sub-contractor and even ten years after the TAA/QF amalgamation, employees still identified themselves as Qantas or TAA. There had been no effective attempt by the company to meld its disparate sections into one solid company.

In short, if you had half a brain, why the hell would you want to be on the Qantas Board? Even the Chairmans' Club wine list wouldn't be a worthy renumerance. :} Anyone with basic aviation knowledge runs a mile.

[fishers.ghost]

Firstly no one knew how to meld the disparate cultures.Even if they knew how they would have been disinclined to so.Why?Divide and conquer.They played TAA CC off against QF CC for years.The distrust between the two groups still simmers.
Its not productive to have employees pulling in different directions.
Currently there are three groups who have little company loyalty.
QCCA,AKL base and LHR base.They know they have been screwed and are not happy with the company.The attitude is play hard see a bit of the world.They know they are not in the job for long.Their loyalty is to themselves and each other.Qantas comes a poor third.
Bravo QF managment.Your strategy of divide and conquer has backfired.
Your corporation is being conquered.
Qantas management have failed spectacularly in every department and on every level.
One could be forgiven for thinking that it was deliberate as it is almost impossible to comprehend incompetence on such a grand scale.
Qantas has made a lot of executives very wealthy people.Thats the only achievement of the last decade

[Brewsters Millions]

Leeches that is what boards are. Mates rates being paid millions to do nothing. Virgin, Qantas and CASA are prime examples of airline industry boards who milk the system to provide nothing in return.
Scurge of society.