Aviation Survey results
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Aviation Survey results
http://www.alaea.asn.au/Aviation_Survey_2012.pdf
Hi all. The Aviation survey booklet will be released tomorrow (on ALAEA website). I think there may be some press interest and once you see the results, they will mainly be asking questions about the airlines down the bottom of the list. There are 8 airlines and the last three are in order -
6. Qantaslink
7. Qantas
8. Jetstar
I suspect that within a few days I may find myself before some of the Qantas Group investors answering some questions. I seek your guidance here on a serious note.
Firstly - What Managers/Board members do you think have their heart in the right place and should be retained?
Secondly - I need a short list of stupid errors made by the board that have been very costly. 777, Kangaroo slots given to BA before olympics etc....
cheers
Steve
Hi all. The Aviation survey booklet will be released tomorrow (on ALAEA website). I think there may be some press interest and once you see the results, they will mainly be asking questions about the airlines down the bottom of the list. There are 8 airlines and the last three are in order -
6. Qantaslink
7. Qantas
8. Jetstar
I suspect that within a few days I may find myself before some of the Qantas Group investors answering some questions. I seek your guidance here on a serious note.
Firstly - What Managers/Board members do you think have their heart in the right place and should be retained?
Secondly - I need a short list of stupid errors made by the board that have been very costly. 777, Kangaroo slots given to BA before olympics etc....
cheers
Steve
Last edited by ALAEA Fed Sec; 26th Jul 2012 at 00:22.
Hi Steve, how far back do you want to go with the board errors ie during Joyce's tenure or including so very expensive blunders made during Dixon's period of mis-management?
A380 is a costly mistake. Didn't someone far more onto it than I once say "never buy an aircraft until it has been proven commercially successful" Such a strategy proved pretty successful for several decades. Combine that with company paid analysis right at the beginning recommending that around 490 seats was commercially sensible, the recent re-configuration demonstrates a failure of accurate strategy. How many times do we have to hear that the "passengers love it" Fact is it's a financial dog for the long haul operations of Qf.
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Crosscutter,
There is some merit in what you say. However do not forget about the "freebies" from Airbus due to the ongoing(at the time) delays with delivery of the 380. IIRC there was a handful of "free" 330s gifted to QF because of said delays. Those aircraft have well and truly paid for themselves(sic).
The blunder with the 200/300 Config; well that's another story.
There is some merit in what you say. However do not forget about the "freebies" from Airbus due to the ongoing(at the time) delays with delivery of the 380. IIRC there was a handful of "free" 330s gifted to QF because of said delays. Those aircraft have well and truly paid for themselves(sic).
The blunder with the 200/300 Config; well that's another story.
Moderator
Could we restrict posts to responding to Steve's two requests:
Please respond only to Steve's request - I'm sure he will judge the merits or otherwise of your suggestions.
This is not a thread to debate or even comment upon each and every suggestion, and indeed, needless debate may be removed.
Thanks!
Firstly - What Managers/Board members do you think have their heart in the right place and should be retained?
Secondly - I need a short list of stupid errors made by the board that have been very costly. 777, Kangaroo slots given to BA before olympics etc....
Secondly - I need a short list of stupid errors made by the board that have been very costly. 777, Kangaroo slots given to BA before olympics etc....
This is not a thread to debate or even comment upon each and every suggestion, and indeed, needless debate may be removed.
Thanks!
Moderator
It is bizarre that Qantas executives receive any bonus or incentive payments whilst the Group continues to decline in value:
Executives remuneration and bonuses eligability should be directly linked to Group consolidated profitability and asset surplus.
Granting executive salary increases and bonus payments whilst the share price goes through the floor is insane and ludicrous.
Executives remuneration and bonuses eligability should be directly linked to Group consolidated profitability and asset surplus.
Granting executive salary increases and bonus payments whilst the share price goes through the floor is insane and ludicrous.
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Firstly - What Managers/Board members do you think have their heart in the right place and should be retained?
380 vs. 777
A330-300 vs. -200 config issues.
Failure to consolidate the alliance with Etihad - that one will prove very costly
Segmentation of the business - every department is working against the others to make their own bottom line look good.
Too many layers of management - executive management is too far removed from the frontline staff.
Money wasted on centre of service excellence or whatever it's called.
Failure to engage staff. Staff engagement is probably so low that staff are actively working against the interests of the business. There appears to be an active policy in place to pit staff against one another in a race to the bottom.
Outdated and ineffective training - the state of the EPs training facility in Sydney is a disgrace.
Outsourcing of engine maintenance. Management have failed to maintain direct control of their most important asset - the reputation for safety the business once enjoyed vis a vis the failure rate on RB 211 engines.
Unimaginative management. The latest letter from the CEO of international to staff indicates the future of international is all about cutting costs. Given the supposed focus on cost cutting over the last few years, there simply shouldn't be any costs left to cut! If there are costs to cut it is an indictment of the success of past management. If there are not, then where does Mr Hickey plan to cut costs and maintain an acceptable level of safety and service?
A330-300 vs. -200 config issues.
Failure to consolidate the alliance with Etihad - that one will prove very costly
Segmentation of the business - every department is working against the others to make their own bottom line look good.
Too many layers of management - executive management is too far removed from the frontline staff.
Money wasted on centre of service excellence or whatever it's called.
Failure to engage staff. Staff engagement is probably so low that staff are actively working against the interests of the business. There appears to be an active policy in place to pit staff against one another in a race to the bottom.
Outdated and ineffective training - the state of the EPs training facility in Sydney is a disgrace.
Outsourcing of engine maintenance. Management have failed to maintain direct control of their most important asset - the reputation for safety the business once enjoyed vis a vis the failure rate on RB 211 engines.
Unimaginative management. The latest letter from the CEO of international to staff indicates the future of international is all about cutting costs. Given the supposed focus on cost cutting over the last few years, there simply shouldn't be any costs left to cut! If there are costs to cut it is an indictment of the success of past management. If there are not, then where does Mr Hickey plan to cut costs and maintain an acceptable level of safety and service?
Last edited by DirectAnywhere; 25th Jul 2012 at 11:13.
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Secondly - I need a short list of stupid errors made by the board that have been very costly. 777, Kangaroo slots given to BA before olympics etc....
Grounding the fleet, causing fear and chaos amongst paying customers, stranding people who bought tickets in good faith to attend events whether important or otherwise...betraying customers' faith in the product. Not for safety, not for serious reasons, but for petty point scoring in an IR punch up.
With one action, destroying positive public opinion created by decades of reliable operations and dedicated staff (and management) that Qantas will get you home.
I was travelling with a family member at the time of the grounding, fortunately by car. We both saw it on the news in a small motel in the middle of the GAFA and said 'thank God we're driving, not flying Qantas'.
It was a despicable, petty and badly orchestrated act that showed exactly what the Qantas Board thinks of their customers. Bean counters can't put a price on public opinion or reliability, but it doesn't make either factor irrelevant, whatever the Board may claim.
They treated their customers like ****, and now wonder why people dislike them. Imagine if a power company had done the same thing; 'we're shutting off the power because the EBA discussions have gotten a bit personal. Freeze your arses off, Sydney!'
(Actually Sir Joh did exactly that in Queensland in the 1980s and people are still complaining about it). 
As a major transport operator they are a utility (albeit a private one) and they have a moral duty to honour their commitment to transport fare paying customers unless there is a serious safety issue. They didn't honour that commitment. IMO this has cost them a tremendous amount of credibility and was an incredibly stupid own-goal.
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Steve,
Great job and probably the first real point that can be driven home for a long time.
In answer to your questions:
1. Doubt there are any who should be preserved unless there is some very fast uturn at a Board level led from within.
2. The most obvious question is how come you guys bought this ****e about RedQ or whatever?Forget the ancient past and stick to current lies, deceipt and deceptions because it is now obvious there never was a credible plan.
Good luck and many loyal employees deserve you.
Great job and probably the first real point that can be driven home for a long time.
In answer to your questions:
1. Doubt there are any who should be preserved unless there is some very fast uturn at a Board level led from within.
2. The most obvious question is how come you guys bought this ****e about RedQ or whatever?Forget the ancient past and stick to current lies, deceipt and deceptions because it is now obvious there never was a credible plan.
Good luck and many loyal employees deserve you.
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What Managers/Board members do you think have their heart in the right place and should be retained?
I think it's pretty clear who's wearing the Darth Vader outfit in the board meetings.
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1. Firstly, the segmentation of the business in the mid 2000s. Then IIRC one of Joyce's first decisions was to reintegrate mainline. Yet within the last couple of years it appears they've reverted to the segmented model, and now are taking it a step further by splitting international and domestic. Millions of dollars in restructuring costs with each change.
2. Failure to take advantage of the synergies that could be used within the group. Each part of the group has it's own admin, flt ops, training, safety etc etc. rather than having each common function combined. And they're happy to let resources lie idle (eg some pilots have been on min hours for years) rather than utilise them elsewhere within the group.
3. The decision to start RedQ, spend millions trying to sell it to the public culminating in the grounding which cost a further $200m and then utterly failing to have any sort of coherent strategy for establishing RedQ. Don't get me wrong, I'm no fan of RedQ, but from an investors' point of view I think this highlights the sheer incompetence of this management. An unbelievably bad plan, poorly executed.
2. Failure to take advantage of the synergies that could be used within the group. Each part of the group has it's own admin, flt ops, training, safety etc etc. rather than having each common function combined. And they're happy to let resources lie idle (eg some pilots have been on min hours for years) rather than utilise them elsewhere within the group.
3. The decision to start RedQ, spend millions trying to sell it to the public culminating in the grounding which cost a further $200m and then utterly failing to have any sort of coherent strategy for establishing RedQ. Don't get me wrong, I'm no fan of RedQ, but from an investors' point of view I think this highlights the sheer incompetence of this management. An unbelievably bad plan, poorly executed.
How about paying the bills for a perhaps, unsustainable LCC? If proven, it could be a very big problem for the entire board 
. And a very expensive mistake.
. And a very expensive mistake.
Cost cutting - following on from Direct Anywhere's post. There has been continuous cost cutting going for over ten years to the point that there is barely enough staff to manage things when they are running on schedule but once there are weather issues or maintenance delays etc, our passengers are poorly treated simply because there are not enough staff to handle the work load - simply not good enough for a premium airline. An example of where insufficient staff costs money is Jetstar - the company that is contracted to provide ground transport in Brisbane make more money out of Jetstar than Qantas. The reason being that when disruptions occur on the Jetstar network (a daily event) there is insufficient staff to keep track of crew movements which results in transport bookings not being cancelled (or additional bookings being made) so the company has to be paid even though no one was transported.
Management style - Joyce is playing his cards so close to his chest that middle management have no idea where the airline is headed therefore the staff have no idea (rudderless ship). Additionally, Dixon installed a management style whereby information only flows in one direction, from the top down. This style has become even more firmly entrenched under Joyce and most staff now don't bother to report events/problems because why would you waste your time when no one is listening. The result is management is making decisions while having no idea what is happening operationally and therefore have no idea of the consequences of there decisions.
Joyce has also appointed executives who aren't traditional "airline" people as he believes that people who have come through the ranks have too much affinity and compassion for the workers to make the hard decisions. The result is executives who have a degree but no experience or common sense.
Segmentation - has been introduced as one of many efforts to cut staff costs , the major problem with this is the duplication of managers (& resulting increase in costs). To use one example, a wholly owned subsidiary, QGS - (Qantas Ground Services), was formed to recruit personnel on lower wages than mainline to perform baggage handling and other ramp duties - with the ultimate aim of displacing the Qantas employees who currently do those duties. The environment that the QGS & Qantas employees are working in is no harmonious and QGS has such a high turnover of staff that they are unable to expand into the roles that the executives want them to do.
Attitude to staff - Joyce and his henchmen declared war on the Qantas staff 2 years ago (still raging) so that staff now simply go to work, perform their duties and go home - very few people now go out of their way to do anything extra for the airline that they were once proud of. As you are aware, Steve, the ongoing war that QantasLink management waged on the engineers in Brisbane has resulted in an extreme shortage so that schedules are in disarray as they struggle to keep aircraft serviceable.
Board members - everyone knows that Leigh Clifford's agenda is union bashing such that his eye is not on the running of the airline (just like his days at Rio Tinto) and therefore shouldn't be Chairman of the Qantas Board.
James Strong is in charge of remuneration and can be directly blamed for the monstrous increases in salaries/fees/bonuses being paid to directors/executives etc. When businesses throughout Australia are doing it tough, it's very difficult to justify these increases when no dividends are being paid and the share price has tanked.
Why is Peter Cosgrove on the board? He has no airline experience and Joyce's management style is totally opposite to what he claimed to use to great effect during his military career (in particular, Timor), yet he just sits silently taking his director's fees without contributing towards better management of the company.
Gary Hounsell - is his connection with the industrial law firm that advises Qantas on IR tactics considered a conflict of interest
The entire board is spectacularly lacking in true "premium airline" operational experience and this needs to be remedied in order to turn the company around.
Management style - Joyce is playing his cards so close to his chest that middle management have no idea where the airline is headed therefore the staff have no idea (rudderless ship). Additionally, Dixon installed a management style whereby information only flows in one direction, from the top down. This style has become even more firmly entrenched under Joyce and most staff now don't bother to report events/problems because why would you waste your time when no one is listening. The result is management is making decisions while having no idea what is happening operationally and therefore have no idea of the consequences of there decisions.
Joyce has also appointed executives who aren't traditional "airline" people as he believes that people who have come through the ranks have too much affinity and compassion for the workers to make the hard decisions. The result is executives who have a degree but no experience or common sense.
Segmentation - has been introduced as one of many efforts to cut staff costs , the major problem with this is the duplication of managers (& resulting increase in costs). To use one example, a wholly owned subsidiary, QGS - (Qantas Ground Services), was formed to recruit personnel on lower wages than mainline to perform baggage handling and other ramp duties - with the ultimate aim of displacing the Qantas employees who currently do those duties. The environment that the QGS & Qantas employees are working in is no harmonious and QGS has such a high turnover of staff that they are unable to expand into the roles that the executives want them to do.
Attitude to staff - Joyce and his henchmen declared war on the Qantas staff 2 years ago (still raging) so that staff now simply go to work, perform their duties and go home - very few people now go out of their way to do anything extra for the airline that they were once proud of. As you are aware, Steve, the ongoing war that QantasLink management waged on the engineers in Brisbane has resulted in an extreme shortage so that schedules are in disarray as they struggle to keep aircraft serviceable.
Board members - everyone knows that Leigh Clifford's agenda is union bashing such that his eye is not on the running of the airline (just like his days at Rio Tinto) and therefore shouldn't be Chairman of the Qantas Board.
James Strong is in charge of remuneration and can be directly blamed for the monstrous increases in salaries/fees/bonuses being paid to directors/executives etc. When businesses throughout Australia are doing it tough, it's very difficult to justify these increases when no dividends are being paid and the share price has tanked.
Why is Peter Cosgrove on the board? He has no airline experience and Joyce's management style is totally opposite to what he claimed to use to great effect during his military career (in particular, Timor), yet he just sits silently taking his director's fees without contributing towards better management of the company.
Gary Hounsell - is his connection with the industrial law firm that advises Qantas on IR tactics considered a conflict of interest
The entire board is spectacularly lacking in true "premium airline" operational experience and this needs to be remedied in order to turn the company around.
Last edited by Going Boeing; 25th Jul 2012 at 10:43.
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1/ I know nothing about the directors and where their hearts lie.But...the fact they continue to pull good money whilst overseeing really damaging tactics tells me a lot. At that level you are on the same song sheet or you find another gig. Has anyone of them broken solidarity? Nope. So they all agree with choice of CEO and his tactics.
2/ Poor decisions people have expressed include....
choice of aircraft and config mistakes ;
industrial warfare over genuine, open negotiations;
grounding the airline rather than talk sensibly.No industrial action caused so much pain or required such a response;
the continued Sydney centric operation adding to its demise;
drawing a line in the sand domestically and throwing capacity at it in a price war but doing the exact opposite internationally where they are rapidly becoming insignificant by design;
what other CEO continually down talks his assets like AJ does with the international operation? What other CEO has personally attacked his front line staff or done so via his PR rep?
A well known business saying "Culture Eats Strategy" the corporate culture at the Q is appalling.The strategy aint too good either so far;
AJ said a long time ago he would cut the levels of reporting A few extras layers that I can see;
announcing Asian ventures then see them quietly fall over.;
closing Tulla heavy then closing Sydney workshops and sending them to Melbourne;
closure of the engine shop that very likely could have saved several hi profile and no doubt expensive engine blow ups.
Talking the talk but not walking it...the ridiculous engagement surveys and pretending people are actually "engaged". I dont think many would disagree Q needs big changes. The utter failure of the exec team to engage their staff to have the majority of them pulling in the same direction is a big mistake or poorly designed tactic costing a vast mount of money. You cannot succeed in this business without having your people onside.
2/ Poor decisions people have expressed include....
choice of aircraft and config mistakes ;
industrial warfare over genuine, open negotiations;
grounding the airline rather than talk sensibly.No industrial action caused so much pain or required such a response;
the continued Sydney centric operation adding to its demise;
drawing a line in the sand domestically and throwing capacity at it in a price war but doing the exact opposite internationally where they are rapidly becoming insignificant by design;
what other CEO continually down talks his assets like AJ does with the international operation? What other CEO has personally attacked his front line staff or done so via his PR rep?
A well known business saying "Culture Eats Strategy" the corporate culture at the Q is appalling.The strategy aint too good either so far;
AJ said a long time ago he would cut the levels of reporting A few extras layers that I can see;
announcing Asian ventures then see them quietly fall over.;
closing Tulla heavy then closing Sydney workshops and sending them to Melbourne;
closure of the engine shop that very likely could have saved several hi profile and no doubt expensive engine blow ups.
Talking the talk but not walking it...the ridiculous engagement surveys and pretending people are actually "engaged". I dont think many would disagree Q needs big changes. The utter failure of the exec team to engage their staff to have the majority of them pulling in the same direction is a big mistake or poorly designed tactic costing a vast mount of money. You cannot succeed in this business without having your people onside.
Last edited by ampclamp; 25th Jul 2012 at 11:06.
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Ceos 'n' stuff
Can anyone name me a fine restaurant in the world that is not run by, or at least has significant input by, a chef? i.e. someone that knows the business, not just the decor?
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Instead of devoting their energies to developing an airline, we have a Board and management with a greater priority - to crucify staff of the 'legacy' airline, to build a multitude of entities that are simply cheap and nasty, to pursue this industrial agenda whatever the cost using their friends in 'dark places' - and it had been many, many, many millions, and for their misguided failures, blame anyone and anything to divert attention from themselves.
Thanks Jacko, Dicko, Strongy, Cliffy and AJ - stellar performance.
Thanks Jacko, Dicko, Strongy, Cliffy and AJ - stellar performance.
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A lot of the Chefs own there business so do what they want Qantas employees don't and the major investors in Qantas don't give 2 hoots what the employees think and wont give a rats what's in some little booklet .