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MERGED: Alan's still not happy......

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MERGED: Alan's still not happy......

Old 9th Mar 2014, 03:11
  #3301 (permalink)  
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Oh, and another one. For QF Int to have any chance of competing and surviving, it needs large efficient twins such as B777 or B787-9, so how can the policy of 'not investing any more in it until it becomes more profitable' make any sense?
Right on the money! I don't think there is enough time left for Clifford & Joyce, they have already failed, clear to everyone except them..

Clifford needs to be called in for the inquiry to explain the above, and why he has the dogged support of this board... when you see the figures below, says they are out of their depth, lost the plot to put it nicely..

Basically the chairman was saying, ''Give us more time, we need a fair go and a level playing field.''

As my good friend David Leckie would say, ''Well, hello.''
After more than 40 years in business here and elsewhere, I can tell Mr Clifford that there is no such thing. And even if there was, the wind only ever blows from one end.
Business is a rough old place and only the good ones make it.

Read more: Qantas must learn to navigate rough weather
As I see it, for Qantas International to survive (the original Qantas) Clifford must go, he is the root cause for the Qantas strategy failures in my view..
As we go into another new week I suspect more and more doubt will surface about the leadership issues at Q from people in similar positions as Mr Mitchell.

He finishes his piece with this blunt message..

In the seven years between 2002 and 2008, my mates Dixon and co made a cumulative profit for Qantas shareholders of $4.350 billion.

Louise chimes in, ''So Leigh Clifford is saying they need more time. How did his lot do?'' Well, the cumulative profit for the 5 years to December 2013 is about $20 million. ''That's ridiculous,'' says Louise, ''they don't need more time.'' ''Quite right'', Charlie says, ''time's up.'' Leigh Clifford needs to toughen up.
Those parked J* A320's are well and truly eating into the profit Clifford & Joyce have generated during their tenures...

Double speak for "go away" Mr Clifford and take the failed strategy makers with you...

I feel for all the staff who have to watch this unfold day in day out for the last 6 yrs... and how slow the Australian business press have been to pick up on this simple point.. from here on I think that will change, better late than never I guess...

Last edited by TIMA9X; 9th Mar 2014 at 04:35. Reason: add pic
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Old 9th Mar 2014, 03:41
  #3302 (permalink)  
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Have a look at the stats in business trends half way down the page. Revenue unchanged, staff unchanged, Passengers up 25%, Fleet up 50% (OK might be lots of small ones), Loadings only slightly different.

I think they should be able to work it out from here.

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Old 9th Mar 2014, 04:31
  #3303 (permalink)  
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Skipness 1E: it would seem to me that the only airline CEO without a wife or girlfriend is also the only airline CEO whose share price has collapsed by 80% in the last 5 years. It _could_ be a complete co-incidence, but the figure is rather startling! Although, it could also be a height thing come to think of it.

There needs to be one solid question about what leasing companies get the big bucks from Qf - and their ownership structure needs to be seriously investigated. A very difficult proposition.

What are the penalties in all this for actually fibbing, as opposed to an outright lie? 'My understanding...', 'I am led to believe....' etcetc
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Old 9th Mar 2014, 05:08
  #3304 (permalink)  
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And; the questions about leasing companies goes right back to the days of Australian Airlines (circa TAA); what was leased?

Who were the leasing companies?

Most definitley, who were the owners/shareholders of the leasing companies?

It could be more than well suggested (rumoured?) where perhaps it is no coincidence owners/shreholders of said leasing companies may well have been senior executives (very) of the companies leasing the equipment many of whom graduated from Australian Airlines to management roles in Qantas.

Who, what and which is leased today where from and who by?

Rose Leasing based on some abscure South Pacific atoll leasing engines for Austrlian Boeing 737s?

Last edited by Dark Knight; 9th Mar 2014 at 05:44. Reason: speelliing...
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Old 9th Mar 2014, 05:28
  #3305 (permalink)  
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Skipness 1E please don't take this the wrong way. My observation with these kind of "empires" is that the blind and unfailing loyalty they offer their masters combined with their dogged and capable persistence to achieve their master's goals at any cost and regardless of right or wrong is what causes this problem.

It is healthier in a large corporation for number 1 to be afraid of number 2 and 3 going after his/her job, but that is just not happening at Qantas. Corporate boardroom discussions should be brutal in addressing any problems and failures, and if you can't deliver then out you go. Qantas's corporate governance is a shambolic parade of useless 'yes' men and women, and look where that approach has taken the company.

Last edited by cattletruck; 9th Mar 2014 at 05:49. Reason: more clarification
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Old 9th Mar 2014, 05:41
  #3306 (permalink)  
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There needs to be one solid question about what leasing companies get the big bucks from Qf - and their ownership structure needs to be seriously investigated. A very difficult proposition.
We have a winner!
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Old 9th Mar 2014, 08:21
  #3307 (permalink)  
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The film regarding the last days of the Reich - Downfall, springs to mind!!!
If the Generals cannot understand the folly of their strategy the future is very bleak. I understand from OTP figures, NPS etc that the staff are delivering, but..... The strategy is flawed... The CEO and Board need a very good look at themselves.
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Old 9th Mar 2014, 09:21
  #3308 (permalink)  
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Originally Posted by ALAEA Fed Sec View Post
What questions would you guys like asked at the Senate enquiry?
Has Qantas put any of its business units (contractors included) under pressure to "shave" safety margins in order to reel in costs?

Fuel, maintenance, ground staff, cabin crew for example.
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Old 9th Mar 2014, 10:04
  #3309 (permalink)  
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Your analogy is entirely accurate. BGA and the board are stuck in the Fuhrer Bunker making majestically grandiose sweeps of their hands directing imaginary Army Divisions across Europe when the reality is Russian infantry are firing on the Reichstag.

And they are similarly deluded. The management ethos is the same, the paranoia is the same and the total disconnect between Dear Leader and 'The Troops' is as pronounced. Add to that the simply laughable Engagement Survey results increase (when apparently their bonuses depend on same) and you get a workforce that now is openly despising its management.

Questions for Fed Sec:
Is it true the bonus/pay structure you enjoy is based at least in part by positive Engagement Survey results?

If you have demonstrably destroyed shareholder value in this company, then what penalty have you paid or would you think is reasonable? Or expressed otherwise, If one person removed/stole $xx BILLiON/million from the company (for his/her own benefit?) then how would you treat them as an employee?
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Old 9th Mar 2014, 10:27
  #3310 (permalink)  
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For the HNL questions, maybe a paid holiday for the recently retired Dwayne might be in order. I would ask Dwayne, "as the airport manager for QF and JQ, where did you send your bill for JQ and how many times did you try to bill JQ? What was the response from Hallmark/QF when you sent a bill for JQ? What % of your work and the work of your staff for QF and JQ? What do you estimated, in $ terms, the entire bill for JQ is from since JQ commenced operating to HNL until you left in 2013 that was paid for by QF?"

For J* Asian ventures, how much debt is carried on and off the QF Group books for J* Asia, J* Pacific, J* Japan and J* HK? For debt that is carried on and off the books of these J* Asian ventures, how much is guaranteed by the QF group or by QF assets in $ terms? What is the total cost of interest payment for the J* Asian ventures debt and how much of this is paid for by the QF group?
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Old 9th Mar 2014, 10:50
  #3311 (permalink)  
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Nice one AR. Like the Dwayne angle.
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Old 9th Mar 2014, 10:55
  #3312 (permalink)  
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Add to that list:

1. When a Jetstar Passenger was denied boarding on a full Jetstar flight due overselling. When the passenger was paid cash for denied boarding. Who paid that cash? Qantas or Jetstar.

2. Were you instructed not to bill Jetstar for services offered by Qantas that totalled $100,000 or less for any given event?


Last edited by Mstr Caution; 9th Mar 2014 at 11:07.
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Old 9th Mar 2014, 11:08
  #3313 (permalink)  
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Don't forget, who pays for paxing/positioning Thai and sin based Jq cabin crew in biz class on qantas? Happens regularly. Not to mention Jq tech crew paxing 1st class on Qf to operate ex sin on the 330's when the 380 flew there. Guess they back to biz class too now due aircraft downgrade?
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Old 9th Mar 2014, 11:13
  #3314 (permalink)  
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Does Qantas pay (or has it ever paid) Jetstar a certain standard amount to carry pax or freight on certain services, irrespective of whether any such pax or freight is actually carried?

Given that the latest 'transformation announcements' only involve further shrinkage and cutbacks, with no means of increasing revenue, how do you expect QF to prosper, or even survive?
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Old 9th Mar 2014, 15:43
  #3315 (permalink)  
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Explain the KPI targets for all executives and further explain the now apparent unintended consequences for the group of such narrowly defined benchmarks. Explain how internecine competition benefits the group as a whole. With examples.

Benchmark the number of supervisory/management/executive staff per employee against the world's best practise for all airlines and all similar sized enterprises.

List every external factor that you have blamed for your dismal performance and explain the effects each has had on your competitors.

Disclose the delivery schedule, lease costs, storage costs and ancillaries for every group aircraft order. From 2012 to 2017

Disclose the current staff on retainer, payroll, per diem, or otherwise compensated for each of the JQ franchises. Describe how each of the group's 110+ subsidiary companies interacts, with revenue costings, with every other unit in the group.

Outline your understanding of the Bushido code and disclose your timetable for embracing same.
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Old 9th Mar 2014, 22:58
  #3316 (permalink)  
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Outline your understanding of the Bushido code and disclose your timetable for embracing same.
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Old 10th Mar 2014, 00:23
  #3317 (permalink)  
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Qantas's Future?
Competing as an international carrier, is Qantas doomed to failure principally due to its labour costs?

It is clear that the CEO isn't very popular on this forum right now. I imagine some people might suggest that if Qantas is failing or even doomed, that the CEO is the principal reason.

Maybe so. That aside, two years ago, a PPRuNe member pointed towards labor costs a big issue, even though at the time the focus of the posting was on the high AUD:


The AUD has dropped since then, but the average employee cost of Qantas is still significantly higher than its international rivals.

How can Qantas compete in this situation? With the knowledge that your airline's labour costs were significantly higher than that of your rivals, if you had the power to make changes, what would you do?

I read a lot of criticism in PPRuNe on how the airline is being run today, but most people would agree that running an airline is a tough job at the best of times. Qantas's situation is serious. What do PPruners suggest and how will this offset a fundamental labour cost problem?
When Alan Joyce commenced as CEO he stated that he wanted only 6 levels of management/supervision between the employee on the floor and the CEO. "Only" 6? In view of companies of a similar size by employee, it's about 1 too many. Further, in various sections of Qantas that number is higher than 6. The last AGM revealed a staff to management/supervision ratio of 2.1:1 - ie 32% of QF employees are management/supervision. Typically, supervisors and management are paid more than staff. Do you think "too many chiefs and not enough Indians" might skew the "average" labour costs at QF? The plan is to sack 5,000 employees - 1,500 of which are management. 1,500/5,000 = 30%. If, as is the company's contention, that the "pain" will be widely spread, the sackings do NOTHING to address the top-heavy management/supervision structure OR to lower "average" wage costs in the short term OR the labyrinthine structure of almost 200 subsidiary companies and entities that make up the QF Group.

A quick comparison of just two first-world airlines chosen at random, quite different in geography and size, one smaller and one larger than QF Group, but both have a mixed fleet ranging from widebodies to small regionals similar to Qantas:
Air NZ 105 A/C, 11,000 employees: 105 staff per airframe.
AA (including American Eagle) 851 A/C, 89,900 staff: 105 staff per airframe (after Chapter 11 ructions & mass sackings).

Now for Virgin Australia including Tiger: 107 A/C, 8773 employees: 81 staff per airframe. Breaking it down:
- VA: 94 A/C, 8,423 staff: 89 employees per A/C (within cooee of QF, AA & NZ)
- Tiger: 13 A/C, 350 staff: 27 employees per A/C (but how much work is done by VA Tigerair in SIN?)

Compare this to Qantas: Group-wide, QF has 33,000 staff for 317 A/C: 104 staff per airframe. It looks comparable to AA & ANZ but let's break it down:
Jetstar Group has 7,000 staff for 116 A/C: 60 staff per airframe.
Qantas Group (everything but JQ): 26,000 staff for 201 A/C: 129 staff per airframe.

There are lies, damned lies and statistics, but the numbers speak for themselves. Clearly the red-tail half of the airline has too many staff compared to AA, NZ & VA. But I'll risk drawing a long bow and suggest that JQ has too few staff per airframe compared to "real" airlines of similar size, namely VA. It adds weight to the suspicions of many that:
1. JQ Group simply could not operate without the efforts of QF mainline staff
2. QF Group is over-complicated and over-managed
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Old 10th Mar 2014, 00:57
  #3318 (permalink)  
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1. JQ Group simply could not operate without the efforts of QF mainline staff
2. QF Group is over-complicated and over-managed
3. Jetstar, Virgin and Tiger OUTSOURCE everything they possibly can to 3rd party providers.
4. This is an over simplistic way of looking at it
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Old 10th Mar 2014, 01:28
  #3319 (permalink)  
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5. Larger aircraft require more staff per airframe

Whilst it's hard to argue that Qantas is over staffed and over managed, this is just one part of a range of issues facing the group.

Qantas management has lost focus on what Qantas is.
Qantas management is reactionary.
Qantas management has lost its innovation.
Qantas management does not have support of employees.
Qantas has outdated employee contracts and does not know how to work with unions to make them more efficient.
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Old 10th Mar 2014, 03:35
  #3320 (permalink)  
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What -438 said.

The old industry-wide yardstick in the 90's was:

100 employees per narrowbody

160 per widebody.

Since then some practices and processes have improved, some activities contracted out, so the targets may a little lower now. Certainly the supervision ratio is ludicrous.

I asked an executive friend at Telstra about their ratio. He said that their alarm bells go off at any less than 9 staff per supervisor/manager/executive. So by that measure QF is carrying a hell of a lot of parasite drag.

And not a lot of it high quality parasites either
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