Australia's Qantas needs to own its problems for its reputation to soar again
When a large listed company and national icon like Australia's Qantas cries foul over competition, plays the victim and sulks to the government when the going gets tough, one has to wonder about management's thinking.
After it was privatised between 1992 and 1995, the airline invested in a decent fleet of Boeing aircraft and had an impeccable flying record. In the 1988 film Rain Man, the character Raymond Babbitt said: "Qantas never crashes."
That was Qantas at the height of its game.
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For some years now, while it kept its flights full, shadows lurk.
There are now regular complaints about poor service including delays and cancellations, confusing refund processes, underwhelming meals, unanswered customer service lines and having surly flight attendants.
Qantas' low-cost subsidiary, Jetstar, which also flies to many parts of Asia, has so many detractors it spawned a website Dontflyjetstar.com and a Facebook page, "Why we hate Jetstar".
I had my share of service shock when I called Qantas' service centre after a recent flight and waited 72 minutes before hanging up.
During and after the pandemic, Qantas found itself embroiled in scandals over the sale of bogus flights that breached consumer laws, more delays and illegal job cuts. Its newly-departed CEO Alan Joyce even had his mansion in Sydney pelted with eggs and toilet paper.
In the course of these incidents, three toxic management attitudes stand out.
Firstly, there is the habit of blaming others for its problems and challenges.
In 2011, Joyce grounded Qantas' entire fleet over a deadlock with unions, leaving customers stranded. He blamed the unions for that decision.
Last year, Joyce pointed to a lack of government support for Qantas' losses and its struggles to get up and running after the pandemic.
Recently, I asked Qantas about the shift in passenger loyalty to other regional heavyweights such as Singapore Airlines, Qatar and Japan's ANA, which topped the World Airline Awards' best airlines in 2023. Qantas ranked 17.
Qantas told me its record A$2.47 billion in underlying profit in the last financial year was a standout, especially when it was teetering on the brink of bankruptcy during Covid-19, even though all airlines suffered during the pandemic.
Then, straight out of the Qantas blame-game playbook, it said Singapore Airlines had "favourable reopening conditions" and government assistance of S$19 billion, which made it easier for the carrier to restart operations.
Secondly, Qantas refuses to play by the rules of the free market. It appears to like casual protectionism from the government when it faces troubles, and sadly, Canberra bites.
Last year, Qantas wrote to Canberra opposing Qatar Airways' application for more flights into Australia. Interestingly, Qatar argued that crimped Qantas flights had forced up fares that ultimately benefited shareholders but not customers.
The Australian government's subsequent decision to deny Qatar more flights is now before a parliamentary inquiry.
A decade ago, in similar style, Qantas argued that domestic airlines like Virgin were competing unfairly against it by expanding operations using a war chest of overseas funding.
In a country where supermarkets and airlines are dominated by a handful of companies, ultimately it is consumers who suffer through higher prices.
Finally, Qantas' attachment to cutting costs, having a short-term view, and chasing the bottom line has coagulated into bad morale and stagnancy.
Successful businesses know chasing revenue or top lines through product innovation and excellent service are just as important as cost-cutting.
Beyond management, the board also has to be held to account, and it was no wonder shareholders were furious at its annual general meeting last week.
Culture may explain why Asian and Middle Eastern carriers have more amiable flight crew, but it does not take a genius to realise that overworked and under-resourced staff will deliver sullen service.
Su-Lin Tan is a Correspondent at the Post's Asia desk.
This article originally appeared on the South China Morning Post (SCMP).
Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.
