COMPANIES involved in mergers, acquisitions and alliances quickly overlook one key issue which inevitably leads to friction, discontentment and resentment, according to Chris Darke, general secretary of the British Air Line Pilots’ Association.
Sustaining and improving staff morale and motivation should be the biggest priority for all companies.
Darke said many firms preach that people are their most important asset, but in reality, investments and publicity material often downgrade staff to the bottom of the list.
Speaking at the Future of Air Transport conference in London, Darke emphasised that people are assets, driving companies forward and are the single most decisive factor between success and failure.
But he is wary of many companies’ approach to people management, warning that the airline sector, for example, has a lot to learn as carriers are going through dramatic change with mergers, alliances and cost-cutting.
Darke said airlines too often concentrate on cost-control measures to maximise profits. Incentivising staff firmly takes a back seat.
“There are two types of people that run airlines – accountants and marketing people, focusing too much on productivity and products,” he said.
“Accountants are concerned about the bottom line and the marketing people are slick presenters keen to show off a product with a polished appearance, such as a comfortable seat, fine wine and good food.
“Airlines are too customer focused and often do not see what customers see – people behind the scenes.
“In this business, we should be concerned about all people in the organisation, not just the final product or front-line service.”
Darke claimed that many airlines lose sight of the bigger picture and even ignore basic areas such as incentivising staff through bonuses and perks.
He highlighted achieving duty-free sales and on-time performance as not being enough to incentivise a select-few staff.
Long-term incentives for all staff are needed to show strong levels of commitment by companies. In turn, it helps improve industrial relations.
Darke’s organisation BALPA is the second largest pilots’ union in the world, representing 7,000 British pilots working for 40 charter, corporate and scheduled airlines.
He added that airlines often make morale worse during tough times when business is down, profits are under pressure and cost cutting is inevitable.
“Evidence shows that 86% of downsized companies in the US experience a huge decrease in staff morale and dissatisfaction. Cost-cutting is counter-productive and leads to all sorts of problems,” he warned.
Strong industrial relations are vital, even if it means being open to the idea that employees are members of unions, said Darke.
He added: “Good industrial relations are all about participation. Unions have a huge part to play in brokering and negotiating change such as mergers and acquisitions.
“In an industry which is heavily regulated and unionised, employers must recognise their importance in the future success of companies.
“There is evidence to show that sound industrial relations lead to a successful partnership. We have seen it with employee-ownership schemes such as United Airlines, Trans World Airlines and Northwest Airlines which have worked tremendously well.
“These are excellent working models. Employee-owned companies outperform traditionally managed companies in a big way.”
Darke proposed that companies should devote more time to human resources and listening to employees and added that it should be addressed quickly.
“We hear so much about how people are the most important asset, but because it is said so often, we all stop believing it,” he added.
n See the Future of Air Transport report,page 28