Up in the Air: How the Airlines Can Improve Performance by Engaging their Employees

Overview

"And you thought the passengers were mad. Airline employees are fed up, too-with pay cuts, increased workloads and management's miserly ways, which leave workers to explain to often-enraged passengers why flying has become such a miserable experience."—New York Times, December 22, 2007

When both an industry's workers and its customers report high and rising frustration with the way they are being treated, something is fundamentally wrong. In response to these conditions, many of...

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Up In the Air: How Airlines Can Improve Performance by Engaging Their Employees

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Overview

"And you thought the passengers were mad. Airline employees are fed up, too-with pay cuts, increased workloads and management's miserly ways, which leave workers to explain to often-enraged passengers why flying has become such a miserable experience."—New York Times, December 22, 2007

When both an industry's workers and its customers report high and rising frustration with the way they are being treated, something is fundamentally wrong. In response to these conditions, many of the world's airlines have made ever-deeper cuts in services and their workforces. Is it too much to expect airlines, or any other enterprise, to provide a fair return to investors, high-quality reliable service to their customers, and good jobs for their employees?

Measured against these three expectations, the airline industry is failing. In the first five years of the twenty-first century alone, U.S. airlines lost a total of $30 billion while shedding 100,000 jobs, forcing the remaining workers to give up over $15 billion in wages and benefits. Combined with plummeting employee morale, shortages of air traffic controllers, and increased congestion and flight delays, a total collapse of the industry may be coming. Is this state of affairs inevitable? Or is it possible to design a more sustainable, less volatile industry that better balances the objectives of customers, investors, employees, and the wider society? Does deregulation imply total abrogation of government's responsibility to oversee an industry showing the clear signs of deterioration and increasing risk of a pending crisis?

Greg J. Bamber, Jody Hoffer Gittell, Thomas A. Kochan, and Andrew von Nordenflycht explore such questions in a well-informed and engaging way, using a mix of quantitative evidence and qualitative studies of airlines from North America, Asia, Australia, and Europe. Up in the Air provides clear and realistic strategies for achieving a better, more equitable balance among the interests of customers, employees, and shareholders. Specifically, the authors recommend that firms learn from the innovations of companies like Southwest and Continental Airlines in order to build a positive workplace culture that fosters coordination and commitment to high-quality service, labor relations policies that avoid long drawn-out conflicts in negotiating new agreements, and business strategies that can sustain investor, employee, and customer support through the ups and downs of business cycles.

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Editorial Reviews

From the Publisher

"This refreshingly readable and persuasive book challenges the emerging orthodoxy that low-cost must mean low staff morale and low customer satisfaction. Drawing on examples from across the world, including 'legacy' airlines such as British Airways and new entrants such as Ryanair and easyJet, the authors analyse the competitive and employment-relations strategies that airlines have adopted. Outcomes for customers, employees, and other stakeholders are analysed. The authors categorise employment-relations strategies as either controlling employee behaviour, or aiming to foster commitment. . . . The authors suggest that the genuine partnerships should feature: joint commitment to the success of the enterprise; efforts to build trust; employment security in exchange for flexibility; quality training programmes; information sharing and joint problem solving with managers and employees."—Jim McAuslan, The Log (British Air Line Pilot's Association), April/May, 2009

"The book provides a detailed overview of the recent evolution and transformation of the U.S. civil aviation industry, especially the impact of low-cost competition and September 11, and it includes a penetrating analysis of the relative performance of different airlines. It pays adequate tribute to the importance of the old 'legacy' airlines in the industry, many of which have been national flag-carriers, though it pays particular attention to new entrants. Although the focus is on the US, the analysis is extended to other markets in Europe and Asia to produce a comprehensive account of competition, business strategies and human resource management in the world airline industry. . . . On the whole, the book is intellectually stimulating and a pleasure to read. It asks the right questions and combines thorough empirical research and informed analysis to answer them. The ideas, arguments and empirical analysis presented merit close attention and wide discussion. The authors even offer a road map to success for consumers, employees, and investors. While the book makes a significant contribution to the literature on human resource management and employment relations in the aviation industry, it is also useful as a starting point for future research."—Stefan Zagelmeyer, Personnel Review, March 2009

"Up in the Air tackles the complex external and internal environments of the world's airline industry. The authors are an impressive combination of Australian, European and U.S. employment relations scholars with significant research expertise in the airline industry. . . . This book is equally valuable in the classroom and the boardroom. The authors' use of a comparative industrial relations approach enriches one's understanding of the complex nature of employment relations. It would be lamentable not to recognize that this book's value extends far beyond airlines. The airline industry has a dynamic internal and external environment with employees spread around a nation or world; frontline employees make important decisions at any hour of the day or night. This book is instructive for successful employment relations strategy in a wide range of industries—particularly those with knowledge workers and/or dispersed frontline decision makers."—E. Patrick McDermott, Journal of Industrial Relations

"There is much to be appreciated about the contribution of Up in the Air that extends beyond the boundaries of the airline industry. The carefully explained lessons of the industry should be of interest to those in other industries where managers may believe that price competition necessitates 'bleak house' approaches to employment relations. . . . Overall what I most value about this book is its undeniable optimism and the pathway it describes to more sustainable employment relations strategies. This is not a naive optimism but is well-founded; securely anchored in insightful scholarly observations of what works in this fascinating industry."—Peter Waring, Critical Perspectives on International Business

"What can airlines do in this new environment to overcome the obstacles and move toward sustainable profits? That is the subject of Up in the Air; to explain how the industry got to this point and what can be done to make it profitable. The central thesis, backed up with strong evidence, is that employee and customer satisfaction can coexist with increased revenue and profits. . . . Up in the Air uses statistics and anecdotes effectively. There are many tables and charts, but they are simple and usually easy to understand. There are also interviews with leading industry experts and company officials as well as stories of successes and failures. . . . This is an informative, balanced, well-researched, astute, and instructive treatise on the airline industry. The book is quite accessible to readers who are neither economists nor familiar with the industry."— Carl Barsky, Monthly Labor Review, November 2010

"Up in the Air is a fascinating account of the airline industry and its evolution. . . . Flying is an integral part of today's world and the low-cost airline model has increased this exponentially. As such a significant piece of our infrastructure it is important that we have a well-developed understanding of the necessary underpinnings of this complex business model. The authors have added first, a balanced, historical perspective of the business development and employee relations within airlines. Second, they offer strategic thinking from their research, which allows for sound planning within contemporary expectations of stakeholders at all levels. Third, they offer solutions for the growth and development of sound employee relations. For the human resource professional there is much value within this work. It is airline specific yet most readers would have a broad understanding of the salient arguments. It has research outcomes and analysis which are transferable to the workplace and HR strategic thinking and planning. It contains valuable models and diagrams, is well annotated and referenced. While academic in style, it is an easy read and tightly structured. It is also well written and has a clear place in today’s employee relations literature."—Geoff De Lacy, Asia Pacific Journal of Human Resources, November 2010

"Up in the Air is a great read; it features fascinating data and persuasive arguments and is an important contribution to the literature on airlines."—Peter Cappelli, George W. Taylor Professor of Management, Wharton School of the University of Pennyslvania

"Up in the Air is a very useful compendium of data about and experience in the airline industry. Every political, union and industry executive concerned about the industry's fate will learn something from its pages, which include suggestions for bringing better labor-management relations into being."—Robert L. Crandall, Retired Chairman and CEO, American Airlines

"The authors of Up in the Air ask all the right questions about this fundamental yet unstable industry. But they also offer a road map to success for the primary stakeholders—consumers, employees, and investors."—Patricia Friend, International President, Association of Flight Attendants-CWA, AFL-CIO

"This book should be mandatory reading for management and unions, to help them to reformulate policies to achieve better industrial relations and support a stronger aviation industry."—Ingo Marowsky, International Transport Workers Federation, London

"This is a timely and important text on the low cost carriers that have transformed air travel in recent years. Up in the Air is written in a lively, accessible, and engaging style with a clear structure and an easy 'flow.' Greg J. Bamber, Jody Hoffer Gittell, Thomas A. Kochan, and Andrew von Nordenflycht provide a detailed overview of the recent evolution of the U.S. civil aviation industry, especially the impact of low-cost competition and September 11, as well as a fascinating account of the relative performance of different airlines. This analysis is extended to other aviation markets around the globe to produce a comprehensive account of competition, business strategies and human resource management in the industry. The authors also offer a thoughtful prognosis and practical steps for the future, to which policy makers, airline managers, and trade unionists should pay particular attention."—Peter Turnbull, Cardiff University, Wales

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Product Details

  • ISBN-13: 9780801447471
  • Publisher: Cornell University Press
  • Publication date: 1/31/2009
  • Pages: 240
  • Product dimensions: 6.20 (w) x 9.00 (h) x 1.00 (d)

Meet the Author

Thomas A. Kochan is the George M. Bunker Professor of Management at MIT's Sloan School of Management. He is coeditor of Negotiations and Change and After Lean Production and coauthor with Saul A. Rubinstein of Learning from Saturn, all from Cornell.

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Table of Contents

Preface
1. Low-Cost Competition in the Airline Industry
2. Developments in the U.S. Airline Industry
3. Developments in the Airline Industry in Other Countries
4. Industry Trends in Costs, Productivity, Quality, and Morale
5. Alternative Strategies for New Entrants: Southwest vs. Ryanair
6. The Legacy Responses: Alternative Approaches
7. Building a More Balanced Airline Industry
Notes
Index

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