While pilots enjoy one of the more visible careers in the
airline industry, the Chief Executive Officer (CEO)
is the person eventually responsible for all the good (and
bad) that occurs at an airline. This is a high-stress job
(to say the least) but those individuals that help guide a
carrier to profitability seem to enjoy an almost rock-start
status in the industry. A few notable airline CEOs have made
the news headlines over the last few weeks. Here are a few
examples:
Just a few weeks ago, Midwest Air Group CEO Tim Hoeksema
urged shareholders to reject AirTran's $345 million
offer to acquire the airline. In a letter to shareholders
filed with the Securities & Exchange Commission, Hoeksema
said a merger would lead to crowded planes and poor
service and he criticized AirTran's recent earnings. An AirTran
executive fired back and claimed his airline has been profitable
for eight years and that the offer will create value
for shareholders.
Meanwhile, Northwest Airlines CEO Doug Steenland
says his airline is “fixed” and prepared to exit bankruptcy
protection as an independent airline. However, he
also said there will likely be airline consolidation
at some point. The now defunct proposed merger between Delta
Air Lines and US Airways would have forced other airlines
to consider their options”, he said.
Last but not least,
US Airways CEO Doug Parker didn’t
respond well to Delta Air Lines' creditors who lagged
in responding to his airline’s merger bid. “We've
got a company to run,” Parker said. “We're not
going to keep chasing this thing, even though we've
got a bunch of people telling us we should.”
See What It’s
All About One of the World’s most successful airlines is
Virgin Atlantic Airways. Its eccentric founder,
Sir Richard Branson, is a highly successful entrepreneur
that enjoys thinking outside of ‘the box’.
Overseeing the airline’s parent company, Virgin
Group, Sir Richard has taken on other airline
projects including a successful carrier in Australia
called Virgin Blue. An offshoot of that airline
is Pacific Blue, a smaller carrier based in Christchurch,
New Zealand. AirsideTV.com interviewed
Tony Marks, the airline’s former CEO, who gave us
great insight into the nuances of running an
airline and the unique business philosophy Pacific
Blue and Branson’s
other airlines operate by. We invite you to watch
this interesting interview on the above video
screen.”
Climbing the Management Ladder
Being the CEO of an airline is not the kind of job that someone
just slips into. Typically these airline big wigs
worked their way up the corporate ranks. In some
cases, they’ve
been recruited from similar positions other industries.
Historically, most airline CEOs have spent a considerable amount
of time in some type of the management structure.
A
good example is Joe Leonard, CEO of AirTran Airways has been climbing the airline
industry's ladder his whole life. Unlike many airline executives who are groomed
at Ivy League schools and rise through the elite ranks of finance, the
60-year-old executive came up through the operations side of the business.
Leonard first earned a degree in aerospace engineering
from Auburn University and then joined Northwest Airlines' maintenance operation
at Minneapolis, overseeing the care of two engine
models. In his previous jobs at Northwest, American and Eastern, Leonard
learned the business from the inside.
Leonard may
have been born to work at an airline but his experience at Eastern in Miami
almost drove him from the industry for good. As president, he ran the airline
day-to-day and dealt with labor unions. Leonard resigned in 1990 when a bankruptcy
judge named a trustee to run Eastern. It shut down the next year. Leonard
left for Northwest, then fled airlines altogether
to run AlliedSignal's aerospace unit. After he took AirTran's reigns in 1999
after the conclusion of the ValueJet crash investigation in the Florida’s
Everglades, the airline’s subsequent quick rise made Leonard
a star. During that time, he earned $1 million in
salary and bonus, more than many CEOs of large legacy
carriers.
AirTran now flies mainly in the East and
upper Midwest, but is quickly expanding across the country, into
Mexico and the Caribbean. Many of Leonard’s peers say he's
taken pride in AirTran's labor relations. For example, he's careful
to call all AirTran employees “crew members,” even
those who don't work on the airplanes. After the Sept.
11 attacks, Leonard and the rest of management took
voluntary pay cuts along with labor. As a result, AirTran had
to lay off only 84 employees, a small fraction of its workforce.
Unlike some airlines
with layers of support staff, AirTran has one secretary
for every two managers. The airline’s modest
one-story headquarters is compact and there's no
dining room for all to enjoy. So, lunch is often
a fat sandwich from a nearby sub shop. All of this
is characteristic of Leonard’s
motto: “Keep it simple, and say 'no' a lot.”
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