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Author: tkksewell Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 610  
Subject: How UAL can prosper Date: 10/30/2001 12:45 PM
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1. Convey a vision. Explain the long term goal. Where will be UAL be in 1 year, 3 years, and 5 years? Get the employess and customers to focus on the long term. Right now employees and passangers know things are tough, but they have no idea where the company is headed even a month from now.

2. Return to the core business. The current situation of United Airlines is similiar to United Airlines in the mid 1980s when it renamed itself Allegis Corp and was a conglomenerate of hotels, car rentals, and airlines. The current management did not learn from this blunder and has again strayed into areas outside of its expertise with forays into internet travel agencies and business jets. Does United Airlines really want to compete with Warren Buffet's Flexjets when it can't even manage its core business? Put the business jets on the back burner for a while until United Airlines has shown it can manage its own business and use the savings to improve the core business.

3. Work together. Instead of fighting with the different employee groups (many of whom own significant stakes in the company), work with the groups. United finally has something the labor unions need -- jobs. The labor unions are eager to work with the company to preserve jobs. United must be more flexible in these negotiations. It should negotiate honestly with the groups and open the financial reports to the unions. Forloughs have been announced and made without proper financial analysis. Arbitrary forloughs will costs much more in the long run. United can only furlough the most junior and inexpensive labor accourding to their labor contracts. The furlough savings are very little and the retraining, severance pay, morale, etc costs are very high in comparison.

4. Empower the employees. Allow decisions to be made at the lowest level where the expertise exists. Example: When should aircraft be held a few minutes past departure time so connecting passengers can make the flight. Currently there are black and white inflexible rules that govenr this. But there are certainly times when exceptions are warranted. Allow the managers at the operations level to make these exceptions.

5. Win back the passangers. To accomplish this service and performance must improve. Put the focus of United back on this. Continental Airlines has certain bonuses for all the employees when the Airlines meets certain parameters (e.g. top 3 in on top arrivals for the month results in bonuses for all the employees). Implement programs such as these to focus the employees on passanger service and performance.

6. Simplify the infrastructure. Currently United Airlines has 7 aircraft types. The maintenance and pilot training costs could be greatly reduced if United could consolidate its fleet.

The bottom line is that it all comes down to leadership. Someone has to stand up and show the way. The current times are tough, but the CEO needs to show people a vision of where the company is going so employees and passangers can look past the current storm and see how the compny will flourish in the years ahead.
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