American Airlines has a weekly series where Ron DeFeo, senior vice president of global engagement, interviews executives at the company (and sometimes with partners) to give employees a better understanding of the reasons for decisions being made at the airline. It’s called “Tell Me Why” and it’s also available on iTunes and soundcloud, which means that anyone outside the airline can listen, too.
The first several episodes were pretty enlightening, for instance interviewing their Vice President of Planning about new routes and about how they see certain hubs, and when they got into their fleet strategy along with their order for new Boeing 787s.
Recently they’ve been fairly milquetoast, such as the last interview with new Vice President of Marketing about how great their customer product initiatives are.
An Executive Vice President Offers Her Take on Where American Is Going
The company gives employees an opportunity to comment on “Tell Me Why” on an internal forum — and boy do they ever. One flight attendant who says that Delta’s onboard product and overall customer experience is better — even if American has newer planes — drew a response from Executive Vice President Elise Eberwein.
Her response is, in a nutshell:
- American flight attendants are better than at competitor airlines
- They can’t be expected to be better than competitors yet since their merger is newer, they’ve only had 5 years
- American has to build products customers love and flight attendants are proud of — and they’re doing that
- Their technology is great too
In other words – the airline is headed in the right direction because of the merger and they just need time to catch up to competitors.
However the airline has been going in the wrong direction since the merger, and the merger is never an excuse or cause for delay when a customer-unfriendly initiative needs to get prioritized (‘integrate before we innovate’ quickly goes by the wayside).
American’s Flight Attendants Are Better?
Ms. Eberwein first said the flight attendant was “one of American’s best..which means I would put you and your crew up against DL or UA any day of the week on any flight, and our service would win.”
She says American’s flight attendants are better, but are they? Are they given the tools to be better? The catering? Are they given the training to be better? And indeed are they told to prioritize customer service or sacrifice it for operational metrics the airline still fails to meet?
Blame It On The Merger, ‘We’ve Only Had 5 Years’
Maybe flight attendants are better, but the airline isn’t better overall and that’s because their merger was ‘only’ 5 years ago,
DL is five years ahead of us in terms of integration. That means they have been merged for 10 years, while we have been merged for just 5. UA is 3 years ahead of us. Not an excuse just similar to a house remodel. DL is five years ahead and renovating their existing structure (and doing it VERY well so not taking anything away from them), as is UA. Both started their remodel projects before us. Then we did a complete tear down and started building a new house (ie placed a huge new aircraft replacement order before the merger closed), albeit five and three years later… it is going to take time to catch up or even surpass. And at some point, both DL and UA will have aircraft orders of their own to contend with as their fleet’s age.
The implication is that American is headed on the right path and just hasn’t had enough time — five years — for results to show. American’s merger of course will always be more recent than Delta’s and United’s. However it’s time to stop using the merger as an excuse. They combined the American and US Airways frequent flyer programs in early 2015, and moved to a common passenger service system in October 2015. They even now have flight attendants on a single system, which lets them more easily assign the plane they want to the route they want.
The merger didn’t prevent them from rolling out a whole slew of customer-unfriendly initiatives. So it’s all about priorities. For instance,
- like basic economy
- six-tiered AAdvantage award pricing
- spending requirements for elite status (and then even raising those spending requirements.
- choosing less comfortable seats in coach or designing an aircraft interior that one American pilot calls the most miserable experience in the world.
When American leadership took over they found an airline whose Boeing 737s had 150 seats in them. They’re ripping out the insides of those planes to squeeze in 172 seats, which means less space between seats (even in first class), less recline, and smaller bathrooms. They’ll be ripping out seat back video screens, too.
They gutted American’s meal service in September 2014, and were surprised to learn customers cared so they restored some of what was lost.
The airline was already on a path to fully lie flat business class seats with direct aisle access, that wasn’t a new management decision.
The things this management did control largely hasn’t been to make the customer experience better (other than faster wifi, though at the expense of seat back screens). Indeed 5 years into the merger larger legacy US Airways narrowbody aircraft still lack power at each seat. The airline’s CEO said they thought they could get away with it (“we thought we could live with this“).
The American AAdvantage team had their own proposal to reward high value customers without undercutting the value proposition of the program. That plan was overruled by legacy US Airways management who decided to copy Delta and United’s devaluations instead, while applying US Airways revenue management philosophy to award availability.
Did they need a merger and new management to make things better for customers — or to make them worse?
Two Competing Visions For American Airlines
Ms. Eberwein says that they “rely far too much” on only being 5 years into merger, and acknowledges they “need to consider the hard product such as pitch, seat comfort, food quality, entertainment options, etc.”
However she says that’s what “Janelle talks about in this brief [“Tell Me Why”]” episode. In other words she suggests American is doing this.
[I]n the year ahead you can expect to see more attention on these aspects of our service. It is one thing to have the largest network (all 3 carriers make this claim), and newer, more fuel efficient aircraft. It is another to understand the psyche of our best customers, as well as our less frequent flyers, and build products they love/want to buy, and deliver those services as you do today with pride and enthusiasm (I see how you look when checking in for flights and I hear your comments when the onground bev service doesn’t occur in first.. you’re the epitome of service). We are paying attention to likelihood to recommend, cabin write ups (to fix things that aren’t working, and feedback on product decisions. So keep the feedback coming.
Lastly our technology is right up there with the rest, and in many cases surpasses the others. And technology, that is how easy it is to do business with us, even during irregular ops, is a focus as well.
But I have to close with championing the hundreds of not thousands of coworkers of ours who are working on all of this and more. We have a lot to look forward to in 2019 and beyond. Thanks again for all you deliver out on the line. Perhaps I can take a trip with you in the year ahead.
The airline’s President Robert Isom though says it’s all about low fares like Spirit and Frontier,
[T]oday there is a real drive within the industry and with the traveling public to want to have really at the end of the day low cost seats. And we’ve got to be cognizant of what’s out there in the marketplace and what people want to pay.
The fastest growing airlines in the United States Spirit and Frontier. Most profitable airlines in the United States Spirit. We have to be cognizant of the marketplace and that real estate that’s how we make our money.
We don’t want to make decisions that ultimately put us at a disadvantage, we’d never do that.
Which version offers a better description of American Airlines over the past couple of years — offering “products [customers] love/want to buy, and deliver those services..with pride and enthusiasm” or offering products that ensure the airline isn’t “at a disadvantage” compared to “Spirit and Frontier?”
The airline has improved international business class, though much of the decision-making there predated the merger. They have also improved benefits for ConciergeKey members. At the same time the domestic product has been made worse — even the domestic first class product with less space and less comfortable seats. Those are decisions made after the merger.
AAdvantage of course was the advantage American had over Delta and they voluntarily chose to to abdicate their unique selling proposition.
The track record since the merger doesn’t have anything to suggest all that’s needed is more time to catch up to Delta with 600 seat back video screens, better operational reliability, and friendly crew who update customers regularly during delays.