The Descent of Air India (7 page)

In both my stints in the In-flight Services Department, the primary focus was on improving the quality of our product, which was regarded as critical for retaining passengers—the environment of extreme hostility created by the union notwithstanding. This should appear to be normal in any organisation, but not in Air India, because the management personnel, while doing precious little to stem the rot, in fact, often contributed to it by taking bizarre decisions. If one predecessor had signed the absurd treaty that a flight will not take off unless the crew complement was complete, a successor agreed to pay flying allowance compensation to a specified number of AICCA office bearers even if they did not fly, thus allowing them to engage themselves in union work on a full-time basis and obviating the need for them to fly to earn their livelihood.

Such a proviso would have been acceptable if it had been introduced with the objective of easing the union’s involvement in management– employee meetings. But that wasn’t the case. Union leaders wanted Air India to pay them their flying allowance (over and above the salary) even when they were not on a flight, effectively asking the airline to pay them even when they were busy conducting activities inimical to the organisations interests. To me, it seemed that fate had decreed that nothing and no one would have the power to stop the airline from its inevitable fall.

CHAPTER THREE

living in the past

‘AIR INDIANS HAD the maximum experience in flying when the skies were opened up, but instead of giving sleepless nights to other airlines, they found themselves in deep slumber.’—this is what I would tell my colleagues when Air India found itself under siege even from fledgling airlines. For an airline that had amassed years of flying time and knew the Indian passenger better than other international carriers, it was a mystery why Air India never managed to build on its strengths or ward off the challenges that emerged with the changing times.

Towards the beginning of the decade of the 1990s, the aviation sector in India was in a state of flux. On the one hand, the government was veering towards an open skies policy, and on the other hand, the Indian passenger was getting more and more demanding. It was also a time when Air India was under pressure on various fronts—people, operations, product and revenues. The going was getting rough, but instead of focusing on the challenges, Air India put its blinkers on. It paid no heed to the growing disenchantment among its fliers; nor did it prepare for the changes in the aviation business. The unions got stronger; the management got weaker; and the airline became hostage to petty self-interests and fell into a state of disrepair.

Surprisingly, the leadership and senior management played the role of passive spectators, seemingly oblivious to the storm that was gathering on the horizon. Hubris appeared to have dulled Air India into a state of complacent apathy.

WRITING ON THE WALL

In the 1980s and the early 1990s, it would have been difficult to find an Indian who had travelled abroad and not flown Air India. It was the first and often the only choice for Indians travelling to foreign lands. Aviation was controlled by the government at the time and only a few international airlines were allowed to operate their flights in and out of India. Moreover, international flights were infrequent; unlike today, when there are hundreds of arrivals and departures every week from different parts of India to all parts of the globe, there were only a few flights every week from Mumbai and Delhi to select international destinations during those days. The hub-and-spoke concept hadn’t yet been perfected, which meant that passengers patronised the carriers of either the originating or destination country. For example, if a person travelled to the USA, it could be presumed that he had travelled by either an American airline or with Air India, and if his destination was London, he either flew British Airways or Air India and similarly for other countries. The government also restricted the number of seats that the foreign airlines could offer. After taking into consideration the passenger traffic between two countries, the ministry of civil aviation would allocate seats to the foreign airline making sure that there was enough business for both Air India and the foreign airline. Besides, foreign airlines could operate only out of the cities of Delhi and Mumbai, with a few being allowed to fly in and out of Kolkata. The government thus controlled the choice of airlines, destinations and travel schedules of international travellers to and from India.

Fliers today, who have the choicest of airlines and routes at their disposal, may find this scenario impossible to imagine. But the truth was that in the 1980s and before, aviation was a sellers’ market. Air India had flourished under—or perhaps because of—these conditions in the post J. R. D. Tata era. Some are likely to disagree with this interpretation because, Air India they say, had to compete with the national carriers of other countries. True, but the competition was more notional than real.

How did that affect the way the airline functioned? For one, Air India never had to aggressively market itself. It was also slow to see merit in introducing amenities on its flights such as flatbeds in premium classes, dedicated in-flight entertainment systems or even the practice of serving free liquor to its economy class passengers. Buoyed by a near monopolistic market, and the fact that Indians across the world preferred Air India because they felt comfortable with ethnic Indian co-passengers, Hindi speaking crew, vegetarian meals and such other services Air India came to believe in its own invincibility.

Soon, however, times changed. In 1991, the juggernaut of economic reforms rolled into the aviation sector. Foreign airlines were first allowed to considerably enhance frequencies and later permitted to extend their reach to other Indian cities. Services were first extended to Chennai, Bangalore and Hyderabad, and later to Pune, Mangalore, Amritsar and Jaipur and other cities. As the number of airlines flying in and out of India went up, so did the number of seats and routes they offered. Also, airlines began carrying passengers not just to and from their countries, but also to other destinations with a brief stopover in the country of origin. Indian passengers could finally exercise a choice and they began to fly the other airlines instead of Air India. Gradually, the US and Gulf bound Indian traffic, among the most lucrative sectors for Air India, also began to move out of its grasp. And Air India’s market share plummeted.

SLOW AND INDIFFERENT

The airline was felled by a multitude of problems. To start with, it failed to keep pace with market trends. The overall emphasis, industry-wide, was on providing customer-friendly and customised services on ground and in the air. But Air India did nothing at all. It failed to understand the changing needs of the customer and keep pace with the times. For instance, Air India introduced flatbed seats in First and Business class and a personal TV monitor in each seat across the aircraft long after the other international airlines. The overall experience of flying Air India too declined while other airlines laid out the red carpet for passengers.

To add to the problem, Air India’s service standards took a dip. Flights were delayed and its on-board experience fell short of expectations. Many industrialists who had once sworn by the airline began shying away. Instead of rallying to strengthen its customer relations at all interface points Air India slackened its efforts which marketing alienated the fliers further.

One example of how things changed was the way the Commercial Department (in charge of sales, marketing and promotion) stopped the practice of mandatory visits to large corporate houses. Previously, the Air India sales officer with his ready smile, a flight timetable and a small gift, even if it was a clay model of the Maharajah or the grey coloured overnight bag which was quite the rage among premium class passengers, would visit the offices of large companies as part of the airline’s promotion and sales effort. The Air India sales team took great pride in these visits which, as any old timer will tell you, soon became a part of industry folklore. It was also common for senior officers, including the Commercial Director, to make sales calls or organise social events like a golf tournament or a theme party to promote the Air India brand. The personal touch was important and that was something that Air India’s sales team had honed to perfection. But all of this went missing when its need was perhaps most critical.

Despite flying state-of-the-art B747-400 aircraft on the India-Europe/US sectors, in the mid-1990s, while other international airlines were still deploying flying machines of the 1970s vintage, Air India failed to reap the advantage because the airline was so used to passengers queuing up for tickets, it expected the same to continue even when the market had changed. It did nothing to win new customers or retain its old ones.

I was flummoxed by this attitude. And in early 2009, when I was on an interview panel looking at candidates for the post of General Manager, I could not help but bring it up. We were interviewing a handful of internal candidates and one, who had just come back from a posting in Los Angeles, when asked as to how he was settling down said he had been meeting travel agents in his office. When I remarked that the market had changed so dramatically in recent years, it might have been more appropriate to meet the travel agents in their offices instead, he was unperturbed and replied ‘I could have’. He was not the only one who behaved thus. Travel agents, in fact, would often complain about the high-handed behaviour of Air India’s sales team. Once at a dinner that I had organised for a group of agents on the occasion of the festival of Onam, since many of the biggest agents in Mumbai are from the state of Kerala, I was shocked to hear that this was the first time they had been invited to an informal interaction by a director. ‘No director has ever called us over to his home’, they said. They also spoke about how some bureaucrats-turned-chairmen would keep their distance from travel agents even at industry meets or functions hosted by Air India, where they would position themselves in one corner of the room and expect the travel agents to walk over and pay their respects. This was in sharp contrast to the behaviour of the chairmen of private Indian airlines, who would walk up to the agents and talk to them. Air India behaved like an emperor even after its empire had been infiltrated and carved up between its competitors.

LEADERS AND MEN

In the decade of 1990s, the government was gradually loosening its control on the airline sector and at Air India, many of the advantages that came with being India’s international carrier were being withdrawn.

The changes in the aviation business and in the government’s relationship with Air India came at a time when the airline was facing a leadership crisis. The airline did not have a strong and stable team at the top, nor did it have a visionary chairman who could bind the numerous departments together under a unifying vision. A firm leadership could have helped the airline redefine its product, improve its service and create an environment that nurtured innovation and initiative. However, in the absence of such leaders, Air India became a messy congregation of departments, each run as the fiefdom of one man or a few union leaders.

The way I see it, the problem was not that the departments were asked to function as distinct power centres but that most departmental heads were not able leaders. They could not motivate their people and work towards the larger interests of the organisation. This was primarily because the airline had not spent time training and mentoring them for the role and also because there was no system that held the departments accountable for their decisions. Performance was neither measured nor made to count in the scheme of career progression within the airline. The departments, therefore, did not work as a cohesive unit, and there were times when they worked at cross-purposes with each other, allowing personal rivalries or pressure from the unions to come in the way of organisational cooperation. For instance, if on-board service was excellent at times, baggage delivery would be delayed or passenger check-in would be clumsily handled, or else the aircraft upkeep and on-time departure would leave much to be desired.

There was one instance of a UK resident who had flown Air India but whose baggage had been misplaced in transit. Despite her letters and repeated calls to the Hong Kong, Delhi and London offices of Air India for more than a week, her luggage had not been located. Frustrated, she wrote to the airline’s executive directors to complain about her lost baggage. As one of the recipients of the letter, I asked the officer in charge of baggage services at Mumbai’s Sahar Airport to coordinate with his counterpart at the Delhi airport; they checked with the baggage handling team, who reported that the bags were indeed lying at the Delhi airport. Without any further delay, we sent them to the passenger by the next flight to London. Although the airline’s complaint redress system was not inefficient, the people in charge were indifferent to the plight of the passengers.

Having served as the head of In-Flight Services during 1993–1995 and therefore aware of the prevailing attitude to customer needs, I suggested in a letter to M P Mascarenhas, managing director in May 1999 that we institute a ‘Department of the Year’ award to prod everyone to perform. The award would go to the department that had excelled in customer service through changed policies, superior service, a significant increase in compliments and a drastic decrease in complaints. I suggested that the parameters for determining the claimant for the award be finalised by a committee and that the exercise also identify those who were failing the company. The letter, however, was consigned to the files and forgotten. Ministers changed; chairmen were moved around; and the unions sprang one demand after another. The departments continued to cave in to the growing power of the union leaders, but the airline authorities refused to pay heed. It was the practice at Air India for ministers of civil aviation to periodically hold review meetings with the executive directors. However, instead of being used to discuss the airline’s achievements and debacles, as they should have been, the meetings became an occasion for lofty utterances through which ministers exhorted departmental heads to uphold the airline’s past glory. And when asked to speak about the departments under their charge, executive directors would bring up matters that did not really warrant a minister’s intervention.