CEO to beancounters: Sit down!

On the one hand, it’s always to good to see sanity prevail:

Delta Chief Executive Richard Anderson studies daily cancellation reports and overruled arguments inside the airline that there weren’t enough cancellations to justify the cost.

As Wall St. J. airline columnist Scott McCartney writes (paywall), attitudes such as this help explain why Delta has the lowest cancellation rate in the industry, a whopping 50% below that of the next best airlines (Southwest and Alaska) and nearly 1/6 of the airline industry average of 1.7%.

You could look at it as simple math: 1.7% of Delta’s 2500 daily flights would mean canceling about 43 flights every day. That’s maybe 6400 pissed off passengers each and every day. As Deming once noted, “dissatisfied customers” have the annoying habit of telling their friends.

As a bonus, this attitude of “the flight must go on!” has improved not only Delta’s cancellation rate but its entire system:

As it cut cancellations with a more-reliable operation, overall on-time arrivals improved and Delta has fewer delays.

So it looks like Delta may have done more than just band-aid their cancellation problem, that is, they appear to have made systemic improvements. The average US airline, after all, is not 5% or 10% worse than Delta but 6 times worse!

There is a deeper question, though. Hooray for Anderson, of course, but why does the CEO have to study daily cancellation reports? Nothing wrong with that, per se — it could be a good example of leading from the front — so long as it isn’t a symptom of micromanagement, or, perhaps worse, the “heroic CEO” syndrome (one recalls former American CEO Robert Crandall bragging about his personal decision to eliminate cashews from first class).

Obviously many people within Delta had to work very hard to to achieve a cancellation rate 1/6 of the industry average, and I say good on them all. But is anybody else working on finding problems, or do they wait for marching orders from on-high? I don’t know.

So what I’d ask Mr. Anderson, were he willing to pay my outrageous fee, is “What fundamental changes have you made to Delta’s culture?” I’d be looking for something like Boyd’s EBFAS, more specifically, a culture or climate that embodies the same basic principles. These climates are designed to pump up creativity and initiative throughout the organization and focus them to achieve the objectives of the organization. And I’d want to see something analogous to a doctrine and institutions that inculcate the doctrine. Otherwise, it isn’t going to last.

Truth-in-blogging notice: I’m a Million Miler on Delta.

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