Editorial: Glenn's gotta go at United

There has been a lot of stuff out there written about United Airlines, and most of it isn't positive. We're all familiar with the United Breaks Guitars video (the second of three is out on YouTube, by the way), and the infamous "Untied" complaint website has been a thorn in the airline's side for many years now. I was on the website of United's Association of Flight Attendants the other day when I came across an account of how AFA members picketed the airline's 2008 shareholder meeting. I figured that it would be another story about angry union protesters, but then the last part of the article caught my attention:
The worst part of the meeting was when Los Angeles Customer of the year, James Anderson, stepped up to the microphone and respectfully addressed [United CEO Glenn] Tilton as a shareholder and a loyal customer who spent $100,000 at United just last year. Employees clapped and cheered for Mr. Anderson. He explained to Tilton that he felt caught in the middle of all of this and expressed concern about the discord at the meeting and the state of employee morale at the airline. He questioned whether he should continue to buy tickets on United Airlines. Tilton shrugged his shoulders and told him it was his prerogative if he wanted to take his business elsewhere but that it was going on at every airline in the industry - so where would he go? There was a shocked silence from the room and Mr. Anderson seemed bewildered at having been so easily dismissed. He paused before quietly stating, "What I’m trying to say is that I’m concerned about this. You talked about aircraft enhancements in your presentation – and they’re great – but they don’t put smiles on the faces of your employees.”
I haven't been able to independently verify the above story, and an email I wrote to the AFA requesting further details remains unanswered. But if the story is true (and I have no reason thus far to believe otherwise), then Tilton should be ashamed of spouting that kind of crap. First of all, it's not going on at every airline in the industry. And secondly, what kind of CEO, airline or otherwise, tells one of his best customers to go ahead and shove it? Maybe if you're Michael O'Leary, CEO of Ryanair. But O'Leary can do so because his airline's fares are so low that people will always come back, regardless of service. If the price is right, service doesn't really matter. But United's no Ryanair, and the airline can't afford to alienate key customers (let alone the rest of us).

That's the attitude that Glenn Tilton conveys - we don't really care about you. And you know what? Chances are that attitude is going to trickle down to the rest of the employees. And while I know that there are thousands of United employees that take pride in their work and do their best, I've also experienced a lot of less-than-stellar service on United. And you can't really blame them too much, either. I'd probably be pretty cranky, too, if my pay and benefits were slashed while Tilton & Co. raked in the dough. A great article over at Forbes, entitled "United Airlines Shows You How Not to Run Your Business," has this to say regarding employee morale:

United's workers... have had their wages, pensions and benefits cut even as the chief executive officer has been paid nearly $20 million dollars over the last five years (despite United's stock dropping 43% during his tenure)... All employees share the pain equally. If there are big cutbacks anywhere, senior management should take substantial pay reductions and limits on its privileges, such as fewer business class flights and trips on private jets. The troops look to senior management for direction. If those troops see the top brass caring for itself at the expense of others, the spirit of the entire organization erodes.

And there you have it. It's no secret, Glenn - perhaps you should look across the Pacific at another airline that's in trouble. JAL has been bleeding red ink as of late (posting a $1 billion Q2 loss). But their CEO takes the city bus to work and gives himself just $90,000 a year in salary (less than the pilots make), as CNN reports:

United's long-running financial troubles show no sign of abating. Tilton's strategy has been to try to polish up the airline enough to sell it off or merge it. Delta was always seen as the likely choice, but it opted for Northwest. And Continental figured that it would be better to just "remain good friends" with United (as evidenced by the new alliance between the two airlines) rather than a full merger. Nobody wants United, and that throws a wrench in Tilton's plans. United's fleet of planes is starting to get a little long in the tooth, and despite the airline's recent talk about shopping around for a big airplane order, it's clear that the airline would have a difficult time obtaining financing. As is pointed out in this Chicago Business article, United has billions in debt, and Tilton's already burned most of the furniture already. There's not much left.

Which means, quite simply, that it's time for Glenn Tilton (and probably a lot of the rest of UAL management) to go. I don't want to play armchair CEO, but it's clear that whatever's going on in Chicago needs to change, and change soon. Times are tough, sure, and everyone's hurting. But United has consistently been a loser in many categories - financial performance, customer service, etc. Firing Tilton wouldn't fix all of these problems overnight, but it would be the first major step on United's much-needed road to strength and stability.

Edit 8/26 7pm: I managed to get in touch with Sara Nelson at the United AFA, who provided me with the following: We do not have a video clip of the meeting. However, Mr. Anderson, himself wrote about his experience on FlyerTalk. And, he appeared again at this year's Shareholder meeting. I personally witnessed both meetings and his interaction with Glenn Tilton. This year Chicago Tribune reporter Julie Johnsson wanted to meet the man Tilton had dismissed and hurried to greet him once the meeting was over.

8 comments:

Steamboat Lion said...

I think the horse has bolted for United. They are now in a death spiral. What do they actually own that a merger partner would be interested in? Maybe some slots at congested airports like Heathrow and JFK.

The staff are demoralised, even their most valuable customers hate them and their fleet is old. Even their newer aircraft like the 777 are in desperate need of a refit, especially at the front of the plane, but they've just deferred that upgrade for another two years.

Tom said...

UAL needs new planes, but Tilton was figuring that they'd get them through a merger. But no merger obviously scratches that strategy.

Anonymous said...

United Airlines has to go. No one at United cares about its PAYING passengers. Good luck if you try to lodge a complaint, as one can only do so by filling out a complaint form (what a joke), on their website. An airline that is run so poorly; where the employees at the airport (counter and at the gates), and on the telephone are extremely rude and do not make any attempt to help the passenger (or at least show some level of compassion and empathy), does not deserve to exist. And United CEO's attitude is a clear indication of what one can expect from the rest of his crew, all the way to the very bottom. I have had it with this crappy airline. They are not getting my hard-earned money any longer.

james said...

Really great ideas. I like every example. Just might have to try these... So cute! Thank you!
more templates easy to download

Jim said...

Happened to run across your posting, and yes, what happened to me at that meeting is true. In all fairness to Mr. Tilton, he may have been caught off guard by my being there as LAX Customer of the Year, and he was obviously surprised at the question. To be honest, although shocked at his candor to a customer, I was impressed that he did not hold back just because I was a customer. He addressed me as a shareholder.

At this year's meeting I questioned their goal and design of the "International Premium Travel Experience (IPTE)" that they were building the airline around. Their hope was to become a world class carrier in line with Singapore, Lufthansa, and others. I brought up two challenges to the IPTE: 1) Capital and debt repayment commitments could force them to sell valued high-yield international routes that they were banking on to pay for the new seats, and 2) the IPTE would never work as long as employees still felt the need to protest. I never received a direct answer to the first question, and to the second, Mr. Tilton said he viewed the protests only as their right to voice a "difference of opinion." Further, he said that United's internal polling of their best customers was showing that the IPTE was a success. I brought up the fact that their loss in market share said otherwise, but he moved on to the next question.

I have not let Mr. Tilton keep me from flying United. I go back because of the wonderful people on the front lines who work so very hard to get us to our destinations safely. I am at a loss as to why UAL's Board keeps Messrs. Tilton and Tague in their jobs.

Anonymous said...

I had my first experience with United Airlines a few days ago. I have to admit it was an experience that I am not pleased about, and I am not sure I will never forget. What started out as part pre-birthday and business trip ended in disappointment. I have detailed my experience with United Airlines below.

On 10/29/2009, my husband and I flew from Bloomington, IL to Atlanta and from Atlanta to Hawaii via Delta and connecting Atlanta to UA San Francisco. Arriving in San Francisco UA had no documentation of our tickets or boarding pass. When that was finally resolved, we traveled on to Hawaii. Not much of a problem yet! On 11/1/09, flying home from Hawaii on UA our flight was delayed, along with over 100 other customers @1:30pm, then again at 3pm. Finally we left at 6pm 11/1/2009-missing our connection in San Francisco. While in Hawaii United Airline provided no explanation or announcement to any passengers. No delays were posted on the eletronic board of any changes to our flight time. UA attendents eventually (after we stood in line for more than a two hours) hand wrote a sign at our gate on a wet board stating flight postponement and we should move to another gate. We along with over 100 of other customers waited in line for three hrs to speak to someone about re-booking another flight and connection. Before we could speak to someone, a UA manager came out to yell at all of us about our inpatience, and told us to get out of line, She said they could not help us with our connections until we were in the air. We were treated as if were pawns in UA's hand and as if the cancelation was our fault. Although refreshments (water, peanuts an pretzels) were provided ,to me it was an insult considering the treatment we received and how we were spoken to and treated. Elderly people were not taken care of as they should have been, and they too stood with us for up to 3 hours. Children were tired and hungry. Some of UA's customers werea already in the airport for more than 24 hours after 3-4 cancelations. UA service attendants and the manager on duty was rude, insensitive and not at all customers focus. UA only had one UA person at their desk for more than an hour trying to help over 100 people. Eventually UA briefly added another employee and then took that person away. We were again told that they only had one person to help us and we would just have to wait because there was nothing that could be done. We finally left Hawaii and missed our connecting flight (as I am sure others did also). Oh, when we finally reached the counter in Hawaii we were told by UA that our bags would transfer to our Delta 6am flight, once we reached Atlanta - so that when we arrived home we would have them. Needless to say, UA did not transfer our bags. We ended up sleeping overnight at the San Francisco Airport until 6am 11/2/09.

We left Altanta and arrived home at 5:30pm 11/2/2009. After 30 hours of trying to get home, we found that indeed UA never transferred our bags to Delta. As of yet 8pm 11/2/09 we have no information on our bags.

This is the first and last time we will fly United Airline. I intend to complain to as many people as possible. Again, what started out as a chance to enjoy a few days in Hawaii turned out to be a very bad experience with an airline that I believe is unorganized,inefficient, and insensitive and not at all customer service focused. As far as I am concerned United is bad news.

Dale Cooper said...

The airline accident attorney I used was a master. It's sad to see United be so callous toward their customers.

Dennis Orlikowski said...

Buy Baltia Airlines the 25 year startup will be getting off the ground with revenue and profits this year.