Column: Boring? Not These Airline Execs
Michael O'Leary's been called crazy, a clown, even the Antichrist.
Oct. 5, 2012— -- He's been called crazy, a clown, even the Antichrist. Michael O'Leary collects such titles the way other businessmen do Rotary plaques because he is outrageous. You'd have to be to call your own paying customers stupid.
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O'Leary, the CEO of Europe's super-discount airline Ryanair, was referring to a passenger who didn't read the fine print on the airline's website then complained about fees. The "stupid" customer wondered why Ryanair charged her family an extra $380 to print out boarding passes. In O'Leary-World, it's because they can. Ryanair is all about the fees.
Same for Florida-based Spirit Airlines. Its CEO Ben Baldanza once dismissed an unhappy customer's threat to boycott the carrier by saying, he'll "be back when we can save him a penny."
Yes, it all comes down to dollars and cents or euros and pence. O'Leary knows people want cheap flights, which leads him to wacko ideas like standing room-only sections on airplanes. "The standing cabin would be [priced at] one euro, the sitting cabin would be 25 euros…I guarantee you, the one euro cabin will fill first." Did I say wacko? Make that wacko like a fox; his SRO scheme gave Ryanair an avalanche of free publicity as did his earlier trial balloon to install pay toilets on planes.
So, for some who run airlines money trumps everything. Others do it for love. Or do they?
Ask anyone who worked at Southwest Airlines during Herb Kelleher's tenure as Chairman of the Board (1978 - 2008) and they'll tell you outrageous stories about him. Or look up an old YouTube video and see for yourself. (I particularly like the one of the then sixty-something CEO "training" for a Southwest charity event by exercising with a cigarette dangling from his mouth and bench-pressing gallon-sized bottles of Wild Turkey). Of course, for Kelleher, outrageousness was all about turning the joke on himself. When it came to business, though, no jokes but plenty of heart. He even once used the L-word when speaking of Southwest employees: "A company is stronger if it is bound by love rather than by fear."
Another airline guy, once mocked as a "cuddly hippie" said something similar about his Virgin empire: "Loyal employees in any company create loyal customers," said Richard Branson, "who in turn create happy shareholders."
Does Ryanair's O'Leary ever wax sentimental? "The purpose [of running an airline] is not to be loved. The purpose is to have the passengers on board," he's said, and if customers don't like his philosophy or the fees they can "b***** off" as he's so delicately put it.
The Irish Times once said Ryanair's CEO "manages dissent with the same delicacy that Josef Stalin brought to his own negotiations with the politically unconvinced."
However, I think Messrs. Kelleher and Branson would agree with O'Leary about the need to make money. All three are smart, tough executives, but you have to be in the airline industry. Forget the romance of flying, airlines are first and foremost a business and the duty of any airline executive is to keep his or her planes in the air.
Just ask Robert Crandall, who headed American Airlines back in the 80's and 90's; he used to tell his people not to invest in their own airline (or any other). One of his more famous quotes about the airline industry: "This is a nasty, rotten business."
