Bronner's Analogy Of Replacing The Ceo



USAirways Chairman of the Board recently stated that replacing Mr Siegel now as USAirways CEO would be the equivalent of putting a gun to the head. Perhaps the honorable Mr Chairman should consider the analogy is more appropriate if he doesn’t replace Mr Siegel. The truth is, he has nothing to lose but much to gain.

I find it incredulous that a Board of Directors would accept public statements by a CEO withholding Plans affecting the long term recovery and success of a Publicly Traded Company. Despite Management’s lack of intimacy with it’s employees, there is a greater obligation by this Executive Team to it’s Stock Holders, Creditors, Contractors, its Customers and the Communities which rely on the Services of this Airline. In addition to the Employees, these parties of interest deserve to know whether the plan is “Business as Usual†or “Ground Breaking Innovative Changeâ€. They have the right to throw in support or express their revulsion at it’s inadequacy.

If the Plan is Good, it will sell itself. We can only conclude that there is some hesitancy on the part of Management that the Plan may not be entirely sellable in it’s current form. But because of the lack of a nurturing Culture between this Executive Team and it’s Employees, all who have an interest in the success of USAirways must be involuntarily excepted from the details of the Plan. Instead, any interested party will hear the details of an alternate Plan.

If this is so, then it is the intention of this Executive Team to press forward with an alternate Plan without the endorsement or cooperation of the Airline’s Employees. This is not entirely an innovative concept. It has been tried in the past with One Hundred Percent Failure. On the other hand... Creditors, Investors and Communities have prospered in the hands of those Executive Leaders who have nurtured a positive Corporate Culture, obtaining the cooperation of Employees and setting forth goals for success. This, in fact, has happened to an Airline (CAL) which has visited Bankruptcy twice.

If history confirms the truth, then the Alternate Plan will fail. The Airline will not survive.

Thus we ask, what is the fiduciary obligation of the Airline’s Board of Directors. Is it to provide investors and creditors and the stability of small dependant economies, the opportunity for prosperity and success? Or the certainty of Liquidation?

What is there to lose? Well, any Executive can handle the Liquidation proceedings of USAirways. That is a low risk assumption. If new Leadership, along with the cooperation of Employees can’t make a Plan work, then I’m sure that Death has the same Value no matter who is tasked with writing the obituary.

On the other hand, only a new Executive Team will allow the potential for a new Corporate Culture, improved Morale, greater Employee support and a monumental spirit of cooperation which will insure the highest probability of success and prosperity in a rising economy.

The correct analogy is that keeping the current Leadership is the equivalent of putting a gun to the head of Investors, Contractors, Creditors, Customers and the Communities the Airline serves – just for the satisfaction of seeing if old Leadership might incidentally find a bullet which will hit an Employee Group who has already sacrificed Billions in an unrecognizable, wandering Plan.
There is no plan, except to layoff thousands and bankrupt the remaining employees.
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Union Leaders have become too savvy to the Siegel/Glass M of O. Siegel’s tricks are designed to merely claim a moral Executive High Ground. The Strategy of the “Plan†is a disguise for the lack of Executive innovative talent and the inability to anticipate and adapt to an industry evolution. Managements plan is simply, to sustain the higher cost of network operations by either paying employees less than their low-cost rivals (in order to compensate for the inequity of business models); or, to have the employees work more hours than their low-cost rivals for the same or less compensation – which is also a pay cut. According to Management's (Glass) M.O., the Plan comes in a two part strategy.

First, Management demands that all discussions and revelations shared with Union Negotiators be keep secret with signed letters and commitments of confidentiality under threat of legal action for violations. At this point the Company reveals the most extraordinarily incompetent, knee-jerk, non-visionary Plan – which exclusively consists of additional employee sacrifice, a scheduled Deadline, and the Plan’s Ultimatum, if Union Negotiators fail to concede. Because the Union Leaders are Gagged, they cannot reveal the absurdity of the plan nor it’s unimaginative details.

Second, Management goes on the road. They cleverly manipulate their audience with their “Dr Jekyll†personality and positive enhancements presentations to the employees, while concealing discussions of the true “Mr Hyde†aspects of a potential for unrestrained exploitation, equivocation and twisted vague logic. The employees will have no real details or specifics to make a rational evaluation and this is how Management hopes to create a subtle divide between the employee and his/her union.

Without being able to speak to the true specifics of the Plan due to broadly restrictive confidentiality agreements, Labor Leaders will be left to speak to their membership and to the public in vague, ineffective language describing, inexplicitly, the imbalance of the Plan. Management will then capitalize on growing Investor, Employee and Public uneasiness.

A shift of “focus†is Management’s strategy when it has no Plan for it’s ill-defined Business Model. Management is trying to shift focus from itself, onto the Unions. It’s a cheap trick because we all know, It’s always fashionable to attack - Unions.

They will point to the Union Leadership, the ones who are privy to the secret details, and claim that it is their recalcitrance which will bring destruction to the Company and to all of our lives. The point here is to generate maximum focus on the disagreeable “Unionsâ€. It’s a natural prejudice in the public’s mind. You can see the Headlines in the Press – Unions thwart Executive Plans for Survival. However, such prejudice in these Headlines doesn’t address the reality that those close to the industry surely understand – this management team has no Plan.

This shift in – focus – strategy, is an effective campaign for Management, non-the-less, because most prejudices are sensational, memorable, easily digested by masses of people with cursory interest and quickly become accepted as “Truths†by those looking for an easy satisfiable reason other than the difficulty of logical analysis and understanding. Like most prejudices, it’s foundation is based on a disregard of the facts and reason. Prejudice encourages hate and ignorance. Unfortunately, this word – “Unionâ€, if used often enough by Management, will achieve the desirable connotation dulling the real focus of USAirways problems – “Managementâ€. This is where Management would prefer the “focusâ€, not to be.

The Unions are appropriately keeping the focus on Management. As the weeks ahead unfold, it is the Airlines current leadership which will become the focus of a cooperative effort going forward. Historical evidence is strong that this leadership is not sufficiently expert at anticipating industry challenges. There is strong criticism by industry leaders and analysts alike who have given timely warnings of events which would lead to this current state of USAirways’ despair. There is no Institution of Higher Learning in this country with a text book on it’s shelves which would be uncritical of the Human Relations application of Business Leadership at USAirways.
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“Who would have imagined that SouthWest would establish an operation in Philadelphia and who would have imagined that Jet Blue would double in size?†Come on now! These are industry trends. It’s no secret to any Airline Executive. For the last decade, Network carriers have been battling these trends unsuccessfully with Regional Jets, “Lite†Divisions and Market Retreat to Core Operations. Was Siegel asleep in class that day when USAir unsuccessfully attempted “High Groundâ€, “Metrojet†and Core Market Retreat. If any Airline Executive has not observed that these trends have been accelerating exponentially, then he should resign his position as that Airlines Chief Executive immediately.

Other Current and Former Industry Leaders and Analysts have been pointing out that USAir’s strategy of “shrinking to profitability†is a fallacy of unwise Executive Decision. It has been Executive Strategy to shrink from competition wherever LCC have introduced service. How can any Airline Executive not determine that these LCC have been picking the “low hangingâ€, ripe fruit for their exponentially expanding appetite for new markets. How can USAirways’ Chief Executive not anticipate that these LCCs wouldn’t team their attack on the only Airline with an obvious historical trend of weakness of heart, marketing misdirection, softness of resolve and retreat.

“Who could have known?†“Who could have known†– is a weak argument given the obvious trends in the industry. Obvious to everyone else. What’s also obvious to critical analysis is that USAirways is not in a financial position to “leap the LCC Competition†in experimental Business Model Strategy. Spending Billions on a Regional jet division to compete with LCC is a risky proposal. A more reasonable approach would be to invest those Billions competing in the Wealth of our Core, High Yield, High Populace, Point-to-Point Markets using the vast resources of ill-managed, idle Aircraft. At this point it is less risky to copy the successful strategies of our LCC Competitors, than to experiment with unproven “leap-the-competition†innovative business model strategies.

The LCC are currently providing a product with advances in Passenger size, comfort, frequency and price. All complimented with attractive advances in personal entertainment technology. They are using conventionally existing passenger and baggage Airport structures and facilities. They are not asking Counties or Airport Authorities to redesign their concourses and gates to offset the special limitations and inconveniences of Regional Aircraft being experimentally substituted in Mainline Transport.

The Executive Leadership at USAirways have not provided the employees with goals to help focus their efforts and sacrifices in building a better more successful Airline. These Executives won’t even show the employees their Plan. Truth-be-stated, ask any employee at USAirways if he could define what Management’s plan was upon emerging from Bankruptcy. Again, these employees have no hope because their leader has given them no Corporate or employee targets, goals or objectives to focus on. We are a wandering bunch going through a daily “business as usual†ritual. Like Management, we’re hoping the economy will solve our problems as a substitute for good Leadership.
Unfortunately, US Airways has six months or so to maintain liquidity and avoid breaking specific covenents of the ATSB loan. There are very few individuals who would be able to step into the CEO position of US Airways and have even a fighting chance of averting this June ATSB covenent issue.

Somebody recently noted that Lamar Muse offered to head up AMR publicly in a DFW news paper. Other notables who might be available on short notice include Herb Kelleher, Greg Brennamen (I may have misspelled, he was CO's #2 for the Go Forward Plan), Robert Crandall. And that is the list of people who I think are 1) available 2) have even a small chance of success at this stage of the game. I don't think any of these people are willing to try given the huge risk of failure when they were all considered successful.

I think just about anybody else would end up wasting a lot of the next six months learning the industry and the company... This is time US Airways cannot afford to lose, even if Seigel isn't the wonderkind he was supposed to be when hired.

That is the problem... Not that US doesn't need new leadership, that US doesn't have time for new leadership to be successful.

When Seigel was announced as the new CEO, I expected something like the Go Forward Plan to be announced within months... A clear, simple vision + carte blanche to make every change necessary in order to accomplish that goal. In fact, I thought that was the brilliance in hiring somebody who helped engineer CO's turnaround. It seemed to me like the US Airways BOD read "From Worst to First" and intended to repeat Bethune's recipe... Even hired as CEO somebody from Bethune's team!

Either Seigel's hands were tied by the BOD and contracts with regards to what he could accomplish, or he didn't act fast enough, or didn't have a plan. It appears to me to be a bit of all three. While its a shame, US Airways problems did not begin with Seigel, or even Wolf + Gangwal, but these last two leadership teams have not had very much success in reversing the trends...
Mark, then show me someone who has seen it, not hear say.

Scare tactics don't work. Morale is at an ALL-TIME LOW. You have said numerous times the word accountability, does Dave have to be accountable for what is happening? The one thing, just one thing, I had hoped Dave learned while at CO while working with Gordon was how to treat your employees fairly and with respect. Dave has done neither.
I agree Hope, I had hoped that Dave would have learned how to treat employees and it is obvious that both Daves know nothing about how to motivate, inspire and lead employees.

My point is that everyone assumes that the plan involves huge paycuts, additional layoffs, etc.....but no one knows what the plan is....and from the sounds of things, neither does Dave and Dave. To make statements like, "There is no plan, except to layoff thousands and bankrupt the remaining employees." is an emotional reaction to a plan that hasn't been seen yet.

I can't prove that there won't be pay or layoff issues.....but no on can prove that there will be.
MarkMyWords said:
Where is your proof if no one has seen the plan?
I'll give you this MMW, you are a man with much faith seeing the good and over looking the negative aspects of situations.

To the ones and even Dave B who say time is too short for a CEO change...I think they are dead wrong. I think that is the ONLY thing that will bring labor back into the picture. Dave B is wrong saying labor and this management are at a stalemate, it's beyond that. The Dave and Jerry show have backfired.

I believe if we don't get an interim CEO soon, then it's over because this CEO no longer has control because they lost all support, thanks to their own lies.
It gets harder and harder to see any positive and I do fully understand the negative. The bottomline is that no one on here has seen "the plan", yet everyone ass-u-mes to know what is contained in it respective to employee wages and furloughs. If none of us have seen it (if it exsists), then how can we predict what it will be? I agree with Chip in another thread when he said that Dave and Dave need to cut the BS and just take the plans to the employees. If there is enough support for "the plan" the employees will put the pressure on the unions to talk. Without anyone really knowing what the plan is it is all speculation.
When are you all gonna realize there is no real plan?

This is what you will see when it finally comes out:

Farm out all heavy maintenance checks.
Farm out Utility.
Farm out Reservations.
More kiosks machines less agents.
Farm out remaining catering.
Farm out Ramp.
Farm out all component repair.
Farm out everything and anything they can.
Slash wages and benefits.
Layoff thousands.
And that is your prediction.......

Where have you seen it in writing that those "farm outs" are actually being asked for? If there is no plan, then where did your predictions come from?

Not saying that you may or may not be right.....but there is no proof that any of these things have been requested.

Speculate all you want.....but show me the proof.