Travel Counsellors Chairman and founder David Speakman gives his own personal thoughts on the effect of the recent Qantas strike on the travel industry;

I had arrived in Melbourne just before midnight on Wednesday fortnight ago, just missing the threatened walkout by customs staff at the airport.
I had made the journey to Melbourne to make sure our new software and the relevant processes were implemented efficiently throughout our global offices, and I always try for an excuse to visit Melbourne.

Thursday and Friday I was in the office a little bleary-eyed and tired, so Saturday was the day to rest, catch up with emails, sleep and watch the Derby. About six o’clock, Sky News announced a live press conference with Alan Joyce, CEO of Qantas. Pricking up my ears, well it was travel, his broad Irish brogue forced you to listen a little more closely he announced with as much gravitas as he could muster, live on television, with me watching, in Australia, that Qantas was to be grounded. He actually said it twice for extra gravitas, just in case we hadn’t taken it in. Within minutes I had an email from one of our top business Travel Counsellors attaching a written statement from Qantas from their website and within seconds I had forwarded to our offices and all 1200 Travel Counsellors throughout the world.

It was a bazooka moment, he had risked all, his reputation, his job, the airline, now an Australian icon on this moment. It ranked with Lehman Brothers going bust in the US – not in size but in shock value to Australia. It was equal to Coca Cola killing Coke or Disney killing Bambi. It will be a defining moment for the “Flying Kangaroo”.

Threats of Union action had been met by Qantas changing schedules and inconveniencing customers. Unions then decided not to act, but the damage was done. The Unions had threatened similar disruption could last up to a year.

My Dad was a coal miner for 47 years and hated strikes but all that a walkout would do in the coal industry is reduce the production of coal. Striking or threatening to strike against a brand has far bigger repercussions. Brands only thrive on trust and trust is built on credibility, reliability and frequency. Qantas reckon that this Union action was costing them $15m per week, but that is only half the story. A brand builds its credibility, its ethos, its beliefs and values over a lifetime so cost of uniforms, how they are worn, how the staff present themselves, how tidy they are, how they respond, how they place the knife and fork, how they make announcements and how they fix things when something goes wrong are all part of the ethos of a company. So any damage to that brand and its image undermines the cost of building that brand. In addition Qantas was seeing forward bookings evaporate. The future of the airline was in doubt. Last year Willie Walsh of British Airways fought a similar battle with the Unions.

But Joyce didn’t stop by grounding the airline temporarily, he insisted that it would not fly until the Unions agreed or were forced by the Government to terminate the industrial action, not just suspend it but terminate it.

From the Union perspective it wasn’t about a pay rise, though they did want one, it was about security of employment. They believed that the airline’s plans to compete in Asia may lead to jobs, such as engineering or flying, being taken from Australians and given to staff employed overseas. Just as manufacturing jobs have left the shores of developed nations to cheaper labour cost countries it’s not surprising that aviation jobs should not have been exported bearing in mind this is the true international business.

As the saga unfolded, claim and counter claim was made. Anyone who has run their own business with all the pressures from within and without must have empathised with Joyce. If he didn’t expand then Qantas would die, if he did he would have to compete with airlines from Asia and the Middle East which had cheaper costs and at least as good service. The same had happened earlier this year with British Airways. No business can exist in a vacuum. It would be great if there was no competition but that is not how the real world works. So you have to adapt, you have to change with the circumstances.
The Unions justified their hit and run actions as not being serious enough to warrant the reaction of Qantas. They felt justified in creating uncertainty with the travelling public as it did not close the airline, it affected few and showed what they could really do if they went to a full blown strike.

A Union representative from the Qantas Pilots body then mentioned that they had taken no strike action for years, but admitted they wore red ties and announced over the aircraft PA system that they wanted Aussie pilots to fly and have job security at Qantas. They were wary of the company bringing in cheaper non- Aussie pilots. But in those few words the problem is encapsulated. Workers feel they have the right to denigrate their own company and brand and therefore reputation. They feel justified as its not full blown industrial action, it’s harmless!

Research shows that customers respond to companies that win awards for looking after their staff. So the converse is also true, customers don’t like companies that don’t look after their staff. So the Union displaying contempt for their boss or Pilots stating that the boss has it all wrong is not going to help the brand one little bit.

Whilst the actions of the pilots are noble, they are also based on self interest. Far be it that the airline stays Australian, with Australian staff. Australians returning home to Australia want to start their Aussie experience on the flight. Visitors also want that Aussie experience to start on the flight. But management know this, it’s in their interests to push the differentiation not to ignore it. But what Joyce cannot ignore is the increased competition on the global stage. Shareholders and the Aussie pubic should rejoice that he has asserted that Qantas management will run Qantas and not the unions. He is paid to make the big decisions and there will never be a bigger one than he made last month.

The airline must now win hearts and minds to convince staff that their jobs are safe with Qantas, that the ethos and values will be retained if possible. The staff in turn must understand and believe the airline is in good hands. The pilots should ditch the ties and their self defeating announcements. Management have a right to expect it.

And if staff feel that their future is not safe then they should get out and pursue their own destiny with unemployment at 3% then jobs are plentiful. Qantas is a special brand in Australia and it should be left to the people who investors trust to look after it.

Loyalty from staff to company and company to staff is essential and it reminds me of the quote from Elbert Hubbard, the American Philosopher.
“If you work for a man, in heaven's name work for him. If he pays you wages which supply you bread and butter, work for him; speak well of him; stand by him, and stand by the institution he represents. If put to a pinch, an ounce of loyalty is worth a pound of cleverness. If you must vilify, condemn, and eternally disparage, resign your position, and when you are outside, damn to your heart's content, but as long as you are part of the institution do not condemn it. If you do that, you are loosening the tendrils that are holding you to the institution, and at the first high wind that comes along, you will be uprooted and blown away, and will probably never know the reason why.” Elbert Hubbard