The Tata Group has been tightlipped about its plans for Air India after the airline was taken over by the conglomerate last week. I can understand the reluctance in speaking to the media before completing the acquisition. At this moment, the airline is being run by a management committee, with many people from the old guard and people from Tata’s various other companies on deputation to Air India.
Who will replace JRD Tata?
Air India was not always in chaos. While it was founded by JRD Tata, the scion of the Tata group, it was nationalised as a national asset somewhere in 1953. However, JRD Tata was retained to run the airline. As India’s first pilot and the honcho of Air India till 1977, when the Government of India fired him from the job, JRD Tata set very high standards for aviation in India and around the globe.
Since JRD left, the airline has been in freefall. It used to make money, but the botched merger with Indian Airlines has caused it to become the bloated carrier with no profitability to speak of. The Times of India ran a story yesterday about how Alex Cruz could run for Air India’s CEO.
Alex Cruz, born Álex Cruz de Llano, was the former chairman and chief executive officer (CEO) of British Airways and former CEO of Vueling, before stepping down from his duties in 2020. As a British Airways customer, while it was run under Cruz for the longest time, I’ve seen both sides of the coin.
In summer 2006, Cruz became the founding CEO of Clickair, a low-cost airline. This became part of Vueling in July 2009: Spain’s second-largest airline with 163 destinations.
In November 2015, Cruz was hired by the CEO of International Airlines Group, Willie Walsh, as the next CEO and chairman of British Airways, to begin in April 2016. International Airlines Group, the owner of British Airways, also owns Vueling. Cruz succeeded Keith Williams.
In 2016 Cruz made 700 British Airways employees redundant when he closed down the airline’s computer department. He outsourced the company’s IT to Tata Consultancy Services, a part of the conglomerate where he might be working in the future, and the company, which essentially generated the cash flow for the acquisition of the ailing carrier.
British Airways witnessed an unauthorised hack in 2018, leaking the data of over 400K BA customers into unauthorised hands. The regulator fined BA GBP 183 million for the breach. However, in October 2020, the fine was reduced to GBP 20 million. There was also a massive IT Meltdown under his charge, which took a few days to resolve, and customers couldn’t fly as a result.
Not just that, under Cruz also became the guy leading the charge of the airline at a time when the airline steered towards charging for F&B in the short-haul economy, although I have to admit the paid food did taste good.
On the other hand, it was under Cruz that the new Club Suites product was launched, bringing British Airways back into the consideration set for a serious, this era, premium product.
In April 2020, during the global collapse in air travel brought along by the COVID-19 pandemic, he told British Airways’ staff that he had set out plans to make up to 12,000 of them redundant. In 2020, a succession plan was put in motion, where Sean Doyle, the CEO of Air Lingus, also an IAG Airline, was appointed to succeed Cruz as the CEO of British Airways. Cruz was stepping down immediately!
Cruz has denied that he was ever approached for the top job at Air India in an email response to the Deccan Herald.
Who could replace JRD Tata?
While JRD dates back to when I was not born, his legend continues. There is enough and more to know about how he aimed perfection at Air India. However, the airline business has changed since Air India was under the Tatas the last time around. Today, the premium business from India has been parted out to Emirates, Qatar Airways and Singapore Airlines, with the emergence of the super-connector model, and these airlines will give a tough fight to Air India while it tries to resurrect what is rightfully its own.
So, whosoever will be appointed won’t be able to deliver any quick results but needs to be around for a good decade or so to see through any turnaround on this assignment. I’d believe the first year or two would likely be spent just agreeing upon and putting up a long term strategy in place and bringing the service standard to hygenic levels (read my AI 787 report to know what I’m talking of).
Ideally, the candidate would have substantial exposure to the global aviation business and clued into the Indian customer? We’ve seen some excellent people enter Indian aviation after working abroad, such as Ronojoy Dutta, who is leading IndiGo now, and Vinay Dube, who really did not get an opportunity with Jet Airways for a turnaround and is now busy establishing his airline. For one, I’d highly hope that Air India’s new owners go for someone with a proven track record at a level below CEO so that they can bring their experience onboard and don’t have the burden of expectation follow them.
When I asked this question on Twitter, honestly, all sorts of answers came back. Including some fine gentlemen such as Sir Tim Clark and Alan Boyce, both of whom I hold in high regard but who are gainfully employed elsewhere. Just follow along with this thread.
Since there is still no done deal for the @airindiain CEO, throw at me the names you’d like to be looked at. Only serious ones please. I’ll go first, Pieter Elbers, who is moving on from KLM. CC: @TataCompanies
(I also know headhunters who could start the conversation 😉)
— Ajay Awtaney (@LiveFromALounge) February 3, 2022
But what the Indian media is not talking about is an able second line to work with the CEO. The current Air India management team is full of people who joined the airline from internal promotions and might be in good hands, but at the top, the airline needs to re-assess all the employees and do a fitment for all sorts of roles.
Here are some critical positions that will be needed to be created/filled at Air India to be able to deliver an airline in good shape over the years:
- Chief Commercial Officer (currently run by Director (Commercial))
- Chief Operating Officer (presently run by Director (Operations))
- Chief Financial Officer (currently run by Director – Finance)
- Chief Technology Officer
- Chief Strategy Officer
- Chief Human Resources Officer (currently run by Director (Personnel))
- Chief Marketing Officer (Can we bring Bobby Kooka back?)
- Head of Engineering
- Head of Flight Operations
- Head of Guest Experience
- Head of Inflight Services
- In case Air India intends to go for leasing aircraft in the future, a head of fleet management.
Honestly, the CEO is just one cog in the wheel. In this case, I believe thoroughly in the idiom that Team Work Makes the Dream Work. This time around, I hope the right people are chosen, and the group spends a lot of time talking to the potential candidate before an appointment. Oh, and don’t just look at the 50+ age group as well. Maybe someone younger and with potential?
And in case someone from the Tata Group is reading this, please don’t let TCS do the IT implementation for this project. Just look at the B2C IT Implementations at IHCL and Vistara, and you will understand what I mean. Otherwise, give me a call, and I’ll come and talk you out of it.
The grapevine has it that Alex Cruz is being considered for the top job at Air India. But Cruz denies it. Earlier on, the name of Fred Reid was doing the rounds as well. Whosoever gets the job is up for a tough ask but will get an open chequebook to get it done. Unfortunately, the Tata Group no longer has a grip on the aviation business as they had many decades ago, and they will have no choice but to bring in experts to run the show.
What do you think about the qualities that the new Air India CEO would likely possess?