by Chris Banescu –
The Boeing 737 MAX disaster provides us with an opportunity to evaluate some leadership qualities of top executives at two major U.S. airlines, Southwest and American. The CEOs of these corporations have chosen fundamentally different responses to their pilots and employees who were negatively affected by the extended grounding of the 737 MAX planes.
One CEO shows himself to be a man of character and integrity. The other one not so much. Southwest Airlines’ top leader, Gary Kelly, is treating the company pilots fairly and decently. American Airlines’ CEO, Doug Parker, could care less about the concerns of their pilots.
Gary Kelly, Southwest Airlines CEO, is actively working to help the company’s employees and pilots
Earlier this year, all Boeing 737 MAX planes were grounded following two deadly crashes that killed 346 people. The popular new plane was banned from flying worldwide after it was confirmed that faulty flight-control software played a major role in both crashes. Since March of this year, hundreds of Boeing’s 737 MAX planes have been sitting on the ground, causing significant disruptions and problems for the airlines who fly these planes. Thousands of flights have been canceled and passengers have experienced extensive delays, many inconveniences, and significant travel disruptions due to this mess. Additionally, thousands of airline employees and pilots have also been adversely impacted by grounding of all 737 MAX planes, with many losing pay as a direct result of the many flight cancellations in the last six months.
Southwest Airlines has 34 MAX planes it stopped flying. American Airlines has 24 MAX jets it took out of service. Both airlines have lost hundreds of millions of dollars due to Boeing’s design defects. However, each company’s CEO has handled the crisis differently.
Gary Kelly, Southwest Airlines CEO, is actively working to help the company’s employees and pilots, and insure they will be compensated for the missed pay:
Southwest Airlines and Boeing have been discussing reimbursement plans and Southwest CEO Gary Kelly wrote in a memo that his airline is “looking at ways to share proceeds as appropriate with all of our employees,” according to WFAA in Dallas where the airline is based.
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So how much money could the employees receive? Southwest had been using 34 of the Max planes which have been grounded since 2019 creating a financial impact of $225 million in the first half of 2019 alone.
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With approximately 59,000 employees at Southwest, each would receive a $3,813 if the airline decided to split a $225 million payout evenly.
On the other hand, Doug Parker, the CEO American Airlines, has not done anything to help the company’s pilots or employees. Instead, the head of the airline’s pilot union, Captain Eric Ferguson, is hounding Parker to convince him to follow Southwest’s example:
“The effect has been real and calculable,” Allied Pilots Association President Captain Eric Ferguson said at a conference for independent pilot unions in Plano, Texas.
Ferguson said APA pilots are seeking a commitment from American similar to one made by Southwest Airlines last month when Chief Executive Gary Kelly promised employees to share any reimbursement from Boeing over the MAX grounding.
a man’s true character is made manifest in times of crisis
A man’s true character is made manifest in times of crisis. The Boeing 737 MAX debacle has given us a brief insight into the real character of two different airline CEOs. It’s evident that Gary Kelly (Southwest Airlines) is the better man of the two. He’s shown himself to be a genuine leader who places the needs and interests of his employees at the top of his priority list and acts accordingly. Doug Parker (American Airlines) comes across as yet another self-centered executive who’s disconnected from his employees and could care less about their concerns or well-being.
Interestingly enough, Gary Kelly earned $7,726,455 in 2018 as CEO of Southwest Airlines, while Doug Parker earned $11,999,517 in 2018 as CEO of American Airlines. Proving once again, that when it comes to some executive compensation packages, quality of character, integrity, and ability and effectiveness to ethically lead, motivate, and inspire employees bears no relevance to an executive’s salary.
