The airline industry is regarded as being one of the toughest in the world. The cost of the core asset – a metallic tube that is identical to the ones all the competitors have – gets more expensive every year and devalues immediately. Volatility in fuel prices and hedging options means having a PhD in Mathematics is almost a pre requisite for management. And then… a chicken sneezes in Bangkok or a volcano erupts in Indonesia and the whole industry just stops flying over night. In 2013, shares in Chinese airlines overnight dropped 15% on the outbreak of Bird Flu!
So, how does one CEO, in under 5 years, positively turn around an organisation to a position of a 40% increase in staff; a doubling of the aircraft fleet; a 25% market share (from a standing start) of the valuable business class market and, most importantly, winning the coveted Ranstad award for being “the business where most people in the country want to work”?
On Monday night John Borghetti, CEO of Virgin Australia Group, spoke at a Business School event where he outlined his way of leading an organisation. The audience made up of students, staff and Alumni of the MBA program were treated to a candid insight into this story. Here are five insights I noted.
Every coaching assignment, whether it be with an executive or a team, will at some point circle around to the topic of confidence. True confidence, not the overplayed type that is really only a cover for feeling inadequate or insecure, is a sexy, appealing trait that serves people and organisations well.
Recently released research from the University of Melbourne shows what many people instinctively knew, is that confident people earn more money and have stronger career opportunities than their peers who are less confident. Lead author Dr Reza Hasmath, from the University’s School of Social and Political Sciences, said the findings also shed new light on previous studies that argued the existence of ‘erotic capital’, meaning better looking people are more likely to get ahead in the workplace or studies which indicate taller people earn higher salaries. However, the research shows that higher confidence levels — which may be a by-product of attractiveness and height — make all the difference,” said Dr Hasmath.
“We have done a series of 360 debriefs and ran one to one coaching sessions but don’t seem to be getting any traction in developing our leaders. Can you help”?
This recent conversation was with the Head of Talent in an international infrastructure business and of course his despair is not unusual.
According to a 2012 report issued by Bersin and Deloies over $14bn per year is spent on leadership development programs in the US alone. Yet Matthew Gitcham from Ashridge Business School in the UK found only 7% of organisational leaders believed their organisations were adequately developing them for future leadership roles and responsibilities.