The dead horse theory passed down from generation to generation by tribal Dakota Indians goes something like this: “When you discover you are riding a dead horse, the best strategy is to dismount”, according to a Whatsapp meme doing the rounds.

But the meme argues that in modern business, government and education, a whole range of far more advanced strategies are often employed, listing 14 which include buying a stronger whip, changing the riders, threatening the horse with termination, hiring outside contractors to ride the horse, appointing a committee to study the horses, providing additional funding and/or training to increase the dead horse’s performance, arranging a visit to other countries to see how others ride dead horses and so on.

Although sent as a joke and circulated among the aviation sector circles as such, the irony of the message did not miss anyone. Air India has long been considered a dead horse and it is one that has more recently moved into the Tata’s stable, who are now adopting many of the strategies mentioned in the meme with less than happy results so far. Many argued that almost all the strategies listed on the Dakota Indian meme and then a few more are at play at the erstwhile carrier Air India under the leadership of the new team put in place by Tata Sons, who bought the airline in October 2021 and took over the reins in January 2022 with very mixed results so far.

Air India CEO Campbell Wilson recently claimed that Air India had undergone a cultural transformation under Tata Sons, a statement that raised many eyebrows as many airline insiders argue that in fact things appear to have taken a turn for the worse at the airline in terms of employee morale and that merely changing the age profile within the airline has not changed the culture, ethos or lifted the morale of the staff.

Trouble with the two airlines in the Tata stable to be merged into Air India - Vistara and AirAsia - have also mounted as the D-day comes closer. In late March and April, Vistara witnessed a spate of cancellations as many of its disgruntled pilots - commanders and first officers - called in sick at the last minute, failed to show up for scheduled flights and generally played hooky. Around 20 percent of its 350-odd flights were cancelled on a daily basis, throwing the airline’s operations into disarray and attracting the ire of inconvenienced passengers. More recently, Air India Express - which has been merged with the parent company - crew went on mass leave forcing the carrier to cancel many flights, alleging “mismanagement”. With a change in the crew scheduling system. Air India Express was seeing many flight delays including a 15 hour delay with a flight from Riyadh to Kochi, where the pilot on duty found he wasn’t trained on the aircraft he was expected to command!

The parent company - Air India - staff too has been increasingly and volubly unhappy with the way the merger and other aspects of the airline turnaround are being handled including many of the latest senior appointments within the carrier. It hasn’t helped that many top positions in the airline have been filled by senior Tata people with scant airline experience.

Some of the discontent expressed on various fora is due to a unilateral change in service conditions and can in part be dismissed as laments of disgruntled staffers who might have been sidelined by the new management. But the bigger issue facing the airline’s management in the face is the fact that none of the changes made so far are reflecting in the final product on offer for fliers - domestic or overseas. “The proof of the pudding is in the eating. From all accounts and verifiable data available, the pudding is yet to show any discernible improvements”, argues Shakti Lumba, a former Indian Airlines senior commander and a sector expert.

A never-ending volley of complaints continues to come in on social media and otherwise via email and letters to the Tata chairman, top Air India management, ministry officials, on social media sites. Although occasionally and anecdotally, some passengers report a good experience on an Air India flight, this is more the exception than the rule. Moreover, it is usually restricted to the newly leased airplanes and the service on those flights. The regular Air India offering feels like “business as usual” and continues to have its tired feel.

The bigger question many are now asking is where the Tata’s appear to be going wrong and why the group seems unable to replicate its success in many other businesses in the airline business so far. That Air India will eventually turn the corner almost everyone takes for granted but many are sorely disappointed with the pace of change with the entire turnaround exercise reduced to a subject of banter among the industry and even fliers on social media and Whatsapp than anything else. Skepticism on whether the present team led by Campbell Wilson will be the final one to deliver salvation is also on the rise.

The foreign element

While several things appear awry in today’s context at the airline, one of the more worrisome factors is that a slow but steady resentment appears to be building up in the erstwhile national carrier against a stream of expats who have come in across functions in the airline of late. This is a problem that has dogged almost all private airlines in India, starting from Jet to more recently the market leader IndiGo, leading often to a “us” versus “them” approach in the carriers.

Bereft of talent and expertise in many critical aspects, to begin with, Air India had brought in a head of safety and security on a permanent basis since it was felt that this was an area where the erstwhile carrier was lacking significantly but slowly there is a steady trickle of foreign nationals across roles, although some are in a consultant capacity.

A recent Whastapp message written again in a lighter vein circulating among the airline and aviation circles asks the irksome question: ”If four Indian astronauts and a team of Indian ISRO scientists can successfully fly rockets into outer space, why do the Tatas and Air India need dozens of foreigners to fly a few airplanes on earth”, a question to which few have the answer. The message has a list of almost a dozen expat hirings and points out that in some cases the expats' wives have also been hired as consultants. “The question many within the airline are asking is whether India lacks talent in all these functions and couldn’t some of this have been avoided”, says an inside source. He argues that above all hiring the spouses is “very poor optics” and should have been avoided at all costs.

In response to a detailed questionnaire sent by Fortune India, the airline spokesperson said that :”Foreign nationals working as part of the Air India team form less than 4% of the total senior management team and less than 1% of the total employee base of the organisation” and that these “resources are playing a crucial role in the transformation journey” of Air India. It also admitted that there are “rare instances of a spouse of an expat being engaged by Air India in a consulting assignment. Herein, each spouse is fully qualified and experienced in the function they are consulting like cabin crew training or airport terminal planning/assessment”. On the matter of expat pilots, the airline spokesperson said that “the expat pilots are offered short term contracts and are being engaged to support the rapid expansion of Air India especially the Boeing 777 and 737 aircraft. The said pilots form less than 3% of the total base of pilots of Air India. Further, Air India is also investing in training to augment its domestic talent pool to cater to its emerging fleet of aircraft”.

In an earlier interview, the CEO had told Fortune India his moves so far here have been to recruit Indians for most roles. “The only exception so far was in the area of safety and security where I felt that bringing in international best practice from a major global airline was required. It helps bring in a new perspective that perhaps was not present or as strong before in the Indian ecosystem.  At a management level, let me state quite clearly that Air India is and will remain primarily an Indian company. It should represent India but it should also represent the world’s best. To the extent that we can do that by keeping it primarily Indian we must, but it still needs to be the world’s best as well”, he had said.

However, airline sources say that despite the earlier proclamations, there has been a steady trickle of expats joining the airline across functions and some of the spouses of the expats have been given roles as consultants, leading to even more heartburn. How this plays out remains to be seen but in the history of Indian aviation, there has always been a divide between the Indian employees and expats, with the former often resenting the better terms, salaries and incentives offered to the latter, leading to constant friction between the two groups. Air India is proving no different.

The external element

If expats are proving to be a thorny issue, so are the external private consultants that have been working on the turnaround almost from the word go. Almost since the takeover, consultants like BCG, PWC and others have been engaged to work on the turnaround and this too has been the cause of some resentment within the airline.

Senior management sources and commanders say that they are often in long meetings with 20-something consultants who don’t know their “elbow from their knee” but hold forth on how to make the airline’s operations more efficient. This hasn’t gone down too well with several who have spent their working lives in airlines. This issue has been a prickly one for the erstwhile carrier ever since former CMD Arvind Jadhav brought in external private consultants to help him make some strong and mostly much needed reforms in the carrier, which at the time led to plenty of disgruntlement for the airline staff. 

An airline spokesperson confirmed that global consulting organisations have been engaged to “evaluate, benchmark, recommend and successfully implement certain functions/ aspects of a global airline”. These include performing internal audit and strengthening of processes/procurement (PWC), full services carrier integration planning/fitment (BCG), process and operating manuals harmonisation across 4 airlines (OW CAVOK). An airline insider said that in many aspects, Tata Sons found the systems, processes, rules and procedures adopted and practiced by Air India were not only outdated but highly inefficient and to streamline these across four airlines - since the final Air India will be a merger of four different entities - outside expertise was unavoidable.

A few greenshoots visible

In a world where an increasing amount of information is being exchanged on Whatsapp, a  recent meme that circulated as a joke in aviation circles was one where a check in counter staffer tells the customer that the amount being charged by the airline was in fact correct since the airline was now charging for emotional baggage. This too did the rounds with some arguing that this was the shape of things to come (with low fare airlines charging for anything and everything under the Sun) and the others arguing that the meme holds for everyone except Air India which appears intent on maximising expenditure, not revenue! Airline insiders say that the management appears to be on a spending spree and the large spends are consistently justified on the grounds that “Air India - in keeping with the Tata tradition and emphasis on excellence -  must offer nothing but the best”.

Consequently, recent numbers say that the airline has seen a rise in losses despite doubling in revenue. As per data submitted to the regulator DGCA, the airline registered a sharp increase in operating revenue - from ₹17000-odd crore to ₹31,377 crore in the year. But with operating expenses outstripping revenue, the airline remained in loss. In its first full fiscal year under Tata ownership, FY23, the airline reported a loss of ₹11,381 crore, up 18.6% from the previous fiscal year, FY22, which had a loss of ₹9,591 crore after accounting for write-offs and exceptional items.

While the high and growing expenses or extravagance as many refer to, it remains a cause for concern, there are some greenshoots visible for consolation. The airline improved its aircraft hours flown dramatically: up from 2,382 hours flown per aircraft in 2021-22 to 3,661 per aircraft in 2022-23. With a fleet size of 118 and total employees by end of FY23 at 14,205, the aircraft-employee ratio of the airline was 120. An improvement can also be seen in the airline’s passenger load factors in 2022-23, third highest for domestic after SpiceJet and IndiGo and second highest for international loads after SpiceJet. The loads carried by the airline on international flights are marginally higher than IndiGo, a feather in the airline’s cap by any yardstick.

The service element : the long and short of it

What remains the biggest concern is that the flow of complaints against Air India’s short haul or domestic offering and in several cases, the long haul flights has failed to abate (see visuals on complaints and emails). While occasionally and anecdotally, some positive feedback does come in - unlike earlier where it was almost always only complaints - the overwhelming majority still find the service and various aspects of the flying experience very underwhelming.

On domestic flights,  many complaints come in on the airline's boarding procedures and process across airports. “It often feels like there is no system in place and the boarding procedures reflect the whims of the officer on duty on that particular day and time”, says a former joint secretary of MOCA. His experience is echoed by many frequent fliers who say that the boarding and passenger handling especially in situations of delay leaves a lot to be desired.

Any criticism of the airline’s offerings are quickly blamed by the management on “old, poor quality aircraft” and while this may be partly true, it doesn’t explain why the aircraft are often found unclean or why there is no semblance in the airline’s boarding procedures. “There is no clear leadership of the airport ground services vertical”, says a senior airline source and this he says explains why the chaos prevails.

Overall, senior commanders and insiders say that the focus of the new management is excessively on introducing “more and more apps” instead of the core operations : scheduling, rostering and improving the on board offering. “It almost feels like these aspects have been given up on as lost causes till the new airplanes come in”, says a senior commander.

“Air India’s on time performance and its handling of the crisis at various airports in the last fog hit winter season is another pointer that the new management is yet to find its feet or prove its mettle '', argues a former CMD of the airline. He says that in times of crisis the actual operations and functioning of any airline is tested and this did not augur well for Air India in the November-December fog hit situation, revealing inherent weaknesses in the running of the airline. When the going gets tough, the tough seem to have failed to get going, he adds, in a lighter vein. He adds that the extent of how much things spin out of control is usually a reliable indicator of how far the management is in control.

A second problem, he highlights, is the tendency of the top management to manage almost everything from the “confines of their glass and chrome cabins in the head office” and almost never step into the battlefield to see how the troops are performing. “Air India has always had this affliction where the boss almost never drops in at the airport or city office to see how things are progressing on the ground. This has been a problem that has dogged almost all the airlines including the market leader IndiGo, more so once it reached its monopoly position on domestic routes : the creamy layer tends to lose sight of the ground reality.

As The Noose Tightens

Although anecdotally some improvements have been reported in the on board experience - especially on long haul flights with leased airplanes, Air India’s service offering has registered no discernible change in many parameters passengers judge airlines by.

As a result, many are skeptical of the ability of the present management team led by Campbell to pull off the entire exercise. Top management insiders say that while Campbell might have the best intention, he lacks the requisite experience to pull off something of this magnitude and scale.

A top management source makes three main points. One, he argues that Campbell himself has primarily been in charge of a subsidiary of a bigger mothership in a cultural environment where authority is easy to enforce. He says that the magnitude, complexity and environment here in India would be a challenge even for someone who had dealt with complex mergers in the past, let alone someone who has never had this kind of experience. “From a structured thinking and environment where your calendar is fixed six months in the future to be air dropped into the chaos of the Indian aviation working environment, the transition itself is not easy”, he points out.

Two, he feels the rope available from the shareholders - Tata Sons - is also shrinking now unlike a year ago. “The shareholders have displayed immense patience and unless they see some delivery on either the operations front or the bottomline, justifying this kind of spending might prove hard for the turnaround team”, he argues. In particular, complaints of basic cleanliness of aircraft or the quality of food are “inexcusable”. He feels there is already a fraying of the patience levels emanating from the top and the constant barrage of complaints received by all quarters don’t help matters. He further adds that he would not be surprised if the present team led by Campbell Wilson is not the one to deliver the “final goods” for the group, a sentiment echoed by many observing the developments. A Tata Sons spokesperson declined to comment on a detailed questionnaire on the turnaround of the airline including queries on challenges at a group level.

From a passenger point of view,  Tata's failure to present a viable and much anticipated alternative to IndiGo on domestic routes and to foreign carriers like Emirates, SIA and others on foreign ones remains a matter of great dismay and regret. With the market leader IndiGo rapidly gaining a reputation as a big bully, taking fliers for granted, passengers looking to jump ship are growing on a daily basis. The sooner Air India gets its act together, the better it will be for all concerned including perhaps its biggest rival. As the saying goes, winning isn’t getting ahead of others, it is getting ahead of yourself.

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