CEO Interview - Dealing with Diversity
Christine Ourmières, CEO of CityJet, says good operational practice is essential when you have offices in four major cities
What is your strategy for the year ahead? Are you expecting a double-dip recession in Europe?
The year ahead will be very difficult for all airlines. We’ve already seen some casualties– Spanair and Malév, to name two. It is no real surprise as the global economic environment is very tough.
At CityJet, we will concentrate on our core business. We will invest in our strengths, which are centered on a robust network from London City and a comprehensive marketing strategy. For example, we have a few more destinations in France on the cards. It’s all about the customer, really. We have to make sure we deliver the best possible service so they continue to fly with us. As a small company, we’ll also continue to outsource, but we’ll keep a very close eye on cost and quality.
But it’s true we’ll be holding fire a little bit because the good news is that we expect 2013 to be better. So we’ll spend 2012 preparing for that and working out what we can do when the market improves. Really, everything boils down to the business case. We’ll expand when the time is right and when our sums say it will profitable to do so.
You have offices in Antwerp, London, Paris, and Dublin and you hub out of London City Airport. Does the diversity of cultures and locations make management more difficult?
It’s all about building a company culture. That provides the cohesion we need. Ours is a very traditional culture; we believe in being customer-focused. When you have a clear direction like this, it is more important than the language being spoken at a particular meeting.
You do need strong leadership as well though. The human touch is important so that staff always have someone in management that they can approach.
But you can’t harmonize everything. There are differences in every country, such as taxes. These vary from country to country and that has a social impact on the way the company operates. It’s about knowing where you are doing business and respecting that environment. You need your employees to have a strong skillset and the knowledge to deal with the diversity.
These things are easier said than done but it is possible and plenty of companies make it work perfectly well.
How does Air France influence CityJet strategy?
We are a 100%-owned subsidiary of Air France. They have a member on our Board so, of course, we work very closely with them, and they are very supportive of us on the operational and commercial side.
But it’s important to point out that the Chairman of the Board is our founder, Pat Byrne. I think it’s fair to say he still has a significant influence on the way the company is run. If you look at our marketing strategy, for example, you will see it has a very independent feel, which speaks more of the unique CityJet brand and service. Ultimately, the decisions taken are about developing CityJet, not developing Air France.
Can regional operations and smaller aircraft survive a forthcoming capacity crunch in Europe?
Actually, given that hub airports in Europe will find it difficult to expand, I think regional services will become more important. We know that London Heathrow will find it very difficult to accommodate more flights without a third runway, for example.
One part of our business model is acting as a feeder for major airlines, and Air France in particular. In theory, that could become more difficult as slots become scarce but the majors will always need these feeders for their long-haul services. There will always be a space for us. The second part of our business model is expanding our own service/brand at London City. We’re developing good relationships with other regional airports in Europe so we can expand our own London City network. As the hubs get crowded, regional destinations will become vital.
Passengers like our aircraft too—the Avro RJ85 and the Fokker 50. The aircraft have leather seats and a nice amount of leg room. The feedback from our passengers is very positive.
So we think the regional service is one that is much appreciated and has a strong future.
Are you happy with London City’s services and charges? And are there any developments you would like to see?
We are one of London City Airport’s biggest customers and I think we work very well together. That’s the way it should be. We bring customers to the airport and a good airport brings customers to us. In effect, we market each other.
But London City is not a cheap airport and we have plenty of discussions about that. Lower charges would make an enormous difference to us. You only have to look at the historical profit margin of the airline industry to understand why.
We do want to see CityJet services at London City develop though. In particular, we would like to see some development in the departure lounges and at the gate, ultimately improving the CityJet product.
Are current security checkpoints ruining the notion of quick, easy travel for regional operations?
We offer a very short check-in time, just 15 minutes. In this respect, CityJet certainly benefits from operating out of London City as the security process runs smoothly and efficiently. Generally speaking, there are very few queues and we’ve worked with the relevant stakeholders to ensure that remains the case. So it’s a very different situation to operating at a major hub that is generally much busier.
The overall security process, however, must be constantly improved to ensure everyone has the safest experience possible and moving to a risk-based approach and utilizing professional security experience is quite correct. Anything that can be done to improve security and the customer experience has to be a good thing.
How important is ground handling to your business model?
Ground handling is a really important part of operations, especially for us. Our ground operations are performed by the airport. We depend on quick turnarounds and a good on-time performance record. I’m pleased to say that both aspects are in excellent shape so we have no complaints.
The only time there may be an issue is with extreme weather conditions but that is true of a large number of airports. We’ve actually decided to invest in a deicing machine at Dublin to help matters there. We’d prefer not to have to buy the equipment, of course, but it’s not always possible to make these arrangements quickly at an airport, particularly during times of extreme weather. We wanted to have a solution, not a problem, so we bought the machine.
How important is modern technology, including social media?
Technology must have a purpose. It has to improve some aspect of operations or customer service. It isn’t a solution in itself.
But I do think social media is important and we have invested heavily in this platform over the past year. So far, the customer feedback has been very positive; they really appreciate a quick response from us. When there is a problem, such as bad weather, it’s far better to be in constant contact, and at all contact points.
We’ve developed what I believe is the first Twitter concierge service in the industry. Through this service, we provide advice to customers on various aspects of their travel arrangements at our many destinations. For example, we have experts giving opinions on the best vegetarian restaurant in Paris or where to go shopping in Dublin, or what might be showing at the 02 Arena when they are in London.
We’ve also updated our applications for Android and Apple equipment. It’s obvious from walking around London City Airport that a lot of customers use smartphones, iPhones, and iPads, so we need to communicate with them in a way that is consistent with their lifestyle. It is definitely working. The customers who have downloaded the apps are among the most loyal. A great app should inspire great loyalty.
How will the European Union Emission Trading Scheme (EU ETS) affect the airline?
The environment is a sensitive issue, especially the EU ETS. We’ve seen some very strong comments from China about it. As an airline, we have to comply with the scheme. We have no choice as it is the law and we have already accounted for the cost of the EU ETS in our budget.
But the cost of compliance must be acknowledged. At the moment, it is distorting competition and we don’t have a level playing field. This must be taken into account. The EU ETS is a business argument as much as an environmental one.
And the overall environmental mitigation steps being taken by the industry should be recognized. At London City, there is still a curfew. There are no flights on Saturday afternoons and Sunday mornings. The airport is studying the ruling and measuring its emissions and noise footprint. Technology has moved on since the curfew was imposed, even though London City is still relatively new. The industry has worked hard to reduce its environmental impact.
What attracted you to aviation and why are there so few women in aviation senior management?
I have a Masters in aeronautics, so going into aviation was a logical progression. For me, though, it isn’t just logical, it’s a passion.
I think when you look at the background of most of the senior management in aviation, you’ll see they have operational or technical experience. At the same time, very few females are in high-level technical courses in universities. In that respect, things haven’t changed a lot in the past 20 or 30 years. In France, only about 10% of engineering students are female. And in the industry, about 3% of pilots are female. So, as long as airline boards prefer a strong operational or technical background, there won’t be too many female CEOs in the foreseeable future.
Having said that, I think it’s clear that the industry is evolving. We’re seeing more people coming from outside of the industry. The focus is shifting towards customer service, and skills and experience in those areas are becoming more relevant.
For example, we have a new CEO at our parent company, Air France, who doesn’t have an aviation background.
I do know, however, that he’s spending a lot of time learning about the industry. Aviation is a unique industry that I don’t think is easy for an outsider to walk straight in. Any leader has to be comfortable with the way their company operates. I know that there is a significant amount of specialist information in my every work day but you don’t have to understand all of it and you do learn quickly. An aviation background is, of course, a big help.
For more information, visit www.cityjet.com