Hollow Victory

On the face of it, BA bloodied the nose of Unite union yesterday in the court ruling on the validity of the staff ballot to strike, making the planned 12 day stoppage over Christmas illegal.

While that may save Christmas for many BA passengers who had booked up with the airline, it is a hollow victory for the management. The staff had voted 9 to 1, that's 92%, in favour of strike action. BA's staff is overwhelmingly dissatisfied with its management to the extent it has taken the unusual step to strike. The warning bells are there that BA's tactic may seem like a victory in a battle but the war-proper has only now begun.

The union has quickly struck back to say they will re-ballot and put the case once again, properly, to the staff and now BA has the longer term uncertainty of when the real strike will begin. For BA passengers, there is now a hiatus and uncertainty - who would bother booking up new flights with BA when they don't know when the strike will be?

In fact, an argument could have been that at least management knew when the strike would be and they so could act to contain the damage - indeed, it could have worked the emotional blackmail of stranded passengers and disrupted Christmas's for many people to its advantage. But no, it just had to take a swipe at the union. In doing, so they have once again bashed the face of the staff who are so incensed at the company's actions that they were willing to kill Christmas for many customers.

BA don't get it - the staff are furious and want a compromise. BA just seems hell bent on killing its own business. As Robert Peston points out on his blog today, there are many serious issues which BA faces, not least that the hole in its pension fund is now valued higher than the worth of the company - and so it focuses on disenchanting its staff and compromising its revenue stream. They could not be in a worse place as they attempt to buy and integrate another failed airline, Iberian.

I have said it before and will bore you with it again - this is a management in no-man's land. It is killing its own business and seems to think that is a good thing. Change at the top is very urgently needed instead of the dreamer who runs it now.

Working Nine To One

Willie Walsh, CEO of BA, is a perennial target of mine but, in fairness, he makes that easy.

I have described BA as a strategically lost company before and there has never been a worse moment for what was once the 'World's Favourite Airline'. It is being squeezed by low budget airlines at one end who consistently out perform expectations in terms of profit and by higher service airlines at the other end who focus on their niche market and make enough to survive. BA's two major 'strategic' moves in the last year have been to make a series of reactionary, 'knee jerk' slashes of its costs, with no real impact or direction, and then make arguably its biggest blunder, to buy another airline in the same strategic 'no man's land', Iberian.

In all of this, the backbone of the company has stuck with Walsh until yesterday when the staff who man the airlines voted nine to one in favour of a strike action, to leave the course of action in the hands of the union, Unite. Walsh seemed to suicidally want to fight his staff, having asked them to make sacrifice after sacrifice to the point when they finally made their stand over the 'dumbing down' of their roles. The company now faces a 12 day period of strike action over one of the busiest travel times of the year - Christmas. It could not have been a worse result for BA - it could not have been a more stupid move by management.

The recent BA history is a litany of business cock ups. Terminal 5's opening was about as inspiring as it got as a superb terminal was project managed in a schoolboy fashion, stress testing the unprepared systems with hordes of real passengers. Then we had the series of staff cost cuts that played with the fantastic loyalty of the staff only to shaft them by trashing their worth in the latest move. In between were two attempts to buy a dying airline in Spain, the first ending in farce as BA's market worth fell below that of their target at the crucial moment, and the launch of a business class only airline out of the City Airport with a capacity of just 32 seats which pandered to the whims of rich bankers when two similar services to the US had failed less than a year earlier.

The message in that service alone could not have been worse to staff, the shareholders and the public - BA was prepared to service rich bankers ahead of paying its staff with a service already proven to be unprofitable by two other companies.

I don't know what the shareholders think of Walsh as they seem to support him grimly, but we now know what the stakeholders think. The once highly vaunted air crews of the once great airline have voted categorically to fight him - and you know instinctively that he has lost his best weapon to survive because he has undervalued and disrespected it.

It's not as if you could not see this coming. It has been a quick process of losing the confidence of the staff and laying a scene for the battle. Walsh calls the action of the union 'cynical' but that's what you get when you lose the support of your staff. From a union's point of view there is no point striking when the airline does not fly - their tactics are generally to hit you were it hurts most as it quickly sparks negotiation, at a battlefield very much with the terrain in their favour. There are no surprises that this is exactly what has happened and it was about as obvious as the cock up at Terminal 5 as it all unravelled.

BA seems to be managed by fools. The strike action is not at all helpful. We can see the Royal Mail happening all over again with the one tragic ingredient for Walsh - the customers do have a choice. There are other airlines to fly - in fact, to Walsh's edification, the skies and airports are full of them. His strategic plan has been a series of schoolboy responses to a business game exercise.

I would say that BA needs a rapid change at the top to survive.

Thatcherite Britain Returns

Stubborn, suicidal union versus clueless, stoic management, backed by a Thatcherite Government.

Sounds like the 1980s? Nope, welcome to Britain 2009. In the face of multiple strikes which to be frank have seemed to have made no difference to an already sporadic service, Royal Mail's Golden Boy multi-million pound management team came up with a brilliant idea which will really solve the problem. Hire 30,000 temporary staff.

Well no doubt the Government are happy on two counts - 1) their stoic Thatcherite stance in the face of leftie Unionism is holding steady and 2) 30,000 off the dole queue will do no end of good to the tragic unemployment figures. It could have been a plan from the Iron Lady herself. But it is her deputy - Lord Mandelson who plays this Iron Lady. Calling the strike suicidal, he wears the mantle of free market capitalist well, even down to saying he has agreed to arbitration when the Union says he hasn't. Perhaps the letter telling them so was in in the post.

It's a really pathetic situation. All across Europe, the old public owned postal behemoths have largely carried on functioning, but for us we have a combination of bright ideas to sell off the profitable bit and leave the millstone around the ever welcoming taxpayers' necks. As Sir Howard Davies said of us all recently, we have no idea of how bad our crisis is and sure enough, as our ever generous cheque book keeps on paying up, we have no idea how much such stupidity will cost us in the future.

Mandelson loves playing God. He loves sucking up to rich Adonis's in the vain hope he can be one. But this has been rank stupidity after daft management. It stems simply from appointing management who have nothing to lose, because when matched with Union leaders who equally have nothing to lose, it is a game of chicken where neither party will turn as neither have a vested interest. In between stands a large workforce who are going to get royally shafted because they think everyone has their best interest at heart.

It's Thatcher's 80s all over again. Substitute Leighton and Crozier for Ian McGregor and Mandelson for Thatcher and you wouldn't know the difference but for the hairstyles. Meanwhile, unlike a homegrown steel and coal industry, every single person depends on the postal service. This is not suicidal, it's downright needless and stupid.