Alf's Articles

Deconstructing The Debacle Behind Delta's Demise

by Alf Nucifora

There's a palpable sense of déjà vu in the air. Memories of a corroding Eastern, a decaying PanAm, a tattered TWA pass before the mind's eye. I fear we're about to relive the experience with Delta Air Lines. I'm sorry to see the degree to which this once great brand and standard bearer has fallen on such bad times. Watching death by a thousand cuts is never a pleasant sight. But it's the passing away of that special union we had, akin in some ways to a marital bond that hurts even more. This has been a steadfast relationship of twenty nine years, encompassing millions of seat miles, untold questionable meals, and the odd lovers' tiff occasioned by a mishandled flight or a lost bag.

The unmistakable signs

The cues are everywhere. At their most serious, it's the airplanes, old and tired, with weathered liveries that carry the scars of too many journeys, too little upkeep and not enough attention. Aircraft equipment is sold off. Schedules get reduced. Terminals show their age, the sorry and decrepit JFK the prime offender in this regard. Gates are handed back at once thriving terminals such as Orlando where growth, not cutback, is the expectation. The sale of subsidiaries, Comair and ASA is seriously contemplated. In-flight service becomes inconsistent. Crown Rooms turn into crowded bedlams with marginal service offerings beyond the free booze sought by the drinking class. The plug is pulled on the much heralded Song experiment, one that in more lenient and forgiving times might likely have succeeded. Even the pillows have disappeared. You knew it was the beginning of the end when they removed the old ice cream sundaes in First Class on the West Coast flights.

Management seeks protection as management is wont to do in circumstances such as these. Ex-CFO, Michele Burns receives a million dollar plus pension in addition to the $656,000 salary and $846,000 bonus she received in her final year at the airline. This in addition to the free, first-class travel on Delta for her and her family for as long as she lives. Talk about inspiring the workers and reassuring the shareholders. In the meantime, it's Chapter 11 for everyone else, with a demand for staff pay-cuts and work rule changes, and the most alien and unexpected of actions for a work force that for so long never questioned its employer's loyalty or commitment to the "family" - a reduction or termination of the sacrosanct pensions. For God's sake, it's why you went to work for Delta in the first place! That and the free air travel.

Still the memories are fond

When I look back over the relationship and relive the years, I'm left with few serious complaints. Delta took care of me and I reciprocated, spending hundreds of thousands of dollars in the process. My Platinum Medallion status and looming Three Million Miler achievement guaranteed a more than satisfactory level of service and performance for most of the time. I know many of Delta's fine staff and respect them for the dedicated and committed professionals they are. A number of the airline's problems and calamities are industry-driven, the result of an environment that will destroy any and all but the most adept and agile players. And to the extent that Delta's problems are self-inflicted, the blame can be spread around liberally. No one ogre stands head and shoulders above the rest.

It's time, however, to say goodbye. The old relationship has been rent asunder. To tell the truth, the frisson is gone. Sure I'll miss the familiarity and reassurance that I felt upon boarding a Delta flight. I new I was traveling with family. It's the same feeling I experience at U.S. Immigration when the officer stamps the passport and says "Welcome home!" But I just don't care anymore. I don't have the energy. The rewards no longer seem important. The return on the emotional investment is no longer worth the effort to sustain the relationship. I don't care about missing the comfortable seating and once-prized service because I know they'll never return. The economics of the operating model won't permit it. I don't care about the Platinum Medallion status. First Class is nothing more than a wider seat and a free drink, both of which I can live without in order to save a buck. And the free upgrades? They've gone the way of the fifties service station attendant who used to clean the windshield and check the tires for free. In the commodity environment which the airline industry has become, emotional brand bonding is out. Just get me there on time and at the right price. One Boeing plane is as good as another…ditto with the airlines that fly them.

Where does it all end?

Even in my wildest imagination, I don't see Delta disappearing from the skies. However, there will be significant change, perhaps the adoption of the more profitable long-haul carrier model, with a corresponding walking-away from the current, hub-and-spoke, cover-the-waterfront, short-haul template. Merger or acquisition is a distinct possibility after bankruptcy protection allows management to take the big bath and clean house.

We have to face facts. With its ruptured operations, onerous overhead and the vigorous competition it faces from discount carriers, the glory days of Delta are over. The once-prized, stalwart legacy staff, the distinguishing element that helped maintain customer loyalty for the airline has retired or been fired. On a recent Delta flight, the cockpit and cabin crew had a combined 151 years of unbroken service with the airline. When they leave, as they all soon will, no one will remain to preserve the genes of the brand, and protect the unique customer and employee-driven culture that once separated Delta from the crowd.

Call it brand Darwinism if you will, but another great institution bites the dust, joining the ranks of others that lost their direction or failed to read the tea leaves and anticipate the market volatility that was about to engulf them.