Gyanendra Kumar Kashyap
Statistics show that Air India is re-gaining its market share; is it a temporary phase? If not, can Air India survive the competition and regain its lost glory and position?
If numbers are to be relied upon, then data for the last six
months show consistent increase in Air India’s market share. As a matter of
fact, it has inched past other airlines to take number two position in the
domestic market over the last two months. It has risen from 16.2 percent in May
2012 to 20.8 percent in October 2012. For June, July, August and September
2012, the market share of Air India was 16.8 percent, 18.2 per cent, 18.2
percent and 19.3 percent, respectively. Can the increase in market share be
attributed to ‘the bad times’ for ‘the king of good times’ or is the ‘Maharaja’
improving its management-employee relations, rebuilding its customer base and
all the more relearning lessons about quality services? Air India, for some
reason or the other has been mired in negative publicity. Be it lack of professional
leadership and good management practices; the inability of the national carrier
to function on sound, independent, commercial lines (thanks to the high
handedness of government and political leadership); or the employees holding
the airline and its passengers to ransom through strikes and protests – may
lead one to believe that this gain is a temporary phase, primarily due to the
crisis at Kingfisher Airlines. While the reason cannot be out rightly rejected,
yet there are ample reasons to believe that Air India is gradually doing things
right and the gain in market share is rightfully theirs. This raises the more
important question: Is Air India the comeback kid and can it survive the
competition and move to the top slot?
When in May 2012, the IPG (Indian Pilots Guild) took the
airlines to ransom, analysts and commentators were worried as to whether Air
India could really come out of the mess and rebuild its image and brand
loyalty? On their part they reasoned that an emphasis on management – employee relations,
customer relations, and quality of service to passengers could help Air India
get back traffic and generate the revenue to recoup the airline. On a rational
ground, the suggestions were perhaps too good to be ignored. For irrespective
of the amount of money the Centre pumped into Air India, nothing could probably
succeed without good management – employee relations. A give and take approach,
where protesting employees gave up their agitation and the management paid
their salaries and dues, was adopted. It constituted a committee to ensure the
implementation of the Dharmadhikari Report. A cash surplus of Rs. 48 crore
during April-July, and the government’s infusion Rs. 2,900 crore to the airline
(under the Rs. 4,000-crore budgetary allocation for 2012-13) gave ample elbow
room to make up-to-date payment of PLI (productivity linked incentives) and clear
payment of salaries of all its employees before Diwali. As a result of these
measures there was a perceptible increase in Air India’s traffic.
It is argued that aggressive fare schemes and an improved
on-time performance are perhaps the two biggest reasons why Air India is seeing
an increase in its market share. This implies that it is gradually getting its
customer relations and service quality on track. Increase in load factor
implies that there have been fewer cancellations and rescheduling of flights
(as a matter of fact, ordinary passengers and India Inc. had lost faith in the
airline on account of the strikes, the cancellations, and the rescheduling of
flights). As for the quality of service Air India is learning from its rivals.
It is now trying to modernize services to improve the entire experience of
flying with it. The airline has roped in the National Institute of Fashion
Technology to design crew dresses. Soon flyers when flying in the new Dreamliner
(Boeing 787) to any international destination can order from a variety of
international cuisines.
The role of independent directors (usually well-known
industrialists) at Air India has been put to question more often than not.
Perhaps they could not see eye to eye with anything that the management
proposed. For a change, the management has decided to invite professionals to
take up the role of independent directors. In a bid to do away with petty
politics and focus on the turnaround, it is expected that their expertise and
professionalism would give the corporate restructuring process a leg up. Perhaps,
this is put to rest the question of lack of professional leadership at the
helm.
In a dynamic aviation market, it may be too early to term
Air India as a comeback kid but nevertheless the approach seems to be on the right
track and will certainly help rebuild its image and brand loyalty. If these can
be taken care of being ‘numerous uno’ is a mere number game.