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British Airways: Reputation meltdown

British Airways has just suffered a torrid bank holiday weekend with all flights cancelled and thousands of disgruntled passengers making their anger felt on social media. A massive IT meltdown has triggered reputation meltdown. The cause for once was not cyber related as was first suspected.

More than £350m has been wiped off the value of BA’s parent company, International Airlines Group, and the airline will certainly face a vast compensation bill running to many millions of pounds. The timing was particularly damaging as it is also the start of the half term holiday for most schools in the UK. Weekend news bulletins were full of pictures of families sleeping on seats.

The great fear for any airline, not to their mention passengers, is a crash or accident. For these terrifying eventualities airlines must by law have disaster plans that are tried and tested and subject to periodic review. Airlines know that if they are perceived to be to blame for an accident or if their response is dilatory or inept then they may not just suffer reputational damage they can be put out of business. Pan Am was not to blame for the Lockerbie bomb but so poor was their response they soon ceased trading.

So why were British Airways seemingly unprepared for a computer based catastrophe? Immediately, and perhaps inevitably the GMB Union blamed the meltdown on cost-cutting, particularly the outsourcing of IT jobs to India in an effort to save money.

The BA chief executive, Alex Cruz, facing calls for his resignation, has resolutely ruled out suggestions that cost-cutting or off-shoring were in any way responsible. He claimed a power surge at a Heathrow data centre was to blame and that back-up systems didn’t kick in. Many disputed this as airlines typically use a system known as UPS, uninterruptible power supply. The idea being that if one supply fails it automatically switches over to another. It may be a while before we learn the real cause.

At Crisis Solutions, we believe there are four essential crisis management capabilities: Activation, Communication, Information Management and Decision Making. We call it the ACID Test and it is our crisis management benchmark. So, let’s subject British Airways to the ACID Test.

Activation

Activation is all about getting the right team in place, with the right skill sets, in order to fight a crisis. We can’t know how the crisis management team was activated or who was present, but there are tell-tale signs that all was not well. Why did it take so long for the CEO to get out in front of the cameras and be seen to be taking control of events? It is important for the boss to stay strategic, but the physical presence of the person in charge cannot be underestimated.

Similarly, Willie Walsh, one time CEO at BA, but now boss of the parent company, IAG, has been conspicuous by his absence. IAG owns several airlines including BA, Iberia and Aer Lingus. Why would you stay invisible when your biggest brand is in meltdown?

Communication

In the early hours and days of a crisis, good communication is paramount and that goes for internal communication to staff and of course in this instance communication to the stranded passengers.

For the latter, it should be simple – a profuse apology followed by constant updates from the airline as to how the situation is progressing and when flights might be resumed and a reassurance that refunds would be made available. This clearly didn’t happen.

The constant gripe all weekend was that BA was telling passengers very little. Louise Wickham, who was travelling with her husband and two children, told The Daily Mail: “There was no communication at all, it’s been a real shambles. We had no idea what was going on, there was no information, they just kept saying wait for the gate. We were trapped and kept against our will in conditions that were just awful.”

As to keeping staff informed, they were sent what some have described as a gagging email telling them to stop making public comments on the crisis.

Many passengers commented on the fact that BA staff were trying to be helpful but clearly were unable to furnish passengers with the information they needed.

Communication is of course a two-way street and Ryan Air were quick to capitalise on BA’s problems. They took to Twitter saying, “Should have flown Ryanair” with a picture from the famous Little Britain ‘Computer says no’ sketch.

Information management

The system for documenting and sifting information to establish what is important and what is white noise needs to be determined before crisis strikes. It’s not just the details of a crisis that are important, it’s the impacts the crisis is having on the company involved. Only by doing this can senior management grasp the facts they need to take decisions and actions to overcome a crisis.

It’s tough to call BA’s information management capabilities, but the fact that BA’s Activation and Communications were so poor would indicate that their information management system needs serious overhaul, particularly as we will see that this too looks to have impacted their decision making.

Decision Making

One way of ameliorating the problem would have been for BA to transfer passengers to other airlines. This was clearly a decision they didn’t want to take.

A passenger at Heathrow Terminal 5 on Saturday night claimed front line staff did all they could to assist but he watched as managers told them not to transfer passengers on to other flights but asked them to leave the airport and go home. He also claimed BA management withdrew all staff from the ticket desk in the lounge and closed the customer service desk as according to management ‘all systems were still down all day’.

BA also refused to refund passengers who booked tickets on other airlines to get to their destination. One BA passenger said: “I booked a flight back to Glasgow using EasyJet from Stansted on the basis I couldn’t get through on any phone line, I couldn’t get the website to work. Skyscanner was reporting no available seats on BA to Glasgow and we were told not to go to the airport. Now BA have told me (via twitter DM) that they won’t compensate me for my EasyJet flight.”

At Crisis Solutions, we believe an important crisis management capability is keeping in touch with the public mood. If your response to an emergency is clearly at odds with what the public and more specifically your customers perceive to be caring and competent then your reputation is likely to take a major hit.

Many passengers felt that decisions taken by BA were based purely on maximising profits at the expense of passenger well-being. This might prove to be a very short sighted mistake.

Conclusion

If this had been a plane crash rather than a computer crash one hopes that BA would have handled the situation in a more sure-footed manner. But was an IT failure any less likely than an air accident given that we live in a world of cyber-attacks, hacks and data breaches?

The computer meltdown caught British Airways completely unawares and their crisis management response has been lamentable. It’s not just their IT that’s taken a hit; their reputation may take years to recover.