Persistance of Corporate Culture

Welcome to 2009. I want to say a few words about Air Canada's widely-reported failures over the holidays in the service they rendered, or more often failed to render, to their customers. I believe there is a lesson to be learned here that extends well beyond this one company.

Consumers' Association of Canada president Bruce Cran said most of the complaints are about Air Canada's response to the situation.

"I don't hear anyone complaining about the weather, it's the treatment that they were given, or the lack of decent treatment by the airline in question," Cran said.

More specifics are in the article itself, but to me the greatest failing is one of honesty: Air Canada has a long-standing behavior of lying to their customers. There are examples of this to be found in other airlines, though perhaps not with the persistence and dogmatic manner which Air Canada exhibits, and for so long a period of time. It is, in a sense, a seemingly inseparable part of their corporate culture.

Going back well over 20 years, from when I first started flying frequently to now, Air Canada has behaved this way. This is astonishing when you look at all that has happened over that long span of time. The company itself has been transformed, in stages, from a tightly-regulated, market-dominating crown corporation to a loosely-regulated public company with a far-less dominant market position. It has seen competitors come and go, one large competitor was acquired (Canadian Airlines), its industry partnerships have shifted to and fro, and foreign operators have been given increasing freedom to operate on their home turf.

Through all of this they have retained their original arrogance and disdain for their primary revenue source: us. It may have originated from the natural self-centredness of government bureaucracy or from their near-monopolistic historical roots, yet it is still there. Individual employees have gone against the trend and rendered (in my experience and in countless other cases) superior service. Unfortunately these stand out the more so for their rarity.

I would characterize this one element of their corporate culture this way: A dollar in our pocket today is worth more than the promise of two dollars in our pocket tomorrow. In other words, once they sell a ticket they will do anything, not stopping even at outright lies, to keep that money, even at the expense of driving away that customer's future business. Underneath this I think you'll find that they believe that customers have little choice and therefore they have little to lose.

Let's catalogue some of the ways they lie. All of these are intended to hold onto your money after you've purchased a ticket.

• If a flight is delayed because the plane was held up elsewhere they will tell you it will be there in 15 minutes when in reality it is still on the ground at a far-distant city. They want to prevent you from seeking a competitor's flight until you have no option except to wait for the delayed flight.
• They will push back from the gate and sit there, sometimes for hours, knowing they cannot take off due to local or distant problems with air traffic and weather, and keep telling you it'll only be a few more minutes. If they stay at the gate you have the option to disembark, which they want to prevent.
• A flight is canceled due to equipment failure and they put you on the waiting list for another flight, telling you there are lots of seats available when they know there is almost no chance you can get a seat. Again, they are discouraging you from seeking a competitor's flight.
• They issue boarding passes to two passengers for the same seat and try to shift the blame to one both passengers. At this point they can bump you to another flight, having successfully kept you from seeking competitive alternatives.

Well, this is a list that can go on indefinitely. There came a point many years ago that when Air Canada made an announcement that my flight would depart 30 minutes late because the plane hadn't yet arrived, I would immediately sprint down the terminal to another airline to make alternative arrangements since I no longer trusted Air Canada to be truthful. More often than not I was right about my choice.

Why do they do this when so many other airlines are open and honest with their customers? Apparently they seem to get away with it, to a degree, although their business has suffered. How is it that through decades of turmoil in the airline industry, their own company, and frequent turnover of senior management, this culture of dishonesty persists?

I don't know the answer. I can even point to similar examples in other industry sectors, and I've even worked for companies exhibiting similar long-term dysfunctional behavior. If Air Canada has not been cured of its inveterate lying until now there may be little hope. The only choice is that the market must punish them. I am doing my part by avoiding Air Canada whenever I have a choice.