Richard Branson's advice to Alan Joyce

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Perhaps the best thing Qantas CEO Alan Joyce could do at this time is to read the self-help business advice of Richard Branson, the co-founder and part owner of rival airline Virgin. 

The essence of Branson's philosophy is to treat your staff as if they were your friends. He believes the most important characteristic in a business leader is to be able to demonstrate that you genuinely like people. 'If people know you care, it brings out the best in them.'

Branson says: 'A company is people ... employees want to know ... am I being listened to or am I a cog in the wheel? People really need to feel wanted.'

Joyce is doing the opposite, declaring war on his staff and their unions: 'They are trashing our strategy and our brand. They are deliberately destabilising the company.'

What is most revealing is the strength of his hostility towards worker input into how to run Qantas. '[The unions] are sticking by impossible claims that are not just to do with pay, but also to do with unions trying to dictate how we run our business.'

He dismisses pilots' demands to preserve Qantas' safety culture as self-interest. This is despite the fact that the company's own website boasts that this culture is a point of difference that gives Qantas an advantage over its competitors.

'Among Qantas pilots, there is a clear culture of safety rules being unbreakable. Pilots who have worked at other airlines before coming to Qantas often report that the culture of adherence to safety rules and regulations is stricter than anywhere else in the world.'

Treating workers as partners rather than cogs not only makes good business sense. It is an ethical imperative, according to an opinion paper published last week by the Edmund Rice Business Ethics Initiative.

The paper analyses Joyce's ethical intent expressed in his declaration 'My priority is to do the right thing by Qantas'. It asserts that Joyce remains vague about what he means by 'Qantas', but most probably means shareholders, management and the Board rather than stakeholders, which includes groups such as workers, the travelling public and the tourist industry.

'In the ethical realm, 'doing the right thing' must extend to others affected by what the actor does. For this reason, many businesses talk about 'stakeholders' not just 'stockholders'.

'Part of stakeholder capitalism is a recognition of the importance of a 'social license to operate' that may be withdrawn if the society where the business operates comes to the opinion that the business is damaging that society.'

The Edmund Rice Initiative is not critical of the increase in Joyce's pay and bonuses, which was approved the day before he grounded the airline. However it suggests profit sharing bonuses should be given not only to management but to staff at all levels, who will consequently be motivated to improve their productivity and quality of service.

The lesson for Joyce is that acting ethically in such ways could well prove to be the most profitable business strategy, as his rival Branson already knows.


Michael MullinsMichael Mullins is editor of Eureka Street.

Topic tags: Michael Mullins, Qantas, Richard Branson, Alan Joyce, Edmund Rice Business Ethics Initiative, ethics

 

 

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Existing comments

I would like to know what the pay and conditions are for Richard Branson's "friends" and compare them to those of Alan Joyce's employees, before I assert Branson has anything to teach Joyce about running a profitable business.
Patrick James | 07 November 2011


Unbelievable!!
john frawley | 07 November 2011


Great article from Michael Mullins!

The people who do all the "dirty work" are forgotten by the management of Qantas. As a Commercial Pilot, I find that the management has over the years being guilty of many unconscionable acts taken against its employees to somehow increase the profit margin while discarding many who had been good employees. The "apprentice scandal" is a good example of the lack of concern for people other than the management.
Trent | 07 November 2011


Michael: I am inclined to believe that any vagueness Mr Joyce might have about his idea of what constitutes 'Qantas' is of the faux-vague variety. I think he is thinking very clearly about shareholders when he contemplates Qantas. He is in pursuit of the divident factor at the expense of almost everything else. Maybe Mr Branson is keen to present Virgin as a company of 'friends' (really?) rather than a loose alliance of foes because he has learned the wisdom of keeping his enemies closer to himself than his foes. Just on the level of cynical pragmatism, maybe Mr Joyce could learn from this. It's great for advertising and for business - and isn't this what it's all about in the new Capitalism?
David Timbs | 07 November 2011


A most disappointing and unbalanced article.To compare the Branson/Virgin business with Qantas is like comparing chalk & cheese.To not give any substance to the Joyce comments that the best way to help his employees & shareholders (who haven't had a dividend for 3 years)is to stand up to union bullies who seem happy to win inthe short term while not considering the longer term interest of all concerned.Listening to Joyce then listening to TWU heavy Sheldon--I know who will do the best for employees &shareholders.
Brian | 07 November 2011


People, face it, large companies like Qantas, the big banks, are working for their shareholders' benefit, not their customers or staff.
Wabana | 08 November 2011


I was most grateful that last Wednesday 2 November, I was able to fly from Adelaide to Sydney as planned. I wanted to thank the staff for their good service, but they hurried us out, looking downcast and very weary - the 'sparkle' has gone out their eyes. It's not difficult to guess why!
Bonita | 08 November 2011


A very perceptive article. He could have easily shared his $2million bonus with the Unions as a sign of such friendship. But then thugs and dictators can never see beyond their own thick skin.
Richard C Smith | 11 November 2011


Can I suggest that it's the unions that are being unethical here, and not Joyce?

It's hard to compare Virgin, a young company of recently hand-picked employees that fit into Virgin's nimble operation, to Qantas with employees and practices that have been around forever.

Qantas can definitely learn from Virgin, but I think this is a bit off the mark.
Dan | 11 November 2011


I wonder if the unions ever considered what would happen to the staff of Qantas if it ceased to be a profitable company?....Then no one would be winners, neither the workers or the passengers. The one eyed prejudice we get about Qantas in the press and from such people as Mike Mullins is unreal. If a CEO doesn't care about his company's profitability, there will be nothing for anyone. My families experience of Qantas has been excellent. At a difficult time in our lives Qantas went beyond the call of ordinary service to help us out, and rewarded their staff for their excellent service just because we wrote a word of thanks.....Long may Qantas serve its customers in such an excellent fashion. good luck to Mr Joyce for standing up to greed. Airlines are a fiercely competitive industry so wake up you guys and think. As to his shareholders rewarding him for his efforts. That is their choice, in a highly competitve world.
penny | 12 November 2011


I totally agree with you Richard I think Alan got his degree from a weet bicks packet, let face it the guy is a knob.
JStevenson | 26 July 2015


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