The Contented Cow Blog

Building Workplaces That Work

I was recently asked my opinion on the mating dance that is going on between Delta Air Lines and Northwest. More specifically, the question was whether or not I thought the two of them getting married was a good idea. In the interest of full disclosure, I will admit up front that, of the major domestic carriers, Delta is my clear favorite, while Northwest is, well, uh… not my favorite, to be very charitable about it.

Airlines are characteristically run by testosterone laden alpha-males who are bent on proving that their thing, ‘er plane is bigger, faster, goes higher, and can stay up longer than the other guy’s. Though airline takeovers are obviously couched as matters of business strategy, one shouldn’t ignore the testosterone thing, not for a minute.

From a purely business standpoint, airlines are a combination of hard assets (planes, parts, equipment), systems (routes, reservation, revenue management, marketng partners, etc.), and people.

In terms of hard assets, especially aircraft, a Delta-Northwest combo doesn’t appear to make much sense. Whereas Delta has a middle-aged, largely Boeing fleet, Northwest operates a lot of Airbus equipment, together with a bunch of rehabbed but prehistoric DC-9’s. Why does it matter? Because the cost of operating, training crews to fly, and keeping spare parts for a fleet of pound puppies doesn’t simplify matters or help competitiveness one bit.

A glimpse at a combined Delta-Northwest route map seems to make a little more sense. There isn’t a lot of domestic overlap, and Northwest’s Asian routes paired with Delta’s strong European and Latin American presence could be a potent competitive offering. Stripping out one of the reservations systems and perhaps a domestic hub (goodbye Memphis?) might save a few bucks. Fuel isn’t going to be any cheaper regardless of whose name is on the door. Purely through the nearsighted eyes of a shareholder, I rate the deal a push, at best.

The reason a DL/NW deal won’t work is the same one that prevents most corporate marriages from working as billed. These are two large organizations with radically different cultures, sets of norms, and value systems. Whereas Northwest’s management and its heavily unionized workforce have been at war for years, Delta enjoys relative peace with its employees. Translation: You might enjoy some lucrative new routes, be able to sell off some of the uncommon equipment models, and wring a little more fat out of the system, but hell will freeze over before these two families fall in love, work harmoniously, and produce a consistent customer experience.

Please Mr. Anderson, don’t do it!

A thought leader in the areas of leadership and employee engagement, Bill Catlette is a seminar leader, keynote speaker, and executive coach. He helps individuals and organizations improve business outcomes by having a focused, motivated, capably led workforce.

He is being featured this week on The Cranky Middle Manager podcast

For more information about Bill, his partner Richard, and their work, please visit their website at www.ContentedCows.com

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