Tuesday, August 7, 2007

Lessons From The Tarmac - Fast Company

I SERIOUSLY am having some war flashbacks. I'm glad to know that Neeleman's short temper and attitude weren't something personal against me, but rather a flaw in the man....or as Jenny Dervin (Corporate Communications) told me, a result of his ADD.

I am so glad he's gone. His public personality (YouTube Bill of Rights and his corporate blog) is so Jeckyll and Hyde from who is he when you meet with him one on one.

The funniest part of the whole story is how the very person he blamed when Charlie and I met with him (Dave Bager, formerly the COO of JetBlue, was in Florida on the date of the debacle) is his successor.

From Fast Company
Lessons From the Tarmac
Take it from David Neeleman and JetBlue: Recovering from a crisis is about the trust you build beforehand.

From: Issue 115 | May 2007 | Page 31 | By: Chuck Salter | Photographs By: Alyson Aliano

"Are we done with this interview? I don't want to talk to you anymore."

JetBlue CEO Neeleman. He just wants to run the company: "It's belts and suspenders," Neeleman says. "If your suspenders fall off, your belt keeps your pants up. You have to have contingency plans for everything. My job is to make sure no one ever forgets what happened."

David Neeleman, the founder and CEO of JetBlue (NASDAQ:JBLU), glares at me from across the small round table in his office in Forest Hills, New York. It's 50 minutes into the conversation, and he's burdened, testy, exhausted. "Look, I haven't slept in three weeks," he says. "I'm tired of talking. Emotionally, I am done … I just want to go out and run the company."

I've come to pick Neeleman's brain on trust, crisis, and redemption. In its notorious Valentine's Day debacle, his airline suffered a startling breakdown due to 2 inches of ice at New York's JFK Airport. More than 1,000 cancellations. Massive delays. Passengers stuck on planes for up to nine hours. And it all played out, unfortuitously, in the media capital of the world. It took nearly a week for JetBlue to return operations to normal.

No surprise that Neeleman wants to put what he calls "the event" behind him. "For the 15th time, we've learned from this," he says. "That's why it's never going to happen again."

He knows, of course, that it's not as easy as that. Eventually, even good companies screw up. They lose track of Social Security numbers, release buggy software, manufacture faulty cars. And customers are watching, trying to decide whether or not to forgive. In this precarious and very public moment, companies and leaders reveal what they're made of.

I already have some sense of what Neeleman is made of. I first wrote about JetBlue in 2004 and have followed the company since. "You built this airline," I say. "What's it like to--"

"Of course, I'm disappointed," Neeleman jumps in. "Bitterly disappointed. I built a great business, and I have great people working for me… . You're overdoing it. Delta (OTC:DALRQ) screwed people for two days, and we did it for three and a half, okay? So go ask Delta what they did about it. Why don't you grill them?"

Because Delta is not JetBlue. Neither is American (NYSE:AMR). The fact that those airlines stranded customers during the storm isn't surprising. They simply met the public's low expectations. JetBlue is an airline that aspires to be better than the majors--humane and, well, fun. It has low fares yet still offers amenities such as leather seats and TVs in the seat backs. The service is more personable, the employees' enthusiasm palpable.

So February's fiasco presents JetBlue with a unique problem--and an opportunity. The problem is removing doubts. Can it handle unpredictable and severe weather? Is the low-cost operation too lean to accommodate the fast growth that has made JetBlue the eighth-largest airline in just seven years? If the solution is beefing up personnel and systems, how does JetBlue keep fares low? How does it set itself apart?

The opportunity, though, is for Neeleman to handle the crisis in a manner that confirms or enhances the brand. He has certainly tried. In the week following the ice-out, he appeared everywhere--The New York Times (NYSE:NYT), Today, NPR, Letterman, even YouTube (NASDAQ:GOOG). He accepted responsibility for bad decisions and overwhelmed departments. He said he'd fix the problems and promised refunds and credits for the aggrieved passengers. He apologized repeatedly. All of that helped confirm, at least to some, that JetBlue is in fact something special in the airline industry. "The single most important thing a company needs to show in a crisis is that it cares," says Bruce Blythe, CEO of Crisis Management International. "That's not a feeling. It's a behavior."

But JetBlue also has this going for it: seven years of goodwill. Its customers largely accept that it cares, because it has demonstrated that it does, flight after flight. Compete Inc., a consumer-intelligence firm, conducted a poll in late February of 428 people who had visited JetBlue's Web site the month before. Despite the colossal Valentine's Day meltdown, 43% preferred JetBlue, the most for any airline.

That's no accident: Brands that are trustworthy before a crisis have an easier time recovering, says Don Peppers, a marketer with Peppers & Rogers Group, who has written about customer trust. In JetBlue's case, he says, "you have customers coming to the airline's defense on blogs." As Neeleman puts it, "If you run a crap company to begin with, you have no money in the emotional bank."

Will customers forgive JetBlue? That depends in part on how it weathers future storms, literal and otherwise. (Snowstorms in February and March passed smoothly.) One thing's for sure: If Delta or American introduced a customer bill of rights, as JetBlue has done, it wouldn't have nearly the same impact. Customers give JetBlue another chance because it has consistently done right by them before.

No, Neeleman doesn't kick me out of his office. He talks for another 15 minutes about how he's fixing systems, training personnel, hiring a veteran COO, using the incident to make JetBlue a better airline. When the interview ends, Neeleman does something that surprises me, although it shouldn't. He says he's sorry for snapping.

Apology accepted.

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