Wednesday, November 28, 2018
Is It Enough?
The CEO of Delta airlines works hard to inspire and motivate employees. He meets with them frequently. He stays after meetings for dozens of selfies with starstruck personnel. He is an unabashed rah-rah executive who believes in his people. All that, however, might not be enough to keep the carrier successful. Inexorable costs are dragging profits down. There is only one way to offset them at the moment -- flying planes full. That, however, might not be enough if another recession hits and business class pulls back. The CEO is compensating partially by entering international routes where fares are more stable and returns better, but even that might not be sufficient. He is faced with two challenges -- keeping employees focused and finding new sources of profitable revenue. Both are difficult in a business where profits are rare and employee unrest frequent. That he has succeeded for the moment is not enough for worried investors. He might need to spend more time communicating with Wall Street. It is tough to be pulled three ways at once.
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