This post is part of a feature on companies and products that our bloggers think are in need of a makeover. See all 26.
This summer I had the misfortune of flying AMR Corp.'s (NYSE: AMR) American Airlines. In my experience, it ranks near the top in its expression of contempt for its customers. As I wrote in my book Value Leadership, it is almost the opposite of Southwest Airlines (NYSE: LUV), which has tarnished its flawless image with its first quarterly loss in 17 years due to a $247 million charge resulting from a jet fuel hedge gone sour. But to give American Airlines a makeover, it would be wise to borrow selectively from what makes Southwest so great.
In August, I was scheduled on a 1:50 pm flight from Boston to Miami -- trying to get a connecting flight to Chile on its excellent airline, LAN Air. American Airlines said the flight would be delayed for 15 minutes because of a mechanical problem that caused the air-conditioning in the back of the plane not to work. Half the plane got out, and an hour later American Airlines announced an indefinite delay.
A big line formed at our gate to rebook. Next to our gate was an empty one with two American employees who were working on their computers. I waited patiently until one of them finished her work and asked if she could help me. She stared at me and said no, she could only help people on the flight scheduled for that gate, and went back to her computer. No thanks to her I ended up booking a flight that left at 6 pm, causing me to miss my connection to Chile.
American Airlines probably does not treat its employees very well, and employees share that meanness with their customers -- at least they did with me. And I would certainly go out of my way to avoid flying that airline again. Evidently, it is not doing too well making money for investors either -- it just reported a $360 million operating loss accompanied by a 5% drop in passenger traffic.
I do not think it is possible to fix American Airlines. But, as I posted and wrote in my book, Southwest does many things well, including hiring people who enjoy serving others, treating them well, and rewarding them for creating happy customers. This is much harder to do than it is to say.
If American Airlines figures out how to achieve this, I will gladly fly it again.
Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.
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Reader Comments (Page 2 of 2)
10-23-2008 @ 1:39PM
Duane said...
To all the Paying Customers that has had Unfair service from American Airlines, it will change';
What "American Airlines" needs to do is CHANGE the way they think about their CUSTOMER'S and Focus more on there KOLOUR'S and stay "True to the, Fast to the, Obedient to the Real" and things will turn around for the Kompaiknee' it is a simple process contact me MR. CEO and may be the flight out to talk with you will be an enjoyable experience and turn the ORGANIZATION around, waiting to talk with each of you {employee's}!!!!
C.e.O. dapair3
10-23-2008 @ 1:40PM
es said...
aa is horrible no question - you are treated like dirt
10-23-2008 @ 2:11PM
Chris said...
I asked a flight attendant from AA to help me lift my bag up to the storage over the seats....she said....."that is not what I am here for"......I swear......my jaw dropped....and this was in first class.........3rd class airline.....sitting in first class I observed how filthy the seats are , the trays you pull out to eat on are disgusting and the "1st class service" was non existent......I, too, avoid American Airlines
10-23-2008 @ 2:24PM
Rhonda said...
I am in complete and total agreement with almost every comment posted. With the exception of Southwest, every one of America's domestic carriers are in terrible need of customer service training. It's an insulting slap in the face. Of course I do believe the fish smells from the head down, so the horrible treatment we all receive from these arrogant, entitled, nasty representatives of American, Delta, United, Continental etc, is the result of how poorly their upper management trains them to treat us. WE are lucky to be flying with THEM, not the reverse. If they don't start seeing this for themselves and doing something about it (can anyone say "study Southwest"), they will most certainly go under because we all know the government no longer has any money to bail them out again.
Does anyone know the reason behind the charges from $100 to $300 to make reservation changes? Aren't they sitting at a computer and changing us from one date to the next? With e-tickets, no new paper tickets are issued....only computer changes....which takes about 5 minutes and qualifies as another insult.
It is so incredibly pleasant to fly internationally.....they get it.
PS....have you tried to use your FF miles on these carriers lately.....they're equally as worthless as the carriers who so generously "award" them.
10-24-2008 @ 3:15PM
Chris said...
great point. No help from AA, expensive, rude and nasty to me when flew from Los Angeles to Baltimore (BWI). On the flip side of things, Southwest. Great customer service, fairs back to L.A. where $213 a ticket vs. $347 a ticket. Point, I only fly southwest....
10-23-2008 @ 4:07PM
Jennifer said...
It is not just American -- Delta, United (both of whom I have flown in the past two months) have the same employee problem. Either an inability or unwillingness to communicate or assist building to behavior that borders on negligence. My current mantra in life "Customer Service Is Dead"... corporations are not serious about how their employees treat the public... it is all LIP SERVICE. This goes well beyond airlines -- customer service is not a profit center, it takes time, commitment and willingness from all involved. It's dead folks, it's dead. And that saddens me.
10-23-2008 @ 5:21PM
Stacy said...
I LOVE Southwest. They put all other domestic airlines to shame.
10-24-2008 @ 12:42AM
Hotelgirl said...
I will avoid this airline at all cost if I can.
I have referred to AA is "Un-American Airlines" since they lost my luggage on a 3 hour layover from the Bahamas to Miami/Miami to JFK. The hardest part to get over was the lack of caring they had for my situation. 24 hours later I had to ask AMEX platinum to find the bag and they did... in one hour.
I have always felt that they should be nicer since they were the ones who ended up being the airline who the terrorists choose that they should be a bit more friendly. I agree that they may have a frustrated staff however, they should be happy that they have a job to go to these days. There are people out there living out of their cars with no hope in sight.
10-25-2008 @ 5:29PM
Jeff said...
We flew AA this summer and had a very similar experience that we wrote about on our site. Later an AA flight attendant wrote a very poignant email which I decided to post here: http://beatofhawaii.com/inside-american-airlines/
Thanks Peter. I enjoy reading your posts.
10-25-2008 @ 10:09PM
Madeline said...
Want to hear a horror story about AA? Although it happened a few years ago, it is in my mind every time I step inside ANY aircraft.. on a flight back from the caribbean via Peuto Rico to NY, there was a storm in NY and all flights were diverted to Virginia, all other area airports were closed. We landed there around 9:30 pm which was about the time we should have landed in NY.. we understood that there was a storm and thought that AA would leave as soon as the storm let up. We could see lots of other airlines leaving about an hour or two later....even air jamaica left. then it was only AA. We sat on that plane, out on the tarmac..not near any terminal until almost 3 am...I kid you not. Air marshalls came and removed us by bus to the terminal, it was almost 5 am when we got to our hotels. We were not allowed to take our luggage and those who needed to get medicines and formula for babies had to give their baggage tags so those bags could be taken off...not once did AA apologize or explain why we did not take off. Apparently, from what I understood from other passengers, the crew on board,as of midnight, had flown the maximum alloted hours for that day..My question is why didnt AA bring in a new crew? ...then to make it worse, they picked us up from the hotel at 10 am the next morning, and the flight out back to NY was not scheduled until 6 pm...did I ever bitch? I wrote them a very nasty letter, still no explanation but a 'hush' reward of 10,000 miles...I usually use AA so that was a welcome reward to some extent, but I will never forget. And you're right, when they cancel a flight, you've got to make sure that they do not cancel your return also...
10-25-2008 @ 11:50PM
LENNY said...
It is unfortuate that i use American to fly Philadelphia to Miami almost monthly and mthen on to Lima, Peru and use Lan for that part of the trip. I have had property stolen out of my check lugage so often i can't count anymore and this is with locked TSA locks and i am very convinced it happens in Philadelphia with American handlers. Lan is a top notch airline with great planes always clean and for the most part friendly workers. On Ameican flights the attendants i have found to be very friendly and helpfull it is on the ground that they are terrible.
10-26-2008 @ 8:14AM
Virgil Bierschwale said...
Unfortunately this attitude is prevalent these days.
Problem is, its not the employee's fault.
It is the managers fault for not instilling the belief in their employees that customer satisfaction is the most important part of their job, and the attitude "I'ts not my job" is unacceptable in any situation.
Virgil
http://www.KeepAmericaAtWork.com
10-27-2008 @ 5:04AM
andy abraham said...
You can add United Airlines on your list... however with the lower price of fuel...and the airlines cutting back on flights.. maybe the situation might change..
What do you think?
Andy
www.myinvestorsplace.com
10-27-2008 @ 1:01PM
Edward Lister said...
Simply put, I don't know of one US owned airline that doesn't suck!
10-31-2008 @ 9:01AM
Mitchell Tucker said...
Mr Cohan,
You are an Idiot and have no historical perspective on the difference between Southwest and American. American employees took huge pay cuts in order to avoid bankruptcy. Not your typical union attittude. If you love Southwest so much what were you doing on American in the first place ? ( that's right...they didn't fly where you were going)Southwest is the
airline equivalent of a Greyhound bus.
I can't imagine your much of a consultant,
succesful business people don't need or want your help. You and the rest of your Wall Street buddies are getting your comeuppance.....well deserved !
11-11-2008 @ 3:09PM
w.t.keane said...
I have tried Delta. and enjoyed it...not business or 1st class but just coach, a little short on leg room perhaps. As to personnel: I have occasionally encountered an unfriendly staff person but 95% are friendly, courteous and helpful. I have no recollection of long delays or missed connections.
I also found Frontier fantastic thirty years ago but I believe they have deteriorated, as have Aer Lingus who were wonderful in the sixties but eliminated "service" from their vocabulary in the late seventies. My favourite was Northwest but they are gone as have Northeast and Eastern who I also liked.
11-21-2008 @ 11:31PM
Patti Jason said...
I was a flight attendant for over 20 years and understand both sides....that of a passenger and that of the employee, specifically, the F/A. When I was flying f/a's were 2nd class citizens, the pilots were Gods and their needs always came first, then ground crews, agents and finally the f/a's....we were the FRONT LINE - the marine's, if you will, we could make or break a flight after the passengers had been raked over the coals on their way to
the aircraft in our limited way had to make up for everything that had gone wrong, we with the least amount of power to do anything.
Airline companies could care less about their employees...get the flight out on time....to bad if you don't have all you may need to provide service to our customers (in the good old days when we provided service). Now-a-days, and I know that I am generalizing, airlines hire anyone who can walk up and down an aisle. When I was hired you had to have a degree, be fluent in other languages and at the very least, be able to form a sentence (in english). In defense of the rudness of the f/a the passengers don't help at all....they complain constantly about everything and expect the same service that was delivered 15 years ago. Hearing people complaining 24/7 and taking it out on the f/a's is so unfair....try complaining to the pilots.....you can't find them after landing they're the first ones off the airplane and simply don't care and leave if up to the F/A's. I drive whenever I can anymore. It is so dishearting to see and hear what goes on now a days....We all need to accept some responsibility in the mess the airlines are in and make life a little easier and less stressful. Just put yourself in the other persons shoes for once. I personally NEVER received a negative letter but when a passenger thanked me for being so nice during the flight I would say "no, thank you" it easy to be nice to someone who is nice.
11-22-2008 @ 1:39PM
Patti said...
This message is specifically for Rhonda....and any other passenger who may be reading this.
International carriers are subsidized by their country. Not in the USA. That's why the planes are cleaner, newer and more flight attendants to serve the passenger.....for example...when I was flying 747's internationally (some time ago) a full passenger load would be over 400 people. International carriers would have 15 to 20 flight attendants. I would work the same flight with 10 to 12 (maybe 12) flight attendants.....now you do the math. Also, remember that a F/A's day can start out at 6 am and end at 8 pm and legally be entiled to only 8 hours of rest.......so when your flight is delayed or stuck on the tarmac for hours you are not the only one suffering....you can sit and be upset....F/A's are standing and being verbally abused.
The paying passenger was all for deregulation and this, in part, is what happens. The Government bailed out and that left the airline companies the green to make up their own rules. The FAA does require a minimum number of F/A's depending the the aircraft configuration but if it were possible to use one FA no matter the passenger count they would probably do that....thank God the aircraft has doors....that's why you've got F/A's on the plane.....to open those doors and provide assistance in an emergency.
Someone complained that the tray tables were dirty.......who did that????? some passenger didn't have the common courtesy to clean up after themselves. You want cheap fares.....you got um....Stop complaining....you'll live longer.