Why do airlines launch sales? When do they launch? Does it work?
My Management Mantra
Context: How do India’s aviation leaders manage? Where do they draw inspiration from? We are launching a series of interviews with Indian aviation’s senior management leaders. The first one features Sanjiv Kapoor, chief strategy and commercial officer, Vistara. Kapoor likes to be respected, not feared and draws inspiration from Steve Jobs.
1. What time do you like to be at your desk?
At my desk at home by 630 am. At my work desk by 9am.
2. Where is the best place to prepare for leadership: at business school or on the job?
For leadership, by being a leader throughout your life. From school days onwards. Business school is good for certain technical and management skills and networking, but leadership cannot be taught in school.
3. Describe your management style.
Very detail oriented but not a micro-manager. Driven by passion, and put off by people who lack passion. Hard-driving, but passionate people enjoy working hard. Refuse to accept “not possible” as an answer. Everything is possible, it is just a question of how long will it take and how much will it cost.
4. Are tough decisions best taken by one person or collectively?
By one person after seeking inputs from key stakeholders, in the presence of the key stakeholders.
5. Do you want to be liked, feared or respected?
Respected. Only bullies like to be feared, not leaders.
6. What does your support team look like?
One shared executive assistant is the support team.
I refuse to accept “not possible” as an answer. Everything is possible, it is just a question of how long will it take and how much will it cost.
7. A business outside of aviation or a business leader that you draw inspiration from?
May sound cliched, but Steve Jobs.
8. Which management book has influenced you the most?
In my youth, it was some combination of Pepsi to Apple by John Scully, and the various Arthur Hailey books, especially Airport, Hotel, and Money – plenty of management stuff in those books too! More recently, Steve Job’s biography by Walter Isaacson. And “From Worst to First” by Gordon Bethune, the former CEO of Continental Airlines.
9. Do you socialise with your team outside of work?
Yes, when time permits. In fact, I have recently been hosting a series of dinners at my home where 30-40 of my staff at a time across all departments come and let their hair down in a relaxed and informal setting while I subject them to a healthy dose of Pink Floyd and early Fleetwood Mac .
10. What would your key management advice be?
Do a job you love to do, lead by example, and demonstrate the power of passion.
When the government unveiled the aviation policy last October, you may have wanted to buy beer for the chaps at the ministry. For starters, there was an aviation policy finally. The Narendra Modi government was finally paying attention to the industry. The centerpiece of the policy was the regional connectivity scheme (RCS).
Plenty of incentives...
Through RCS, the government wants to connect small towns and cities and link them to metros. To get more people to fly, fares of half the seats in an aircraft are to be capped at Rs 2500 (around $35) a passenger for 1-hour flights. The government will cover the costs of those seats and airlines can sell the rest as they please. Several other incentives such as reduced taxes and exemption from airport charges were introduced to coax investors.
No surprise then that the government got a raft of proposals. It approved 27 proposals from five airlines to connect 43 airports on 128 routes.
So far so good.
But all these incentives may amount to nothing because India's aviation infrastructure sucks. India has scores of ghost airports. The running ones are under strain. Mumbai and Delhi have hardly any slots available.
Ideally, there should have been more functioning airports and a second airport at the metros for the regional flights to fly to. But those will take years to build.
Captain GR Gopinath, the founder of Air Deccan, which is one of the successful RCS bidders, told Rede that hundreds of crores are spent on fancy terminals even in regional towns but investments on navigation aids and night landing are not undertaken, resulting in airlines aborting flights because of visibility problems in poor weather. That makes it unviable for regional airlines because they would want to fly the maximum number of hours as possible. Gopinath says the government has also neglected investments in trained manpower to man airports, which means smaller airports operate in limited hours.
It is safe to say the government realised rather late that even RCS stations want to be connected to the metros, and not really to each other. So as a stop-gap arrangement, the government has forced metro airports to give up the few remaining scarce slots for regional airlines. Airports like Mumbai and Delhi are vehemently protesting because it is inefficient use of scarce slots to make space for smaller aircraft. It has also worsened the capacity problem at big airports.
Oh, the costs!
The infrastructure challenge apart, operating smaller aircraft in regional airports will be tough for regional airlines. They cannot spread the costs such as salary, insurance and leasing charges like their bigger counterparts because of the fewer seats. Planes cost a bomb. An 18-seater is around $6-7 million. Lessors aren't enthused about smaller aircraft either and given India's record of failed airlines insist on advance rentals of a year or more compared with the usual practice of three months. Smaller aircraft become uneconomical and unviable for these reasons.
It remains to be seen how reliable these planes will be during the monsoons, especially to the North-East. Consistency of schedule and credibility are as crucial in aviation as any other business.
All in all, it doesn’t look so good for the regional connectivity scheme.