A time to use your talent or waste your talent?

This is not the first economic downturn experienced by the aviation industry.

As with any industry effective control of costs is paramount in terms not only of survival but in anticipating the return to positive growth.

The industry seeks to control and minimise expenditure in order to maintain some level of direction towards profitability. Of course many costs are contractually fixed and thus attention is focused on those variable areas, inevitably including employee costs highlighted particularly by the bean counters.

But are these employee 'costs' or would they be better described as 'talent assetts'. For sure there are areas of employment that directly relate to the health of the business . More passengers can mean more check in agents, more cabin crew, more pilots etc and vice versa. But recent press has highlighted disproportionately large staff reductions relative to declining business volumes. Were these positions so fundamental in the good times?

Does business not have the courage to resolve staff level issues other than in times of business downturn - thus the downturn becomes the excuse rather than the cause for some proportion of staff reduction!

So what is aviation trying to achieve -the survival and improvement of the business as a medium term strategy or just a short term cost cutting exercise - the 2 options are often less than compatible.

Is this industry like many others in the western world exhibiting elements of 'shorttermism''. Listening to a economic issue being developed into media driven crisis. Giving too little thought to the needs in 12 months as green shoots start to re- appear. A quick fix to reduce the responsibility for employing and the associated HR issues that attach.


A reduction in passenger and cargo throughput may require a measured adjustment of workforce. But some see it as an opportunity to contract out functionality with fixed costs being replaced by variable.- why now? If it is such a good business practice, why not do it in times of positive growth?

Who is driving this strategy? HR or the accountants? Are the blind leading the blind?Experience suggests that many making the decisions are least qualified to judge the resultant impact on the business.

Often loosing the skills base and contracting out function to a third party who will have to learn your business whilst being charged with the only interaction with your customer base can be a dangerous place to be . Keeping skills within the workforce, particularly those supporting the customer interaction - airport functionality marketing/sales and telesales functionality inclusive at least maintains the quality of interaction everyone strived so hard to keep high during the good times.


So for those planning such cuts, is the lack of short term cost strain worth the long term talent drain. Cost reduction in terms of employment costs but with the associated increase in third party contract costs will often lead to poorer customer service, allowing your revenue streams to be 'controlled' by a third party whose task after all is to look after their own business first and the principals second.



Caution is advised - the saving of costs for 10 staff for a one year economic glitch will be lost in revenue many times over in the subsequent years once the issue fades and is replaced by more positive economic trends. The loss of talent can be permanent .

So should the current focus be more talent retention and less cost containment?

What do you think?