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BW Businessworld

A Change For The Worse

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Add another blunder to the government's long list of blunders last week — the removal of Air India chairman and managing director Arvind Jadhav before his initial term ended (in May 2012), and his replacement by yet another bureaucrat whose priority (yawn…) is the airline's economic turnaround.

What a joke this has become! What, can someone explain, will yet another joint secretary with little exposure to running businesses manage to achieve in Air India's precarious circumstances? We have been trying to turn the airline around since Russi Mody was given temporary charge 17 years ago.  Today, even if Air Asia's Tony Fernandes or Ryanair's Michael O'Leary were brought in to head this carrier, they would tear their hair out within days of taking charge. What pray will Rohit Nandan (no reflection on his abilities) achieve that his predecessors could or could not besides pouring more of our money down the Air India drain?

The reason behind this sudden change is pretty simple. The minister and ministry of civil aviation wanted a more pliable candidate. A ministry official, after the removal, was quoted in a newspaper as saying that the airline was being run by "Jadhav and his small coterie of people" and that was unacceptable. What he meant was that the "coterie" needed to be replaced by another group of people who would listen to the ministry. Jadhav was too independent to be running a government firm.

When Jadhav took charge, he spoke his mind openly. In an interview given to BW (17 August 2009) after he took charge, Jadhav candidly listed the evils that afflicted the airline — the staff was underworked and overpaid, productivity levels were pathetically low, and pilots and crew were spoilt silly (have Air India pilots compared their salaries with pilots in any airline in the US?). Employees were used to freebies (airline tickets for spouse and family) and didn't want to strain themselves by working too hard in return.

Jadhav came like a bull in a china shop and pointed out all this upfront. He set about making changes that upset nearly everyone. He soon became the most hated man in the airline. His high handed-approach alienated him from Air India's old hands and the ministry's bosses who were used to running the airline like a personal fiefdom. The pathetic way in which the government handled the former COO, Gustav Bauldoff, was a case in point (Bauldoff had to resign after he complained of too much government interference). Jadhav should have taken his cue from that.

In Jadhav's defense, I have to say that in over 15 years of writing on Air India, I have met a host of airline CMDs. Most of them — like M. Thulasidas or Raghu Menon — never spoke their mind openly and never dreamt of opposing the minister and secretary in charge. In fact, much of Air India's current problems can be traced to decisions taken at the time when Thulasidas was the managing director and Praful Patel was the minister. It is yet to be seen if Nandan will be in the Jadhav mould or in the Thulasidas mould.

I am aware that many of Jadhav's actions have raised question marks over his own personal integrity. I am not aware if these are justified but in a sector where past ministers have thought nothing of borrowing aircraft from industry players to ferry their guests for free to attend their personal functions, we have all learnt to turn a blind eye to minor transgressions of this kind. What the government seems to have overlooked is that Jadhav was different because he admitted there were problems. And recognising your problems is the first step towards solving them.

Jadhav may not have achieved any miracle with Air India. There is no hope of that anymore, and the disease runs deeper than any physician can treat. Air India's only hope lies is trimming down an unreasonably huge aircraft order  — planes they have no idea where to deploy or how to fill — and aiming for a sell-off where the government writes off most of the airline's debts. Instead of a turn-around specialist, we need a sell-off specialist who can systematically shut shop while salvaging whatever it can of the family silver.

Failing that, the Jadhavs and the Nandans of the world can come and go and make not an iota of difference to the situation in which most Air India employees find themselves today — unsure of whether they will get their next pay cheque; and if they do, when.

Meanwhile, the Prime Minister and some of his more intelligent Cabinet colleagues need to sit down and do some real introspection on whether they at all want to save Air India or are they willing to let it go the Titanic way?


(This story was published in Businessworld Issue Dated 29-08-2011)