Q5 interview Carolyn McCall, CEO easyJet plc.... (May 2011)
Carolyn McCall is the CEO of easyJet plc. Prior to her appointment in 2010 she was Chief Executive of Guardian Media Group, and a non-executive director of Lloyds TSB, Tesco and New Look. In this interview, we ask Carolyn about her views on employee engagement and leadership...
1) Carolyn, easyJet delivers a value-for-money 'no frills' service. How do you engage your people not to fall into the trap of providing a 'cheap' customer experience?
It depends which part of the customer experience you are dealing with. We have complete control of the onboard experience; the cabin crew are easyJet employees. We recruit, train, manage and incentivise them. And they’re fantastic. There is a real camaraderie amongst them. They love the brand and they really enjoy their jobs. I get emails all the time from passengers praising their onboard experience, which is all down to our hard-working crews.
We have mapped every single point in the process where our product comes into contact with the customer. Our focus on the passenger is what truly differentiates us. It is where we build brand affinity, and where we generate loyalty.
Yet there are certain parts of the customer experience where we have to cede direct control of the process to others; for instance, airport staff. We use our leverage and influence with airports, ground handlers and other external stakeholders to encourage them to be friendly and helpful to our customers. It is not an economic issue; it costs nothing to be friendly. It’s about caring, smiling, being welcoming and wanting to serve each passenger the right way. So externally we influence our partners where we can, and internally, we hire the right people and make sure we develop them.
2) How do you reflect your internal brand in your external brand? What do you have to do to line the two things up?
The employer brand and the external brand have to be one and the same. I carried out a brand audit as soon as I arrived at easyJet to make sure there were no gaps between what we say the brand is and the actual experience our customers have with us. If you say your brand is one of integrity, openness and helpfulness ... you clearly have to be so.
Another early priority was to appoint a marketing director with deep expertise in customer insight AND a strong understanding of brand building. Both attributes are required for driving behaviours internally and externally. You want your people to live and breathe your brand, and become very strong advocates of it.
In recent years, easyJet’s brand positioning has focused on price, but there are many other important elements to easyJet. We beat Ryanair hands down on customer experience, but the real win for us is to demonstrate that we’re better at short-haul than the BAs and Air Frances. easyJet must stand for convenience, good value, and being acutely passenger-focused.
3) How important do you see employee engagement during a change process?
It is the single most important thing. Statistically 80% of change programmes fail. When change is imposed on people it fails to achieve ‘buy in’. If people don’t feel the need for change, they block it. Of course, change has to be led by the top team; but leaders have to engage people at all levels. They have to listen to their thoughts, encourage new ideas and get them actively involved in the process. If you end up ‘doing change’ to people, the process is doomed.
4) Do you think that male and female leaders approach employee engagement differently?
I don’t think it is gender-specific. It really depends on one’s personality; some people do it quietly and confidently, some are more extrovert and exuberant. Some don’t do it at all.
5) How have you found the experience of moving from a privately owned organisation to a nakedly commercial one where there is constant pressure to manage the margins and satisfy shareholders?
The biggest difference is the relentlessness of quarterly reporting. You feel like you are constantly on the road talking to investors and analysts. The speed at which the quarterly reports come upon you ... it really can feel like minutes! The other difference is the short term nature of quarterly reporting; you might approach half-year with one set of figures, whilst you know that Q3 is going to be stellar. There is a rhythm and a ritual that you have to get used to which is quite different from working in a privately owned business.
6) And finally, who has been the biggest influence on your career?
There are many. The Guardian opened me up to some fantastic people; Alan Rusbridger and Caroline Marland have been very big influences on me. I learnt how to manage people at the Guardian, how to really get the best out of them in a very creative and challenging environment. People underestimate how tough the Guardian is; it was a real meritocracy.
My experience at Tesco has also influenced me enormously. Working on the Board with people like Mervyn Davies, Charles Allen, Karen Cook, David Reid -- an amazing array of non-execs -- not to mention Sir Terry Leahy and a formidable executive team, taught me a great deal about how PLCs operate.
Austerity and opportunity: the budget cuts and new markets - March 2011
The Chancellor’s recent budget statement had the business pages debating the effects of a 1p reduction in petrol duty, and the usual rises on booze and fags. But do these tweaks really impact any businesses other than those – such as the haulage or oil industries – where these items are key parts of their operating costs? Q5 doesn’t think so. These microeconomic adjustments got the headlines because the big macroeconomic strategy has already been spelled out, mantra-like, by the coalition Government. As is often the case, it was what the Chancellor didn’t say more than what he did that is important. Those businesses who want to capitalise on the wider economic climate would be foolish to overlook the continuing public sector context.
Public spending from central government will continue to decline sharply. This is to be offset by an outbreak of opportunity in the public services space for anyone who is ready for it. No 10’s new Director of Policy, Paul Kirby, is about to publish a white paper in which he will propose opening up public services to more providers, urging the Coalition to expose a huge market to private sector organisations. Services in areas as diverse as healthcare, policing, and schooling could go the same way as privately-run prisons, an industry worth billions of pounds a year.
Kirby has been appointed from KPMG where he wrote a number of papers advising a shift in Government focus to frontline services financed on a ‘payment by results’ basis. This would drive lower unit costs, value for money and, if savings are to be realised, private sector suppliers will be welcomed in to help.
Any business at this time should be reviewing their own functions and seeing if these seachanges provide any opportunities for them. The potential market is just too big and wide-ranging to ignore. And if there are openings to capitalise on, skilful adjustments in company structure and agile change management will be the key building blocks of future success.
Andy Cottrill, Principal Consultant, Q5
Specialist Media Show Presentation - May 2010
On the 25th May, Q5 presented at the very successful Specialist Media Show. Sharing a stage with media industry experts, we presented our views on what it takes to create truly effective multi-media sales teams. Our view being that in the future it was less about 'selling' product (space, clicks, etc) but in positioning yourself to help grow your client's business. As such structuring your sales teams to work across platforms, create solutions that meet needs rather than sell 'space' was crucial.
For the full presentation see below.
Organisation Physiotherapy - March 2010:
As the world economy tries to get back on its feet, organisations are still struggling to recover the effectiveness that they once had. Whether this is because they cut too deep in the wrong areas, or kept doing the wrong things but with less people rather than focus on the core activities they need for the future, they are potentially at risk of not recovering completely. However, we believe businesses need to follow some simple steps to rejuvenate and get back to peak form.
Our experience tells us that businesses need to undertake some 'physiotherapy'; focusing on those areas that have been damaged most by the recession. Through identifying what the areas of real pain are through a simple diagnostic, creating and delivering on an integrated 'treatment plan', and engaging your people with the future, we can help you recover to be the shape, size and structure you need to be in order to make the most of the recovery.
For the full article see below.
Hello Laura and Sophie - January 2010:
We are very pleased to be able to announce two new arrivals to Q5.
Laura Pethers has joined us as our office manager and is tasked with the responsibility of organising all that we do, and scheduling all our client meetings. Sophie Stock is providing us with independent book keeping and financial support.
We are very excited about what Laura and Sophie will add to Q5 and we are delighted to have them on-board.
Goodbye Meenakshi - January 2010:
Meenakshi Venkatakrishnan, who joined us on an internship from the London School of Economics in June last year, has returned to her home in Tamil Nadu, India. We would like to thank Meenakshi for her outstanding contribution over the last few months, and wish her well as she furthers her career in India.
'The Cost of Doing Nothing' - January 2010:
Selling the benefits of having an engaged, motivated workforce is easy on one level; you know it makes sense... but trying to attribute a financial value to it is much more difficult. Over the last 18 months, many organisatons have had to reduce their cost bases. But, cost-reduction programmes conducted at breakneck speed can lead to more than trimming of fat; often it can lead to inadvertent muscle damage, in the form of business processes that no longer work, operated by employees with low morale.
People talk up the intangible benefits of focusing on "people change", but if you are a senior executive trying to persuade your CEO to invest some money in re-engaging their workforce becase it will make your organisation more money or, at the very least, save it some, how do you go about doing it?
In our experience, organisations built around happy people with positive attitudes and long-term goals out-perform unhappy companies. You can build up a cogent business case for re-engaging your employees by calculating the cost of doing nothing.
Organisations are thinking, living things. It is impractical to run a controlled test to compare the reaction of one group of people going through a series of 'change' interventions with another group who are not subjected to any interventions...
For the full article see below.
'Talent': Making it work for you in the downturn: The Q5 Talent Roundtable Report - September 2009:
This summer Q5 pulled together a selection of talent experts from a wide range of different clients for our Talent Roundtable. We debated and discussed the key issues facing the talent management discipline and the pressures on what to do about talent in today's environment. We addressed the challenges faced when you know that there is a need to manage your talent and are faced with a sceptical audience. "Surely in a downturn, talent sorts itself out", some might say; well our research and the views of the experts we sought out say quite the opposite. In a downturn it is just as important to focus on getting the most out of your talent. If you want to succeed, you must get the right people, with the right talents in the right roles, as simple as that. Making Talent work for you is just as important now as it always has been and as organisations try to survive and seek new ways to grow and innovate, your talent and how you help it perform, can make all the difference.
For the full article see below.
'Organomics': Shaping and sizing your organisation to thrive in the prevailing economic conditions - 13th July 2009:
At this moment in time organisations around the world are reducing their costs. We, at Q5, are specialists at helping organisations to do this. However, our approach is never 'slash and burn'. Instead we use 'organomics', a term we have crafted to describe how through careful analysis of your organisation we can help you achieve sustainable, long term cost reductions rather than just short-term fixes. This is, we believe, how organisations can get the best of all worlds; savings, a better working organisation and the ability to deliver results in the long term. In these times of tough economic challenges, using 'organomics' will help you and your organisation become more effective and more efficient, today, tomorrow and into the 5th quarter!
For the full article see below.
PSBII: the organisational challenges ahead for BBC, Channel 4, and anyone else who comes to the party - 15th June 2009:
On the 16th June, Lord Carter publishes the final version of "Digital Britain". For those not involved in the media world, this is the culmination of a year-long investigation into the future of digital information and communication in the UK. In an interim report in January, Lord Carter made some interesting proposals for universal broadband, the future of the press and the migration to digital radio. The topic that piqued most people's interest was whether..."..a long term and sustainable second public service organisation providing competition for quality to the BBC (could) be defined and designed, drawing in part on Channel 4's assets and a re-cast remit." At Q5 we ask the question, what might the proposed 'tie-in' between Channel 4 and BBC Worldwide look like and what could it deliver? For the newly installed Secretary of State for Culture, Media and Sport, Ben Bradshaw, this surely will make interesting reading. We are only 400 metres away from Parliament so if Ben wants to pop around for a chat, we'll put the kettle on!
See our full thoughts in the article below.
Challenging, but opportunistic times - 8th May 2009:
Today's business environment is more challenging than at any time anyone can remember. Certainly, most of today's leaders have never experienced anything quite so stark. Those that are highly-leveraged are having to explore ways of becoming 'cash-positive'. Those that are relatively 'cash-rich' are in survival mode, seeking to protect existing revenue channels as vigorously as possible. Speed is the key ingredient, but hasty decisions are often poorly conceived.
These challenges are not exclusive to particular industries or organisations; everyone is under extreme cost pressure. However, now is not the time to panic. The most effective business leaders we know are focusing on change and, in some instances, a complete organisational 'reboot'. This means looking at your operating model (what is it you do and how you are set up to do it) and making it fit for navigating the downturn but flexible to meet the opportunities when the upturn eventually comes.
It is worth remembering from the Great Depression of the '30s to the recessions of the '50s, '70s and '90', for every vanquished organisation, there were also victors. Fortune Magazine, Procter & Gamble, Burger King, Hewlett Packard, MTV, Apple...the list goes on. Each came into existence, or launched major new products in the pit of a downturn. The message being, despite the challenges, be opportunistic, be optimistic...and make the decisions that are right for your business. Your current challenges may just be the opportunity you have been looking for.
Q5 move into new offices - 1st May 2009:
Q5 have moved into their new offices at Little Tufton House, 3 Dean Trench Street, Westminster. We look forward to welcoming you to our offices in the new future.
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