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A new head for Air India PDF Print E-mail
Wednesday, 10 August 2011 00:00
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When a top aviation ministry official takes time out to brief reporters on the fact that Air India’s chief Arvind Jadhav is on his way out, you begin to get more than a bit worried about whether the ministry knows what it’s doing. It can’t be the government responding to the Opposition’s demand since of all the heads the Opposition has asked for, this is the most insignificant. If Jadhav is replaced, as now looks likely, his successor will be the fourth chief the airline has had in the last three years. So many chiefs is bad for any organisation; for one that’s supposedly trying to turnaround, it’s suicidal. Indeed, things are so bad that when, as part of the turnaround strategy, a team was set up, the government went out of its way to ensure the team was disbanded, starting from the expat COO to the chief training officer and even the COO of the low-cost airline which is the lynchpin of Air India’s turnaround strategy.

It can be no one’s case, not even Jadhav’s, that he’s the best chief Air India can ever get. The point is a more basic one: will the aviation ministry allow any chief to function independently? Indeed, given that it is responsible to Parliament for Air India’s functioning, can it allow any chief to function independently? Perhaps why privatisation is the only solution, and not just for Air India.

The best course is to give Parliament the true picture and let it decide. On the one hand, Air India needs R42,000 crore of infusion over a decade. Along with this, it needs the government to protect its turf by not giving out any more bilaterals. After that, it needs to be left alone. And the chances of it succeeding even then are poor. Consulting firm Deloitte which evaluated Air India’s turnaround plan said it was a long haul given that the plan envisages a situation in which Air India’s cost structure will be much lower than that of rivals like Jet and Kingfisher—it projects Air India’s domestic market share growing at 22% annually as compared to 10% for its rivals (15% for Air India vs 3-4% for rivals in the international market)! Once the pros and cons are put forward in this manner, maybe after Deloitte is asked to make a presentation with Air India’s management asked to respond to the points made, it seems pretty obvious what Parliament will opt for. Or does it?

 

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