A look at airline mergers and the impact to quality
Last week I shared the most recent ranking of our US based airlines. Both American and US Air were on the low end of that report in 9th and 10th place. Now they have announced their plans to merge. One can only wonder, could two terrible airlines somehow become better if they merge? Let’s look at some other airlines who tried…
Song – Remember them? Could have been the next JetBlue. In flight free entertainment, expanded leg room, and one of the best on time records of any airline. Delta bought their planes and gutted them out to smash as many customers in one plane as possible.
NorthWest Airlines – Another casualty courtesy of Delta (again). These planes were older, I’ll give you that…but customer service was much better. And how did prices from BOS to DET go from $299 to $499 overnight?
Continental – Merged with United in 2010, surpassing Delta as the world’s largest airline. Where was United on that list of best to worst airlines?…oh yeah, LAST PLACE!
See if you remember any of these merges. Wonder if they fared any better? What do you remember?
- 1997 – Bought by ValuJet Airlines, kept the AirTran name
- 2010 – Bought by Southwest Airlines, will retain the Southwest name.
- 1986 – Acquired Jet America Airlines.
- 1986 – Acquired Horizon Air, which continues to operate as a separate airline.
- 2005 – Merged with bankrupt US Airways, retaining the US Airways name.
- 1971 – Acquired Trans Caribbean Airways
- 1987 – Acquired Air California
- 1997 – Acquired Reno Air
- 2001 – Acquired TWA
- 2013 – Merged with US Airways. Surpassed Delta as the world’s largest carrier, kept American name.
- 1934 – Begins as Varney Speed Lines
- 1982 – Acquired by Texas International / Merges, retains Continental name
- 1987 – merges with People Express, Frontier, and New York Air
- 1987 – Acquires PBA and Britt Airways from People Express merger / creates Continental Express
- 2010-2012 – Merged with United Airlines. Overtook Delta as the world’s largest airline by passenger traffic in 2011, kept United name.
- 1924 – Started as Huff Daland Dusters
- 1928 – Huff Daland Dusters was purchased by C.E. Woolman and renamed Delta Air Service after the Mississippi Delta
- 1953 – Purchased the Chicago and Southern Air Lines, and flew under the name Delta C&S for the next two years
- 1972 – Purchased Northeast Airlines
- 1984 – Established the Delta Connection (ASA, Comair, Skywest, …)
- 1987 – Merged with Western Airlines
- 1991 – Purchase of Pan Am’s European routes, and acquired Pan Am’s shuttle, forming what is today Delta Shuttle
- 1996 – Delta Express began service, ended November 2003
- 2003 – Song began service, ended May 2006
- 2008-2010 – Merged with Northwest Airlines. Became the world’s largest carrier by passenger traffic in 2008, kept Delta name
- 1972 – Delta purchased Northeast Airlines
- 1916 – Founded by Col. Lewis Patenaude, under the name Northwest Airways
- 1927 – Began flying passengers
- 1949 – With its new routes to the far east, re-branded itself as Northwest Orient Airlines
- 1986 – Purchased Republic Airlines, and dropped the word Orient from its brand name
- 2008-2010 – Merged with Delta. Became world’s largest airline by passenger traffic in 2008 under the Delta name.
· Pan Am
- 1979 – Merged with National Airlines
- 1991 – Delta Air Lines purchased Pan Am’s European routes, and acquired Pan Am’s Shuttle
- – Acquired Atlantic Southeast Airlines
- 1985 – Acquired Muse Air
- 1993 – Acquired Morris Air
- 2008 – Acquired certain assets of bankrupt ATA Airlines
- 2010 – Acquired AirTran and will retain name Southwest Airlines
- 1986 – Purchased Ozark Airlines
- 2001 – American Airlines purchased TWA, retained name American Airlines
- – Merged with Capital
- 2010-2012 – Merged with Continental Airlines. Surpassed Delta as the world’s largest carrier. Kept United name
- – Started as All American Aviation Company, renamed All American Airlines and then Allegheny Airlines
- – Purchased Lake Central Airlines and Mohawk Airlines
- – Changed name to USAir
- – Purchased Pacific Southwest Airlines and Piedmont Airlines
- – Changed name to US Airways
- 2005 – Merged with America West, keeping the US Airways brand
- 2013 – Merged with American Airlines. Surpassed Delta as the world’s largest carrier, kept American name.
- 1925 – First incorporated as Western Air Express by Harris Hanshue
- 1926 – Western’s first flight took place
- 1928 – Reincorporated as Western Air Express Corp.
- 1930 – Purchased Standard Airlines (subsidiary of Aero Corp. of Ca. founded in 1926). WAE with Fokker aircraft merged with Transcontinental Air Transport to form TWA.
- 1934 – Western Air Express broke off from TWA and briefly changed its name to General Air Lines, returning to the name Western Air Express after several months
- 1941 – Western Air Express changed its name to Western Air Lines, which was later altered to Western Airlines
- 1967 – merged with Pacific Northern Airlines
- 1987 – Delta merged with Western Airlines (kept Delta name)
If you plant honesty, you will reap trust…
A successful business man was growing old and knew it was time to choose a successor to take over the business. Instead of choosing one of his Directors or his children, he decided to do something different. He called all the young executives in his company together.
He said, “It is time for me to step down and choose the next CEO. I have decided to choose one of you. “The young executives were Shocked, but the boss continued. “I am going to give each one of you a SEED today – one very special SEED. I want you to plant the seed, water it, and come back here one year from today with what you have grown from the seed I have given you. I will then judge the plants that you bring, and the one
I choose will be the next CEO.”
One man, named Jim, was there that day and he, like the others, received a seed. He went home and excitedly, told his wife the story. She helped him get a pot, soil and compost and he planted the seed. Every day, he would water it and watch to see if it had grown. After about three weeks, some of the other executives began to talk about their seeds and the plants that were beginning to grow.
Jim kept checking his seed, but nothing ever grew
Three weeks, four weeks, five weeks went by, still nothing.
By now, others were talking about their plants,
but Jim didn’t have a plant and he felt like a failure.
Six months went by — still nothing in Jim’s pot. He just knew he had killed his seed.
Everyone else had trees and tall plants, but he had nothing
Jim didn’t say anything to his colleagues, however, he just kept watering and
fertilizing the soil – he so wanted the seed to grow.
A year finally went by and all the young executives of the company
brought their plants to the CEO for inspection.
Jim told his wife that he wasn’t going to take an empty pot.
But she asked him to be honest about what happened.
Jim felt sick to his stomach, it was going to be the most embarrassing moment of his life,
but he knew his wife was right. He took his empty pot to the board room. When Jim arrived, he was amazed at the variety of plants grown by the other executives. They were beautiful – in all shapes and sizes. Jim Put his empty pot on the floor and many of his colleagues laughed, a few felt sorry for him!
When the CEO arrived, he surveyed the room and greeted his youngexecutives.
Jim just tried to hide in the back. “My, what great plants, trees and flowers you have grown,” said the CEO. “Today one of you will be appointed the next CEO!”
All of a sudden, the CEO spotted Jim at the back of the room with his empty pot. He ordered the Financial Director to bring him to the front. Jim was terrified.. He thought, “The CEO knows I’m a failure! Maybe he will have me fired!”
When Jim got to the front, the CEO asked him what had happened to his seed,
Jim told him the story.
The CEO asked everyone to sit down except Jim. He looked at Jim, and then announced to the young executives, “This is your next Chief Executive Officer!
His name is Jim!” Jim couldn’t believe it. Jim couldn’t even grow his seed.
“How could he be the new CEO?” the others said.
Then the CEO said, “One year ago today, I gave everyone in this room a seed.
I told you to take the seed, plant it, water it, and bring it back to me today.
But I gave you all boiled seeds; they were dead – it was not possible for them to grow.
All of you, except Jim, have brought me trees and plants and flowers. When you found that the seed would not grow, you substituted another seed for the one I gave you.
Jim was the only one with the courage and honesty to bring me a pot with my seed in it.
Therefore, he is the one who will be the new Chief Executive Officer!”
* If you plant honesty, you will reap trust
HIT Impact Study from HIMSS Informatics
Today HIMSS released a report stating an improvement in HIT adoption during an hour webinar. Seems rather low doesn’t it? It’ll probably come to no surprise to see the other low scores from clinicians regarding value of HIT from workflows, communication, and reporting perspectives. Many of the statistical values were broken out to show the variance between Pharmacists and Physicians…as clearly there is a true value to patient safety and communication within pharmacy. Interdisciplinary clinics with low executive buy in to the value of clinical transformation, received terrible scores. Hospitals considered “High Technology focused” received considerable higher scores for physicians versus those organizations with less than stellar investments in HIT. Read more on their website below. Let’s face it, until we are able to convince those investing in consulting services to agree to also invest in early adoption planning…we will see on going delays in implementations and increased costs. The full report is available on Himss website.
2013 Airline Quality Rating Report
The annual report shares some interesting ratings on all the US based airlines. The first thing I read was that Delta had more pets die on its planes than any other. Not that I ever travel with a pet, but interesting statistic just the same. I just had to share that tidbit. Ranked in order of timely arrivals, baggage handling, overbooked flights, denied boarding, and customer service are:
- Virgin America
- Jet Blue
- AirTran
- Delta
- Hawaiian Air
- Alaska Air
- Frontier
- Southwest
- US Air
- American
- American Eagle
- SkyWest
- Express Jet
- United Airlines
Here are some passenger oriented key points:
- Virgin America comes out on top in terms of timely arrivals, baggage handling and customer service. 83.5% of all flights arrived on time (industry average is 81.8%)
- The second-ranked airline in terms of overall quality was Jet Blue, which posted better than average performance in terms of on-time arrivals, mishandled bags and customer complaints.
- In last place, United Airlines, came in well below average in all categories; 77.4% on-time arrivals, 1.83 denied boardings per 1,000 passengers, 3.87 mishandled bags per 1,000 passengers, and 4.24 customer complaints per 1,000 passengers. Wow, sorry for you all who fly United.
- Hawaiian Airlines has the best on-time performance of all the airlines in the report, at 93.4%.
- American Airlines had the worst, at 76.9%.
- United had the most customer complaints of any airline.
I wish I had more opportunity to fly Hawaiian Air! You can find this report at Forbes.com and on most airline websites.
Consultant bill rates…have they reached their peak?
Having monitored bill rates for consultants over the last several years, I’ve seen a new trend…flattening out. Does this mean we’ve seen the peak in the industry and the needs for consulting services is slowing down? Perhaps the market is so saturated with firms and resources. Or maybe hospital purses are a bit tighter now than a few years ago. I’m going to say a maybe to a couple of these and suggest a few other hypothesis that are worth considering.
Let’s look at the first suggestion that the market has peaked in the industry. This is absolutely not the case. With EHR vendors continuing to see profits year after year, our industry of consulting will see similar growth. Reports from Epic, Meditech, Cerner, and several others all show continued growth in new clients both domestically and internationally. 2012 report shows less than 55% of hospital have even tapped Meaningful Use stage 1 requirements, and even less for stage 2. Remember, this is for EHR conversion requirements giving the hospital money to do so. Did I mentioned the impending doom of ICD10? Finally don’t forget about all those small physician practice and specialty clinics being swallowed up by nearby eager hospitals to extend their referral base into the rural areas of every state. The need for consulting services will continue to grow and boom in most vendor spaces….(well, not McKesson or Siemens).
Every day I read about some new consulting firm that is now offering EHR consulting services. Billion dollar companies want a piece of the action and are buying up the small shops (since when did companies stop making photo copies to move into Healthcare IT?). March of 2012, KLAS reported 45 unique firms that focused on Epic consulting services. March of 2013, that number grew to 60. What that means for the client/hospital is lot’s more options. It used to be about quality of the consultant, now it’s expected they are all the same…and price shopping by firm is certainly cutting into bill rates. And don’t forget about independent consultants, who if they can get in the door..are eager to bill $15-$20 less than you.
Is the market saturated with resources? I don’t think so. Look at LinkedIn on any given day and you’ll find literally hundreds and hundreds of job postings. I myself posted a handful today and noticed the same jobs had already been posted by other firms. We are desperate to find more consultants to fill those roles. Everyone is desperate. In my little town of Boston, there are 5 major hospitals converting to Epic within the next 12 months all within 60 miles of each other. Where do you think they will be getting their resources? Yep, watch the emails start flying from recruiters when the realization hits them all that there are not enough people in the state of Massachusetts to meet their needs. Some will try to pretend they don’t need us, then they’ll call 6 months into it. There is plenty of work for all of us.
Purse strings and budgets are certainly tightening up. Hospitals can go to Neiman Marcus (Epic) or Target (Allscripts) to meet their budget, and most will get them to MU requirements. But what about physician buy in and patient safety? Hospitals are starting to consider the higher end vendors in favor of internal cooperation. That leaves less and less for consulting services. The hospitals don’t worry at first, as they are told they won’t need consultants. Oops, I guess that was an error on someone’s part. The money will come from somewhere…it always does. However, when high end firms approach the $150+ an hour there is some consequences. Mainly; restrict travel expenses. Things like use local consultants, provide long term housing with bi-weekly travel, no per-diems, shared transportation, and roll travel costs into bill rate…are all becoming ever more popular.
Regardless of bill rate, consulting services will continue to be in demand. Don’t be alarmed if you see a drop in bill rate…or don’t even know what your bill rate is. Make sure your bonus structure is around hours worked, not bill rate…and be sure your expenses are covered. Firms will have to work a little harder with clients to stay competitive. Hospitals will have to continue to depend on firms to bring in qualified subject experts to get their software installed, their end users trained, and their IT staff confident to manage without you after go-live. We are years away from peaking this industry.
What if airlines charged by passengers weight? Samoa Air is doing just that…
I think the concept sounds a little crazy, but yet Samoa Air makes the announcement to charge $4.16 per kilogram for the passengers weight with their luggage. The airlines suggests that it encourages their passengers to be healthy and watch their weight. I’m skeptical at best, and not because I’m over weight. If anything I never check and my luggage never weighs much at all. I like the idea of charging for bags by weight and size maybe…but certainly not the passenger. Just my thought…
Change to Delta Skymile members – Points now expire at death
A sneaky little change that can’t be found anywhere on their website any more. In the past you could identify a beneficiary to your skymiles, but now that option has gone away. Joining the likes of other airlines with the same policy including: United, South West, and Jet Blue.
It’s really a shame, because Delta is benefitting on millions of miles from those who have given their loyalty exclusively to one carrier. No email or formal announcement of the change was announced to members. It only appeared in last week’s posting of Flyertalk.com from an airline representative. A glimpse into that posting:
Tim Winship, editor and publisher of FrequentFlier.com, was not surprised travelers are angry.
“Earning frequent flier miles in the minds of most people is akin to earning money and the idea that your miles — or your money, for that matter — would simply disappear when you die strikes a profoundly disturbing note in the minds of many,” Winship told NBC News.
Delta countered that the benefits of SkyMiles are intended to reward those who participate in the program directly. They are the ones who demonstrate their loyalty to the airline, said Delta spokeswoman Chris Kelly Singley, in a statement.
She added that the policy change was made after careful review.
“We are the only airline whose miles do not expire, so our customers have the ability to enjoy using miles without the risk of ever losing them,” Singley said.
“In order to offer this unique benefit, some other, lesser-used policies were examined and determined not to have as much value to our members.”
Interestingly US Air, United, and Alaska still offer the ability to identify a beneficiary. The common census seems to be, don’t let your miles add up. Use them, transfer them, or give them away while still alive and well.
Spring is here – The “hottest” time of year for new contracts!
It’s Spring! Although you wouldn’t know it here in Boston, it’s a comfy 30 degrees outside today. With warmer weather right around the corner, this is the time of year clients traditionally start up new projects and will be looking for new consultants. Spring is always the busiest time of year for recruiting and new engagements. Now is the time to be on the lookout!
If you are not participating in all the Epic groups on LinkedIn, sign up today. Be cautious that many of these are straight forward recruiting sites, but many have discussion boards that are worth reading. I personally find the following the best:
- Epic Job Seekers
- Epic Users – 1 Stop Shop
- Epic Knowledge at your Fingertips
- Epic – Contract Professionals
- Epic Certified
Almost all the firms have representation on Facebook, LinkedIn, and Naymz. I myself prefer to go to the source directly. Take a look at the various firms website. Some are pretty sad, that would be a red flag. Others provide fantastic detail on opportunities and their organizational structure.
What I love about the world of Epic, is there are so many choices. With over 45 firms that offer Epic support services, the consultant has the upper hand. I’m always hiring. My friends at many competing firms are also always hiring. Have a preferences of size of organization, leadership structure, bench/bonus policies, or hourly versus salary? Every single firm has a something different to offer in each of these areas. Have a list of what you want…and then match it up.
Good luck with your search. Obviously you can always contact me directly if you want to discuss options out there that are a good fit for you.
Strange Customer Service Delta Story – Pizza for diverted passengers
Passengers on a flight from Boston to Atlanta were delivered pizza after they were diverted because of weather. A possible tornado on the ground in Atlanta caused some problems in the air for people traveling from Boston. The flight had circled for a while, but the pilot made a decision to divert to Knoxville, Tennessee. They had to wait for hours for the runway to clear, but they didn’t have to sit there on an empty stomach. Upon landing the plane was greeted by a cop car with 30 pizzas in the back seat. Passengers were a few hours late, but everyone got a hot slice of pizza.
Ok, so I’ve been on a few flights in my time. I have never heard of such a thing. I’m thinking security at Knoxville is a bit less than normal. But what about the idea of Delta serving pizza? You would think there would be other issues besides security here. I have to say, this is certainly going above and beyond. No one knows for sure who ordered the pizzas or how they were paid for. Just very strange.
What is your strangest customer service story mid flight?
Expect long lines at your airport – Spring Break
That wonderful time of year when college kids take over the airports is upon us. Obvious destinations within the US including ORL, MIA, LAX, and LAS will especially see an impact to security lines. Be prepared and arrive early. Watch out for those kids who somehow were able to get a hold of alcohol. Expect long delays in security for those who travel but once a year and don’t know the rules.
A couple tricks:
Don’t have TSA pre-check? Go in that line anyway. Especially in Orlando where they don’t have a first class or status line (they have a “professional travel” line that everyone uses). Even if you are not cleared for pre-check, they’ll just put you in line right there…cutting off about 75% of the people. Terrible I know, but so worth making a few people mad.
Spend the extra $20 for a preferred seat. Get to the front of the line with United, US Air, American, and Jet Blue by purchasing a coach upgrade. You’ll get a couple extra inches of leg room, but best of all…you’ll get to use the status line for security. Jet Blue has a special quick security line for those who spend the extra $20.
Do not check luggage! If you can limit yourself for one week, this would be the week to do it.
Good luck! I myself am heading to Vegas on Thursday. Thinking that won’t be too bad. But the return trip on Sunday is going to be terrible. Thank goodness for TSA pre-check!
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