What if “AA” meant “Apple Airlines”? A tribute to Steve Jobs.

Recently, Steve Jobs stepped down as Apple’s CEO. As one of the most iconic business leaders during more than three decades, he set the benchmarks for customer experience and loyalty, employee engagement and stakeholder value creation. As a tribute to his invaluable contribution to the art and science of corporate leadership, I will try to imagine his AA – Apple Airlines.

Please be indulgent – my phantasy may jump beyond the boundaries of reality. But isn’t the airline industry lacking just this – a fresh air of creativity and innovation? Said that,  imagination is a highly productive work tool and I extracted many of the following ideas from “What if we were…” sessions I moderated at different customer experience workshops.

This post is longer than usual, but I think it is really worth it, running a “mental simulation” on how Apple Airlines would be like.

However, while we could continue for hours and hours imagining how Steve Job’s hypothetical airline would look like, as a strategic customer experience specialist, my point is not telling anecdotes of great service. What is really important is the analysis of the leadership and organizational style that enables a company to generate a value proposition that makes customers willing to pay more, as in every market there can be only ONE cost leader that can survive by offering the customer to pay less.

Let’s start with a fairy tail.

Two hours after take off, just after finishing my delicious meal, the flight attendant approached my seat with a worried expression: “Mr. Uphoff, I am so sorry to inform you that your luggage is not going to arrive with this flight. On behalf of Apple Airlines I would sincerely like to apologize. I am informing you now so you don’t have to wait for it on arrival. One of the cargo hold doors of the aircraft didn’t open, so we had to leave part of the baggage behind and unfortunately yours was among those pieces that remained on the ground. The baggage will be loaded on the next available flight. With some luck, you can expect delivery to your home still tonight, otherwise you should get it tomorrow morning.”

Before I could ask anything, she gave me a plastic card and proceeded to explain what was going to happen next: “Here is a prepaid 300 euro credit card for you, so you can go to buy whatever you need just on arrival. If we can’t deliver the suitcase within two days, we will reload it automatically with another €300. You’ll get an SMS informing you that the money is available. If it doesn’t show up at all after a month, we will give you a call and you would be entitled to another €600, but that’s extremely unlikely to happen. By the way, should you decide to buy during the next six months a ticket on Apple Airlines with the money you have on this credit card, we will double the euros or dollars! I mean, with €300, you can buy tickets worth €600. You don’t have to do anything, our website or call center will detect your card automatically.”

I was truly amazed and happy that Apple Airlines would not make me lose my time and good temper, when the purser said: “Ah, one last thing: you don’t have to fill out any forms. We digitally photograph every piece of baggage upon reception, so we exactly know how it looks like. I would just like to check the delivery address and your mobile phone number to make sure we get the delivery right…”

Back to reality

Wouldn’t that be nice? There is no reason for airlines not to handle lost baggage this way, but, of course, great customer facing performance is only the tip of the iceberg of great leadership, a consistent strategy, a motivated human organization and a well designed system to support flawless execution.

But, while we could easily imagine hundreds of scenes of great and “amazing” customer service, we want to dig deeper into some of the elements that made Apple great and that might be applicable to airlines, too.

Apple Airlines. How it all started.

The airline was founded in the 1970s, just after Southwest Airlines inaugurated the era of competition in aviation. Challenging unmovable industry truths, Steve and his partner Steve set up an airline in his dad’s hangar. It became an immediate success.

But after the IPO in the early 1980s, the experts and consultants took over the company, changed the strategy to enter the market share game and Steve ultimately left to start up a new airline called NeXT. Finally, in mid 1990s, customers, employees and shareholders implored him to come back to save Apple Airlines from bankruptcy – the experts had left the sinking ship.

He performed such a successful turnaround that Apple Airlines had become by 2010 the most desired consumer brand, the best place to work, the most admired company and the corporation with the highest shareholder value in the world.

Let’s look at just a few select Apple Airline’s key success factors:

One of Steve Job's leadership qualities are the ability to integrate out-of-the-box realities into a holistic value proposal.

1. Leadership

Let’s start with an original citation of Steve Jobs: “It’s in Apple’s DNA that flying aircraft alone is not enough — it’s technology married with liberal arts, married with the humanities, that yields us the results that make our heart sing.” The original phrase says “technology” instead of “flying aircraft”. But the important conclusion here is that only an organization that knows to look beyond its own borders and limitations, creating value proposals that are as holistic as the human being whose needs it aims to satisfy, will be able to position itself as the real leader.

Steve transmitted a clear vision to employees and customers of Apple Airlines: whatever we do must be of great value and joy for the customer as a whole. His vision was long term, as opposed to the competitors’ pendulum permanently swinging between the extremes of cutthroat cost cutting and some erratic value based gold mine search exercises. Many books and articles have been written about Steve as a leader, I am not going to repeat his particular characteristics. His authenticity (he put his life and money where is mouth was) and his commitment to long-term strategic developments made the real difference here at Apple Airlines. You may also want to have a look at my post  After the age of CFO-CEOs, we now need people-CEOs!

Customer Service: This is a function directly derived from leadership (even though many corporations bury this function in some lower rank operational function). Managers and employees at Apple Airlines knew they had all the support from the top, knowing that they would never be penalized for committing an error while trying to execute the corporate vision of making customers happy.

Steve actually inverted Ryanair’s O’Leary’s “fly BA” advise to customers, who complained about bad service. He told customers complaining about high prices to use Ryanair, or also BA (like “go buy a boring PC, an Android phone/tablet…”). He perfectly knew that only those who never had flown on Apple Airlines complained about high prices, real customers understood and loved the value proposition, rarely defected and even convinced their friends to give it a try, too.

Back to reality: Bad service is very frequently the direct result of bad leadership, or leadership that doesn’t care about employees and customers, which is the same thing.

The point is that Steve was able to create and communicate a seamless and mesmerizing vision of a company that customers loved and employees were able to execute. And if something went wrong, it became an opportunity to learn and to surprise the customer by not arguing and giving back more than he or she had asked for.

2. The NeXT experience.

Remember what Steve Jobs did after the Apple board ousted him? (Yep, at one point consultants, financial analysts and industry experts decided to convert Apple Airlines into a “normal carrier”, to make some quick money).

He went to create NeXT Airlines, decided to outsource all commodity processes, let other do the flying, and concentrate on designing the best possible hardware (physical touchpoint design: points of sale, airports, aircraft interiors,…) and software “user interface” (service, processes, systems). In the 1990s, when the (new) board implored him to save the company from bankruptcy, he brought in this groundbreaking “operating system” system. Steve had eliminated all the jungle of unconnected legacy systems that were extremely costly to license and to operate. In consequence, he created what would later evolve into AOSX (Airline Operating System ver.10).

Back to reality: It is well worth pursuing the thought of having one easy to use, integrated “operating system” to handle all the airline information and processes in real time, from reservations to baggage check-in (see above) and even revenue management, CRM or maintenance scheduling. The lack of system integration and real time update cycles is still a major barrier to offering the type of that fairy tale like Customer Experience that makes passengers feel happy, employees proud and shareholders satisfied. Why not ask your IT providers to have “CEM built in” into the system? This is nothing beyond reality as I have recently been asked to join the innovation board of certain visionary airline IT providers to assist them in doing just that – make their solutions more “customer value creation aware”.

In today’s mass-customized environment, not a single outstanding service element can be delivered without really deeply integrated, yet easy to understand and operate systems.

In the Epilogue of this post I will also explain how “systemic thinking” is a key resource to CEM related innovation: learning from the deeply investigated science of computer user interface  design can help us to approach the traditional Customer Experience Journey Mapping of an organization in a refreshingly new way.

3. The iTunes/Appstore experience.

Steve decided to build an ecosystem of innovative solutions and services that engaged customers beyond loyalty (taking the Frequent Flyer Program to the next step), creating huge new revenue opportunities, converting “ancillary” into “core” revenues (remember our From CRM to CEM – monetizing real loyalty post? This is about monetizing CRM). A customer doesn’t fly, a customer is a human being, needing to do business, relax or meet loved ones.

Back to reality: Knowing so very well your customers, how could your airline “appstore” ecosystem look like? Remember: it’s easy to switch brands, but very hard to change ecosystems. Anyone hooked to iTunes wanting to take the hassle to look somewhere else for an alternative?

4. The Retail experience.

I would call it “the sensorial experience”. No bad taste allowed. No shabby aircraft interiors tolerated. No airport presence without an engaging branded and themed scenery. No physical touchpoint without a wow.

Apple Airlines took this one step further, reinventing those languishing “airline city centers”. Apple Airline Lounges opened in all major destination cities, a new concept of urban Spas and chill-out cafeterias, allowed trying out the Apple Airlines onboard experience without leaving the ground. The destinations’ tourism boards were in charge of setting up highly appealing themed sceneries resembling the flair of a tropical rainforest, with real butterflies, or a Caribbean beach with palms, sand and blue water.

Located major malls and in downtown landmark buildings, some historical, others showcasing Apple’s postmodern architecture, they quickly became a favorite spot to have an affordable, yet healthy business meal while surfing or watching TV on the in-seat IFE under an indoor waterfall. Others came just to have a nap in the reclining business seats, available for free to premium members of AA’s FF ecosystem and at a nominal fee, including a free wakeup cappuccino, to all customers.

Back to reality: before launching the Apple stores in the early 2000s, the top consultants and experts augured a failure. But Steve Jobs wanted to control the whole experience cycle, end to end, inventing a new concept of shop design with an in-shop organization around customer needs, and not around products nor prices (just observe the three areas that structure every Apple store, next time you enter one). By the way, the idea is not that crazy. As you can see here, Delta’s well conceived but luckless Song offspring (under John Selvaggio’s leadership) made some interesting experiments in getting the Song experience closer to the customer.

Epilogue – why this is not just daydreaming:

I found imagining being like another, highly admired, organization or personality to be an interesting and highly productive tool for workshops as it often either sparks innovative thinking or provides insight in what prevents a company from achieving the same degree of success.

Another interesting tool I have developed with avionline, the company I am a partner of, is the “the integrated user interface model”, going beyond the traditional linear “customer experience journey mapping” approach. We found this helpful to build a consistent and simple set of –visible and holistically designed– touchpoints and underlying –invisible, efficiency oriented – processes. Understanding Apple’s OSX user interaction metaphors is a great lesson to make any type of user interface, virtual or real, more efficient while maintaining simplicity and easy of use, both for end users (“passengers”) and system administrators (“managers”).

I will present a more comprehensive set of practical CEM oriented tools in my upcoming “Practical CEM Guide for Airlines”. Please register (on the right hand column is form to do that) if you want to get informed about the publication details and date.

In the meantime, I would love to know your ideas on if and how the Apple management style could be applied to airlines and other travel related companies. Please feel free to contact me with your opinions and proposals, as well as requests for collaborations, speaking engagements or workshops.

For another story on innovation in the airline and travel industry, you may have a look at “Where is the Travel Industry’s Silicon Valley“.