Björn again

zoom

Gulf Air has 35 Airbus and 24 Boeing aircraft on order.

How Gulf Air's CEO has breathed new life into the once ailing carrier.

To say Gulf Air has suffered some turbulent times over the past few years is a gross understatement.

When Aussie CEO James Hogan left the company in 2006 to head up Abu Dhabi start-up Etihad Airways, the Bahrain flag carrier was allegedly left in financial dire straits.

For a while it seemed no one was willing to fill Hogan's big shoes and it was not until many months later, in February 2007, that former Crossair CEO André Dosé decided to run the gauntlet.

Not for long though - Dosé didn't hit it off with the airline's board and decided to bail, leaving Gulf Air in crisis.

Fortunately, there was someone brave enough to grab the bull by the horns and get the Gulf's oldest and most established carrier back on its feet - another Swiss national, Björn Näf, who had been chief operating officer at the airline for four months before Dosé decided enough was enough.

"It was a surprise when the previous CEO moved out. I didn't know what to expect but when I was offered the job I said, ‘why not?!'" he reveals.

"I had the advantage of being chief operating officer so I knew the difficulties and the challenges. They were, primarily, punctuality, morale, finance, reliability and reputation. I knew what was broken and I knew what the board expected. I had to bridge the gap from where we were to where we wanted to go."

Näf says he started working with the board immediately and implemented a 100-day action plan to address the most pressing issues. Bad press, uncertainty and a series of high-profile walk-outs had really caused staff morale to slump to an all-time low and so Näf made sure his first step was to establish open dialogue with all employees.

"I engaged with my management team by holding regular meetings, issued a weekly newsletter to staff to keep them updated on news and developments and also met with staff to explain our roadmap and communicate our growth strategy," he says.

"Within one month we lost a lot of employees - a lot of people were just walking out -so we stopped that by immediately adjusting salaries; an increase of 70% for cabin crew and 50% for pilots."

At the same time, the workforce was reduced from 6000 to 5000, but Näf says he ensured Gulf Air invested in people and training so that key people employed could implement changes quickly and effectively.

Näf also set about re-thinking the network and improving efficiency and productivity. "André (Dosé) had said we should downsize and shrink. We said that was not going to work. We had to grow by offering more destinations and also, we needed to re-define the product," he explains.

"The network was not aligned to the needs of the customers. We now have a new network and new connection times. With that new network came a lot of efficiency and productivity. The aircraft are being used more - 27 aircraft are carrying almost six million passengers per year. That's the highest number of passengers Gulf Air has carried with less aircraft."

He compares this to Etihad Airways, which recently boasted carrying six million passengers using 42 aircraft.

"So who is doing better?" asks Näf, trying to suppress a cheeky grin. He also notes that in August, Gulf Air achieved 80% seat load factors - "the highest in its history" and that in October, punctuality hit the 85% mark.

"Around 18 months ago we were in the 30s," he laughs.

The network

Pre-Näf, Gulf Air had witnessed a period of significant consolidation with many long-haul routes axed.

In addition, all Boeing 767 aircraft were phased out and there was a renewed focus on boosting the Middle East network.

But Näf stresses that Gulf Air cannot make money by serving the Middle East alone.

"Bahrain is growing and it wants to be connected to the world. We can help the Kingdom to grow and investments to grow.

"That's our role. We see ourselves as helping facilitate the development of Bahrain. So when we decide about destinations, it's strategic," he explains. "If you want to attract premium customers, it's all about timing and connectivity. We need daily connections. We still have the strongest Middle East network, but we need to have more long-haul routes at the moment."

Gulf Air currently flies to 42 destinations in 26 countries. Näf reveals that cities including Rome, Milan, Munich, Madrid, Barcelona, Vienna and Moscow are on his hit list.

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM