Public Relations Crisis at United Airlines: How the company addressed it

 

Executive summary

In this study, a review of the incident that caused a huge PR crisis for United Airlines is presented. In the review, it was noted that on two occasions, the company acted in a way that triggered discontent from the consumers. First, it forcefully dragged a passenger off its plane in order to accommodate its crew, even though the passenger had fully paid for the flight and was issued a seat by the company. Secondly, it barred two teenage girls from entering its flight based on a sexist policy of inappropriate dressing (the girls were wearing leggings). Thus, consumers became angry and pushed for a boycott of the airline. The resulting effect was reduced patronage, dwindling market share, and reduced financial performance.

This study reveals that the resulting negative effect was due to how the company handled the issue. They did not genuinely apologize and did not implement supporting measures to ensure it did not escalate. Thus, it is recommended that the company should ensure that such a crisis is managed in the future by putting all staff to work and having clear contingency plans. Essentially, the overall approach employed by the CEO for handling the crisis was as a result of the company’s culture, and as such a culture needs to be addressed to avoid future reoccurrence.

Introduction

It was mentioned by Wang (2008) that in recent years, the impact of crisis on organizations and individuals has been stronger. Based on this view, Lusia (2013) stated that corporate leaders now need to be aware and conscious of these words. This will also involve having the right set of skills that will allow them to prepare, manage, and find necessary remedies for crisis issues that can potentially threaten the overall sustainability and existence of their company.

In the case of United Airlines, the company is facing exactly these issues. It is faced with a twin crisis issue where it dragged a passenger (who dully paid for their flight and was assigned a seat by the company) out of its plane, and also barred two female passengers from boarding their plane for wearing "leggings trousers". This has led to numerous calls to boycott the airline, with customers sharing pictures of their United Airlines loyalty and/or credit cards cut in half. The CEO, Oscar Munoz, has also acknowledged that such treatments are not deserving of any human being.

In the wake of these crises, this research is designed to: assess and discuss the management and leadership styles displayed by the company in the wake of the incident; highlight and interpret the leadership lessons that can be gathered from the CEO; evaluate the impact of organizational culture on leadership behavior; and recommend necessary strategies that the company could have employed for leadership in crisis management.

The leadership and management style displayed in this incident by United Airlines

In order to understand the leadership and management styles employed by the airline, it is vital to review what leadership and management styles are all about. By definition, they represent the way leadership controls the affairs of their company, which can be either inherent or acquired. Although there are different styles of leadership and management, the focus here will be on Lewin’s and Likert’s leadership and management styles.

Lewin et al. (1939) led a group of other psychologists to conduct a study that focused on forming their theory on leadership styles. They formulated three leadership styles as being autocratic, democratic, and laissez-faire. Autocratic leaders (as well as management) make decisions without consulting anyone. This form of leadership produced the worst level of discontent as well as created the highest level of revolution amongst the subordinates. Democratic leaders, on the other hand, involve others in the course of reaching any final decision. This kind of leadership ensures that the leaders are highly appreciated. The lazier-faire leaders have minimal involvement in decision making. This is the best style of leadership in cases where people are capable and motivated to make decisions and are not limited by any central coordinator.

On a similar note, Likert (1967) noted that there are four main styles of leadership for decision making, as an exploitative authoritative style — which is a form of leadership where the leader makes use of threats and fear-based approaches to attain conformance. This leadership style does ignore the concerns of people, and communication is from the top down. The benevolent authoritative style features the leader showing concern for people and using such an opportunity to form a benevolent dictatorship. This form of leadership appraises good performance and dispenses rewards. Consultative leadership is a leadership style where the leader makes the majority of the decisions and offers information that suits their best interest, but the flow of information is upwards and the leaders listen to the views of their staff. Finally, participative leadership is based on the maximum use of participative methods, which engages people in decision making and ensures that people at all levels are performing well (Likert, 1967).

From the above discussion, it is clear that the company employed autocratic leadership as described by Lewin and an exploitative authoritative leadership style as described by Likert. This is because

• The company exploited a passenger that had dully paid for their flight authoritatively (believing that the passenger could not do anything) by forcing him out of a flight he had already boarded, resulting in a number of injuries to the passenger.
• Secondly, the company autocratically barred two female passengers from boarding their plane for wearing "leggings trousers", also believing that they could do anything they liked to their passengers.

Thus, this prompted a high level of discontent from aviation passengers across the globe, not only against United Airlines but against all aviation companies in general. Clearly, it can be seen that altercative leadership does produce the highest level of discontent, as described earlier in this paper.

The leadership lessons from the airline’s CEO

In accordance with Avi and Lori (2017), the incidence of having a passenger dragged off-plane was followed by days of conflicting explanations, global outrage, and falling stock prices, which forced the company to enter into the Mea Culpa mood and the CEO announced that there would be an internal investigation as well as lay down an apology for the incident. Thus, it can be deduced that:

• Although being fully aware of the incident (through the circulating video), the company did not apologize instantly.
• The company was only forced to apologize as the incident started to affect their performance negatively; thus,
• It can be concluded that the apology was not a sincere regret of the incident but actually geared towards forcing people to conform to their business objectives and reverse the negative effects of the actions on their performance.

To confirm this, another incident occurred in which the airline was forced to defend itself following a sexist policy that barred two teenage girls from a flight for wearing leggings. As a result, there was never a clear intention on the part of the airline to serve customers honestly or address the issue; instead, their primary focus was on reversing the negative effects the issue was having on their performance in order to create financial sustainability.Thus, the leadership lessons from the incident are that the CEO should have

• made the necessary efforts to address the issue instantly.
• Apologies to the affected victims (personally) and the entire market (generally) affected instantly; and
• Ensure that the apology is genuine and sincere, not merely geared towards ensuring that the crisis does not have a negative influence on their performance.

Evaluation of the impact of organizational culture on the leadership behavior of the CEO

Culture is a socially learned construct that is transmitted by members of an organization, providing necessary principles that govern how people in the organization behave (Jen-Te, 2007). It is defined as the belief that moderate staff know what is expected of them and what they ought not to do, which includes values, assumptions, and practices related to their work (Staniland, 1985). In every organization, their core value starts with their leadership, which will then be used to form the leadership style obtainable in that organization. These values and behaviors of the leader will be used to lead the subordinates in a way that both parties act in a manner that is carefully aligned. In cases where the company is able to develop unified strong values, behaviors, and beliefs, it will lead to the emergence of a strong organizational culture. Thus, it is necessary that leaders appreciate their functions with respect to maintaining organizational culture, as doing so will make it possible to ensure consistent behavior between members of the company, reduce levels of conflict, and create the needed healthy working environment for employees (Christine, 2006). Additionally, the behavior of a leader is clearly moderated by existing organizational culture because it is expected that leaders do not function in conflict with the company’s values (Yafang, 2011).

According to a review, United Airlines does not have a distinct corporate culture, though it does adhere to a set of values that guide its business operations (Steven, 2017).These values are: "warm and welcoming" and "making decisions based on facts and empathy." Even so, the incident under discussion demonstrates that the company clearly ignored its values when confronted with a crisis.Neither did it make decisions based on facts and empathy (as it forcefully forced out a paid passenger in order to accommodate its crew), nor was the airline warm and welcoming to the teenagers it barred from boarding a flight due to their dress (Steven, 2017).

Thus, one can easily see that the behavior of Munoz, the CEO, was mainly based on the company’s culture (which doesn’t regard the consumers much and focuses primarily on their own interests even if it affects the consumers negatively). That is why the CEO was only able to apologize when it was evident (days after the incident) that the issue was having a negative influence on the company’s performance. Additionally, while it acknowledged its faults in the incident of "dragging off a passenger forcefully from the airline", it still went on to bar other passengers from boarding because of the way they were dressed.

Conclusion and Recommendations

Basically, the discussion above points to poor crisis management as the main factor behind the company’s woes. Thus, the recommendation is centered on effective crisis management, and there are two steps: understanding the role of organizational members and adopting the right leadership strategies and style.

It was noted by Lussier and Achua (2007) that both leaders and staff members have equal roles when it comes to addressing the crisis being faced by a company. Thus, it is recommended that organizational members at all levels should have a vivid understanding of the crisis and employ necessary response measures (Jarret, 2007). In the case of United Airlines, the staff (crew members) are close to the company and they would have used them effectively. Following the incident, the company should have ordered its crew on all of its flights to apologize for the incident after its pre-flight safety demonstrations (directly or through the circulation of flyers). This would have melted the hearts of some of its consumers while helping defend the company against the impending negative impact of the incident on their performance (financial and non-financial).

Secondly, it was argued by Moats et al. (2008) that companies should implement scenario planning and scenario-based training (SBT) when coping with a crisis. Scenario planning entails creating different stories with varied futures based on the present performance of the company, which helps the company to be better prepared against unknown threats. On the other hand, scenario-based training is a practical activity that entails actually planning how to handle such a situation and training the staff on the necessary skills. Therefore, it is recommended that the company should implement scenario planning and scenario-based training in relation to potential trade-offs with its consumers (in particular) and stakeholders (in general), to help them be better prepared to address such issues in the future.

Also, findings show that building a good rapport with the media, especially prior to any crisis, does help mitigate the negative impact of such a crisis and better protect its reputation in the process (Horsley and Barker, 2002). Therefore, it is also recommended that the company should have a strong media network which they will use to provide vital and concrete information to the stakeholders in the course of any crisis, as this will help them mitigate the possibility of counter-media networks making the crisis worse.

In conclusion, no company is immune to crisis because the factors that cause them can be both internally and externally motivated, and are sometimes beyond a company's control. However, how the company addresses a crisis does determine what will happen to its performance following the crisis. In the event that a crisis is poorly managed, it is expected that it would negatively affect the performance of a company, as shown in the case of United Airlines above. However, strategic management of a crisis allows the company to at least limit or mitigate the negative effects that such a crisis could have on its performance, creating the needed room for sustainable business processes. Thus, it is concluded that the negative effects experienced by United Airlines as a result of the incident in question are because the company poorly managed the crisis, creating a higher level of discontent from the consumers and, as such, reducing their intention to purchase from the company. However, careful management of crisis based on the contingency plans discussed in the recommendations above is expected to shield the company from adverse negative effects of crisis in the future, but this must be entirely based on how well such strategies are integrated into their corporate structure.

References

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