Planning, a clear cut direction, Corporate governance these are some of the ingredients that are missing from most African airlines and the reason why there are few of them successfully operating in the continent today. As Nigeria is bent on re-establishing it own national airline, here are some key lessons it can learn from how Ethiopian Airlines has survived for 74 years.
HOW do you establish a viable airline? Is it about percentages of shares owned or should it be the will and intent to drive the process? These are some of the things that need to be considered especially in Nigeria where there is a plan to re-establish a national airline.
Each time the argument is put forward, there is always this cliché ‘government has no business in business’ however, this has long been demystified by fellow African brother Ethiopia through their carrier, Ethiopian Airlines which has shown strength, consistency, vision and a long term initiative to bring Africa together for 74 years.
Through sheer will and discipline, Ethiopian Airline has shown is among the last guard of successful national carriers in Africa and is still partnering other countries to help establish national airlines and show them how to run it.
ASKY is a successful case and has become a name in the West African Sub-Region while Ethiopian is also in partnership with ChadAir for their national carrier, Ghana and Ethiopia are now in talks having signed an Mou, Malawiair is also in cooperation with Ethiopian Airlines, it was established as a national carrier and Ethiopia also gives RwandAir all technical support as well as management consultancy.
Managing Director, International Services, Ethiopian Airlines, Mr. Esayas WoldeMariam Hailu who spoke to Nigerianflightdeck on what it entails to establish and run a viable airline premised it on four critical pillars among which the most important is self restraint of staff and a prudent management of resources all part of good corporate governance.
He once said in an interview,”That is an embodiment of Ethiopian Airlines strict corporate governance and prudence in cost management and in everything that is the basis for success. Those people who are very prudent in cost management are rich people. People who are carefree in management are not always good, we have to be very careful as far as cost management is concerned.
“The number one contribution to the success and the attainment and meeting our own goals and even beating it, is having a clear strategy, clear marching order that is not vague. So where we are going tomorrow, today we are planning for it. Infrastructure, fleet planning, human resources management, systems procedures. Whatever we have to plan for tomorrow we do those things today, this is our four (4) pillars.
According to Haliu very recently, sincerity of purpose down to the lowest staff is a key driver of a successful airline business and any business for that matter, stating that in Ethiopian Airlines nothing is wasted or pocketed, excess funds are returned to the airline’s coffers and this is the patriotic spirit that workers of the airline at all levels have imbibed.
Haliu who was was General Manager of the airline in Nigeria and was nicknamed ‘Baba Ijebu’ for his incredible bargaining power and austere lifestyle while staying in the country for years says Ethiopian Airlines is getting it right because of its consistency and purpose.
He emphasized the four pillars that has built the airline up to the enviable level it has attained over the years.
He said,”First, it is all about long term planning and the Vision 20:2020 and now, we are going into Vision 20: 2035 from 2020, which is another 15 years of strategic planning for us. So, long te m plan requires fleet planning, age of fleet, Human Resources, system and resources, facility planning, catering, cargo and the academy planning. Everything has to go into it. So, our long term planning has been the root of our successes.
He also differed with those who seem to wear the toga that government has no business in business stating that once there is that sincerity in putting the country first, any government can achieve what it has.
“As I have mentioned earlier, our advice should start from the African Governments. In the past, people have always say that government should not involve itself in business, but that has been disproved. It all depends on how you manage it. The equity and ownership structures don’t matter. For instance, Ethiopian Airlines has been managed by the government 100 per cent and it’s working properly. First, the African Government should not meddle in the aircraft acquisition process, management and employment of people.
“The autonomy from the Ethiopian Government, despite being 100 per cent being sponsored by the government is another means of our success. The airline is allowed to be run in terms of industry without meddling in its commercial running and whatsoever.
“Strict corporate governance which precludes and disallows any kind of mismanagement and the government is also not interfering in any of the things that we are doing. Although Ethiopian Airlines is 100% owned by the government, the government has given 100% autonomy to the senior management of Ethiopian airlines to conduct the business without any interference. So those things have been the factors that are helping us to achieve and beat our own plans for the future.
“The third one is that we always emphasis on new technologies, which are part of our success. We have new aircraft, new fleet, young age fleet and others. Also, the management is very prudent, strict with corporate governance reigning supreme. When it comes to safety, security and transparency, decision and employment, there is no interference. Everything is by merit.
“These are some of the elements that are part of the success of the airline and we share experiences with our African carriers and we are trying to sell the model to them. But, we discover that some of these strict corporate governance may be strange to some African airlines because as a big boss, you feel no one should ask you questions and you can do anything without being queried.
On Nigeria and its proposed national airline
Haliu said, “There have been attempts to invite foreign airlines to participate with the Federal Government of Nigeria on the new national carrier project and Ethiopian Airlines has always been participating on that. So far, we have not been picked, but we are able, capable and ready whenever the vacancy is available. We are ready to come and cooperate with Nigeria on that.
According to him, there is no doubt that Nigeria requires its own national carrier, with the population, which is the demographic dividend and also the largest economy on the continent, mobility is very high; local and foreign.
” If we are requested to come onboard, we are ready and willing to do that and any partnership that is required, we will welcome it.
Basically, Nigeria no longer needs theories of how to establish a national airline, it needs to do and while at it identify individuals who will drive the process selflessly and ensure that the right decisions are taken because in truth whether it is a owned 100% by government or by a private individual, if the right steps are not taken, the carrier will be dead on arrival, so we should look at existing models that are functional within the motherland, Africa and learn from them instead of re-inviting those whose aim is to corner and rape our market.