LAXdude1023
Topic Author
Posts: 4496
Joined: Thu Sep 07, 2006 3:16 pm

AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 6:08 pm

It is what it is...
 
United727
Posts: 351
Joined: Sat Nov 13, 2010 1:26 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 7:46 pm

Damn, I was hoping that meant that Horton was going to work for a $1/salary this year!! Guess Not....
 
chepos
Posts: 5961
Joined: Sat Dec 02, 2000 9:40 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 7:50 pm

Can they take Tommy with them whle they are at it ?

Regard,

Chepos
Fly the Flag!!!!
 
User avatar
lightsaber
Crew
Posts: 12038
Joined: Wed Jan 19, 2005 10:55 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 9:00 pm

While no one likes layoffs, AA needs to do more than they have yet announced. 20% isn't enough. They need to remove a layer (or two).

That isn't fun. My current employer is in the process of removing two layers of management. (Yea... too much burden. Oops). It is a scary and painful process. But it had to be done. We couldn't win bids as the 'management costs' per engineer were far too high. Every part of AA must earn their keep. I wish they didn't need to lay off anyone...

Too many US companies are becoming top heavy. Needless management layers help those at the top understand the business, but at a heavy cost. Airlines need to be lean. There needs to be an easy to identify business reason to keep a position or department.

I know 20% is the overall goal... To be blunt, I do not see the value of half of AA's corporate overhead costs. I'm not saying cut costs 50% (that would cripple AA in the short/mid-term). But set a higher goal than 20%. Thirty VPs (plus Executive VPs and such) is far too many. Cutting 5 isn't enough.

Lightsaber
"They did not know it was impossible, so they did it!" - Mark Twain
 
ripcordd
Posts: 1037
Joined: Sat Apr 01, 2000 1:12 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 9:13 pm

You know the funny thing they filed back in Nov 6-months ago why did it take sooo long for them to take a paay cut? They complained to the judge everday that the unions do not take a paay cut it costs them blah blah xxxx amount of dollars then why did it take them 6 months? Are the managment union? This should have been done day 2 of BK....
 
Sydscott
Posts: 3118
Joined: Thu Oct 30, 2003 11:50 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 9:55 pm

Quoting lightsaber (Reply 3):
Needless management layers help those at the top understand the business, but at a heavy cost.

Wouldn't you expect those at the top to already understand the business? If the don't then what the hell are they doing there to start with!
 
User avatar
usdcaguy
Posts: 1061
Joined: Mon Jan 26, 2004 12:41 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 10:27 pm

Quoting lightsaber (Reply 3):
Too many US companies are becoming top heavy. Needless management layers help those at the top understand the business, but at a heavy cost. Airlines need to be lean. There needs to be an easy to identify business reason to keep a position or department.

How many airline managers does it take to screw in a light bulb? Five. One to request a PowerPoint on the subject, one to tell the analyst to put it together, one to rewrite the slides written by the analyst, one to write a PowerPoint on how to save money by firing managers and analysts who write PowerPoints and one to tell an admin to place a work order with Facilities.
 
chepos
Posts: 5961
Joined: Sat Dec 02, 2000 9:40 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Tue May 01, 2012 11:05 pm

Quoting usdcaguy (Reply 6):
Quoting usdcaguy (Reply 6):
How many airline managers does it take to screw in a light bulb? Five. One to request a PowerPoint on the subject, one to tell the analyst to put it together, one to rewrite the slides written by the analyst, one to write a PowerPoint on how to save money by firing managers and analysts who write PowerPoints and one to tell an admin to place a work order with Facilities.

And 10 managers to come up with the cornerstone strategy.

Regards,

Chepos
Fly the Flag!!!!
 
ORDJOE
Posts: 650
Joined: Wed Aug 11, 2010 2:27 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 11:07 am

Quoting Sydscott (Reply 5):

One would think but no, it is every company. Those people think alike and a lot of companies have far too much management.
 
ckfred
Posts: 4763
Joined: Wed Apr 25, 2001 12:50 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 4:33 pm

It's not uncommon for a cut in senior executives, and then the remaining senior executives then do futher reductions of their areas of responsibility. A senior VP or executive VP may be told that he has to reduce his headcount by X number of people or reduce his payroll by $X.

This may be the start of futher reductions in white-collar management.

Some companies will announce every round of lay-offs, while others wait until every round of lay-offs is complete, and then announce the total reduction.

AA may have just cut the number of positons at the top. Now, the remaining ones will go through and make further cuts.

My wife has worked for several Fortune 500 companies. It's very, very rare to cut senior and executive VPs at the same time that people 4,5, or 6 levels down on the org. chart are let go.

But, this begs the question. Is AA top-heavy? Does it have too many layers of management?

I don't know the answer. But, I doubt that it's anything like GM was, when it would take 6 or 7 levels of management to approve adding one color to the choices for the mid-size cars sold in the U.S. and Canada.
 
User avatar
lightsaber
Crew
Posts: 12038
Joined: Wed Jan 19, 2005 10:55 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 5:12 pm

Quoting Sydscott (Reply 5):
Wouldn't you expect those at the top to already understand the business? If the don't then what the hell are they doing there to start with!

In day to day operations of large groups, its easier to understand what is going on if multiple sub-managers summarize the details. However, that adds cost and communications delay. At some point one has to just let the business run missing some information due to the expense of 'communication paths' in large companies.

Its one thing to understand an industry, its another to understand how the business is working that day/week/month/quarter/year.

Quoting usdcaguy (Reply 6):
How many airline managers does it take to screw in a light bulb?

  

Lightsaber
"They did not know it was impossible, so they did it!" - Mark Twain
 
jfk777
Posts: 5955
Joined: Tue Aug 22, 2006 7:23 am

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 5:25 pm

Lets hope AA isn't cuttimg muscle in the name of cutting "FAT".
 
PRAirbus
Posts: 687
Joined: Wed Apr 20, 2005 11:59 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 5:57 pm

The tsunami for the unions will finally come on June 6th when the judge rules about AA contracts! :O After that step, another round of job cuts will most likely take place. I hope AA management is smart enough to delay immediate imposition of 1113 after the peak of the summer high season. Doing so right during high season may cause havoc in its operations since employees will start to grasp and react to 1113. Tough times for AA!  
 
BCEaglesCO757
Posts: 180
Joined: Wed Mar 09, 2011 10:16 pm

RE: AA Cuts 20 Percent Of Senior Leadership Costs

Wed May 02, 2012 8:07 pm

Quoting lightsaber (Reply 3):
Needless management layers help those at the top understand the business, but at a heavy cost.

Thats the problem. Too many at the top in the airline industry with NO CLUE.

A little late to be learning.

Not saying they have to,but hiring from within with employees who may have started out at the ticket counter,Reservations,ramp,mechanics,FA,etc and worked their way up would do some well.

Of course that is entirely my opinion.

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos