The high-flyer with an ear to the ground

In the search for the Big Idea, BA's new chief has chosen a simple one - communication
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The Independent Online
Everyone has to have a Big Idea these days. At British Airways, Bob Ayling's is individual responsibility. Out go the interminable meetings, the hierarchy, the buck-passing. In comes initiative, creativity and trust. Mr Ayling's mission as BA's new chief executive is to cut out layers of management and devolve responsibility.

The number of senior executives reporting to his predecessor, Sir Colin Marshall, was 25. In his re-shuffle announced this month, Mr Ayling settled for 11. "You cannot effectively create a team out of 25 managers," Mr Ayling said. "Some people say you only need six or eight to have an effective team."

Staff complained to him that layers of management smothered good ideas and stopped things getting done, so there is going to be a change of style at BA, he said. "That style is going to be a less hierarchical one. We must put much more authority into the hands of people on the front line."

Mr Ayling, 48, says all this in a dry, rather laid-back way which belies the enthusiasm of his message. But there is no doubt it comes from the heart. He stepped up from his pounds 508,000 managing director's job this month. His appointment was not only widely expected but widely welcomed by staff, who viewed Sir Colin, and Lord King before him, as somewhat aloof. "My style is a fairly informal one," Mr Ayling said, adding that he never found his two predecessors remote in any way. Certainly, he said, they were excellent mentors, especially for a man who has no formal management training.

Low morale was highlighted in a recent BA staff report. There was criticism that line managers were ineffective, and that there was a lack of communication. "I recognise both these as being problems in some areas, and I am determined to do something about it. Already we have started a really radical change in the way we communicate as a company."

Next month he conducts a week-long presentation to 5,000 staff, representing 10 per cent of BA's workforce. Twice-daily broadcasts will be beamed to employees around the world. "This is going to reveal in a very open way all the issues that face us as an organisation. There is no point in keeping these secret. They have to be exposed to everyone in the company, so that when they are asked to take part in change, they know why these things are happening."

This month's management re-shuffle also hinted at likely changes in corporate strategy. There was a new position of director of acquisitions and investments, and someone to develop BA's "interests with USAir", the American partner. Mr Ayling denies that these moves are to kick new life into BA's stalled global alliance strategy. "What I have got to do is pick up the legacy of our various investments and take them on to the next stage. I will very much be concentrating on that. We have espoused this strategy and we have now got to carry it forward."

His biggest headache is USAir, where BA wrote off half its $400m investment after industrial unrest, air crashes and fierce competition turned the 24.6 per cent stake into a millstone. Although USAir is slowly being turned around, Mr Ayling acknowledges that the high cost base is still a problem.

BA last week put further investment in the US operator on hold, but analysts say BA will have to expand its presence in America. The US aviation industry is poised for consolidation, and rumours that a BA deal with American Airlines is just around the corner refuse to die. Mr Ayling admits that all the operators are talking to each other, but warns that any big alliance will spark a whole series of deals. "Whoever breaks the mould will put in play a chain reaction over which they have no control. It's a bit like five-sided chess. It would be a brave person who forecast how it is going to end." He said BA's immediate needs were satisfied with its USAir investment, but went on: "Our arrangement with USAir is not exclusive. If we felt it was right to do something else, we would."

The European aviation industry also faces a shake-up as the continuing use of state aid to prop up loss-makers becomes an economic unreality. Mr Ayling said: "The taxpayers of Europe clearly will not go on tolerating a situation where they personally subsidise the existence of airlines."

UK governments do not escape criticism either, and Mr Ayling repeated threats to create another "hub" on the Continent if Heathrow's Terminal 5 expansion is rejected. "Those who have been responsible for airport development in this country have not sufficiently understood the economics of a major airline and the economic trade-offs. Other governments rightly view airports as a huge source of wealth creation."

Mr Ayling still finds it "quite surprising" to be heading one of the UK's most celebrated companies. He did not have the best start for a life in the fast track, having been withdrawn from public school because of his parents' financial problems, and having missed out on university. This may have been a help rather than hindrance. "It makes you self-reliant much younger, and you always feel you have to achieve something. Also, you start on this ladder of experience much sooner."

He always wanted to be a lawyer, and at 24 he became the youngest partner in Elborne Mitchell, aviation insurance solicitors. Five years later he moved to the Department of Trade and Industry, and later worked as a legal adviser to Norman Tebbit on the bill paving the way for BA's privatisation. He was noticed at BA, which he joined as legal director.

It has been a rapid rise, and inevitably social pleasures took a back seat. He still manages to escape to the Welsh hills to go walking. Regular trips to watch his beloved Chelsea are, however, a thing of the past.

Russell Hotten

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