Qantas has spent decades and millions of dollars telling us it’s the Spirit of Australia.
asserted
it → spend → Australia
But yesterday it told 850 of its own staff that their jobs are being outsourced to Accenture and offshored to India.
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jobs → tell → India
In the very same year it made a $1.29 billion profit.
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it → make → profit
I can tell you why decisions like this get made in two short words – executive bonuses.
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decisions → tell → words
When bonuses are tied to profits, company leaders make short-term decisions that benefit themselves.
asserted
that → tie → themselves
And the cost of long-term brand damage is really difficult to quantify, so they don’t bother.
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they → quantify → damage
A brand is a promise, and a good brand is a promise kept.
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brand → keep → ?
It’s not what you say about yourself, it’s what your customers feel about you.
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customers → ’ → you
Nobody ever flew Qantas because it was cheap, and it’s been a long time since it was the best airline in the sky.
asserted
it → fly → sky
It was once the safest, but all the others caught up with that.
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others → catch → that
So we flew it because of how it made us feel.
asserted
us → fly → it
And if you were able to watch those kids singing I Still Call Australia Home without a lump in your throat, well, you’re a monster.
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you → watch → throat
We pay more for that feeling, and Qantas knows we do.
asserted
we → pay → feeling
And before anyone writes brand feelings off as airy fairy feel-good stuff, the reality is that about two thirds of the average company’s value can be traced to its brand.
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thirds → write → brand
It’s an asset worth real money, but Qantas is trading that away to increase short-term profits.
asserted
Qantas → ’ → profits
Qantas’ reward for cutting jobs showed up within hours – the share price rose 6 per cent – but the brand damage will be long term.
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damage → cut → hours
Qantas didn’t have to look far for a cautionary tale.
asserted
Qantas → have → tale
David Jones, once one of Australia’s strongest and most successful brands, went into administration last week.
asserted
Jones → go → administration
Going to David Jones once made you feel special.
asserted
you → go → Jones
But the company was sold to people who didn’t understand the brand.
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who → sell → brand
And, in the interest of short-term profitability, they cut all the things that made the instore experience special, then wondered why people stopped shopping there.
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people → cut → things
Under Alan Joyce, Qantas outsourced part of its workforce in Australia to labour hire companies.
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Qantas → outsource → companies
That meant on the same flight they often had people working side by side doing the same job but one was employed by Qantas and the other contracted out on worse pay and conditions.
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other → mean → pay
Then Qantas management seemed surprised when morale fell through the floor.
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morale → seem → floor
If you don’t treat your staff well, that will impact a customers experience.
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that → treat → experience
It’s called brand transference.
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It → call → ?
In five years, Qantas fell from Australia’s best brand to 41st, and in 2023 alone, $384 million was wiped off its brand value.
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million → fall → value
It also copped a record $90 million penalty for the illegal outsourcing.
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It → cop → outsourcing
By the time Alan Joyce left early, in 2023, the national carrier had become a national punching bag.
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carrier → leave → 2023
It was incredibly telling that when Paul Scurrah left Virgin in 2020 the crews were in tears.
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crews → leave → tears
When Alan Joyce left Qantas three years later, crews were seen high-fiving.
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crews → leave → Qantas
Which brings me to Vanessa Hudson.
asserted
Which → bring → Hudson
When a brand is in that much trouble you normally bring in someone from outside the culture that caused it.
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that → bring → it
Instead, they chose Joyce’s chief financial officer, a Qantas lifer who worked closely with Alan Joyce.
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who → choose → Joyce
It was a chance for a proper reset and they squibbed it.
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they → squib → it
In fairness, the brand did recover in the short term.
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brand → recover → term
This year it was named the strongest airline brand, with its brand value up 32 per cent to $5 billion.
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value → name → billion
But that recovery took three years and hundreds of millions of dollars, because fixing a brand always costs more than looking after it in the first place.
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fixing → take → place
What you don’t do is spend three years rebuilding it and then burn through it to cut costs in a year you made $1.29 billion.
asserted
you → spend → billion
Qantas said earlier this year there was no plan to send jobs offshore, and now 850 of them are going.
asserted
850 → say → them
…and 15 more, not listed.
The Aporia
