American Airlines is in the process of cutting 30% of management jobs, and with that we’re going to see some major changes when it comes to the company’s management structure.
Doug Parker is staying on as CEO, and I tend to think most of the changes are fairly insignificant to us customers. There’s one exception, though.
In this post:
A leadership change at American AAdvantage
Bridget Blaise-Shamai has been the President of AAdvantage and Vice President of Customer Loyalty and Insights at American since mid-2016. She has been at American Airlines for over 25 years, and has worked in all kinds of functions, though the focus has almost exclusively been on loyalty, customer insights, and marketing, and that’s a good skill set for the head of a loyalty program.
She has decided to leave the airline, and based on what we know:
- This was her choice, and she’s not being forced out
- She will be staying on for a few months to help with the transition, especially as the AAdvantage program may be used as collateral to secure further funding
The President of AAdvantage is leaving the airline
What is the legacy of the President of AAdvantage?
Let me first acknowledge that we never know what goes on in the background. In other words, even the head of a loyalty program has many constraints, and probably can’t do everything they want to.
Just as it’s not fair to give them all the credit, it’s also not fair to give them all the blame.
As far as Blaise-Shamai’s legacy goes, I’d say it’s mostly positive, and I have a lot of respect for her:
- My frustration has been the lack of innovation at AAdvantage, as it seems to me the program has just coasted by
- That being said, Blaise-Shamai has always been dedicated to running a transparent program, and in the past few years American has continued to have an award chart, and there have continued to be good value award redemptions
- All things considered I’d say Blaise-Shamai was quite an advocate for customers, especially when you look at the direction other programs are taking (just look at United MileagePlus, where we’ve seen devaluation after devaluation)
AAdvantage has continued to have some good award redemption values
Who will be the new President of AAdvantage?
While we’re still waiting on an official announcement, it’s my understanding that all signs point towards Rick Elieson being next for this role. He has also been at American for over 25 years:
- He’s currently the President of Cargo and VP of International Operations
- Prior to that he had all kinds of roles, including being the VP of Global Partner Marketing, President of AA Vacations, Managing Director of Digital, Managing Director of Revenue Management, and more
What concerns me about the future of AAdvantage
There are a couple of things that concern me about the future of American AAdvantage, when looking at the way American is rearranging executive positions. American’s current SVP of Network Strategy, Vasu Raja, will become American’s Chief Revenue Officer.
In describing this move, a letter to employees says the following:
Vasu will retain responsibility for our Network and Alliances teams while adding leadership responsibilities for the Revenue Management team and our loyalty program. The link between network and revenue will never be more important than over the next 18 to 24 months as we rebuild the airline. A more coordinated effort between Network Planning, Revenue Management and the AAdvantage program will be enhanced by this new structure.
I have a lot of respect for Raja, though almost without exception it’s bad news for loyalty program members (at least those looking to get outsized value) when revenue management and loyalty programs work more closely together.
Maybe that’s a topic for another post, but that’s essentially how you end up with something like the Delta SkyMiles program, and more revenue based redemptions. That’s not necessarily terrible for all members, but it is bad for those looking to maximize value.
Revenue management & loyalty working together is usually bad news
Bottom line
The President of AAdvantage will be leaving the airline in the coming months. While I haven’t exactly been a huge AAdvantage fanboy in recent years, I at least respect how transparent the program has been.
I can’t say I’m terribly excited about “a more coordinated effort” between revenue management and AAdvantage.
Furthermore, while I respect that American Airlines promotes from within, the airline seems to lack fresh ideas and perspectives, so replacing a lifelong American Airlines employee with another lifelong American Airlines employee doesn’t make me all that optimistic.
What do you make of this leadership change at AAdvantage?
@P
Mean. Program goes down, hard working people lose jobs. Think about other people before you speak.
AAdvantage can be used as collateral? Damn, and they claim miles have no cash value.
Good riddance I say, the program can fail and they can go to hell.
Found a couple of interviews in cargo trade.
http://www.aircargonews.com/FTypers2020/FTypers0420/FT04.15.20.html
http://www.aircargonews.com/FTypers2019/FTypers0519/FT05.20.19.html
As the best friend of an AA management employee, the reality is that focus should be on the ludicrous union contracts that are forcing the company to keep superannuated 777 pilots on 150k plus a year whilst firing young, just above average wage, support staff and junior management. The seniority system is irrational and means that AA is forced to cut harder and deeper than it needs to in other areas in order to keep...
As the best friend of an AA management employee, the reality is that focus should be on the ludicrous union contracts that are forcing the company to keep superannuated 777 pilots on 150k plus a year whilst firing young, just above average wage, support staff and junior management. The seniority system is irrational and means that AA is forced to cut harder and deeper than it needs to in other areas in order to keep the union employees in their golden deals. It is disgusting and the unionised front line staff who are taking bread and water from the tables of support staff should be ashamed of themselves.
From a someone with personal contact with her, Bridget was amazing to work for. Fair, available, and certainly not a kiss up. She will be missed and we are grieving. By the way, the US Aadvantange dept reps are being cut by 30%- 50%. Why not a kind post about the non-union, $15/hourly paid workers who were still working side by side in the office until late in the COVID19 crisis? We worked there because...
From a someone with personal contact with her, Bridget was amazing to work for. Fair, available, and certainly not a kiss up. She will be missed and we are grieving. By the way, the US Aadvantange dept reps are being cut by 30%- 50%. Why not a kind post about the non-union, $15/hourly paid workers who were still working side by side in the office until late in the COVID19 crisis? We worked there because the schedule is good for us retired folks and single parents. But now living waiting for the final cut. Its terrifying. Our direct management cried at our last meeting. Men and women. I don't know about the highest management at AA but Aadvantage customer service department's management are respectable and caring.
@Matt Fortini — The most OG virtue signal is "we proudly support our troops!"
Frequent flier miles are a thing of the past. I realize why Lucky doesnt want to admit nor post about it, but it's the truth.
My immediate thought at reading that too @Ross!
The mindset of gate agents and their assistants has always been akin to cargo loading, so I guess this will become further entrenched in the toxic AA customer relations.
The alleged incoming 'President' of AAdvantage has an unremarkable skill-set to offer, and I really wonder if this is the best AA can do.
AA, the only program left that still takes expired miles from the flyers, even during an epidemic.
Hey, at least they are transparent about it.
AA wants to innovate, I know where to start.
Moving the guy in charge of Cargo to handling Passenger Loyalty -- perfect!
>Doug Parker is staying on as CEO
Well, duh. There's virtue signaling to be done, and who else is better at it! Oh wait, there's horrific customer service to be overseen, too :D
I thought when I called to try and get more award seats released, I was supposed to say "revenue management"?
If I could cash out my points at 1 cent each I'd take it and run, both here and at BA.
With cutbacks people have to double up their duties and that will likely cause more issues unless you are a great delegated.
Ha moving from cargo to AAdvantage? Guess we all know what we’re going to be treated like in the future.... CARGO
I think some of these people must have pictures of Doug Parker running around naked with feathers hanging out his butt in order to keep their jobs and even get promoted! Dang, where are those kinds of pictures when I need them?!?! :)
As always, a blog about the business side of AA with contradictory messaging.
First you say: "As far as Blaise-Shamai’s legacy goes, I’d say it’s mostly positive"
Then immediately: "My frustration has been the lack of innovation at AAdvantage, as it seems to me the program has just coasted by"
If your frustration has been the lack of innovation, then having fresh blood take over the program would be the first step towards said innovation.
@ Biz Guy -- Hence my opinion that the legacy is "mostly positive." I'll take lack of innovation over some of the "innovation" we've otherwise seen among loyalty programs. And I'm not sure I'd call someone else who has been at the airline for 25+ years "fresh blood."
My guess is that they were looking to cut management positions in light of the protracted crisis and projected low revenue streams into the unforeseeable future. I don’t see the Revenue Management and AAdvantage department link as being foreboding. And as for Ms Blaise-Shamai, her tenure has been rather unremarkable in terms of innovation. At this point, they need to come up with incentives to get people back on airplanes and that will include better...
My guess is that they were looking to cut management positions in light of the protracted crisis and projected low revenue streams into the unforeseeable future. I don’t see the Revenue Management and AAdvantage department link as being foreboding. And as for Ms Blaise-Shamai, her tenure has been rather unremarkable in terms of innovation. At this point, they need to come up with incentives to get people back on airplanes and that will include better AAdvantage value for elite members.
Ben, AA's Revenue Mismanagement and Loyalty have already been working together. Yes, AA's Revenue Mismanagement team in general is pretty lost in space... I mean, when they often price Business Class higher than First Class (MIA LAX 77W, AND JFK LAX/SFO 321T), you know the complete lack of competence that plagues them. However, with the new dynamic award charts, not everything is bad because when load factors are low, you see LAX SYD for 48,000...
Ben, AA's Revenue Mismanagement and Loyalty have already been working together. Yes, AA's Revenue Mismanagement team in general is pretty lost in space... I mean, when they often price Business Class higher than First Class (MIA LAX 77W, AND JFK LAX/SFO 321T), you know the complete lack of competence that plagues them. However, with the new dynamic award charts, not everything is bad because when load factors are low, you see LAX SYD for 48,000 miles one-way in Premium Economy which isn't a bad a deal at all. Plus, AA has such much turnover that when new analysts join, they panic more quickly and this will benefit us as consumers looking to optimize our miles.
@ David -- No doubt that there has already been closer cooperation between revenue management and loyalty. But hearing that there will be *even more* cooperation is bad news, if you ask me.
Did revenue-based mileage earning start while Bridget was the head of AAdvantage? If so, I'd add that to one of her legacies.
@ Joey -- Yep, it did indeed.
@Ben (Lucky): Nobody will leave the President of AAdvantage position unless she is promoted to a higher level position, which is not in this case or is hired to a higher level, more money position in a different organization. Of course, it must state "that's her decision" and "she is not being forced out" while we all know what happens.
On the other hand, look at Rasa Vasu. When he was the VP Network...
@Ben (Lucky): Nobody will leave the President of AAdvantage position unless she is promoted to a higher level position, which is not in this case or is hired to a higher level, more money position in a different organization. Of course, it must state "that's her decision" and "she is not being forced out" while we all know what happens.
On the other hand, look at Rasa Vasu. When he was the VP Network and Alliance, AA lost partnership with LATAM. Wow, and he got promoted. Wow, I mean "Really? This Rasa must know how to talk to Doug Parker". Wow!
AAL stock up 42% on the news.
Hey Ben, Have you thought about what would you do if all this business of selling credit cards and miles tips go away? Do you have a plan "B"?