The current crisis within Air India reminds me of Julius Caesar's famous quote, Veni Vidi Vici, but with a twist. Chairman Arvind Jadhav came, the pilots struck, the government compromised, and the continuing down slide at Air India won out.

Since government takeover in 1953, strikes at Air India are frequent. Few Indians were surprised that the 250 executive pilots went on strike from 26th September. At least today there are other airlines and passengers have alternative options.

Iron man Jadhav

The surprise has been the resolve and tough approach of Chairman and Managing Director Arvind Jadhav, whom I consider to be the "iron man" that Air India desperately needs. Since his appointment, Jadhav has been tough with staff, as his interview with Business World shows. Remember life long employment is a sacred cow in India's government.

Jadhav has to be pragmatic and decisive. Air India has accumulated losses of Rs 7,000 crore (US$ 1.45 billion) and borrowings Rs 15,241 crore (US$ 3.175 billion).

Union power

To prevent a fatal tailspin, Air India and more importantly, its political bosses have to take on the unions which have become excessively powerful. The pilots' representative V.K. Bhalla made loud announcements that pay cuts will not be accepted. Air India is bloated in terms of staff, if pay cuts are not accepted, harsher job cuts will have to follow.

Yet, even while Air India is on life support, its owner, the government is not supporting management. On Monday while rumours of a lockout were rife, the civil aviation secretary M.M. Nambiar was quoted as saying that, "in the interest of passengers" strong action was not allowed. Even the Prime Minister Dr. Manmohan Singh, an economist of international stature, pulled the rug from under Jadhav's feet forcing him to accede to the demands of the pilots.

Disciplining not just the pilots, but all the staff, is desperately needed. Already other sections of employees have been emboldened to strike. While hectic parleys were going on between the airline management, the ministry of civil aviation, and the prime minister's office, the executive ground engineers announced they were going to strike in support of the executive pilots, while the two other pilots' unions also announced "moral support".

Urgent reforms

Air India has to start by amending all existing employment contracts, providing both strong incentives and even stronger disincentives. For example, specify the steps that will automatically apply if an employee joins a strike -- warning, followed by immediate dismissal, all within a period of 48 hours. If the staff at Air India do not agree, the exit door is always available. Sorry, but desperate situations call for desperate measures.

However, cost savings cannot be achieved on the backs of employees alone. Air India has to undertake a comprehensive network review. For example, three of its wide body aircraft spend the greater part of the day (14 hours) idling at New York JFK and Newark Liberty airports. Aircraft only earn money when flying and the idling costs the airline monstrous amounts. The airline has to forgo the old "babu" culture and get out from the clutches of the parasites at the civil aviation ministry who milk the already bleeding airline with needless expenditure, and politicians who force the airline to fly ridiculously unprofitable routes just for political mileage.

Combating cynicism

Majority of the traveling tax payers of India are cynical of any reform of Air India, thanks to the complete lack of professionalism and sound business operations that surround Air India, both within and from outside.

Iron willed steps based on sound business logic and a concrete plan of revival will have a salutary effect on employee performance, and the opinions of the millions of Indians who have had enough of the antics at Air India; and this would be the first and strongest step in Air India's revival. Otherwise, there is always the door of oblivion for the Maharaja.

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