On December 17, 2015, at 2:48 pm, Jet Airways announced that the firm’s Chief Executive Officer, Cramer Ball had resigned, effective February 29, 2016. Ball is touted as the one who engineered the turnaround in the fortunes of the airline, and losing him meant that the next incumbent had to at least be as good as him, if not better.
Cut to May 30, 2017. The airline announced the appointment of Vinay Dube, an industry veteran and a proven performer as its next CEO. The appointment was approved by the Ministry of Civil Aviation on August 9, 2017 making Dube’s appointment effective from that date.
It may have taken Jet Airways a long time to identify and appoint a CEO, but the company persevered until it identified the right candidate.
Commenting on the appointment Naresh Goyal, chairman of Jet Airways, had said, “Vinay will lead the executive management committee to deliver on our strategic objectives, at a time when the Indian Aviation market is poised to develop manifold going forward.”
Goyal further noted that the company had made “demonstrable progress” towards achieving long-term goals and was confident that under Dube, Jet will accelerate the momentum of turning around the company to higher growth and profits as well as deepen relationship with strategic partner Etihad Airways.
Dube joined the airline after it reported a net profit of Rs 438 crore for FY17 on a consolidated basis making it the second consecutive profitable year.
Starting off as a operations research analyst with American Airlines, Dube in his 27-year career has taken up several responsibilities such as senior vice-president, Asia Pacific for Delta Airlines profitably expanding their business by over 60 per cent since 2010, entering new markets of Japan, China, Hong Kong and Korea, besides diversifying the airlines’ network and customer base.
As VP and chief information officer of Delta, he and his team helped architect the technology footprint for Delta’s acquisition of Northwest Airlines, besides enabling Delta’s 3.5 per cent stake buy in China Eastern Airlines.
He also held leadership positions in product management/sales/marketing & strategy at Sabre Inc, a technology and marketing services firm specialising in the travel industry.
A father of three and an operations research post graduate from the University of North Carolina, USA, Dube, hails from Mumbai and feels happy to return to the country after more than three decades.
“I am privileged to have been entrusted with this crucial role in a company that espouses key Indian values of service and hospitality. I look forward to meeting the organisation’s objectives, with the support of the entire management team and employees, in order to strengthen and grow the airline and its illustrious legacy, " he said.
Challenges before Dube
The first and foremost challenge before Dube is to deliver on the faith reposed in him by the 10-member Jet Airways board of directors―which consists of five aviation industry stalwarts―Naresh Goyal, chairman, and four directors, Anita Naresh Goyal, Gaurang Shetty, James Hogan and James Rigney―the last two representing Etihad Airways.
In addition, he has to ensure that airline operations are adequately staffed with increase in aircraft utilisation and without significantly affecting the salary bill. Plus, an increase in basic salary of operating staff (such as pilots, cabin crew and ground handling) would mean more provisions in terms of retirement benefits, which, in a declining interest rate environment erodes profitability.
He also has to raise sufficient resources to reduce the airline’s debt burden (which stood at Rs 9,035 crore in FY17 down from Rs 10,813 crore in FY16).
For this, further improvements in operational efficiencies (such as a focus on selling tickets directly to more number of flyers and hence reducing agent commissions while enhancing yield), and cost reduction in the wake of competition is a challenge before Dube.
Finally, he also has to contend with, increased capacity, slowdown in key markets such as the Gulf countries leading to declining fares, resulting in the aviation sector not being able to pass on the fuel price hike to customers.
Will Vinay Dube deliver? Only time will tell.
Raghavendra Rao is a freelance writer
