WEBVTT
1
00:00:00.480 --> 00:00:02.580
Ed Bastian, CEO of Delta Airlines,
2
00:00:02.580 --> 00:00:05.760
has been with the company for over 25 years
3
00:00:05.760 --> 00:00:08.070
and helped lead it through 9/11,
4
00:00:08.070 --> 00:00:09.480
the big financial crisis,
5
00:00:09.480 --> 00:00:12.450
and then as CEO, through the COVID pandemic.
6
00:00:12.450 --> 00:00:16.350
In this Moment of Truth interview, I explore with Ed how he,
7
00:00:16.350 --> 00:00:19.770
while battling to keep Delta afloat, made critical decisions
8
00:00:19.770 --> 00:00:22.140
that actually lowered revenue,
9
00:00:22.140 --> 00:00:25.383
but positioned Delta for continued success.
10
00:00:29.490 --> 00:00:31.470
Ed, thank you so much for your time.
11
00:00:31.470 --> 00:00:32.550
It's great to see you.
12
00:00:32.550 --> 00:00:33.780
Christoph, welcome to Delta.
13
00:00:33.780 --> 00:00:34.613
Great to have you here.
14
00:00:34.613 --> 00:00:36.540
Yeah, wonderful to be here.
15
00:00:36.540 --> 00:00:39.690
We will talk a lot about crisis in this conversation,
16
00:00:39.690 --> 00:00:43.590
but now it's mid-2025 and there's no crisis.
17
00:00:43.590 --> 00:00:48.180
In fact, it's the year in which Delta turned 100 years old.
18
00:00:48.180 --> 00:00:49.013
Yeah.
19
00:00:49.013 --> 00:00:51.450
How are you guys doing in your centennial year?
20
00:00:51.450 --> 00:00:53.940
Well, pleased to say we're doing well.
21
00:00:53.940 --> 00:00:56.670
Of course, the year started off a little rocky
22
00:00:56.670 --> 00:00:59.310
with some of the geopolitical strains,
23
00:00:59.310 --> 00:01:02.970
but we've gotten through most of that, though every day,
24
00:01:02.970 --> 00:01:06.150
we are ready for those next challenges.
25
00:01:06.150 --> 00:01:10.620
But to get to 100 years in our industry,
26
00:01:10.620 --> 00:01:12.480
given how many airlines have come and gone,
27
00:01:12.480 --> 00:01:14.940
I think is quite an achievement,
28
00:01:14.940 --> 00:01:17.220
if I must say so about my people.
29
00:01:17.220 --> 00:01:19.980
And to be the first US airline reaching 100.
30
00:01:19.980 --> 00:01:21.960
So that's amazing to hear, Ed.
31
00:01:21.960 --> 00:01:26.250
Now, you've been here for more than 25 of those 100 years,
32
00:01:26.250 --> 00:01:27.840
growing through the ranks.
33
00:01:27.840 --> 00:01:30.660
And as you did that, you also experienced
34
00:01:30.660 --> 00:01:33.390
quite a number of crises as a leader.
35
00:01:33.390 --> 00:01:36.690
First, you were here when 9/11 happened.
36
00:01:36.690 --> 00:01:39.330
Second, you were here when
37
00:01:39.330 --> 00:01:42.030
the big financial crisis impacted the world.
38
00:01:42.030 --> 00:01:47.030
And then as CEO, you navigated through the COVID pandemic.
39
00:01:47.670 --> 00:01:50.820
Let's talk about that moment of the COVID pandemic.
40
00:01:50.820 --> 00:01:55.820
You had a great 2019, you had a very strong start into 2020,
41
00:01:55.890 --> 00:01:57.330
and then between February and March,
42
00:01:57.330 --> 00:01:59.430
you lose more than 90% of your revenue.
43
00:01:59.430 --> 00:02:01.860
Well, that moment was a long moment.
44
00:02:01.860 --> 00:02:03.930
It was a matter of weeks, if not months,
45
00:02:03.930 --> 00:02:06.600
before we were able to really get through
46
00:02:06.600 --> 00:02:08.280
the worst of the crisis.
47
00:02:08.280 --> 00:02:10.500
Even in the face of all the uncertainty
48
00:02:10.500 --> 00:02:15.180
and all the darkness, we set out a very simple template.
49
00:02:15.180 --> 00:02:17.550
You know, we're going to focus on our people,
50
00:02:17.550 --> 00:02:21.210
we're going to focus on protecting our cash,
51
00:02:21.210 --> 00:02:24.720
and we're going to focus also on protecting our future.
52
00:02:24.720 --> 00:02:28.140
And I think one of the most important things that we did
53
00:02:28.140 --> 00:02:31.350
was that we said, as flying came back,
54
00:02:31.350 --> 00:02:33.630
we're gonna continue to protect not just our customers,
55
00:02:33.630 --> 00:02:37.170
but our people, by blocking the capacity on our planes.
56
00:02:37.170 --> 00:02:40.410
We blocked all of the middle seats for well over a year.
57
00:02:40.410 --> 00:02:42.510
It was easy to do it in the first couple months.
58
00:02:42.510 --> 00:02:44.640
It was much harder to do in the last few months,
59
00:02:44.640 --> 00:02:46.800
but we knew people still weren't ready
60
00:02:46.800 --> 00:02:50.280
to have someone sitting next to them in the seats.
61
00:02:50.280 --> 00:02:52.800
And customers to this day will come up
62
00:02:52.800 --> 00:02:54.750
and thank me for that decision
63
00:02:54.750 --> 00:02:56.700
because the people that were flying then
64
00:02:56.700 --> 00:02:58.050
weren't flying out of choice.
65
00:02:58.050 --> 00:02:59.940
They were flying out of necessity,
66
00:02:59.940 --> 00:03:02.460
whether to get to the bedside of a sick loved one
67
00:03:02.460 --> 00:03:05.910
or to be on the front lines, fighting the pandemic.
68
00:03:05.910 --> 00:03:09.480
And they said there was only one airline that they saw
69
00:03:09.480 --> 00:03:11.190
how we were managing that they would fly
70
00:03:11.190 --> 00:03:12.720
during COVID: Delta.
71
00:03:12.720 --> 00:03:14.010
And as a result, it's the only airline
72
00:03:14.010 --> 00:03:16.890
they're ever going to fly in the future was Delta Air Lines.
73
00:03:16.890 --> 00:03:18.720
Even while we were willing to sacrifice
74
00:03:18.720 --> 00:03:21.600
a meaningful amount of revenue, when we look back
75
00:03:21.600 --> 00:03:23.940
and see how we did, like for like,
76
00:03:23.940 --> 00:03:26.100
we actually had more revenue on our planes
77
00:03:26.100 --> 00:03:28.290
than our competitors did on the airplanes
78
00:03:28.290 --> 00:03:30.930
because people were paying a significant premium
79
00:03:30.930 --> 00:03:32.250
to stay loyal to Delta.
80
00:03:32.250 --> 00:03:36.390
So take us back to that moment when you made the decision
81
00:03:36.390 --> 00:03:38.670
that you weren't going to sell the middle seat,
82
00:03:38.670 --> 00:03:39.960
at least for the time being.
83
00:03:39.960 --> 00:03:43.770
Well, it wasn't a popular decision to say the least.
84
00:03:43.770 --> 00:03:46.920
Certainly amongst certain people, our commercial leaders
85
00:03:46.920 --> 00:03:49.890
and our finance leaders needed the cash.
86
00:03:49.890 --> 00:03:52.380
But we said, as I mentioned,
87
00:03:52.380 --> 00:03:54.630
people were going to be first on the agenda.
88
00:03:54.630 --> 00:03:57.960
And when you kept coming back, if that is your priority,
89
00:03:57.960 --> 00:03:59.880
that drove my decision making.
90
00:03:59.880 --> 00:04:03.540
I don't do it often, but I used my CEO chip to make certain
91
00:04:03.540 --> 00:04:05.400
that we got through that.
92
00:04:05.400 --> 00:04:07.650
And I've got to say the team rallied behind it.
93
00:04:07.650 --> 00:04:11.340
What special things did you do with and for employees?
94
00:04:11.340 --> 00:04:14.700
Well, we were very actively engaged communicationwise.
95
00:04:14.700 --> 00:04:19.050
We had our own internal internet, if you will.
96
00:04:19.050 --> 00:04:22.140
We call it Sky Hub, where people were able to see me,
97
00:04:22.140 --> 00:04:24.900
and I'd spend up to an hour just letting people know
98
00:04:24.900 --> 00:04:27.780
what was going on, what I knew,
99
00:04:27.780 --> 00:04:29.520
more importantly, what I didn't know.
100
00:04:29.520 --> 00:04:31.830
And the one thing I learned and walked away from
101
00:04:31.830 --> 00:04:34.410
was how important it is to be vulnerable,
102
00:04:34.410 --> 00:04:36.660
to be authentic, to be transparent
103
00:04:36.660 --> 00:04:38.970
in terms of taking people with you,
104
00:04:38.970 --> 00:04:39.960
because people were scared.
105
00:04:39.960 --> 00:04:44.700
When your people could hear and see and feel,
106
00:04:44.700 --> 00:04:46.920
you know, what you were going through as a leader
107
00:04:46.920 --> 00:04:49.890
and be able to share that with them on the journey,
108
00:04:49.890 --> 00:04:51.300
they said, "We're with you.
109
00:04:51.300 --> 00:04:52.350
Just keep going."
110
00:04:52.350 --> 00:04:55.020
Yeah, well, you were one of them at that moment.
111
00:04:55.020 --> 00:04:57.690
But we're leaders, we're paid to have answers, right?
112
00:04:57.690 --> 00:05:02.610
It's not comfortable sometimes saying, "I don't know."
113
00:05:02.610 --> 00:05:06.930
We're paid to know, but when you're honest,
114
00:05:06.930 --> 00:05:08.190
that's more important.
115
00:05:08.190 --> 00:05:09.090
I totally agree.
116
00:05:09.090 --> 00:05:11.670
Let's talk about crisis management
117
00:05:11.670 --> 00:05:14.010
and your philosophy a bit more generally.
118
00:05:14.010 --> 00:05:16.560
So how do you think about the balance
119
00:05:16.560 --> 00:05:19.410
between playing defense and playing offense
120
00:05:19.410 --> 00:05:22.500
and how do you think about using a crisis
121
00:05:22.500 --> 00:05:24.330
to actually create the foundation
122
00:05:24.330 --> 00:05:26.820
for future growth and future success?
123
00:05:26.820 --> 00:05:30.870
I think the answer to me, looking back over with COVID now
124
00:05:30.870 --> 00:05:33.630
in the rear view mirror, is we had built
125
00:05:33.630 --> 00:05:37.020
a resilience gene, a resilience mindset.
126
00:05:37.020 --> 00:05:40.710
And while we didn't know what was coming,
127
00:05:40.710 --> 00:05:42.600
we knew something was going to be coming.
128
00:05:42.600 --> 00:05:46.140
And once we knew that we had the support of our government,
129
00:05:46.140 --> 00:05:48.660
that, you know, our people were going to do everything we
130
00:05:48.660 --> 00:05:53.640
could to save money, we actually started to play offense.
131
00:05:53.640 --> 00:05:55.710
We have big airport projects going on
132
00:05:55.710 --> 00:05:57.540
all across the country,
133
00:05:57.540 --> 00:06:00.180
billions of dollars that we doubled down
134
00:06:00.180 --> 00:06:04.410
and invested more in, knowing that we had a moment
135
00:06:04.410 --> 00:06:05.640
to get the airports done.
136
00:06:05.640 --> 00:06:09.090
We expanded our technology infrastructure to the cloud
137
00:06:09.090 --> 00:06:10.710
and we moved to the cloud,
138
00:06:10.710 --> 00:06:12.930
a plan we didn't even have in place yet,
139
00:06:12.930 --> 00:06:14.010
you know, pre-COVID.
140
00:06:14.010 --> 00:06:16.110
We stepped into opportunity.
141
00:06:16.110 --> 00:06:17.640
We faced the hard realities
142
00:06:17.640 --> 00:06:20.310
as the old Stockdale Paradox from Jim Collins.
143
00:06:20.310 --> 00:06:23.670
Yet we never veered from the end game.
144
00:06:23.670 --> 00:06:26.850
In fact, looking back, we've accelerated
145
00:06:26.850 --> 00:06:28.380
our journey in getting there.
146
00:06:28.380 --> 00:06:31.770
It didn't set us back, it actually helped propel us.
147
00:06:31.770 --> 00:06:34.800
For many CEOs, they are either facing
148
00:06:34.800 --> 00:06:36.840
or have yet to face their first crisis.
149
00:06:36.840 --> 00:06:38.490
What advice do you have for them?
150
00:06:39.390 --> 00:06:40.830
Well, I wish 'em well.
151
00:06:40.830 --> 00:06:42.660
It's not for the faint of heart,
152
00:06:42.660 --> 00:06:47.103
But in all seriousness, there is a lot to be learned.
153
00:06:48.030 --> 00:06:51.750
One thing that I did and I'd encourage all CEOs do,
154
00:06:51.750 --> 00:06:53.760
is to focus on your strengths.
155
00:06:53.760 --> 00:06:55.950
You know, when you go through times of crisis,
156
00:06:55.950 --> 00:06:58.680
it's very easy to think about all the problems you have.
157
00:06:58.680 --> 00:07:02.760
I think one of the natural tendencies we have
158
00:07:02.760 --> 00:07:06.270
when problems hit, we tend to kind of close up a little bit
159
00:07:06.270 --> 00:07:07.860
and we want to go away and try to figure it out
160
00:07:07.860 --> 00:07:09.900
and come back with the answer.
161
00:07:09.900 --> 00:07:11.460
It's the wrong time to close up.
162
00:07:11.460 --> 00:07:14.520
It's the time to open the doors, to let ideas in,
163
00:07:14.520 --> 00:07:16.770
to let people see what's happening.
164
00:07:16.770 --> 00:07:20.460
And I think another thing that when you go through crisis,
165
00:07:20.460 --> 00:07:24.540
people tend to feel, you know, kind of the burden of that,
166
00:07:24.540 --> 00:07:27.240
they're carrying this weight on their shoulders.
167
00:07:27.240 --> 00:07:30.570
The one thing that I was very conscious about,
168
00:07:30.570 --> 00:07:32.700
and I know that's a natural reaction,
169
00:07:32.700 --> 00:07:35.310
was that this is a blessing.
170
00:07:35.310 --> 00:07:37.200
There was never a more important time in the history
171
00:07:37.200 --> 00:07:39.900
of our airline to be sitting in the seat
172
00:07:39.900 --> 00:07:41.970
of responsibility than I was.
173
00:07:41.970 --> 00:07:45.720
And while it was hard, boy, what an opportunity.
174
00:07:45.720 --> 00:07:46.680
What a privilege it was.
175
00:07:46.680 --> 00:07:48.690
What a blessing, not a burden.
176
00:07:48.690 --> 00:07:51.630
You talk very prominently about
177
00:07:51.630 --> 00:07:54.120
the importance of your employees.
178
00:07:54.120 --> 00:07:57.510
How do you manage culture at Delta?
179
00:07:57.510 --> 00:08:00.600
Well, you manage it through your direct interaction
180
00:08:00.600 --> 00:08:02.880
and engagement with your frontline teams.
181
00:08:02.880 --> 00:08:05.250
And I'd say the majority of my time
182
00:08:05.250 --> 00:08:08.190
is spent working with our frontline teams.
183
00:08:08.190 --> 00:08:11.070
At Delta, our founder had a famous saying,
184
00:08:11.070 --> 00:08:13.350
you know, "Take care of your people first
185
00:08:13.350 --> 00:08:16.050
and they in turn will take care of your customers,
186
00:08:16.050 --> 00:08:19.560
who will then reward your shareholders with their loyalty."
187
00:08:19.560 --> 00:08:22.470
When you think about culture in our business
188
00:08:22.470 --> 00:08:24.720
and you think about the competitive differences
189
00:08:24.720 --> 00:08:26.970
that we have within the airline space,
190
00:08:26.970 --> 00:08:28.950
we all have the same airplanes.
191
00:08:28.950 --> 00:08:31.020
We all fly to many of the same airports.
192
00:08:31.020 --> 00:08:33.540
We all use many similar technologies.
193
00:08:33.540 --> 00:08:35.640
The only thing that can't be replicated
194
00:08:35.640 --> 00:08:37.530
in our industry is the people.
195
00:08:37.530 --> 00:08:38.670
That's wonderful to hear.
196
00:08:38.670 --> 00:08:40.020
Thank you so much for your time.
197
00:08:40.020 --> 00:08:41.370
Well, thank you, Christoph.
198
00:08:41.370 --> 00:08:42.210
Great to work with you.
199
00:08:42.210 --> 00:08:43.770
Thank you for all the support we receive
200
00:08:43.770 --> 00:08:45.630
from BCG throughout.
201
00:08:45.630 --> 00:08:48.060
You guys have been big partners for us in getting us
202
00:08:48.060 --> 00:08:50.339
to this 100-year mark and beyond.
203
00:08:50.339 --> 00:08:52.922
(upbeat music)