Assessing US Airways' Doug Parker's Legacy
Of course, it's too soon to tell. Over the next few years, as he oversees the merger of US Airways and American (AAMRQ.PK), which would create the world's biggest airline, Parker and his every move will be closely watched and continually assessed. Obviously, Parker is poised to establish himself as an aviation leader for the ages, but the events of the next few years will shape his legacy.
In an interview, Parker said that legacy should be largely about whether he can preserve jobs for the employees of US Airways and American. "What I care about is, by the time I'm done, I'd like the people at American and US Airways to know the company will be there for them," he said. "I'm highly confident we'll get there."
In some cases, "management didn't make sure the airline could stay in business," Parker said. "That's our job, to be sure we're doing everything we can" to ensure that airlines survive."From a historical perspective, Parker has already established himself as the key catalyst for change in the final round of post-deregulation airline industry consolidation. After he pursued a merger with Delta (DAL - Get Report), Delta merged with Northwest. After he pursued a merger with United (UAL - Get Report), that carrier merged with a hesitant Continental. Then Parker pursued a merger with American, one that now awaits only regulatory approval. Imperial Capital analyst Bob McAdoo said Parker's ability to reverse the fortunes of American, which has underperformed its peers for close to a decade, will be the key factor in establishing his legacy. But perhaps improving American's performance will, in the end, equate to preserving jobs for its employees. At the moment, five leaders stand out as the giants of the post-war airline industry, essentially one at each major airline. Robert Crandall built American, Stephen Wolf built United and Frank Lorenzo built Continental, which later merged with United. Herb Kelleher created and built Southwest (LUV - Get Report), and Jerry Grinstein transformed Delta. Commercial aviation is so young, relative to many other industries, that all of its most important leaders are still alive. Asked whether it is reasonable to compare him to the industry's five giants. Parker responded: "I don't care about comparisons. I really don't. What we're doing, what I learned about a long time ago, is that it's (most important) to think of all these employees who do their jobs so well, but are so beholden to their leadership." Still, Parker said he has found a role model in Kelleher, who "really cares about the people who work for him. "Herb understands people so well -- that's in the airline," Parker said, noting that if Kelleher were talking with an employee and "if the president of the United States walked into the room, Herb wouldn't divert his attention," but rather would remain engaged in the conversation. Kelleher "is in a class by himself," Parker said. "I could never get there." Like Kelleher, Parker focuses intently on employees. During a presentation at US Airways media day in April, he described an October 2001 trip home to Phoenix from Washington D.C. just after he failed to secure an Air Transportation Stabilization Board grant that would have ensured the continued operation of America West, which later merged with US Airways. "It was a bad day," said Parker, who thought to himself: "I'm 39. I've been CEO for a month. Now I'm going to liquidate. It is not going to look good on the resume." A depressed Parker went to the rear galley and spoke with a flight attendant, a single mom, who asked how it had gone. "I couldn't lie to her," he said. "I told her: 'They don't want to do it. We're trying to get it done. Hopefully we'll be able to get through bankruptcy.' She just looked at me. She said: 'You can't do this. I've been doing this job for 15 years. This is what I do. I have my child care set up around it. I can't do anything else.'" "I realized this isn't about me," Parker said. "Management's job is to serve the people who do what she is doing." A later run at the ATSB succeeded in securing a $380 million loan guarantee, making American West the first carrier to receive an ATSB loan guarantee. Airline experts see additional legacy considerations. Consultant Bob Mann called Parker "absolutely the foremost advocate for consolidation" and said he needs continued support from labor, especially given that the American unions provided early, essential backing for a merger that was initially opposed by American management. "Labor threw the other guys over the side of the boat in order to sign up with this guy, and labor will be the key to his legacy," Mann said.
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