Ed Bastian, CEO of Delta Air Lines, leads a company that has been on the front lines of pandemic challenges. The majority of Delta’s workforce doesn’t have the option of working from home. Over the past two years, Delta has won widespread praise for its handling of the complexities resulting from Covid, and Bastian has developed ideas and strategies for how a company can not only survive during crisis, but thrive.
HBR editor in chief Adi Ignatius sat down with Bastian in this episode of our video series “The New World of Work” to talk about:
- The power of purpose and connecting employees with a larger mission
- Ways business can work closely and productively with government
- The importance of supporting and keeping safe workers who may not be able to work from home.
“First and foremost, headquarters is not in charge of anything,” Bastian says. “We use the term headquarters, [but it] really needs to be a support center to the people out in the business that are making it happen out in the field.”
“The New World of Work” explores how top-tier executives see the future and how their companies are trying to set themselves up for success. Each week, Ignatius interviews a top leader on LinkedIn Live — previous interviews included Microsoft CEO Satya Nadella and former PepsiCo CEO Indra Nooryi. He also shares an inside look at these conversations —and solicits questions for future discussions — in a newsletter just for HBR subscribers. If you’re a subscriber, you can sign up here.
ADI IGNATIUS: Welcome to the show Ed.
ED BASTIAN: Adi, good to be with you.
ADI IGNATIUS: We billed this show as: who could be more on the front lines of the challenges that we all face (to maybe lesser degrees), that this pandemic has brought, than someone keeping an airline going. You’ve got people who have to be there physically, who have to deliver physically. What has it been like to try to guide a business through all this?
ED BASTIAN: It’s been an interesting two years. That’s for sure. In the last six months, things have certainly settled. They don’t feel settled, but they are settling down. And we look forward to getting through this latest variant, Omicron, very, very soon according to the doctors. And getting an opportunity to return as close to normal as possible.
But you’re right, Adi, throughout the entire pandemic our people have not had the option to work from home. Very few have. And as a statement of unity we all came back to the office starting last June, [with a] requirement to be back into the office, to ensure that we’re all together, we’re all navigating this challenging environment. And there’s been such a great spirit about it.
People are excited. And we’re excited when we all came back last June, to be together, and we see real strength in that collaboration.
ADI IGNATIUS: When you came back to the office together (this is before Omicron maybe upset those plans), you were relatively early and relatively forceful saying, “I want people to be back in their seats in the office,” saying there is a value to that. A lot of companies aren’t there. They’re somewhere else entirely. You must have a workforce that has differing views on it, how do you make this make sense: that we really need to be together? How do you make that case?
ED BASTIAN: First and foremost, headquarters is not in charge of anything. We use the term headquarters. I think we need to start looking at our lexicon. It really needs to be a support center to the people out in the business that are making it happen out in the field. And well over 80% of our employees do not have an option—did not have an option—including in the most difficult and darkest days of the pandemic. They needed to show up and perform their responsibilities, taking care of our customers, and taking care of our airplanes, and making certain that the world keeps moving.
And if you’re going to be a true servant-leader, you come back and you serve, which is what we asked our people to do. Was everybody thrilled? I think a lot of people were happy. Were there some that couldn’t come back? Yes, we were sensitive to that if people had some unique situations. But I wasn’t going to leave it to our people to decide how they best fulfill their service obligation. We wanted to serve together. And the majority of our people were very happy to be back.
ADI IGNATIUS: Let’s talk about this moment where Omicron is not as serious, apparently not as fatal as previous variants, but obviously incredibly contagious. I think the figure was that 8,000 Delta employees have contracted Covid within the last four or five weeks, lots of flight cancellations, not just for you, but for the industry. How do you cope with a hit like this?
ED BASTIAN: I called it the final kick in the teeth from the pandemic, Omicron, because if you recall we had a very, very busy Thanksgiving holiday. A lot of people back in the skies for the first time. And we ran basically a perfect, very, very clean operation. Staffing all in the right places. And got everybody where they needed to be on time.
Two days after Thanksgiving ended, we first heard word of Omicron, and then within just a matter of weeks, it hit us hard in this country, right at the same time we were experiencing the busiest travel surge for demand, because of the Christmas and New Year’s holiday. A lot of people had put off traveling to that point. All hitting at the same time: the confluence of Omicron, the most infectious variant we’ve seen, coupled with the highest demand level. And a lot of our people as a result coming down—even though our people are vaccinated and boosted—still coming down with the disease. One thing that we did, Adi, is throughout the pandemic we’ve encouraged testing. We’ve vaccinated people. We give them tests. And so we probably had a better pulse on who was really coming down with Omicron than most other companies, certainly most other airlines.
As a result of that, we took a pretty big hit, because we saw it happen within our own workforce very, very quickly. However, over the course of the next couple of weeks, certainly by the second week in January, things are pretty much back to normal here at Delta. It was a tough two weeks on the cancellations front, but for the last ten days we haven’t had more than just a handful of cancellations a day, due to staffing or Omicron, out of over 4,000 operations that we fly.
It hit us hard. We worked through it. Fortunately there’s been no severe illnesses caused by it. And people are now back to doing what they do best, which is taking care of travelers and getting them safely to their destinations.
ADI IGNATIUS: It’s all quite amazing to ponder from the outside. I know that you are still encouraging or requiring passengers to wear masks. And maybe some of your competitors feel less strongly about that. At least one question has come in: did you ever consider requiring proof of vaccination, the way some restaurants do, or Broadway shows do, as a condition for flight?
ED BASTIAN: We haven’t. Certainly, a lot of people have asked about it. And it’s been a topic of conversation ongoing. Internationally it is largely a requirement, to get into many countries around the world, you need to be vaccinated, including our country. And testing requirements. There’s a lot of paperwork. It makes it very, very difficult to travel internationally, when you think of all the requirements, and the requirements continuing to change and shift, particularly with this latest variant. All the restrictions went back up again.
It’s a huge deterrence to travel. When you weren’t quite sure what exactly you need, or what you’re going to find when you show up. Domestically we’ve been able to keep the airways open throughout the entire pandemic, because we’re deemed by the government to be an essential service. People need to get to where they need to go for medical reasons, for health reasons, for job, etc. It’s not like going to a restaurant or going to movies where you’ve got various options. A lot of people don’t have options, they need to travel and they need to get to where they’re at.
Secondly, we carry, at Delta, millions of people a week. To be able to check and validate not only vaccination records but potentially exemption requirements and the like would be just a huge logistical snafu that would cause us to really slow down the operation and put the onus back on our people to try to manage who gets on and gets off planes.
The airplane is the cleanest place you can be. Everyone on that is wearing a mask. The air filtration systems are the highest quality. They change out the full air with environment within a plane every two to three minutes while we’re in flight. People are adhering to the requirements. They’re not moving around. They’re buckled into their seats. So I don’t think there’s really a reason why we would need to check vaccinations in order to fly domestically. Coupled with the fact of demand: customers tell you they’re ready to go. It’s not as if it’s deterring travel, people are ready to travel.
ADI IGNATIUS: This also makes me think of the talent challenge. And I’m interested in how tough it’s been to retain talent. I don’t know how widespread it is, but we all see videos of air personnel being abused by patients who aren’t happy with mask requirements or whatever. So what have you learned about what you need to do to retain top talent at this point?
ED BASTIAN: I think everyone in this environment needs to ensure they’re staying very, very close to their people, they’re communicating, that there’s a level of transparency about what’s happening, and never more so than their travel experience with all the challenges that you highlight. Yeah, there are certainly cases that are well documented of air rage, and all the airlines that have had them. Pleased to say at Delta, there are very, very few. We’ve been relatively, I wouldn’t say unaffected, but the numbers are really quite low for us. People are trained to handle those situations. They do a fabulous job, and candidly, customers police it too onboard the planes. When somebody is not following the instructions of a crew member, it’s not just our crew members, the fellow customers step in and ensure that the flight is to go off on time as safely as possible.
When you think about the bigger question about retaining and recruiting, we’ve hired 9,000 people over the course of the last year. We had a very, very large early retirement opportunity for our people as voluntary. About 20,000 people took the opportunity to retire in the latter part of 2020, so we needed to supplement our team, and we’ve been hiring all across the board, from pilots to flight attendants to technologists to aircraft mechanics to reservationists, airport workers, you name it. We’ve been bringing a whole new generation into the company, and they’re doing a fabulous job. Our brand is strong. Our hiring brand is strong. People want to work here.
Glassdoor just ranked us yet again in the very top companies to work for, as anonymously by the people themselves that have the best sense for what it’s like to work here. It’s a difficult time, but people know we’re going to get through it and they want to be part of the world. And when you join an airline, you’re really signing up to be a citizen of the globe and being part of what it takes to keep the world moving together.
ADI IGNATIUS: Because what you do is so visible, we all feel we know the brand. I think in some ways you’re a paragon for what it means to lead a business through a challenging period. Your industry has its own specific needs, but I think we all need to get used to the idea that we’re going to be leading through crisis. And it may not be the pandemic, it may be something else, but that feels like the era we’re in. Can you offer some general lessons about how to lead successfully during a crisis?
ED BASTIAN: One of the most important things I’ve already mentioned is about communications, about staying very, very close to your team, to your people, to being authentic, to being transparent. It’s easy when times are difficult to want to shy away when you don’t have the answers to the questions that you need. It’s never more important to be visible and let people know what you know and what you don’t know. And we still, to this day, we have a lot of questions that we don’t have the answers for, but people respect the fact that we’re honest with them. We tell people what we need them to know and do, and when they ask us, we give them our very, very best insight as to how we see the future and what’s happening around and why we do make some of the decisions that we’ve had.
As difficult a period that this industry has seen over the last two years, you would imagine employee engagement to actually take a nose-dive, that people would be pretty discouraged or put off or upset, and we have found just the opposite. Our employee engagement scores have stayed just as strong throughout the pandemic as ever because there’s a real pride in what we do. As I tell our people, we didn’t have a choice. We didn’t choose the pandemic. The pandemic chose us and our company has never needed us more. Our customers, our community have never needed us more than right now. And this is the time to show up and serve and be part of the answer and part of the solution, part of bringing the world back together.
And it’s a noble mission. We fly a noble mission in normal times, but in times of difficulty, it’s really important that you fulfill that mission honorably and with passion, and so it gives people a real purpose. And I’d say that’s the second thing is: ensure that as you’re going through this hard time and you’re coming out of this hard time, you reflect on your purpose. You reflect on what you learned, you reflect on what you’re going to be doing. But more important than ever, I think it’s all given us a chance to sit back and ask ourselves the tough questions as to why do we do what we do? Why is it important? How are we going to get through this and what it’s going to take to ensure that we bring our people with us.
So that’s all wrapped into the purpose. And our purpose here at Delta is to ensure that no one better connects the world. And you think about the world needing air travel. It needs it more than ever. We are as isolated and distant from each other that I can ever recall. We just need to get back together and the airlines are going to be a big part of bringing the world together.
ADI IGNATIUS: We also talk a lot on the show about the extent to which businesses, CEOs, can be involved or need to be involved in social issues and health issues. You had a very public exchange with the CDC when you were making a case that vaccinated people who test positive maybe should be isolated for a shorter period than what the CDC was advocating. And in fact, the policy evolved. Can you talk a little bit about that as an example of private sector-government interaction?
ED BASTIAN: Yeah, well we need to be very active working together. Support with the government, the government support back, and ensuring that we’re tackling this huge challenge together with the best minds and the best science guiding the path. And one of the early indicators that we saw in the middle of December, as our people started to come down with Omicron, was we are hearing conflicting messages. We were hearing early on that, while it’s highly contagious, the impact seems to be a lot less than the original virus, and the guidance with respect to quarantine and isolation had never changed from the very first onset of Covid almost two years ago.
And so we asked the question to the CDC, because we were having thousands and thousands of our people that we were having to pull out of the operation in a very disruptive manner and isolate when the science didn’t seem to suggest that that was necessary. The science is (and I we’re continuing learning) with Omicron, there’s a pretty concentrated couple days before you’re symptomatic and a couple of days after where you’re highly contagious. But after that, your period of isolation requirements really drop immensely. And I know there’s a lot of controversy around the testing requirement, but if you could test at the end of day five that you no longer have the virus present, why are you asking businesses to keep their staff, their critical staff, away from the job for another 5 days? And more importantly, that airlines, hospital workers, firemen, police, people that are providing essential services that we need, particularly during a holiday season, to keep our society moving, it’s time we thought to update the guidance. And fortunately, the CDC took our input. We don’t have any influence with the CDC, but they took our input, they received the same question from a number of other industries as well, and they updated the guidance and it was really appreciated.
And by the way, if you come down with Omicron and you’re forced to isolate for 10 days during a holiday period, that almost seemed punitive to people during that period of time. And the other thing that I was worried about, personally, people wouldn’t even test to find out if they had it at that point, if they realized, “I’m going to miss the holidays. I’m going to miss that.” We want to encourage people to find out, to keep getting tested, and to continue to watch the signs to stop the spread, and the policy seemed like it was pushing people in the other direction.
ADI IGNATIUS: Beyond that, how do you choose the social issues, political issues that you’ll get involved in personally, and how do you manage and protect a brand reputation as you do?
ED BASTIAN: First and foremost, it’s always difficult to decide that. And candidly, my natural inclination is not to get involved in any of them because in a world that’s divided as we are currently in, you’re going to upset a lot of people, so you’ve got to be cautious. But at the same time, when you see something happening in your or community that runs counter to the values of the company and what you espouse, particularly on behalf of your people, sometimes you feel compelled to voice your view, your concerns, and to engage. There’s an endless number of topics that you could pick on a social matter to engage in. I think you have to be very careful and very cautious.
As you know, we did engage on voter rights legislation in Georgia. We weren’t the only one, a number of companies did as well, because we saw the effect it was having within our team and within our people, and our people were looking up to us asking, “After all we’ve been through over this last year, two years, and the challenges coming out after the George Floyd situation in the middle part of 2020, and the commitments that we made to continue to push forward and fight to ensure that everyone has equal access, everyone has equal opportunity, and do our very best to promote an equitable and diverse workplace, as well as community, how can we sit by and be silent?” So that was a tough one, but you’ve got to be very, very careful in terms of which issues you choose.
ADI IGNATIUS: I know you’ve made it clear that climate change is an issue of importance to you personally. How does an airline, a huge user of fossil fuels, credibly contribute to sustainability?
ED BASTIAN: That’s a tough one, and because it’s a tough one, it makes it a very important one. We’re in what’s classified as a hard-to-decarbonize industry, because 98% of our emissions, our footprint, is jet fuel, is a fossil fuel. And we do not have a substitute source to use for propulsion for our aircraft. So we need to ensure that we’re doing everything we can to seek those new sources of energy in the short term, investing, and trying to get much greater attention to sustainable aviation fuels. We’ve made a commitment as a company that by the end of the decade, a full 10% of our flying will be done using sustainable aviation fuels. And, while that doesn’t sound like a huge commitment, given the fact that sustainable aviation fuels today largely are nonexistent, if Delta were to go out and procure all of the SAF that exists within our country, it’d be enough for us to fuel only our planes for 1 day, and no one else in the industry would have anything else for the entire year.
It’s really a very minimal amount, so we need the government to be good partners with us. And we are having those conversations to create commercial opportunities for the energy producers to invest in SAF and the airlines to make sure that we’re going to be good partners and purchase and procure those, because today the cost of buying one gallon of a sustainable aviation fuel is upwards of 5 times the cost of one gallon of jet fuel, and it’s not a commercial opportunity at the present stage.
The other thing we’re doing, certainly, is looking longer term at hydrogen and electrification—all new technologies, but they’re going to take some time. So, at Delta, we made a commitment 2 years ago that, while we couldn’t find the answers today with respect to a new alternative source of energy, we could make a difference in terms of offsetting our footprint. We invested in certified offsets that eliminate the carbon that we create on a daily basis through investment in re-forestation projects, clean water projects in various parts of the world, investing in natural sources of decarbonizing the climate and the world and the planet when we can’t find an alternative use to do that ourselves. So there’s a full playbook and, just like the auto industry, is going to take us several decades before we get there, but we follow what happened in the autos, and they’ve been on a 20-year journey of electrification and using clean transportation. It’s going to probably take us just as long in our industry, but we’ve got a good path to follow if we stay focused and work closely with our government partners and our customers around the world.
ADI IGNATIUS: I want to get you a couple of questions from our viewers. This is from Oslo, and the question is, how do you engage with Delta Air Lines stakeholders to gather good ideas that can help the company revive the business, specifically coming out of the pandemic?
ED BASTIAN: Oh, we get information from so many people all the time. As you mentioned, we’re a very visible industry. I’ve got a visible access point. I only use a single email and people know it, and so I get probably thousands of emails a day of all varieties of something that had happened that went wrong, of something that went great, and please thank that employee, of ideas and opportunities. So people love air travel and they love to engage with air travel, and as a result of that, I want to make sure that I’m accessible for anyone who has good ideas.
ADI IGNATIUS: Here’s another question, this is from Cincinnati, Ohio, really a couple questions about data and analytics. How has the use of data analytics helped Delta stay ahead of the curve in the industry? And is there a digital strategy that aims to focus at the customer experience and direct sales as well?
ED BASTIAN: We’re very focused on data and analytics. In fact, some would argue the very first artificial intelligence applications came through the airline industry back 30 or more years ago through use of revenue management technologies. When you think about our business, and we have thousands of flights a day and hundreds of thousands of seats a day that we sell and the pricing of that, the yield management, the inventory, and the ability for consumers to be able to shop and match and try to find a different product category, requires an enormous amount of technology and data analytics. We have a whole team of almost 500 people that do just that for a living, every single day as they’re managing the flights and managing the pricing and the changes to make sure that we’re meeting the market where they want to buy the seats at, but at the same time, not overselling or underselling in managing that whole process.
But we use analytics far more than just as a pricing tool and an algorithm. It’s how we manage our operations, the quality of the predictive technologies we deploy, the engineering, the mechanical applications to ensure that we’re providing just absolutely the very best and most reliable air service in the world. A lot of it’s about using intelligence and taking the insight you’re getting off of the planes and off of the engines and insights from others in terms of how to run a really clean and great operation. One of the things I was most proud of last year, we were named at the end of the year by Cirium, which is the group that looks at airlines all around the world and is a data analytic shop, as the most reliable airline in the world. And it was the first time they named that, and they named Delta in 2021. And we got their big award for that because of data analytics and the intelligence that our people have at their fingertips to make good decisions for people and provide great quality operations.
ADI IGNATIUS: One more audience question. And this is something I was going to ask as well, which is the rollout of 5G that’s coming. I know Delta was one of the signatories in a letter to the White House that said this could potentially wreak havoc on the flight control systems. I don’t understand how serious an issue this is. Could you clarify what your concerns are?
ED BASTIAN: It’s a very serious issue. We’re huge proponents of 5G. I think it’s going to be a great technology. We need to update the technological backbone and the infrastructure of our country, without a doubt. But we also need to make certain that the application, in terms of the rollout, can be coordinated along with running a safe aviation system. Not just for the airlines, but also for the express package carriers and the UPS’s and the FedEx’s of the world that are also using those airways. And the FAA, as 5G is being rolled out here, had some real concerns about whether the impact of the C-band, which is the spectrum that the telecom companies will be using, could cause interference with readings that the airplanes have—particularly in proximity to the airports and landing—and offset and impact some of our instrument ratings and the quality of the information and other aspects of air travel.
And they need to have that fully vetted and fully tested. So it was not the airlines, as much as the regulator, the FAA, that was raising that concern and telling us as the operator that, “You may have to ground flights. You may no longer be able to operate certain types of equipment unless you have a very clear day. If you have difficult conditions, you may have to force people to divert.” And it would be very, very disruptive without having fully tested the rollout of the application in the aviation infrastructure. So it’s an issue for our government. I’m confident our government’s going to be able to solve this working closely with the FCC, as well as the FAA. And the White House is involved, as you mentioned. And Secretary Buttigieg and others. And it’s something that we need our government agencies to collaborate and come up with a great pragmatic solution that doesn’t cause customers of the airlines to be affected. Because the same customers, same people, are going to enjoy and utilize the benefits of 5G. So work in process. Hopefully really good news, hopefully soon here on that score, because we need to get an answer soon.
ADI IGNATIUS: I’m always interested in the path that people take to the C-suite, to the CEO role. I mean, your background is as an accountant, as an auditor, as a finance guy. How does that background inform your leadership style, now that you are CEO?
ED BASTIAN: Well, it created, I think probably, a comfort with numbers, with analytics, a curiosity about how to influence and impact and have better outcomes using the core information system. One of the things about airlines, when I tell people some of the core competencies that people need to have strategically within airlines, is comfort with analytics. And you also need to be comfortable as a decision maker. We make decisions here, hundreds if not thousands of times a day, and we need to be really good decision makers. As we operate a very, very complex and sophisticated scale company on a global basis, 24/7. So I think those are some of the core capabilities that I brought to the airline.
I joined Delta about 25 years ago in a finance area. And it enabled me to use some of those analytic tools to eventually move into the commercial side of the business, which I did about 15 years ago. And I’m fortunate enough now to be a CEO for six years. So it’s hard to see how an accountant by trade becomes CEO of an airline, but when you start thinking about what makes accountants successful, it’s people that are able to read financial statements, read financial data, and be very, very comfortable in analyzing and finding good solutions from the data.
ADI IGNATIUS: Ed, I want to thank you for being on the show. I really appreciate it. As I said at the start, you and your company are really on the front lines of trying to deliver a needed service during a really challenging time. So thank you for taking the time to be on “The New World of Work”.
ED BASTIAN: My pleasure, Adi, good to be with you.
Credit byHarvard Business Review