Sunday 22 April 2018

First goal is to get airline out of the red for new chief

Head office staff in Dublin feared the new boss was going to pull the plug on the loss-making carrier. Their concerns, as it transpired, were unfounded. By John Mulligan

Christine Ourmières admits that when she began her new job at Cityjet's head office in Swords, Co Dublin, last year staff were certain she was there to pull the plug on the loss-making airline.

Appointed chief executive of Cityjet in September after the departure of former boss Geoffrey O'Byrne-White, Ms Ourmières is an Air France-KLM lifer.

Coming from the carrier that wholly acquired Cityjet in 2000, it seemed to employees -- wrongly, it transpired -- that the writing was on the wall for the Irish subsidiary.

Cityjet, established in 1992 by chairman Pat Byrne, has racked up substantial pre-tax losses in the past couple of years -- €115m in the two financial years to the end of March 2010, to be precise. In the 12 months to the end of March 2010, the pre-tax loss was €51.5m and the operating loss €45.7m. The bottom line was making for pretty dismal reading and it's little wonder staff feared the worst.

"The rumour was that I was appointed to close the company," says the Frenchwoman, who started her career at Air France in 1988 and since 2005 has been working at roles with the airline outside her home country.

"There was fear of change. It's not easy for anybody to accept change, so you have to explain to people what your priorities are, how you want to do it and have a flow of communication."

One of her immediate objectives is to get the airline out of the red. Ms Ourmières insists that Cityjet will break-even on an earnings before interest and tax level this fiscal year.

She also spent two months doing roadshows to explain to the company's roughly 1,000 workers how she plans to revive the airline's financial fortunes.

Improvements

"Everyone knows there are improvements to be made. People wanted to know more about the company's financial situation. They were really worried about it," she explains. "They needed proof there was a future."

Cityjet's main operating base is London City Airport -- the docklands facility formerly owned by financier Dermot Desmond. It's the single biggest customer there, accounting for about half the airport's business, and flies to regular and seasonal destinations including Dublin, Paris, Amsterdam, Antwerp, Florence and Milan.

It recently added Avignon -- Ms Ourmières' Provence birthplace -- as a summer destination from London. Of the 2.1 million passengers Cityjet carried last year, 60pc were business travellers and the typical customer is male and aged 45, Ms Ourmières points out.

The new business plan she drafted specified four key values that would exemplify Cityjet's internal and external operations: openness, passion, commitment and caring.

While that might all sound a bit like the usual corporate fluffiness, it's clear that Ms Ourmières, who is 46, is far from a soft touch.

When she got the phone call last year enquiring if she'd be interested in the Cityjet job, she says it was a "big surprise". With a Masters in Aeronautics and an MBA from the prestigious Essec Business School in France, she'd been working as general manager and vice president for Air France-KLM in New York for just a year. She had moved there with her family from the UK where she was general manager of the airline's operations.

"I was asked if I'd be interested and it was a huge surprise for me, because I'd only arrived in the US in 2009," he explains. "I had to talk to my husband," she laughs.

Her family is still in New York, where her daughter is attending college. Her eldest son might return to France for schooling, while she's hopeful that her husband and youngest child will be able to join her in Ireland.

For now, her job here means regular commutes across the Atlantic to keep the domestic scales level. She's also a keen runner and took part in the New York City Marathon last year but had to cry off this year's London Marathon because of a skiing injury.

"From the first second, I felt it was a really fantastic opportunity," she says of the Cityjet offer. "It's a personal challenge, but a decision where you need the support of your family," she adds.

"But you don't have any real opportunity if you don't take risk."

Decisions

Among her more immediate decisions was one to effectively reorganise what she perceived to be a somewhat lumbering management structure that existed as a result of Cityjet's 2007 purchase of Dutch regional carrier VLM.

"We decided with the management team to change the organisation of the companies because we were facing challenges. The integration of the two companies and the way we were working together could be improved, so now we are running full steam on the integration," she says.

"For me, it was very important to have a limited number of senior managers to be able to take decisions quickly," explains Ms Ourmières. "It's always difficult if you have more than 10 people around the table so we decided to create a limited number of senior management positions."

The team of five -- which includes Ms Ourmières -- meets every Monday morning.

"We don't have long meetings," she points out. Asked if she's a tough boss, Ms Ourmières considers the question for a moment before answering.

"I have very high expectations, not only with my team but also with myself," she says. "People who never worked with me have a perception of me as a very tough boss. It's important to have fun though, and I would not be able to work without having fun with my team."

There won't be much of a party atmosphere if Cityjet can't deliver the numbers for its parent, however. On the upside, the regional carrier benefits from the clout of Air France- KLM in terms of its fuel buying -- one of the most expensive parts of an airline's operating costs along with wages. Recruitment has also been frozen. The airline has also been honing its pricing skills.

"There's always a balance to be struck between load factor and yield," according to Ms Ourmières. "For us, yield is even more key because we have small capacity aircraft. We will never make money if we position ourselves as a low cost product. It will never be our strategy. We're a full service airline and passengers will never be asked to pay for a beverage or sandwich."

In the year to the end of March 2010, Cityjet's revenue declined 8pc to €282m while average fares fell 16pc. This year, Ms Ourmières says that she wants to squeeze a more than 5pc increase from the airline's yield.

"We want to be smart, agile and very dynamic," she adds.

But one wonders whether Cityjet would be better off being smart, agile and dynamic based outside Ireland. After all, its biggest base is London City, and the Cityjet name doesn't have the same Irish resonance as Ryanair or Aer Lingus. In fact, most consumers would probably be unaware that it's an Ireland-based airline.

"Cityjet is an Irish company and if you ask if Dublin is the best location for us, then I think there's no reason to change," Ms Ourmières insists. "There is expertise here at the company and we have an Irish operating certificate and the relationship we have with the Irish Aviation Authority is fantastic."

She says Cityjet also has a Belgian Air Operator's Certificate and will decide by the end of the year whether to maintain both it and the Irish licence.

For at least the next two years, Ms Ourmières' performance will primarily be tested in her ability to stem losses and return the airline to the black.

"Today's vision is that we have to be a profitable company."

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