The restructuring programme approved by the European Commission in July 1994 is well under way, and unless disaster strikes the carrier should show a net profit this year for the first time in 18 years.
The excesses of the previous two decades are evaporating. The Boeing 727 previously kitted out for the Greek presidency and sitting unused on the tarmac for most of 1994 is now being refitted for passenger use. Doganis himself has rejected the spacious office of the former chairman, to take the smaller office allotted to the chief executive. Employees once promised lifelong sinecures have been retired.
Doganis arrived in February, two days after a hurried departure from his position as head of air transport at Cranfield University. While Doganis has been in academia for most of his working life, he has combined this with a variety of consultancy roles in the air transport industry. Speaking fluent Greek and as a recognised authority in airline economics, he was certainly the government's choice candidate to revive the struggling Greek carrier.
Known for his liberal views, Doganis has now found it politic to tone down his criticism of state aid, allowing that some carriers should be 'given an opportunity because of their national importance'. And he admits Olympic is looking for 'compensation' for the $220-270 million cost of the enforced move to the new Athens airport at Spata, which is due to open in 2000.
There may have been raised eyebrows when an academic was appointed to head the airline, but there is recognition that Doganis is taking the task in hand. 'I am very impressed. He is learning rapidly,' says a previously sceptical observer.
Doganis' biggest challenge on arrival was getting to grips with labour relations, complicated by the presence of 17 unions at Olympic.
Doganis is quick to stress the importance of putting a long term strategy in place. Planning at Olympic used to be about deciding what to do next season. Now Doganis is forcing managers to think about pure strategy - where the airline should fly, what its fleet should be, and which carriers it should form alliances with. Decision making is being streamlined, the product is to be revamped, and employees are having pride instilled, as well as a being re-orientated towards customer service.
The chairmanship of Olympic Airways is a precarious position - the average lifespan in the job is around nine months. The incumbent has to battle against political interests both inside and outside the airline, and deal with what can seem like a daily deluge of misinformation in the Greek press. Clearly some stability is needed. Doganis is determined to stay long enough to see the restructuring plan through to completion in 1997, and to enable Olympic Airways to put its days as a basketcase carrier behind it.
Prof Rigas Doganis: Well obviously whatever one's position one must reflect the interests that one is representing, so inevitably one's opinions are very much influenced by the position that one holds. I still believe basically in a more liberal air transport environment, but at the same time it is clear that some European airlines, including Olympic, have been slow in the past to prepare for a more competitive and a more liberal environment. Therefore I believe it is absolutely right that they should be given an opportunity to adjust because of their national importance.
The next step, once you can create hope and a vision that the airline is going somewhere, is changing the culture and the way of thinking and turning the airline from being production-oriented to being customer-oriented.
At the same time, it is very important for the staff to feel that management is close to them and not isolated on the sixth floor of a building on Syngrou Avenue. Therefore, I spend a large part of my time visiting areas within the airline, from the cleaning ladies to the technicians, to reservations and computer staff.
We have started sending regular letters to the staff, informing them what is happening and what the senior management is doing. One of the problems in Greece is that the airline is so high profile that there are daily reports in the press, most of which are inaccurate in part or in whole and have the tendency to misinform or disorient the staff. Direct communication with the staff is critical.
We accept that, but we will try and delay it as long as possible so that we can transform our ground handling operations into a much more efficient, customer-oriented business unit. With that in mind, for the first time this year we have put a senior director in charge of a new ground handling division which brought together all the sections that are dealing with ground handling at Athens airport.
The biggest area where my background hadn't prepared me adequately was in the area of labour relations, particularly in a country such as Greece and an airline like Olympic, which is highly unionised. Coping with 17 or 18 different unions and a union federation is something I have had to learn. But I don't think anything could have prepared me.
Source: Airline Business
