Industrial Relations Senior Lecturer Jim McDonald told the recent Employers and Manufacturers Association conference in Auckland that the collapse of Ansett was due to poor management not work practices.

He said an examination of airline productivity measures revealed Ansett employees had significantly increased productivity during the 1990s. 

“Ansett revenue per employee, for example, grew 25 per cent between 1992 and 1998,’’ Mr McDonald said.

“One industry measure, based on the revenue from passenger kilometres travelled per employee, showed that productivity grew more than twice that of Qantas. On the basis of the available seat kilometres per employee, Ansett workers achieved a growth three times that of Qantas.

“Therefore, it is unfair for politicians and commentators to say work practices contributed to the collapse of Ansett when a myriad of other factors assisted in its crash.”

Mr McDonald said high costs, coupled with a fleet of too many aircraft types and the complexity of the corporate structure were all elements of the airline’s demise.

He said News Corporation and TNT, joint owners of Ansett from 1979 to 1996, failed to invest in upgrading the fleet.

“When Air New Zealand bought out TNT in 1996 and News Corporation in 2000, it had no additional funds to invest in Ansett. Nor did it have in place a clear strategy for maintaining a presence in the Australian airline market.

“Air New Zealand hollowed out the Ansett management structure, transferred all of the major management functions across to Auckland, and left Ansett without leadership for more than six months.’’

But Mr McDonald said there were lessons to be learned from the Ansett situation.

“Companies taking over others on an international scale must be sensitive to international human resource management issues, identify and build upon the human resource strengths of the target company, and be perceptive about the impact of the takeover on employees’ morale.  

“Leaving a subsidiary company without management leadership is a recipe for disaster.”