In 1994, Continental Airlines was the worst major airline in the United States by almost any measure a passenger cared about. In the government's rankings it was last in on-time arrivals, last in handling baggage, and first in customer complaints. It had already been through bankruptcy twice, and it had gone through roughly ten CEOs in ten years. That year it lost about $619 million on $5.7 billion in revenue, and by fall it was running dangerously low on cash.
Gordon Bethune did not come from a business school. He spent about twenty years in the U.S. Navy, most of that time enlisted, working in and supervising aircraft maintenance. After the Navy he worked for Braniff, Western, and Piedmont, then ran large divisions at Boeing. He finished his bachelor's degree at 43 and held a commercial pilot's license. He joined Continental as president in early 1994 and became CEO that November. He approached the airline the way a mechanic approaches a broken machine: find out what is actually wrong before you start replacing parts.
His diagnosis surprised people who expected him to blame the workforce. He later put it plainly: “It wasn't anything wrong with the employees. It was the management, and it always is.” Years of cost cutting, labor fights, and turnover at the top had left frontline people with no clear goal and no reason to believe that doing a good job would make any difference. Bethune decided the fastest way to fix the airline was to change what management asked of employees and what it gave them in return.
The result was the Go Forward Plan, rolled out in late 1994. It had four parts. Fly to Win meant flying where customers actually wanted to go and dropping routes that lost money. Fund the Future meant getting control of cash and costs. Make Reliability a Reality meant running an on-time airline that delivered bags to the right place. Working Together meant treating employees as partners and telling them the truth about how the company was doing.
The most famous piece of the plan was a check. Late flights were expensive, costing the airline in missed connections, rebooked passengers, and hotel rooms. Bethune offered to share the savings with everyone. Every employee, from gate agents and ramp workers to reservation agents and mechanics, would receive $65 for each month that Continental placed in the top five of the Department of Transportation's on-time rankings. The money did not go only to managers. It went to the people whose hands actually moved the airplanes.
The airline responded faster than almost anyone expected. Continental reached first place in on-time performance by early 1995, and it qualified for the bonus repeatedly that year. Over time the program changed. The bar was raised toward a top-three finish, and later payouts rose to $100 for the best months. The core idea stayed the same. The whole company was aiming at one measure that customers cared about, that an outside agency kept score on, and that every employee could see each month.
Bethune also went after the rules and symbols that told employees they were not trusted. Instead of a thick manual that tried to script every situation, he told people to use their judgment and do what was right for the customer and the company. By his own account in his memoir, the old rule book was literally set on fire. He had the fleet repainted so that roughly 200 aircraft wearing several different color schemes finally looked like one airline. And he insisted on measuring success the way passengers did: on time, with their bags, treated decently.
The turnaround showed up quickly on the balance sheet. In 1995, with largely the same people and planes, Continental earned more than $200 million, its first annual profit in years. It won J.D. Power awards for customer satisfaction, and its stock climbed from single digits to more than $50 a share. Fortune named Continental one of the 100 Best Companies to Work For six years running, and in 2004 ranked it the world's most admired airline. The cost was real, too. Unprofitable routes were cut and thousands of jobs were eliminated in the early years. Bethune retired at the end of 2004.
Most managers cannot write $65 checks to the whole company. But every manager can do what sat underneath those checks. Pick one measure that your customers actually care about. Make sure it is honest, ideally kept by someone outside your team, so nobody can argue with the score. Post it where everyone can see it, every week. Then make sure that when the team wins, the people who did the work feel the win, not only the people who supervised it.
Recognition counts as much as money. Name the specific people who made the difference, out loud, in front of their peers. Find the rule that keeps good people from doing the obviously right thing, and get rid of it. Tell your team the truth about how things are going, including when they are going badly. People who are trusted with the facts tend to act like owners of the outcome.
People do not push airplanes out on time for a slogan. They do it when they know what winning looks like, when they can see the score, and when the people at the top make sure the crew on the ramp shares in the victory. Honor the people who do the work, and they will show you what your operation was capable of all along.