Qantas calls on ‘total transformation’ specialist BCG to manage CEO change and rebuild image

The under-fire airline has called on a company specialising in ‘total transformation’ to manage the CEO change and rebuild its battered image.

Qantas has ramped up its relationship with strategic management consultancy Boston Consulting Group to help new chief executive Vanessa Hudson repair the airline’s tarnished reputation.

Described as helping clients achieve “total transformation”, BCG was expected to work closely with Qantas’ own team to help manage current issues, and navigate the transition from Alan Joyce to Ms Hudson.

The partnership continued a long term collaboration between the airline and BCG which played a key role in developing the business model for Jetstar in the early 2000s.

Ms Hudson faced an enormous task to restore Qantas to its former status as one of Australia’s most trusted companies, worthy of the “Spirit of Australia” slogan.

Since travel restarted last year, high airfares and a sub-par operational performance have done little to impress customers, along with controversy over hard-to-use travel credits, Qatar Airways, slot hoarding and a record annual profit.

An Australian Competition & Consumer Commission lawsuit alleging Qantas had sold tickets on already cancelled flights only added to the deepening crisis facing the airline and prompted the early exit of Mr Joyce.

Qantas CEO Vanessa Hudson with former boss Alan Joyce at the airline’s annual results in August. Picture: Christian Gilles/NCA NewsWire

At the same time, the Qantas share price continued to ebb lower, wiping close to $1bn from the company’s market value.

In a recent statement, Qantas acknowledged its reputation had been “hit hard on several fronts” and assured customers they “heard and understood their disappointment”.

Qantas confirmed the airline’s long-term relationship with the BCG was being accelerated to help with the image repair job.

Already, Ms Hudson had instructed executives to “fix” problems and get on with returning $570m held by Qantas to customers unable to use Covid-related travel credits.

But more challenges awaited Qantas, particularly around Mr Joyce’s “golden handshake”.

After pocketing more than $10m worth of shares under two executive bonus schemes, Mr Joyce was expected to receive a short-term bonus of $4.3m plus many millions more from the long term incentive plan.

Details of his package would be revealed in the Qantas annual report due to be lodged with the ASX ahead of the November 3 AGM.

The airline was also sweating on a High Court decision due on Wednesday in the case over the 2020 decision to outsource almost 1700 below-the wing workers including baggage handlers, tug drivers and cleaners.

No matter which way the verdict went, it was beyond question that Qantas had already suffered significant fallout from the outsourcing by way of higher rates of mishandled and damaged bags, and longer wait times at baggage carousels.

According to its website, the Boston Consulting Group helped clients with “total transformation — driving complex change, enabling organisations to grow and driving bottom-line impact”.

Last year, BCG become part of Qantas’s “green team” — a group of five organisations that agreed to pay a premium for flights to help fund the purchase of sustainable aviation fuel.

Australia Post, Woodside Energy, KPMG and Macquarie Group made up the numbers in the team, in an effort to reduce carbon emissions by around 900 tonnes a year.

On Monday, the Qantas share price continued to flounder, closing down 2c at $5.52.