Leadership in the C-Suite: United Airlines CEO Scott Kirby

Well, how's everyone? It's great to be here with all of you. While they get that working, I told them also beforehand—I do a few of these student events. I go to my alma mater every year, but do two to three other student events. And one of the things I love about it, and that's great about it, is every time you're with a group of people like all of you, all the negative headlines and stuff that you can read in the press, you walk out feeling great confidence in the future, in the country. So I appreciate being here, because it really is fun.

Well, have them move to United. They can upgrade to first class.

Well, you know, I do think it's a whole lot more important to look forward than the past. It's cool, and we have a cool history, and it's fun to celebrate a lot of firsts at United, but I'm a whole lot more interested in the next 100 years than the last. I probably should be embarrassed to admit this, but I'm not. Like the day of our actual 100th anniversary, I was in the office and our head of HR came in and said, 'Scott, you have to give a speech at noon today. You know, there'll be a couple thousand employees there. You got to give a speech.' Like, 'Oh, okay. What's it about?' She said, 'Today's our 100th anniversary.' Like, 'Oh, okay. I'll do it.' But I am excited really for what the future means. And at United, we want to be the best airline in history and set a new standard really for what it means to be an airline.

One of the other things that's cool—that'll matter to many of you in your careers as you go further—is being, certainly at a company like United Airlines, the largest airline in the world, and airlines are high profile, you realize that you can not only do good things for your company, create a great place for your employees to work, do well for your shareholders, you can actually make a difference in the world. You know, I get to spend—like, to me it's shocking—the amount of time I get to spend in the White House or with the leaders on both sides of the aisle. You know, the number of them that I can text and call and talk to about stuff, and they often disagree with me, and whatever my view is often doesn't prevail. But you can make far more of a difference if you try. And in some ways, you know, being in a position like mine, that's the coolest part of the job.

Yeah, being a CEO is fun—if that's the question.

Yeah. Well, I mean, one of the things that I say often—if you're going to take anything away, this is one of maybe two things that I would say take away. One is that people often confuse management with leadership. Management is about compliance tasks. It's about checklists. You know, it's about going through and doing everything that your job says you have to do. Checklists are really important, especially in an airline. Like, I want our pilots doing the checklist. I want our mechanics doing the checklist. It's really, really important. But the further you move in your career, leadership is about inspiration and vision. It's about how you make people feel. And if you can inspire people—if I can get 120,000 United employees believing in the direction we're heading and wanting to go there with me, like that is so much more powerful than management. And it's something that many people confuse. And so the role, as you move up in leadership, and by the time you're the CEO, it's almost exclusively about inspiration and vision. It's going to go from compliance, and every step along the way in your career, you're going to move more to inspiration and vision. Every day you're leading people, you should think about how am I going to make these people feel good and want to do great things. And it's your job to make them want to do great things. And you'll just go so much further if you can do that.

You know, that—I'll take it even a little bit broader. You know, incremental change is good, but nobody gets excited about incremental change. And I want to excite people. And to excite people, you got to do something big, something that feels bold. And—but we'll probably talk about—like, I think reading is really important. I'll go ahead and say it: reading is really important. Don't get your information from AI. That may be a good starting point. I'm going off on a tangent. You have to read and understand to be successful, and come up with the vision and ideas that other people don't have, and then, you know, have them be good ideas, but then have the courage to pursue them. And, you know, like one simple example—I sort of launched this really during COVID. Every expert, like literally every expert in the world, said travel demand will never recover. Air travel is going to be down 50% permanently, all the airlines around the globe are going to have to dramatically shrink. A bunch of them are just going to go away and go out of business. It will never recover. And literally every single global long-haul airline in the world, 100% of them, with the exception of United, permanently retired part of their global international fleets during COVID because they bought into the expert view that air travel will never recover.

And we looked at that—I looked at that—and thought, one, I think it's wrong. Like, COVID is going to end, and when it ends, nothing about human nature will change. The logic didn't make sense to me that air travel would never recover. But watching everyone else shrink was an opportunity. We then did the largest aircraft order in the history of aviation during COVID, when everything was shut down—the biggest order in history. And that really launched—one, we got incredible pricing because nobody else was willing to buy. But, you know, it also was sort of a launching pad and a point of pride, you know, for our employees that we were willing to do that, and it turned out to be right. That, you know, sort of you build on that momentum. But the big bets are where you're going to make a difference, you know. And if you're just trying to be a little bit better, like maybe you can be a little bit better than the person in the cubicle next to you, but a little bit better is not going to—maybe it'll eventually get you into one of the interior offices, but it's never going to get you into the corner office. You got to be willing to make big bets. And find the places where you see something that no one else sees, which is another reason, by the way, that reading is so important. Like, you need to figure out stuff that other people don't see and don't know so that you can make intelligent big bets.

Well, you know, that one I can't—I'm going to say I'm not going to take credit for, because I copied others, which you all should be willing to do. If somebody else has a better idea, copy it. Don't cheat, but copy it. And for most of aviation, people thought of air travel as a commodity. You guys are in business—you know, like a commodity, low cost always wins. And so if you're in a commodity business, you're making steel, you know, your job is to get the cost as low as possible, because if your competitor is a penny a pound cheaper than you, then they're going to get all the business and you're going to go out of business. So it's all about cost control, and that's what most people thought in the airline business. And the commodity is really the schedule. So if one airline flies four times a day in a market and airline B flies four times a day, you're both going to get 50% market share. And by the way, all the kind of mathematical models that are used to model airlines are built that way. Doesn't matter which airline, they all get share based on the number of flights and the quality of the flight schedule that they have. And that's what most people thought. And we're trying to build at United what we call a brand-loyal airline—to give you reasons to fly, give customers reasons to fly United beyond just the schedule. So when the schedules are competitive in that market, you have a reason to choose United. I'll talk about some of the things we're doing, but the most credit actually goes to David Neeleman, who founded JetBlue.

And I was young and in my, you know, in my career—I'd just become a VP at America West Airlines, which is based in Phoenix, Arizona. You know, whatever that was, 25 to 30 years ago. And JetBlue, a small startup airline, and they put live TV on the airplane. No one ever had had that before. And I thought, what a gimmick. Like, that's just so stupid. But then I was hearing all this buzz about it. I actually flew out to New York from Phoenix to fly on a JetBlue flight and just see it for myself, and like it was a light bulb moment for me—like, oh my god, this is so much better as a customer. And so at America West I went to our board and got a—we had about 100 airplanes at the time, JetBlue had 11, so we were 10 times bigger than JetBlue—went to the company that had put it on for JetBlue, negotiated a deal with them to put live TV on the America West aircraft. And so that would have put them on the map. They were going from, you know, 11 aircraft to, you know, a hundred-something at one airline, and no one else was going to buy it. They were struggling. They were financially worried about whether they were going to be able to survive. Like it was going to put them on the map and make the company. So I go to the board meeting—it's like the biggest non-aircraft capex that we'd ever had in the history of America West. And America West had just come out of bankruptcy, and, you know, little airline, and our board was nervous about it. They said, 'Yeah, this is another big bet.' The board said yes. I called the CEO. He didn't answer the phone. Like, he didn't call me back. I called the next day. Didn't answer, didn't call me back. And more than 24 hours after I called him, he finally called me. It's like, 'Scott, I'm so sorry that I didn't call you back. What happened was JetBlue found out you were going to put them on your airplanes, and they bought the entire company to keep you from doing it.'

So anyway, that was my first lesson in—well, there's a lot of lessons. One, figuring out other things matter for customers, which was really the question. There's some other lessons in that too, but that brand loyalty matters. So we've tried at United to focus on service, product, technology, and reliability. And I'm hoping many of you probably do fly United—if you make the mistake of flying—yeah, thank you. And how many of you also make the mistake of flying, you know, the other guys? Whose app is better? Can you tell the difference? Like, you know, the app at United—and that's just the tip of the iceberg for technology. The service is better. And by the way, we're now getting Starlink on. Today we have 48% of our flights across the system have Starlink on. It is incredibly important to customers. And, you know, another one where we're the first big airline to launch it. And we're getting it done really fast. SpaceX is a great partner. We're getting it done really fast. But those kinds of investments for customers make it feel different to fly United than it feels to fly others. And, you know, for some examples—in Chicago, we have a big competitor in American, they have a hub there. We had lower market share in Chicago than American in 2016. And today we have doubled our market share in the market. In Denver, against Southwest, the numbers are even more dramatic—we have more than doubled. And in the Bay Area where you compete with Alaska and San Francisco, we have about triple what our two competitors combined have. I mean, it really works. Most products are not commodities. Consumers are looking for something to make a difference. Companies fall into the trap of believing they're a commodity and just focusing on cost. I mean, just focus on cost and your product is crappy, because by definition you're making it cheap. And if you give people something that they want, that's the key to success.

Well, it was interesting to say the least. One, like, there's SpaceX and Gwen who run it, and I think it's the only company that Elon Musk is involved in that he really lets somebody else run. He runs the other ones, but Gwen is amazing and he lets her run the company.

She is amazing. And so part of the negotiation was, you know, negotiating was easy. We had aligned incentives. I admit that we stalled the negotiations a little bit to let a couple of our big competitors—we knew they were negotiating to re-up on their legacy deals with the old technology—and we wanted them to do that first to make it harder for them to match.

Timing matters. But then they've just been a great partner. Like most people in the airline—like, if you go to Boeing and want something, it's a decade, like literally a decade. If we'd have tried to keep going through the usual channels, it would have been at least a decade. And we have people sitting at Starlink, like in a big cavernous warehouse, and, you know, when we first started, like something wouldn't work and the engineers are like, 'Okay,' and like you sit down at the table and they tinker with it and say, 'Put this on the airplane, see if it works.' Like, 'Okay, that worked. Okay, we'll start manufacturing that.' Like, they're incredible to work with. You know, we did have conversations about, you know, people worried. There were some people that worried about doing business with Elon Musk. And people even asked me—Elon had tweeted about me personally, you know, like six months before.

Bad. And, does he tweet good about anyone? He may tweet good about us now because we're big on Starlink. But I got my board members like, 'You're willing to do business? He tweeted this message.' Like, I don't care at all what he says about me. Like, he's got a great product and our customers want a great product, so that's what matters, and that's what I care about. And we did have to have some discussions with our people about being willing to—but doing the right thing. It's again, like, doing the right thing for customers, that's what matters.

Well, I think advertising—sorry to the advertising professor that I met earlier—is the tail. It's not the dog. And the tail shouldn't wag the dog. The advertising supports what you're doing in reality. You got to have a good story to tell before you can ever do—you can't convince someone of something in advertising that's not true. And you got to have a good story to tell. So for us, we went through COVID and we came up with, you know, a slogan that was Good Leads the Way. And it was just sort of natural, from a bunch of stuff that we were doing, for that to be natural, and it was consistent with all the things that we were already doing. We weren't trying to have a tagline or have a commercial that was going to be the vision of what we wanted to be. We were who we wanted to be, and then all of our communications, including advertising, supported that. The truth is for us, we do paid advertising, but we do far more that's, you know, we're just in the news all the time, and far more of that is unpaid. You just got to all be consistent. So, you know, you can't. Anyway, figure out the right strategy that you're going to have, do it, and then the advertising will come along with it.

Well, that's the clever thing about Good Leads the Way. It can mean a lot of different things to different people, and it does mean different things. To me, it means always do the right thing, which is a pretty simple life philosophy. And the genesis of it was, you know, to some degree, a bunch of stuff that we did kind of coming out of COVID that in some cases was controversial. Probably one of the big ones was a vaccine mandate, which United had—one of the very few big companies, we were the first big company that I know of that had it. To me it was a safety issue, and, you know, I'm responsible for safety in an airline—especially safety is not just number one, it's like an order of magnitude higher than any other industry. And to me, when it was a safety issue, I had no choice but to do it. And, you know, I said that to people. I've said it to people even in the current administration, you know, so still people there, there are different people that want to still relitigate those things. And every time—I'm respectful of it, you have a different opinion, but I'm responsible for safety at United Airlines, and I thought it was a safety issue, and I felt like I had no choice. And almost everyone respects that, by the way. After you explain it that way, they may think you shouldn't have done it, but almost everyone respects that.

Aviate Academy, which you sort of referred to at least, you know, is another example where we try to give—today about 92% of the pilots in the country are white men. That's just a legacy of a lot of—it's military, you know, where they come from. So we created an academy to give all people a chance. And by the way, it's like we take—I think we had 250,000 applications for 500 positions, so like one of the most selective you can—But we work with Women in Aviation and the Tuskegee Airmen and Latina, you know, aviation, to give people who would otherwise never have a chance to get into a cockpit—we give them a chance. And that took some real positives for some people, some real negatives from others. But doing stuff like that, where, you know, what we've done, sustainability—we're the leader for all airlines on sustainability really around the globe. And that was kind of the genesis of Good Leads the Way. But Good Leads the Way means a lot of other things. You know, flying all around the globe—you know, we added 10 new international cities in our last route announcement, you know, and that's connecting people and uniting the world, you know, and all of that kind of stuff feels good and feels right. And some people don't agree with all of it. But it's all consistent with doing at least what we think is the right thing.

I don't think so. Because Good Leads the Way became the statement, the tagline, after we'd done a bunch of stuff. The biggest decision was around—the biggest of all of those things that we did was the COVID mandate. And it was big because nobody else was doing it. It was risky. We were telling—you know, two weeks before, or maybe even a week before, I think it was two weeks before the final date where you had to be vaccinated. And by the way, we told our employees, when COVID ends—and we think it will—if you don't get a vaccine, you can come back, but you can't work in a job where you have to be around other people. You can work in a job where you don't have to be around other people, but you can't be a pilot or a flight attendant, for example, unless you're vaccinated. But two weeks before the deadline, 18% of our employees did not have it, and the whole executive team came to me like, 'Scott, we can't do this.' Like, you know, we're barely surviving here in COVID, and if we lost 18% of our employees—like, it would shut the airline down. Like, well, if that's what happens, we're going to have to figure it out, because when I say safety is number one, I mean it. I think all of you mean it. And we've concluded this is safety. So we're doing it no matter what. And by the way, two weeks later, we had 99.7%. So it all worked out, which is good.

The message got out there. But that moment, you know, and then people at the time talked about like how proud they were of our willingness to take a stand on something we thought. And I've even had employees who, in the years after, you know, a number of times somebody has stopped me somewhere and said, 'You know, I still don't think it was right that you made me get vaccinated. Should have been my decision. I don't think it was right, but I respect why you did it and you told us why.' That's like the most you can ask for.

Yeah. So, by the way, the CEO job—when I say the CEO job is, I do think that being the CEO is one of the easiest jobs at a company because you really only have one responsibility, which is the culture. You get the culture right and everything else takes care of itself. You know, I talked earlier about how you make people feel. It's about the culture and how you make people feel. The culture that I want—the broad culture I want at United—is our employees to feel proud. And when I talk about our employees, I'm talking about our frontline employees. You know, a pilot, a flight attendant, a gate agent—I want them to be proud of the company, because if they're proud, they want you to feel the same way. When you get on the airplane, something goes wrong, they want to fix it because they want you to know that's the exception. And, you know, they want you to feel good about the company because they feel good about the company. And management's a little different. My guiding philosophy—and I told you there's two things, this is the second thing, if you're going to take anything away from me—it's no excuses. Like, I went to the Air Force Academy and I learned it there. Like, when you're a cadet at the Air Force Academy, it's yes sir, no sir, no excuses, sir.

That's where it came from. Got it. And it's hard, like, you know, and they'd put you in situations where something happened and they knew you had nothing to do with it. But they'd ask you why and you'd have to say, 'No excuses, ma'am.' And there were consequences, like you're going to have real consequences from it. But it's a great lesson for business and for life, because bad stuff is going to happen, and stuff that's unfair is going to happen to you. It is going to happen to every single person. And if you make excuses about it or feel sorry for yourself, even if it's legitimate, you're going to have a hard time getting past it. And if you say, 'I'm going to overcome it no matter what,' you'll find ways to get around it, and it's a lot more fulfilling. You wind up in a better place. It's a lot more fulfilling. So, in a management team, you know, it's the one cardinal sin for me. Like, people know you can come into my office and say, 'Here's a problem,' and you can say, 'I have no idea how to solve it.' But if you come in and make excuses and say, 'Not my responsibility,' you're in trouble. At my previous employer, I banned the now-current CEO from using the word weather. He could not say weather to me, because they'd come in like, 'Oh, bad weather yesterday, we had a terrible operating day.' Like, 'You guys effing can't say the word weather.' And like, I'm going to fire you if you say the word weather in my presence, because it becomes a convenient excuse. And, you know, like—

It makes it just—just like, and, you know, when COVID happened, like, how are we going to turn it—the worst, most existential crisis that ever happened to aviation—but instead of being down in the dumps and feeling bad about it, like, how are we going to turn this into an opportunity? It happened. Like, I can't change it. And, you know, I can spend all the time I want feeling sorry about myself or hoping it's going to get better, but like that won't make anything better. How do you overcome the challenges, no matter what they are? It's just—it's empowering if you do it. And it's the one requirement I have for people that are executives on the exec—I don't expect it all the way down in the organization, but on the executive staff I—

I haven't—I don't think I've banned any. People know better. People know the weather story and—

What's wrong with basement?

So, yeah, I don't think I have — I don't know of any words that I've banned at United, but everyone knows the weather story.