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United's Report Card So Far This Year

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Source: Archived Content

Date: Dec 18, 2000

United has just released the results of their performance on the company's 'Core Objectives' during the first nine months of this year.  For those of you unfamiliar with them, UAL had established the following 'Core Objectives' and their respective goals, listed below as written by the company.  I have personally added their actual performance on each goal in red and green type.

Financial Objective
Keep United strong with solid financial performance.
Profitability Target: 7.8 percent fully distributed pre-tax margin.
United actually achieved a 64 million dollar net loss during the third Quarter.  Their tax margin was, according to NewsReal was "below the nine-month target of 8.9 percent that would indicate the company is on track to achieve its annual goal."

On-Time Performance Objective
Make United more reliable with consistent on-time performance.
Departure Target: 57 percent of all flights push back at their scheduled time.
United actually achieved 42 percent of all flights that pushed back at their scheduled time.

Customer Satisfaction Objective
Keep our customers coming back with superior customer service.
Repeat Customer Target: 36.9 percent of all customers definitely want to fly United again.
United actually achieved 34.4 percent of all customers who definitely want to fly United again.

Employee Confidence Objective
Make United a better place to work with our People Objective.
Employee Engagement Index: 48 percent of responses to Climate Survey are favorable.
Actual results as yet unknown.

Safety Target: Limit work place injuries to 4.1 per 100 employees.
United actually sustained 4.8 work place injuries per 100 employees for the first nine months of the year.

Diversity Target: 35.5 percent representation of women and 25.9 percent representation of people of color in management positions.
United actually achieved 37.5 percent representation of women and 26.1 percent representation of people of color in management positions.

During the first nine months of 2000, UAL Corporation failed to meet the majority of its objectives.  They did meet their Diversity Target (under Employee Confidence) and they are still waiting for results from the Employee Engagement Target (also under Employee Confidence).  How will they get the results for the Employee Engagement Target?  According to NewsReal: "It will be based on the results of the Climate Survey recently administered to a sample of employees systemwide.  The company expects to have the results of that survey by the end of the month."  (I added the bold type!)

Needless to say, this is not a very good report card.  If I had a kid and he brought home a report card like this, I'd ground him for a week at least.  And we haven't even seen the results yet of the Employee Climate Survey!  Also, if my kid brought home that kind of report card, I sure as heck wouldn't let him buy any treats like US Airways.

The bottom line here is that UAL Corporation owners and the Board of Directors  need to do a serious review/house cleaning of this company's management strategies and its internal operational organization.  This should and must be done before any further action is taken to purchase another airline.

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