Diversity turns airline around

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Continental airlines executives credit diversity hiring and multicultural marketing initiatives over the last five years with playing a big role in the airline's turnaround.

Continental last month celebrated its independence for the first time since 1983 after buying back $450 million of its stock from Northwest Airlines. It was the final hurdle in a long odyssey from the bottom of the heap in the early 1990s. At the same time, Continental was named Airline of the Year for 2001 by Air Transport World.

Airline executives say one reason the company has posted several years of profits and double-digit growth is its aggressive attitude in hiring, training and retaining minority employees. About 23% of its managers and 37% of its employees are minorities.

"Having a very diverse workforce to meet an increasingly diverse global customer base has become an important advantage for us," says Pat Bissonnet, Continental director of diversity and fair employment practices.


With a number of bilingual employees serving areas with a high number of Hispanics-including its Newark, N.J., and Houston hubs-Continental has been a leader in recruiting and retaining Hispanics, and over the last few years has added signs in Spanish at 20 airports. Bromley Communications, San Antonio, handles U.S. Hispanic advertising.

To maintain its edge in the competitive market for international airline travel, Continental plans to hire a record number of airplane crew members who speak French or Japanese in addition to English, so that bilingual crews will serve key routes to Europe and Asia.

Continental also became the official airline of the U.S. Hispanic Chamber of Commerce last year, and within the last several months has formed alliances with the Organization of Black Airline Pilots; Black Flight Attendants of America; National Black MBA Association; and Hispanic MBA Association to recruit minorities at all levels of the company. These relationships are crucial to the airline's diversity recruitment initiative.

"Serving people in their native language and with their native cuisine is a huge plus for customers; they tell us it's a major reason they keep flying on our airline," says Pete Garcia, VP-sales and marketing for Continental's Latin America and Caribbean operations.

Traffic from Latin America now represents about 15% of Continental's revenues, and the company plans to maintain bilingual crews on most flights as it ramps up its international service to Europe and Asia, with crew members who speak at least two languages.

"It costs a premium to hire crew members who speak [multiple] languages, but it's worth the investment because it really cements the traveler's loyalty," says Mr. Garcia. He joined Continental in 1977 and has played a key role in developing its international reservations desk, consisting of 75 people speaking dozens of languages.


Diversity goals are not limited to language-based efforts. To attract African-American pilots, Chairman-CEO Gordon Bethune was the keynote speaker at a recent annual meeting of the pilots' group.

Beyond multicultural marketing moves, Continental continues to break new ground with internal programs designed to encourage diverse workforces to pull together as a team. One program in particular, instituted in 1996 to reward team efforts, has helped promote diversity, says Ms. Bissonnet. Every month that Continental is ranked among the top three airlines nationwide for on-time arrivals, each employee is given $65.

"Employees tell us these programs have driven home the importance of looking at the person next to you as a team member, regardless of their ethnicity or lifestyle," Ms. Bissonnet says.

Continental is strengthening its diversity efforts this year. Last year it formed its first-ever Diversity Council, consisting of seven executives who hail from various departments including human resources, sales and marketing and operations. The group begins a series of meetings this year, with the goal of building a business case in each division for diversity, Ms. Bissonnet says.

"We have a top-down philosophy that starts with Gordon Bethune, insisting that every employee be treated fairly and that we all work as a team, and diversity is a big part of that," she says. A new video promoting diversity has been developed for Continental's managers; it includes a call to action from Mr. Bethune.

Next month, top managers throughout Continental airlines will participate in a new program promoting diversity employee issues, Ms. Bissonnet says. "Each division of the airline is being charged with developing diversity initiatives appropriate to that division, recognizing that diversity issues must fit the job and the circumstances," she says.


Employees are responding to Continental's practices. In last year's tight job market, the company received 80,000 to 90,000 applications for 15,000 job openings, ensuring a rich pool of applicants. Continental is currently ranked 18 on Fortune's list of the "100 Best Companies to Work For." Continental also has made repeat appearances on Hispanic Business' list of best places to work for Latinos. Last year, Continental extended benefits to domestic partners and made its companion travel benefits useful to non-spouses.

"We have diverse lifestyles among our employees-not everyone is married-and we want to recognize facts about how people live, regardless of gender or race," Ms. Bissonnet says.

Continental's workforce diversity efforts are paying off, notes one marketing consultant.

"Continental's success is not unrelated to its diversity initiatives, and its efforts to reach out to an increasingly multicultural workforce," says Andrew Erlich, president of Erlich Transcultural Consulting, a cross-cultural market researcher. Diverse workforces are more creative because they have diverse viewpoints, he says. However, conflict can also arise from diversity efforts.

"Management must recognize the differences among cultures in their workforces and create pathways for people to communicate and reach understandings across cultures through planning and leadership," says Mr. Erlich.

Examples include customized training programs to address potential conflicts and help employees understand other points of view and respect one another.


Continental's headquarters in Houston is home to one of the fastest-growing Hispanic populations in the nation and is a laboratory of diversity, says Stephen Klineberg, a professor of sociology at Rice University.

The "Houston Area Study," a demographic field program conducted each year by Mr. Klineberg, reveals that of people 18 to 30 years old in Houston's Harris County, 39% are Hispanic; 29% are white; 22% are African-American and 8% are Asian.

"The workforce of the future is going to be even more diverse than today, and in order to be effective, companies must meet these groups halfway with support systems, encouragement, diversity training and management programs geared for them," Mr. Klineberg says.

Introducing such diversity programs isn't always easy: "Many groups are uncomfortable and insecure with diversity initiatives, but companies must recognize the points of view of people from all ethnic groups in order to find balance and succeed," he says.

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