Leading Change: How Alaska Airlines Took Over an Industry Darling

Abstract

Alaska Airlines (Alaska) acquired the small but sleek and much beloved Virgin America (Virgin) at the end of 2016. Alaska's executives had to set a strategy to take all the good in Virgin, integrate it into the larger company, and present the unified commercial carrier in a digestible way to its customers and affected employees. But taking over Virgin's fleet and operations without keeping its brand meant Alaska was going to feel blowback from the many Virgin fans in the Pacific Northwest and beyond when it subsumed its competitor.Systems guru Sandy Stelling and her leadership team—a carefully selected group of seven subject-matter experts, most of them women—were tasked with guiding Alaska through the trickiest part of the integration process: turning off the lights on Virgin's passenger service system (PSS) and merging all the data into Alaska's PSS. When the dust settled on the PSS integration, customers would no longer see any trace of Virgin's brand online, in airports, or when contacting call centers. The PSS integration was the highest-risk portion of the merger. Communicating exactly what Alaska planned to do and how—both to its customers and internal stakeholders—was critical. To make matters worse, executives were asking Stelling and her team to perform the integration faster than any airline had ever done it.If the company didn't perform the PSS integration flawlessly, Alaska risked wasting considerable time responding to bad press, infighting, and fixing mistakes. How would Stelling and her team make sure they did their job right? Excerpt UVA-BC-0268 Rev. Feb. 25, 2019 Leading Change: How Alaska Airlines Took Over an Industry Darling Sandy Stelling and her team sat together at Alaska Airlines (Alaska) headquarters in Seattle, plotting to eliminate a product customers loved. The airline had acquired the small but sleek and much beloved Virgin America (Virgin), closing the deal at the end of 2016. And Alaska planned to take over the smaller firm's fleet and operations without keeping its brand. Alaska was going to feel blowback from the many Virgin lovers in the Pacific Northwest and beyond when it subsumed its competitor. Alaska's executives had to set a strategy to take all the good in Virgin, integrate it into the larger company, and present the new unified commercial carrier in a digestible way to its customers and affected employees. . . .