The Infinite Game

by Simon Sinek

The senior executives decided to give all their flight attendants and all their pilots a midcontract raise of 5 percent and 8 percent, respectively, and asked for nothing in return. The decision would cost the company over $900 million over the next three years. It was a decision they knew Wall Street would hate. And they were right. On April 27, 2017, when American made the announcement, Wall Street’s reactions were predictably disapproving. One analyst, Kevin Crissey, who specializes in the airline industry for Citi, wrote to his clients, “This is frustrating. Labor is being paid first again. Shareholders get leftovers.” A letter from a group of J.P. Morgan analysts echoed the sentiment. “We are troubled by AAL’s wealth transfer of nearly $1 billion to its labor groups,” said the opening line of the letter. “We’re sensitive to American’s desire to ‘build a foundation of trust’ with its labor stakeholders,” the letter later explained, “but we think this latest agreement goes too far. . . . The solution to a rising wage bar is not to chase it, in our view. Sometimes, the timing of one’s commitments is simply fortuitous.” By “fortuitous,” I believe they were saying “possibly unfair, but in our favor.” Fortunately, the leaders at American Airlines had the courage to make a decision to strengthen their company without considering Mr. Crissey’s and the J.P. Morgan team’s annual bonus structures.