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Friday, October 30, 1998 - Page updated at 12:00 AM

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New Chief Executive At Delta Air Lines Sees Blue Skies For Once- Fading Airline

AP

ATLANTA - For most of an hour, Leo Mullin has been describing his first year as chief executive officer of Delta Air Lines with almost-boyish enthusiasm.

Hands wave and point in emphasis as this bookish-looking 55-year-old boss explains what he's done since leaving the utility company Unicom and joining the airline in August 1997. At times, he stammers as his mouth struggles to keep up with the torrent of thought.

"The whole year has been a career highlight for me," he exults, leaning across a conference table. "This has been the best year of my business life!"

But the effervescence fades as Mullin describes the event that all his years in other industries could not fully prepare him for - the Sept. 2 crash of a Swissair flight with which Delta had a code-share agreement.

He expresses pride in Delta's response, the unhesitant treatment of the crash as if it had been Delta's own plane that crashed off Nova Scotia, killing all 229 people aboard. He recalls the memorial services.

"I talked to those passenger families," he said. "We had a (Delta) flight attendant on there, Patricia Eberhart, and I read her file several times. She was a wonderful person, she had great involvement with the community."

Mullin stares down into his coffee cup and pauses. When he looks up, his eyes have reddened.

"It just drives it home," he says. "It can be an intellectual experience when you go through the practices, but when you see all of the human aspects of what this tragedy represents . . . it causes you to wake up every day and worry about safety first."

The telephone call that awakened Mullin with news of the crash was his most searing moment at Delta. But there have been other notable, sometimes bumpy, times for the 69-year-old carrier during his tenure:

-- Delta recorded its first billion-dollar profit for the fiscal year ended June 30, and its stock hit a record high of $143 a share.

-- There was an ardent effort to take over Continental Airlines, which spurned Delta for an alliance with Northwest Airlines.

-- A sweeping strategic alliance with United Airlines also was undercut when Delta pilots balked while seeking a board of directors seat that Delta refused. The two airlines settled for a frequent-flier partnership.

-- There were signs of progress on the crucial issue of customer satisfaction - Delta moved from last to fourth within a year in major airline on-time performance, and the airline also improved its ratings on baggage handling.

-- Delta's leadership team was reshaped, with four of Mullin's top six executives brought in from outside the company - two, like Mullin, from outside the airline industry.

The Delta board's decision to oust Ronald Allen and bring in Mullin as the first non-Delta chief executive in company history followed a decade in which money-losing expansion was followed by sharp cost-cutting.

On the line for Delta, said Sidney Harris, dean of the Georgia State University College of Business Administration, was its core value of high-quality customer service, which it seemed to be losing along with employee morale.

Mullin recalls the situation as one of low morale, physically "shabby" airplanes and a troubling image of declining customer service.

Mullin, who holds four Harvard degrees and arrived with three decades of management experience in the railroad, banking and utility industries, took advantage to steep steeped himself in the airline culture, learning through asking questions and listening.

A pleasant surprise was his warm reception by employees.

But Chuck Giambusso, elected to lead the Delta pilots union in August, says the warmth and "sense of relief" that greeted Mullin is wearing off.

"The pilots' point of view is that no progress is being made, whether there is or isn't an effort being made," Giambusso said. "I would say everyone still has an open mind with a lot of distrust - a lot of it Mr. Mullin inherited."

But with his learning period behind, Mullin feels confident about Delta's future - his apparent challenge being to decide what adjective to use: "Good, very good. . . . I think Delta's long-term prospects are excellent."

Copyright (c) 1998 Seattle Times Company, All Rights Reserved.

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