Company Outsider: When IndiGo collapsed, its leaders were nowhere to be seen

A toothless regulator and a dominant player in a two-horse race is a recipe for disaster. We saw that unfolding this past week as thousands of fliers, scheduled to take one of Indigo’s 2,200-odd daily domestic flights, faced last-minute cancellations and rescheduling, throwing their lives into disarray.

Worst was the confusion that ensued, as the airline failed miserably to provide accurate and timely information. In less than a week, the reputation that the airline worked so hard to build over the last two decades lies in tatters.

Yet, the scenario could have been different. Imagine if IndiGo's billionaire co-founder, Rahul Bhatia, and its chief executive officer, Pieter Elbers, had chosen to camp at the major airports as the crisis unfolded and faced the ire of the travellers while helping them manage their disrupted schedules.

Eventually, under pressure from the government, IndiGo said it would refund fares for cancelled flights, and also helped organize hotel rooms for those left in the lurch. Elbers, too, issued a video message, but only after the crisis had spiralled for three days. By then, the damage was done. Television and social media was flooded with videos of angry and distressed passengers demanding answers and clarity. Much of the flak was handled by the helpless ground staff who lacked enough information, and had no power to take decisions on the spot. The presence of Bhatia and Elbers would have ensured quicker decision-making without the need to wait for instructions from absent bosses.

It’s at moments like this that true leaders rise to the fore. “The ultimate measure of a man is not where he stands in the moments of comfort, but where he stands at times of challenge and controversy," said Martin Luther King. Indeed, great leaders stand their ground when the danger is most acute. Jawaharlal Nehru entering volatile areas, confronting angry crowds, or even wading into danger to stop violence, is the surest testimony to his leadership. No matter how much criticism he faces, no one will question his right to be called one of the great leaders of our time, purely because he showed up when hiding might have been the prudent option.

Business history also offers examples of leaders playing a proactive part in handling a crisis. In 2008, Ratan Tata arrived at the Taj Mahal Palace hotel shortly after the terrorist attacks began and stayed outside for three days. Similarly, following the 2018 engine failure on a Southwest Flight which caused the US airline's first in-flight fatality, CEO Gary Kelly visibly took charge of the response. Rather than sending generic condolence letters, he made personal phone calls to the surviving passengers and the victim’s family to offer support.

According to the Center for Creative Leadership, leaders must demonstrate visible leadership during a crisis, rather than staying holed up in offices or meetings. A Harvard Business Review article from April 2020 notes that in a crisis, people don't need a vision to inspire them; they need what psychologists call "holding." This means acknowledging people’s emotions and providing a sense of context and reality. When there's a fire, people are already motivated to move but often flail. What they need is containment, which is the ability to soothe distress, and interpretation, which is the ability to help others make sense of a confusing situation.

The contrast with IndiGo's response couldn't be starker. While Elbers eventually spoke, it was via a video message, a sanitized, controlled medium that allowed no direct engagement with affected passengers. Instead, what Bhatia and Elbers needed to do was to be seen at the airports, assuaging customers.

The present crisis again points to the perils of market concentration and regulatory oversight. With IndiGo controlling 60% of India's domestic market—far exceeding the 40% threshold typically considered monopolistic—the airline wields enormous power with limited accountability. When it stumbles, the entire country's air travel ecosystem collapses.

But beyond market structure and regulatory failures lies a more fundamental question about leadership. When crisis strikes, do leaders show up or hide behind corporate communications? Do they make themselves available and take ownership, or do they wait for the storm to pass before emerging with carefully-scripted messages? From the evidence of last week, IndiGo’s top brass went missing when the storm struck.

Eventually, IndiGo will recover; its operations will normalize, and India’s airports will return to normalcy. What will remain is the thought that in the ultimate test of leadership, IndiGo's leaders chose to manage from a distance rather than lead from the front.