Robert Crandall
Encyclopedia
Robert Lloyd "Bob" Crandall (born December 6, 1935 Westerly, Rhode Island) is the former president and chairman of American Airlines
. Called an industry legend by airline industry
observers, Crandall has been the subject of several books and is a member of the Hall of Honor of the Conrad Hilton
college.
.
He graduated from the University of Rhode Island
, and from the Wharton School of the University of Pennsylvania
, with an MBA.
In 1966, he joined TWA
, where he worked for six years. In 1972, he left to become a senior financial officer at Bloomingdale's Department Stores
, but he returned to the airline industry in 1973, as senior financial vice president of American.
Before the passing of the 1978 Airline Deregulation Act
, Crandall was one of the act's loudest opponents. In 1982, he had a famous conversation with Braniff
CEO Howard D. Putnam, in which he told Putnam that if Braniff raised their prices, American would too. Crandall has publicly expressed embarrassment over that conversation. 1982 was also the year that Crandall became American's president. In 1985, Crandall succeeded Albert Casey as American's chairman and CEO.
During the latter period of Crandall's tenure as CEO, investor concern over airline bankruptcies and falling stock prices caused Crandall to remind his employees about the dangers of investing in airline stocks. Known for his candor, Crandall later told an interviewer, "I've never invested in any airline. I'm an airline manager. I don't invest in airlines. And I always said to the employees of American, 'This is not an appropriate investment. It's a great place to work and it's a great company that does important work. But airlines are not an investment.'" Crandall noted that since the airline deregulation
of the 1970s, some 150 airlines had gone out of business. "A lot of people came into the airline business. Most of them promptly exited, minus their money," he said.
In 1997, Crandall received the Horatio Alger award.
In 1998, he retired from American and he went on to work as director of many other companies, including Celestica, Haliburton, and Anixter.
He is the 2001 recipient of the Tony Jannus Award
for outstanding leadership in the commercial aviation industry.
Crandall is credited with creating the first frequent flyer program in the airline industry, the AAdvantage
program, as well as pioneering modern reservations systems through the creation of Sabre
. He is also credited with pioneering yield management
. Crandall also serves as a senior adviser and sits on the board of AirCell
, an in-flight telephony company which won the larger of two licenses for air-ground data service
that provide in-flight broadband service.
American Airlines
American Airlines, Inc. is the world's fourth-largest airline in passenger miles transported and operating revenues. American Airlines is a subsidiary of the AMR Corporation and is headquartered in Fort Worth, Texas adjacent to its largest hub at Dallas/Fort Worth International Airport...
. Called an industry legend by airline industry
Airline
An airline provides air transport services for traveling passengers and freight. Airlines lease or own their aircraft with which to supply these services and may form partnerships or alliances with other airlines for mutual benefit...
observers, Crandall has been the subject of several books and is a member of the Hall of Honor of the Conrad Hilton
Conrad Hilton
Conrad Nicholson Hilton was an American businessman and investor. He is well known for being the founder of the Hilton Hotels chain.-Early life:Hilton was born in San Antonio, New Mexico...
college.
Life
Robert Crandall was raised in Rhode IslandRhode Island
The state of Rhode Island and Providence Plantations, more commonly referred to as Rhode Island , is a state in the New England region of the United States. It is the smallest U.S. state by area...
.
He graduated from the University of Rhode Island
University of Rhode Island
The University of Rhode Island is the principal public research university in the U.S. state of Rhode Island. Its main campus is located in Kingston. Additional campuses include the Feinstein Campus in Providence, the Narragansett Bay Campus in Narragansett, and the W. Alton Jones Campus in West...
, and from the Wharton School of the University of Pennsylvania
University of Pennsylvania
The University of Pennsylvania is a private, Ivy League university located in Philadelphia, Pennsylvania, United States. Penn is the fourth-oldest institution of higher education in the United States,Penn is the fourth-oldest using the founding dates claimed by each institution...
, with an MBA.
In 1966, he joined TWA
Twa
The Twa are any of several hunting peoples of Africa who live interdependently with agricultural Bantu populations, and generally hold a socially subordinate position: They provide the farming population with game in exchange for agricultural products....
, where he worked for six years. In 1972, he left to become a senior financial officer at Bloomingdale's Department Stores
Bloomingdale's
Bloomingdale's is an American department store owned by Macy's, Inc. .Bloomingdale's started in 1861 when brothers Joseph and Lyman G. Bloomingdale started selling hoop-skirts in their Ladies Notions' Shop on Manhattan's Lower East Side...
, but he returned to the airline industry in 1973, as senior financial vice president of American.
Before the passing of the 1978 Airline Deregulation Act
Airline Deregulation Act
The Airline Deregulation Act is a United States federal law signed into law on October 24, 1978. The main purpose of the act was to remove government control over fares, routes and market entry from commercial aviation...
, Crandall was one of the act's loudest opponents. In 1982, he had a famous conversation with Braniff
Braniff International Airways
Braniff International Airways was an American airline that operated from 1928 until 1982, primarily in the midwestern and southwestern U.S., South America, Panama, and in its later years also Asia and Europe...
CEO Howard D. Putnam, in which he told Putnam that if Braniff raised their prices, American would too. Crandall has publicly expressed embarrassment over that conversation. 1982 was also the year that Crandall became American's president. In 1985, Crandall succeeded Albert Casey as American's chairman and CEO.
During the latter period of Crandall's tenure as CEO, investor concern over airline bankruptcies and falling stock prices caused Crandall to remind his employees about the dangers of investing in airline stocks. Known for his candor, Crandall later told an interviewer, "I've never invested in any airline. I'm an airline manager. I don't invest in airlines. And I always said to the employees of American, 'This is not an appropriate investment. It's a great place to work and it's a great company that does important work. But airlines are not an investment.'" Crandall noted that since the airline deregulation
Airline deregulation
Airline deregulation is the process of removing entry and price restrictions on airlines affecting, in particular, the carriers permitted to serve specific routes. In the United States, the term usually applies to the Airline Deregulation Act of 1978...
of the 1970s, some 150 airlines had gone out of business. "A lot of people came into the airline business. Most of them promptly exited, minus their money," he said.
In 1997, Crandall received the Horatio Alger award.
In 1998, he retired from American and he went on to work as director of many other companies, including Celestica, Haliburton, and Anixter.
He is the 2001 recipient of the Tony Jannus Award
Tony Jannus Award
The Tony Jannus Award recognizes outstanding individual achievement in scheduled commercial aviation by airline executives, inventors and manufacturers, and government leaders. The award is conferred annually by the Tony Jannus Distinguished Aviation Society and was first bestowed in 1964 in Tampa,...
for outstanding leadership in the commercial aviation industry.
Crandall is credited with creating the first frequent flyer program in the airline industry, the AAdvantage
AAdvantage
AAdvantage is the frequent flyer program of American Airlines. Launched May 1, 1981, it was the second such loyalty program in the world , and remains the largest with more than 67 million members as of October 2011.Miles accumulated in the program allow members to redeem tickets, upgrade service...
program, as well as pioneering modern reservations systems through the creation of Sabre
Sabre (computer system)
Sabre Global Distribution System , owned by Sabre Holdings, is used by more than 55,000 travel agencies around the world with more than 400 airlines, 88,000 hotels, 24 car rental brands, and 13 cruise lines...
. He is also credited with pioneering yield management
Yield management
Revenue management is the process of understanding, anticipating and influencing consumer behavior in order to maximize yield or profits from a fixed, perishable resource...
. Crandall also serves as a senior adviser and sits on the board of AirCell
Aircell
Aircell is a private company started in 1991 developing broadband for both private and commercial aviation. Aircell is the only company in the United States authorized by the Federal Communications Commission and Federal Aviation Administration to use frequencies in the 800 MHz band for...
, an in-flight telephony company which won the larger of two licenses for air-ground data service
Air-ground radiotelephone service
Air-ground radiotelephone service is a method of telephone communications used by aircraft pilots and passengers of commercial airline jets flying over the United States....
that provide in-flight broadband service.
Awards
- Horatio Alger award, 1997.
- Tony Jannus AwardTony Jannus AwardThe Tony Jannus Award recognizes outstanding individual achievement in scheduled commercial aviation by airline executives, inventors and manufacturers, and government leaders. The award is conferred annually by the Tony Jannus Distinguished Aviation Society and was first bestowed in 1964 in Tampa,...
for outstanding leadership in the commercial aviation industry, 2001. - L. Welch Pogue Award for Lifetime Achievement in AviationL. Welch Pogue Award for Lifetime Achievement in AviationThe L. Welch Pogue Award for Lifetime Achievement in Aviation was created by Aviation Week & Space Technology to be presented to an individual who is "considered a visionary and a preeminent leader of contemporary aviation."In 2011, the International Aviation Club of Washington, D.C., and the Jones...
, 2004.
External links
- "SOMETHING SPECIAL IN THE AIR?", PBS News Hour, May 20, 1998
- "WEBCAST: A CONVERSATION WITH ROBERT L. CRANDALL", DePaul University