United Airlines CEO: Oscar Munoz
A Moment Gone Viral
In April of 2017, Dr. David Dao boarded his United Airlines plane at Chicago O’Hare International Airport. He was Louisville, Kentucky bound on this Sunday evening, that is until an announcement came over the speakers. The cabin was made aware that four United employees urgently needed to board this full flight, meaning, four passengers had to get off the plane.
Keep in mind, it’s not like they boot you and say “better luck next time.” Typically, this goes for all airlines, when an overbooking occurs, the company will provide another flight, room & board if necessary, and additional cash to get somebody through the day. In this case, guests were offered up to $800 to give up their seats; even still, no volunteers surfaced.
Therefore, the United staff randomly selected four passengers to exit the plane. Three of the four willfully got off; the fourth, however, wasn’t so compliant. Dr. Dao was headed home to Kentucky to help open a clinic for U.S. Veterans – the aviation security officers could care less.
Dr. Dao was manhandled and forcibly removed from the plane. In the process, he suffered a concussion, broken nose, and lost two teeth – all of which was caught on video. Needless to say, the event spread like wildfire on social media, sparking international outrage at the barbaric treatment of this man.
After watching the video, Munoz reveals the word “shame” comes to mind. He assumes full responsibility for the incident, explaining, “it was a system failure. We have not provided our frontline supervisors, managers, and individuals with the proper tools, policies, or procedures that allow them to use their common sense.”
He continues, “They all have an incredible amount of common sense, and this issue could have been solved by that…This is on me. I have to fix that, and I think that’s something we can do.”
“This will never happen again,” Munoz says. “We are not going to put a law enforcement official onto a plane to take them off … to remove a booked, paid, seated passenger. We can’t do that.”
United later reached a settlement with Dr. Dao, providing closure for both parties to move on. Amidst this untimely occurrence, Munoz was conducting one of the greatest aviation industry comebacks ever recorded.
In an effort to fully grasp the spirit of such a tale, let’s explore the very beginning of this story. Rewinding our clock before the international headlines, executive compensation, and ivory education, we find a local beach boy growing up in humble circumstances beneath the golden southern California sun.
Having been born in Mexico, Munoz describes some of his earliest memories in a self-penned LinkedIn article:
I know what it is to look over the horizon toward America and believe in its promise for a better life. As a young boy, I lived in Mexico and was raised by my maternal grandmother. Though she worked hard, we did not have a home to call our own. My earliest memories are of traveling between nearby towns as either friends or relatives would be kind enough to let us stay for a while.
I vividly remember holding her hand as we’d knock on the doors of houses where I had never been before and the gratitude we would feel when those doors generously opened to us. Ultimately, America opened its doors to me and gave me opportunities that exist nowhere else in the world.
Son of a Meat Cutter
Oscar’s family chose to plant their newfound American roots in Huntington Beach, CA. He’d turn out to be the oldest of 9 children – interesting coincidence, Delta Air Lines CEO Ed Bastian, is also the eldest of 9 children.
His father was a meat cutter at a local grocery store while his mother stayed home to take care of all the kids. Munoz says that one of the greatest lessons he’s learned in life came from his father, he tells Dad.CEO how he discovered the value of “Proof, Not Promise:”
When I was in junior high, on days during the summer when I wasn’t on the beach – which wasn’t many – my Dad would drive me in our mobile home to the supermarket where he worked as a meat cutter. I would help him out, sweeping floors or moving boxes. Whatever he needed.
Anyone who’s worked in a supermarket knows there’s a trick to the trade. When you cut up a slab of meat, there’s usually a lean side and a side that’s got the fatty, not-so-good side. The bosses always wanted my father to display the good side up and wrap it quick so people wouldn’t see the less appealing side until they got home. My dad didn’t like doing that.
He would always show the customer both sides of the cut before wrapping it up. He believed that people should get what they expect. As he would tell me, “Listen, they will buy it once and will turn it over and realize that this is not what they wanted, then this will create long-term issues.”
So, from that, the concept was born for me that I will not promise you anything. I’m just going to deliver proof. We say this to Wall Street all the time and it has proven very well for us over time in our industry. It’s about honesty and integrity, even when it’s not easy or appealing.
Oscar was walking down a hallway late to class when his La Quinta High School counselor stopped him and asked, “Where are you thinking of going to college?” He responded, “what’s a college?”
For a kid who’s parents were so busy, they had to feed their 9 children in two separate sittings, Munoz offers more insight into his adolescent aspirations in another LinkedIn article:
Despite the love and laughter that filled our home, preparing for college was never a topic of conversation. My parents didn’t go to college and it certainly wasn’t the first thing my friends and I were thinking about in high school.
Thankfully, there was someone thinking about my future for me – my high-school college adviser. She went out of her way to take an interest in me and my future.
Without her, my life would certainly have taken an altogether more probable path than the extraordinary one it did.
Thanks to her encouragement and guidance, I was well on my way to applying to the kinds of universities I never dreamed of attending before. I ultimately became the first member of my family to go to college, all because of her.
Having been accepted to Harvard, Munoz reflects on why he chose not to attend the Ivy League University, explaining, “We were invited to an event that was black tie optional. I don’t know what that means at that time and my dad certainly didn’t. First of all, we got stopped at the door; they said, ‘you must be lost,’ because of the way we were dressed.”
Considering surfer-boy Oscar was fresh off the beaches of Orange County, the “ratty” reddish-brown hair extending down to his shoulders did not help his case for getting into the room. He adds, “I thought I looked good.” Nevertheless, he was allowed entry, carried out a death march across the ballroom with all eyes on him, and sat down at a table where he was immediately interrogated regarding his background, major, etc.
Munoz came to the conclusion, “I knew that just wasn’t the right fit.”
Choosing to stay closer to home, he ultimately decided to attend the University of Southern California – earning his bachelor’s degree in business administration in 1983.
A former member of the Greek community, Munoz says, “My allegiance and pride for our school have only grown over the years. The memories we created grew into lifelong relationships that I treasure to this day,”
He adds, “The most important, of course, was meeting Cathy — now my wife of 32 years — at a Trojan football game. We now have four wonderful kids who are daily reminders of the incredible direction my life took thanks to my time at USC.”
In 2015, Oscar Munoz was elected to the USC Board of Trustees.
After graduating from USC, he earned his MBA from Pepperdine Graziadio Business School in 1986.
Munoz’s career began with serving in various financial roles at Pepsico.
Crossing over to the enemy, Munoz then defected to Coca-Cola, where he began working his way into more senior positions.
According to Bloomberg, between 1999 and 2000, he shifted industries to take on a CFO role at U.S. West Retail Markets. Munoz then became V.P. of Finance for Qwest Communications Intl Inc; between 2001 and 2003 he worked his way from V.P. to CFO of Consumer Services at AT&T.
Munoz served as President and Chief Operating Officer of CSX Corporation, a premier transportation company. Munoz also served as a director at CSX. During Munoz’s tenure, CSX transformed itself into an industry leader in customer focus, reliability and financial performance. CSX was named one of Institutional Investor’s Most Honored Companies for a decade of excellent financial performance, including increasing its operating income by nearly 600%.
His total career at CSX spanned from 2003-2015.
United Air Lines CEO
Munoz was added to the board of directors for Continental Airlines in 2004; following the company’s merger with United, he was officially a United board member by 2010. Although his success was rapidly mounting at CSX, the airline industry must have just as steadily been calling his name.
In 2015, the opportunity to become the CEO of United presented itself, reflecting on his consideration of taking on the role, Munoz says, “Know thyself, REALLY!” While being interviewed at Stanford, he explained the importance of understanding oneself to the tune of our most questionable human qualities. The term “late-night thoughts” comes to mind.
“Frankly, I just thought I had another turnaround in me,” he said to David Rubenstein. Understanding the frustrations of employees and customers, excited about returning to an industry where he could foster meaningful relationships with consumers, and optimistic to leave his own significant mark on the world, Munoz accepted the United CEO position in 2015.
38 days after taking over as CEO, Munoz suffered a heart attack that left him needing a whole new heart. He jokes with Rubenstein, telling him how he told his coworkers “I’ll see you on the other side” just before leaving a meeting on the day of his transplant surgery. They didn’t know he’d be going to the hospital for such a serious operation and as soon as they found out what was going on, they didn’t take so kindly to his final choice of words!
Munoz says he meant it in the most positive of ways but understands where there could be room for misinterpretation given the circumstances. Some people grab a sandwich at the deli for lunch, others try out a heart transplant – whatever makes you happy, right?
Within two weeks, astonishingly, he was back in the office.
While his start may have been shakey, a CNBC article cites the leaps United has made, particularly towards the tail end of Munoz’s tenure, explaining how a freshly implemented strategy “paid off with United growing its net profit from $2.1 billion in 2017 to $2.5 billion last year. In 2019 United has already earned $2.3 billion through the third quarter and raised its full-year earnings guidance in October.”
The addition of Scott Kirby to United’s executive team is also of notable importance. In December of 2019, it was announced that Munoz would be handing over day-to-day control of the company to Kirby, in turn, he’d become Chairman of the Board. Considering the onset of COVID-19 that quickly followed this announcement, Munoz continues to be heavily involved with managing the company through this global pandemic.