Resilience Is an Asset Class

On Tuesday June 24, I was stuck in the airport of Muscat, Oman, for seven hours, awaiting a return flight to Doha. Qatar airspace had been closed from late Monday afternoon until just after midnight on the Tuesday morning.

 It followed a warning of an impending missile strike by Iranian forces on the US Forces Al Udeid Air Base in Qatar, which was duly carried out on the Monday evening, without loss of life. The missiles were launched in response to earlier strikes by US forces on suspected Iranian nuclear weapons sites.

Other Gulf states followed in closing airspace, with Bahrain, the UAE and Kuwait also closing airspace.

My delay was inconvenient but, in the context, it was remarkable that it only lasted seven hours. Although my scheduled time of departure was after the re-opening of airspace, hundreds of flights had had to be diverted or cancelled, resulting in aircraft and their crews being located in locations very different from the timetable, in some cases hundreds or thousands of miles away.

There were nearly 100 Qatar Airways aircraft due for landing at the point of the closure of airspace. 

Some 25 we re-routed to Saudi Arabia, 18 to Turkiye, 15 to India, 13 to Oman, and five to the UAE. A flight from Nigeria was diverted to Egypt. The remaining flights were re-routed to various airports in the Middle East, Asia and Europe, including as far away as London and Barcelona.

Dealing with such disruption is complex in aviation. For example, there are strict rules on the maximum hours a pilot may fly over a certain period of time; in addition, they may need to be acclimatised to the local time zone. So while there may be aircraft ready for take-off with qualified pilots employed by the same airline at the same airport at the same time, there may still be a further delay.

Despite the huge disruption caused by the closure of airspace, Qatar Airways put into place well-practised crisis response measures.

 I observed the exceptional calmness of the staff on the ground in Muscat, as well as their helpfulness and professionalism. 

As soon as the airspace was closed, Qatar Airways staff knew what to do, and well-practised plans were implemented – not just aircrew and check-in staff, but employees trained to book hotel rooms, communicate with stranded passengers, advise on visas, and help those with medical needs. More than 3,200 hotel rooms were booked, and 35,000 meals distributed.

Within hours of airspace reopening in the early hours of June 24, flights resumed – a total of 390 on that day, with more than 11,000 passengers on their way that morning alone. Within 24 hours, all passengers on the diverted flights had resumed their journeys. By Wednesday June 25, Qatar Airways operated 578 flights, and no diverted passengers were still stranded.

The airline has built up considerable ‘muscle memory’ when it comes to dealing with disruptions. The blockade of Qatar airspace in the period 2017-2021, during which time only a narrow corridor over Iran was accessible, was followed by the Covid-19 pandemic and associated lockdowns which had a devastating effect on the aviation industry. Qatar Airways was one of the few carriers that managed to continue operations – obviously while observing protocols on hygiene, testing and vaccination.

There is an important lesson around business planning and executive priorities. In the early years of globalisation, there was an emphasis on establishing ultra-lean supply chains, based on the ‘just-in-time’ principle – minimising the amount of stock that has to be warehoused, for example. This led to very high operational efficiencies – but only if there are no significant disruptions. A hyper-efficient business operation is fragile.

Since the pandemic, there has been a fundamental reappraisal in business planning and related theory, downplaying the importance of being ‘just in time’ and building in more contingency. Resilience is increasingly likely to be given equal priority to efficiency. This means not just building up stock, or having some spare capacity, but also rigorous scenario-planning and staff training exercises testing the ability of teams to respond to different types of crises or other unexpected events.

There are perhaps two types of company executives: Those who expect trouble-free roll-out of all the strategic plans they unveil on PowerPoint presentations, and those who expect disruption, and almost relish a mini-crisis and having to react to events. The latter are always more suited for real operations, and especially during the current period of trade wars, unpredictable geopolitics and relentless cyberattacks.

Since the Israeli and US attacks on suspected nuclear weapons sites in Iran, and the Iranian regime’s response on June 23, it has been impossible to know whether the conflict would escalate, be resolved or just be dragged out in a cold war. These three broad categories of outcomes are still all possible, as no one can be certain of the durability of the ceasefire agreed following June 24.

The author is a Qatari banker, with many years of experience in the banking sector in senior positions.