Cebu Pacific Air (B)

On February 2, 1998, Lance Gokongwei, the 31-year-old CEO of Cebu Pacific Air, learned that Flight 5J-387, from Manila to Cagayan de Oro, failed to arrive at its destination on schedule and was believed to be missing. Barely three years old, Cebu Pacific was just beginning to gain significant market share in the Philippine domestic airline industry. The A case (UVA-OB-0768) describes the information Gokongwei had at the time. This series of cases (see also UVA-OB-0770 and UVA-OB-0771) describes the events that followed the tragic ending to Flight 5J-387. Cebu Pacific's transparency with the media, full cooperation with the government inquiry, assistance to victims' families at a personal level, and readiness to face up to its obligations gained the sympathy and trust of the public. At one point, the government grounded the airline, citing safety concerns. Statements were published in national newspapers that expressed confidence in the airworthiness of Cebu Pacific and disapproval of the airline's suspension. More important, Gokongwei received encouragement and support from his employees through their volunteer efforts following the disaster and letters of support, while hundreds took unpaid leaves. This case series provides an international dimension to the study of leadership. The material presents an opportunity to challenge students to consider leadership issues and present recommendations within the context of a cultural and economic environment different from that of the United States