Download Helios Airways Tragedy: A Case Study on Service Harm Crises and Crisis Management and more Lecture notes Communication in PDF only on Docsity!
26 Volume 4, Number 1
Air Transport Service Harm Crisis: The case
of Helios Airways tragedy
By Zisis Maditinos and Christos Vassiliadis
case study
Introduction
Crisis is a concept that has attracted considerable attention across
a diverse range of academic literature. According to Smith (2005), this
work has also generated a significant body of theory that draws on
multiple disciplines, particularly around the processes of crisis genera-
tion. As far as the service sector is concerned, this work has not gained
the attention it deserves, despite its obvious relevance to the manage-
ment of service sector organizations. Instead, literature has focused
on the processes of “service recovery”. This focus may have led it to
ignore the significant body of work within the crisis literature on the
processes of crisis incubation.
Crisis management is a continuous process of recognizing and
responding to factors associated with a potential or actual crisis and
its resolution. Therefore, crisis management deals with the anatomy of
a crisis by looking at some symptoms, and recommending methods
of prevention and intervention. A basic component of crisis man-
agement is communication. Developing effective communication
strategies helps to avoid or deal more effectively with the unexpected
bad publicity. During a crisis, it is usually the publicity that can sink the
organization, not the damage from the crisis itself.
In service organizations that are involved in “high risk” service sec-
tors, such as airline industry, health care services etc, further research
and better understanding of the incubation process is absolutely
necessary. In these high risk service organizations, when accidents
happen, they usually result to serious harms, even to human casual-
ties. These accidents obviously trigger organizational crises that may
involve and affect several stakeholders and mainly the host organiza-
tion, whose continuity is sometimes seriously unsettled. These crises are
the outcome of a failure interaction among human, technological and
organizational factors (Ash and Ross, 2004, Smith, 2005, Peters and Pik-
kemaat, 2005). When organizational pathologies related to these factors
are combined - sometimes in addition to external pathologies (super-
vising authorities, governmental bodies etc) - any possible mistake can
trigger an organizational crisis with unpredictable consequences.
The case of the Helios Airways flight HCY522 crash during August
2005, in the Attica area, Greece, which led to the death of 121 people,
is used in this paper to illustrate how the failure interaction of the fac-
tors referred above can cost the existence of the organization itself.
Moreover, the company’s reaction to this unexpected crisis is assessed in
order to offer useful conclusions for service organizations’ managers.
Breif Literature Review
Service Harm Crises
There are several reasons that trigger organizational crises. One of
these reasons is due to the harm that a product or a service can cause
to users or consumers. In the first case we have a product harm crisis
while in the second case there is a service harm crisis. In these two
types of crises, people who consume the product or the service are
harmed due to problems or failures that are linked to the consumption
of this product or service.
In the existing relevant literature there is not any special defini-
tion for the term service harm crisis. Siomkos and Maditinos (2002) first
used it in a paper describing the case of Express Samina Shipwreck
(a shipwreck in Greece with more than 80 victims, September 2000).
Searching for the term “service harm crisis” in Google search engine
(during December 2013), it gives back very few results (approximately
21), most of them relative to the above referred paper. In contrast,
searching for “product harm crisis” term, Google gives back 175 results
(in the same period).
Service harm crises can be defined as complex situations wherein
the consumption or the use of a service can cause harm (damage or
even death) to the user or consumer (Maditinos et al., 2010). They can
cause serious problems to the responsible organization resulting in
vast financial costs (e.g. for the compensation of the victims), negative
effects on sales, destruction of its corporate image, even its existence
and business continuity. They are mainly man made crises, as they are
triggered basically by human errors. There are of course some cases
caused by natural disasters: for example a thunderstorm can cause
the crash of an airplane, which constitutes a service harm crisis. But
such types of crises can be avoided if people involved in the service
provision take the necessary measures (i.e. the pilot lands the plane
in the nearest airport, before it enters the storm). They can usually be
considered both immediate and emerging crises. When no warning
signals exist, service harm crises are immediate. For example the plane
hijacks during 9/11 were an immediate crisis for the airline companies
whose planes were hijacked, as there were not any warning signals for
Zisis Maditinos and Christos Vassiliadis are affliated with University
of Macedonia.
Journal of Hospitality & Tourism Cases
this tragedy. But, when crisis preconditions are obvious, such as sys-
tems failures, shortage of resources and small scale accidents, then the
service harm crisis is an emerging crisis which can be avoided if certain
actions are undertaken. Furthermore, service harm crises can be con-
sidered both natural accidents and abnormal accidents. The Express
Samina shipwreck in Greece was a “normal accident” because some
people didn’t do their work properly and thus system failed to deliver
safe services to the customers. In contrast, the 9/11 airplane crashes
in WTC is an abnormal accident as it is considered to be the result of
deliberate evil action (terrorism).
The importance of the interaction between the human operator
and machines and the subsequent impact of organizational factors
on this relationship has long been recognized in academic literature
(Smith, 2000). Failure process is a complex dynamic process. A series of
major accidents and disasters in recent years have pointed the domi-
nant role of latent error within the chain of causality for such events.
Ash & Ross (2004) have provided a useful approach for organizational
crises using the “lens of epidemiology”. According to them, over time,
researchers in the field of epidemiology have found that there may be
no specific event, condition, or characteristic that is sufficient itself to
produce a disease. Disease is the result of many factors, none with the
exclusive ability to cause all forms or examples of it. When multiple
factors combine to create a crisis (as is generally the case), we refer to
them as causal components. Causal components can be separated by
time; one may have occurred years before the others, its residual ef-
fects nevertheless influencing outcomes.
Even though the final result is the only one attended to by the
general population, crises are the result of a series of events that occur
over time. In his book Human Error, Reason (1990) used an effective
analogy to explain how one small problem or error can be compound-
ed by subsequent errors. He described how layers of precautions can
be aligned in precisely the right way to produce dramatic results.
Because of its obvious similarity to the dairy product, this model is
named the “Swiss cheese effect.” Slices of Swiss cheese can be thought
of as subsystems in an organization, with the holes representing er-
rors. In this sense, error could represent any level of incompleteness
(omission or commission) that causes the intended safety system to
be less than complete. When a number of subsystems line up, there
is generally enough redundancy to prevent serious crises. However,
sometimes the holes in the cheese might line up and let error move
through the entire system.
Figure 1 shows five separate systems, which are part of a bigger
system, as slices of Swiss cheese. All of these subsystems have “holes”
that represent the errors that occur. The arrow passing through all the
holes shows the precise alignment of the errors. What is most impor-
tant is that they are seemingly preventable. Major catastrophes do not
occur by an isolated slip or mistake. In almost every case, they are the
result of a larger error chain—rare circumstances combined to create
a situation that proves disastrous. A cascade of events seems to form a
combination that unleashes calamity.
Crisis management and communication
In general, crisis management is a continuous process of recogniz-
ing and responding to factors associated with a potential or actual crisis
and its resolution (Ray, 1999). Further, Kash and Darling (1998) define
crisis management as a series of functions or processes to identify, study
and forecast crisis issues, and set forth specific ways that would enable
an organization to prevent or cope with a crisis. The basic tenet in crisis
management is that crises can be managed much more effectively if the
company prepares for them. Therefore, crisis management deals with
the anatomy of a crisis by looking at some symptoms, and recommend-
ing methods of prevention and intervention.
According to Stocker (1997), when confronted with a crisis, the
first response to a crisis can be very important. Even though a crisis
is on a much larger scale, the rules of complaint handling and the “
R’s” still apply:
- Regret : stakeholders want the organization to say that it is
sorry that a crisis happened. Not that it is guilty, or even re-
sponsible, just that it regrets the event. This is very hard for
some overprotective lawyers, who will caution that “these very
words will come back to bite us in court.” First, the real costs
are not in the courtroom, and second, crisis research is clear: if
the organization does not express regret, nobody will listen to
anything else it says. An organization cannot skip the first R and
jump to the second.
- Resolution : The organization should state, if appropriate,
what it will do to resolve the issue. For example it will put
safety caps on the medicine, buy double-hull ships, and test
the chips before they are shipped, or, if it is not the company’s
fault, it will do nothing.
System 1 System 2 System 3 System 4 System 5
Figure 1
The Swiss Cheese Effect
Source: Reason (1990)
Journal of Hospitality & Tourism Cases
The Case of Helios Flight HCY522 Tragedy
About Helios Airways Company
Helios Airways was founded in 1999. It was the first private
owned airline company in Cyprus with its headquarters in Larnaca.
In November 2004, the company was bought by Libra Holidays, a big
tour operator in Cyprus (Wikipedia, 2009) and operated scheduled and
charter flights from Larnaca and Paphos. It carried about 250.000 pas-
sengers annually (Dahman, 2008).
The company faced a serious incident of aircraft malfunction one
more time before the 2005 crash incident of flight HCY522 in Athens
area, Greece. It was on 20 December 2004, when a Helios Airways
Boeing 737 form Warsaw suffered a loss of cabin pressure. Three pas-
sengers were rushed to hospital when the plane landed in Larnaca,
Cyprus (Dahman, 2008). However, as the first innovative no-frills airline
in the region with an excellent reputation, passengers did not sue the
Airways for the hazard of cabin pressure experience, and as a result the
total safety culture of the company was not questioned. In addition,
the issue remained unidentified, as the media also did not pick up on
the problem. The company remained a reputable airline as it contin-
ued to carry around 250.000 passengers annually.
The Fatal Crash Incident
In August 14th 2005, the company came to the international
headline news. A Boeing 737-31S on the flight HCY522, flying from
Larnaca to Prague via Athens was crashed in Attica suburbs. The air-
craft had 115 passengers and 6 crew staff on board, all of whom died.
The aircraft departed at 09:07 a.m. from Larnaca Airport. Its des-
tination was Prague, via an interim station in Athens International
Airport. At 10:37 a.m., it entered the Athens FIR but it could not
communicate with the control tower of Athens Airport. Several com-
munication efforts followed but none was successful. As a result, the
responsible emergency plan was activated and the Greek National
Defense Council scrambled two air fighters, F-16, in order to find out
what was going on. At 11:18 a.m., the F-16 pilots got in visual contact
with the Helios aircraft. They saw that the co-pilot was unconscious,
the pilot was missing from his position, and the oxygen provision
system was activated. The plane was driven by the automatic pilot
system. At 11:48 a.m. the F-16 pilots saw someone who was trying to
regain the control of the aircraft. At 11:50 a.m. the plane was out of
fuel and the tragedy was inevitable. Fifteen minutes later it crashed in
Grammatiko area, North Attica. None of the passengers or the flight
crew survived (AAIASB, 2006).
According to CNA (2005) an emergency meeting was conducted
at Larnaca Airport, chaired by Cyprus President Tassos Papadopoulos,
after news came in about a crash of a Helios aircraft. Helios Airways
senior management was also at an emergency meeting. At that stage,
there had been no official announcement from the company. Rela-
tives of the passengers and crew of the fatal flight of the Boeing 737
were gathering at Helios Airways headquarters in Larnaca trying to
find out as much information about their relatives as they could. Nikos
Anastasiades, spokesman for Helios Airways, informed relatives of the
victims about the fatal flight. The entire statement was the following:
“A Helios Airways aircraft heading for Athens and Prague, with 115
passengers and six crew on board, crashed north of Athens around
12:20 [on Sunday, 14 August 2005]. Rescue teams are at the scene
of the crash. All options as to the cause of the crash are being inves-
tigated. The government has set up a crisis management centre at
Larnaca Airport to help the relatives of the passengers and the crew.
Our thoughts are with the families of the passengers and the crew and
we are doing everything possible to give them all necessary informa-
tion of this tragic accident.” Anastasiades did not take any questions.
In Greece, rescue efforts were coordinated by the Ministry of National
Defense and the Transport Minister, Anastasios Neratzis, headed to the
scene of the crash. Both “black boxes” belonging to the fatal Boeing
had been recovered and they were sent to a special centre in Paris for
examination. Helios Airways representative George Dimitriou, accom-
panied by his lawyer in Athens completed a testimony over the plane
crash. The representative in Athens of the Helios Airways testified at
the Athens Police Headquarters on Monday in relation to the Helios
Airways plane crash. The representative said in his testimony that he
learnt of the air crash from a relative who communicated with him by
phone and briefed him regarding what he had heard on television.
Later, as he was said to have stated, he went to the company’s office to
learn exactly what had happened.
On 15 August 2005 a spokesman for Helios Airways announced
that their fleet had been grounded since a Boeing 737 crashed. The
Airways hired aircraft from other airlines (Austria and Egypt) to carry
its passengers to their destinations. Helios Airways’ Sunday flights into
Cyprus were carried out as normal. Andreas Drakos, Executive Director
of Helios Airways said that the aircraft that crashed on Sunday in Ath-
ens was airworthy and had undergone the necessary checks before
take-off. He said the Airways would give an initial sum of € 20.000 to
the family of each passenger killed during the crash.
In January 2006, Helios Airways changed its name to Ajet Aviation,
continuing to be owned at 100% by Libra Holidays. This act obviously
aimed to improve the company’s ruined image due to the accident. In
the end of October 2006, Ajet Aviation announced that it would cease
all flights within three months. The company announced that it would
stop flights for “financial reasons”, adding that the move was a direct
consequence of the 2005 tragedy. Industry experts argued that the
adverse publicity stemming from Helios airplane crash had hit business
and made it commercially impossible for the firm to continue operating
flights. The company stopped totally its flight operations by the end of
- With this decision, the high expectations of the company’s owners
30 Volume 4, Number 1
were totally crashed, like the fatal plane was (Wikipedia, 2009).
The accident also affected other stakeholders. Families of the
dead passengers filed a lawsuit against Boeing on 24 July 2007 for
manufacturing defects. The families claimed 76 million euros in com-
pensation from Boeing (AFX News, 2007). On 23 December 2008, five
Helios Airways officials were charged with manslaughter and of caus-
ing death by recklessness / negligence. Relatives of the deceased filed
a class action suit against the Cypriot Government – specifically the
Department of Civil Aviation – for negligence that led to the air disas-
ter. They claimed that the DCA was turning a blind eye to airlines’ loose
enforcement of regulations, and that in general the department cut
corners when it came to flight safety (Wikipedia, 2009).
The investigation results
Soon after the accident the Greek government ordered the es-
tablishment of an Air Accident Investigation and Aviation Safety Board
(AAIASB). The AAIASB had to investigate and find out why that tragedy
had happened. Its final report was submitted in November 2006 and
was based on data from the accident site, the readout of the flight
recorders, the testimonies and documents gathered, and the examina-
tion of parts and systems of the aircraft.
This report gives a strong evidence for the theory presented
briefly above about the failure interaction. More specifically, the AA-
IASB reported that there were direct and latent causes, as well as some
other factors that contributed to the accident (AAIASB, 2006).
The direct causes were the following:
- Non-recognition that the cabin pressurization mode selector
was in the MAN (manual) position during the performance of
the: a) pre-flight procedure, b) before start checklist and c) after
takeoff checklist.
- Non-identification of the warnings and the reasons for the acti-
vation of the warnings (cabin altitude warning horn, passenger
oxygen masks deployment indication, Master Caution), and
continuation of the climb.
- Incapacitation of the flight crew due to hypoxia, resulting in
continuation of the flight via the flight management computer
and the autopilot, depletion of the fuel and engine flameout,
and impact of the aircraft with the ground.
As far as latent causes are concerned, they can be summarized as
following:
- The Operator’s deficiencies in organization, quality manage-
ment and safety culture, documented diachronically as findings
in numerous audits.
- The Regulatory Authority’s diachronic inadequate execution of
its oversight responsibilities to ensure the safety of operations
of the airlines under its supervision and its inadequate respons-
es to findings of deficiencies documented in numerous audits.
- Inadequate application of Crew Resource Management (CRM)
principles by the flight crew.
- Ineffectiveness and inadequacy of measures taken by the man-
ufacturer in response to previous pressurization incidents in
the particular type of aircraft, both with regard to modifications
to aircraft systems as well as to guidance to the crews.
Finally factors that contributed to the accident
- Omission of returning the pressurization mode selector to
AUTO after unscheduled maintenance on the aircraft.
- Lack of specific procedures (on an international basis) for cabin
crew procedures to address the situation of loss of pressuriza-
tion, passenger oxygen masks deployment, and continuation
Flight Crew Maintainance Manufacturer
Operator
International
Aviation
Authorities
Airplane
Crash
Figure 2
The Swiss cheese effect in Helios Flight HCY255 Crash
32 Volume 4, Number 1
remunerated the victims’ families with an initial € 20.000 in an effort
to reduce negative feelings towards the Airways. Finally, by righting
the wrong, the Airways tried to demonstrate concern and regret by
sending the aircrafts for a further check-ups by SAS (Sweden Based
Scandinavian Air Systems). That is, Helios Airways tried to show that
necessary changes were made to prevent the recurrence of the crash.
Helios Airways was supposed to firstly apologize and show regret di-
rectly after the event, thus requesting forgiveness. With regard to the
settlement of the € 20.000, Helios Airways was supposed to show that
no amount of money can compensate for a lost life. Although Helios
Airways did in fact send their aircrafts for further checkups, they did
not ensure that the public, which includes the victims’ families, was
aware of this fact. Helios Airways could have done so by distributing
this information to all forms of media.
Elicit sympathy. Helios Airways was not able to use this strategy,
which involves showing that it is an innocent victim. As a result, the
stakeholders were unsympathetic and more critical, and they placed
Helios Airways in a negative light. Helios Airways could have promised
to give the victims’ families, and anyone else who may have been af-
fected by the accident, what they deserved. They should also have
communicated regularly with the stakeholders. One way to express
their deepest sorrows and condolences would have been to send
members of staff to the funerals and memorial services of the de-
ceased. Basically, Helios airways should have admitted its mistakes and
try to prove it is a victim of those mistakes.
Conclusions
Pearson (2002) identifies the obvious: there is no way to ensure
that an organization will escape crises. Especially in high risk industries
such airlines, passenger coastal shipping, health care services etc, when
accidents happen, they usually result to serious harms, even to people
deaths. So, it is necessary for these companies to develop all the re-
quired mechanisms and measures (scanning processes, cross checking
etc) in order to eliminate or minimize the possibilities for potential cri-
ses. However, as there is no way for an organization to ensure that it will
escape crises, crisis preparation and communication should be of high
concern for every organization’s leadership and management. There is
no doubt that both preparation and communication are complicated
processes, and despite the progress that has been achieved in terms of
formulating crises’ aspects and impacts, there are several unsuccessful
crisis management cases that come to publicity on a constant basis.
The case of Helios Airways flight HCY 522 crash was an indicative
service harm crisis case. It can be considered as a man made, emerg-
ing crisis as the AAIASB report revealed. Moreover, it can be seen as a
normal accident due to a series of human errors and omissions, which
interacted among each other. While the root cause of the crash is held
to be a result of human error, there is clearly a number of mitigating
factors that need to be considered when assessing causality.
Although Helios Airways was operating in a high risk industry, the
company proved to be totally unprepared in managing crises. It did not
apply elementary rules of crisis management. The communication effort
was incomplete and as a result the company failed to rescue its destroyed
image due to the plane crash. Moreover, this failure to manage the crisis
effectively led the company to cease its operations permanently.
The main conclusion of this case study is that in high risk service
industries, such as airlines, it is necessary for the managers to pay
extreme attention to the preconditions that can result to potential
failures and furthermore, to organizational crises. They have to under-
take all the necessary actions in order to avert these potential crises
or minimize their effects if they finally happen. This “scanning” process
could be assisted by models that help the organization to estimate
the degree of the existence of such dangerous issues. Further research
should focus on the development of such models.
Discussion Questions
- What were the actual reasons of the Helios Airways accident?
- How was the Swiss cheese effect confirmed in this case?
- What should the company do to apply effectively the 4Rs?
- How can such service harm crises be prevented?
- What should a service organization do in order to prevent its
continuity from such situations?
- Which are the better communication strategy tactics to be fol-
lowed in such situations?
- If you were a tourism/hospitality organization’s manager, what
could you learn from this case study?
References & Additional Reading
AFX News. (2007). Cyprus air crash victims’ families make 76 mln euros legal
claim against Boeing, Retrieved 20th of March 2009 from http://www.forbes.
com/feeds/afx/2007/07/25/ afx3949967.html.
Air Accident Investigation & Aviation Safety Board (AAIASB). (2006). Aircraft
Accident Report for Helios Airways Flight Boeing 737-31S at Grammatiko,
Hellas, on 14 August 2005. November 2006.
Ash, R.S., & Ross D.K. (2004). Crisis through the lens of epidemiology. Business
Horizons, 47(3), 59-34.
Cyprus News Ageney - CNA. (2005). Cypriot Airline Crashes, Retrieved 15th of
March 2014 from http://www.hri.org/news/cyprus/cna/2005/05-08-14.cna.
html#01.
Coombs, W.T. (1995). Choosing the right words: The development of guidelines
for the selection of the appropriate crisis-response strategies. Management
Communication Quarterly, 8(4), 447-476.
Dahman, T. (2008). Communication Strategies in Times of Crisis: A Case Study
Analysis in The Airline Industry. Master Thesis Dissertation, University of
Pretoria, January 2008.
Kash, T. & Darling, J.R. (1998). Crisis management: prevention, diagnosis and
intervention. Leadership & Organisation Development Journal, 19(4), 179-186.
Maditinos, Z., Vassiliadis, C., Andronikidis, A. & Tzavlopoulos, I. (2010). Service
Harm Crises: A Preliminary Conceptual Approach. Proceedings of the 13th
Journal of Hospitality & Tourism Cases
QMOD International Conference, Cottbus, Germany, September 2010.
Pearson, C.M. (2002). A Blueprint for Crisis Management. Ivey Business Journal
66(3), 69-73.
Peters, M. & Pikkemat, B. (2005). The Need to Use Disaster Planning Frameworks
to Respond to Major Tourism Disasters: Analysis of Australia’s Response to
Tourism Disasters in 2001. Journal of Travel and Tourism Marketing, 19(2),
9-20.
Ray, S.J. (1999). Strategic communication in crisis management: Lessons from
the airline industry. London: Quorum books.
Reason, J. (1990). Human Error. Cambridge: Cambridge University Press.
Siomkos, G. and Maditinos, Z. (2002). Service Harm Crisis - The Case of Express
Samina Shipwreck. Disaster Recovery Journal, 15(1):20-24.
Smith, D. (2000). On a Wing and a Prayer? Exploring the Human Components of
Technological Failure. Systems Research and Behavioural Science, 17, 543-559.
Smith, D. (2005). Business (not) as usual: crisis management, service recovery
and the vulnerability of organizations. Journal of Services Marketing, 19(5),
309-320.
Stocker, K. (1997). A Strategic Approach to Crisis Management. In C.L.
Caywood (Ed) The Handbook of Strategic Public Relations and Integrated
Communications. (pp.189-203) New York: McGraw-Hill.
Wikipedia. (2009). “Helios Airways Flight 522”, Retrieved 15th of March 2009
from http://en.wikipedia.org/wiki/ Helios_Airways_Flight_522.
