How to Out wit, Out play, Out smart the Incumbent!
Some business succeed to do a lack of competition, others succeed in spite of it. If you can make it in the airline business my guess is you could make it in pretty much any industry. Consider the following. First, you need a whack of capital to start and build your business. You are navigating a number of “uncontrollables” like fuel costs, airport fees, and catastrophe’s like 9-11. Yet in spite of the odds being stacked against him Robert Deluce of Porter Airlines rolled the dice and began Porter Airlines almost 5 years to the date.
For Small Business Week he’s out and about sharing his story from a Chamber keynote yesterday to an interview with Lang and O’Leary earlier this week: http://www.cbc.ca/video/ As one who looks for patterns of success and has a fondness for synthesizing information I thought I would take a crack at recounting the “Porter Success Formula”
Culture Counts – One of Porter’s biggest successes and an on-going challenge is building and maintaining a strong corporate culture. Engaged employees spawn loyal customers. Loyal customers improve profitability – enough said.
Resilience Matters -The business plan was written, the real estate (aka Toronto Island Airport) secured, the plan for the bridge to transport people over was designed – and then it was turned down. Some would have thought – no bridge, no business. Instead Mr. Deluce picked himself up, dusted himself off reworked the business plan, dug deep to find more capital and made sure he had the best and brightest senior executive team to get the job done. Roadblocks are a fact of life; overcoming them is critical.
Little Things Add up to a Lot – Free beverages (and not just any beverage – wine and beer), pleasant snacks, more leg room, leather seats, a lounge with great seats, wi-fi and the crème de la crème friendly people! Customers like to feel special. Porter’s customers feel cared for. So much so that their customer satisfaction rating was 83% – a higher number than Ipsos Reid had ever seen in the airline industry. Crafting a good customer experience and aligning all of your touch points provides a solid pay back.
KISS – Keep it simple s_ _ _ _ _ _ ! Speed, convenience, service – those are Porter’s foundational pillars. Whether you create a guiding principle like the Four Season’s (do unto others as you would have done unto you) or foundational pillars like Porters; a simple, succinct message that helps your employees understand what matters most makes sure your unique competitive advantage gets walked and talked every day.
Costs Controls are King – Sure it’s great that you can provide a superior customer experience but if you can’t do it efficiently you’ve got a hobby not a business. Porter’s breakeven load factor hovers around 50% in comparison to other industry giants – low cost carriers come in at 73% while legacy carriers are at a whopping 83%. Figure out how you can give more than your competition and keep your costs lower and you’ve got a recipe for success.
So next time you’re sitting around the board room table lamenting that it can’t be done. Look at someone like Porter who has done it and do a bit of brainstorming as to how you can apply the same principles in your business.