Imperial Class: A little background

If we do end up with (most) airlines converting to premium offerings and ditching coach class, we’ll be right back where airline travel started. My old friend and former boss at Lockheed, George Hamlin, has a column, “Suite Life,” that talks about this and other factoids from the era of super glamorous air travel over at Air Transport World.

As he recalls:

Airline service began by catering to a premium market. … As commercial aviation advanced, there were numerous other aircraft types that were fitted with berth-type sleeping facilities. In addition, as aircraft became larger, it also was possible to install more luxurious passenger accommodations. Continue reading

Fastest way to kill a company?

I don’t know, but an effective way is to move your Schwerpunkt off of cheng / chi. When this happens, your ability to generate chi will atrophy (it’s hard enough to keep it going, anyway), and eventually cheng will follow. Here’s an example.

From an article in Monday’s Wall St. J. (subscription required) on recent problems at Target:

Creative leeway—once the DNA of the chain affectionately dubbed ‘Tar-zhay’—took a back seat to rigid performance metrics.

Auftragstaktik (as we might describe it) was replaced with control:

Initiatives once left to divisional leaders to execute on their own became subject to consensus and extensive testing, say former executives. Even small projects, like a mobile app, became bogged under the weight of giant teams.

What happened out in the marketplace, what customers experienced, was predictable:

The chain “lost a lot of what used to make it unique,” says Barclays analyst Matthew McClintock. “There haven’t been exciting reasons to shop at Target in recent years.” (emphasis added)

Kill creativity and you kill agility and then … Continue reading

Is blitzkrieg enough?

Did the Germans win WW II?

Maneuver warfare, a modern updating of the infiltration tactics that led to the stunning German successes in 1939 through late 1941, is a better way to fight opposing military forces: Create a gap in the enemy defenses, penetrate into his rear areas, cause panic and chaos, and exploit before he can figure out what’s going on. Numbers become irrelevant and can even be a vulnerability once panic sets in. Continue reading

Bad news for Imperial Class?

You may recall my prediction that in about five years, the three legacy major airlines in the US will merge and discontinue coach class service. This would leave them with a 2-class product, business and a superpremium offering I called “Imperial Class.”  You can read more in the press release, available on the Articles page.

Grant Martin, however, notes in a piece on Quartz.com, that none of the all-business-class airlines, started during the last decade, succeeded. The sole survivor, Open Skies, now flies a dual coach / business class configuration. Continue reading

What customers want

Gregory Ciotti has an interesting column on LinkedIn today, “Why Steve Jobs Didn’t Listen to His Customers.”

The subject is market research, and the question is: Should you ask customers what they want? My answer: Sure. Why not? You going promulgate an edict: “Never ask customers what they want.”?

The big issue is what you do with this information. Well, why not just build what they say they want? Sometimes this works. If I had to guess, I’d say it works pretty often because you can reliably predict that customers want problems fixed. As Ciotti notes:

Perhaps this is the truth behind Apple’s innovation — Steve Jobs did actually listen to customers, but only to find out which problems they faced, and to identify the biggest points of friction they had.

Continue reading

Figures and maps from Certain to Win

I know a lot of you have bought electronic editions of Certain to Win (“a lot” being relative, but I’m highly grateful and flattered, nonetheless) that did not have legible figures and maps. My sincerest apologies.

I’ve uploaded a PDF file with all the graphics in the book. There’s a link to this file on the Articles page.

Some electronic editions also didn’t play well with Table I on page 43. I recreated that table in an earlier post and have also added a link on the Articles page. Continue reading

Kill your business model. Now!

Eric Beatty has an interesting post on this subject on LinkedIn, “Challenge your business model before someone else does.”

He suggests that companies examine their customer experiences and try to find “pain points” that they can solve. He cites Simple.com, Square, and Uber as start-ups that have created new business models and asks why established companies can’t do the same.

It’s a very good question. Continue reading

The march to Imperial Class

Continues unabated: “Etihad’s New Three-Room Suite, for When First Class Just Doesn’t Cut It” in BusinessWeek.

The space, which costs about $43,000 for some flights, is priced to include two travelers and comes with a butler, chef, and shower.

For the background on Imperial Class, here’s the original press release, and here’s an update.

I’m not criticizing Etihad, by the way. If they feel there’s a market for this service and they can make a dirham or two, more power to them. That’s what business is all about.

It’s sometimes said that services like this indicate a bifurcation — the superrich and everybody else. That’s sort of what I was driving at in the original news release. But that’s not quite right.  This service is a consolation prize for those who are rolling in dough but can’t afford a Gulfstream. The real superrich will fly their own G650s or similar, leaving a service like Etihad’s for the merely very wealthy. It’s the distinction between the 1% and the .01%, a distinction that is, I’m sure, important to those concerned.