Quo vadis? Buisness Aviation - what will come & what is necessary
I fully agree with you CargoOne and SpainFly. I think the revolution started already mid 2007.
Our industry must wake up, as it will never occur exactly like in the past.
CargoOne you are right, the fundamentals changed and I am completely in line with your arguments you provided so far:
There were several factors which made bizjet market to grow:
- more and more rich people, try to google how many new millioneers and billioneers were appearing each year;
- stupid security things at airports
- overcrowded terminals
- dramatic fall in service level on intra-european flights
- smoking ban
additonal facts /thoughts from myside:
* 9/11, SARS, Bird Flew, Oilcrisis, etc. favoured BizAv growth
* Increasing speed of globalisation favoured BizAv, that speed is turned into zero speed. Eco development cooled off, and this is in line with the latest traffic figures for BizAv (compare FAA, Eurocontrol)
* Even Premium Airliner travel dropped significantly (compare IATA)
* Buisiness Traveller completely changed their travel behaviour and pattern
* millioneers and billioneers which gained ground by leveraged high risk BizModels are heavily impacted by the ongoing “Deleveraging” of the industry and capital market -à major cause, why traffic deteriorated in the last since mid 2008
We must wake up and prepare
* We must forget sounds from EBACE 08 irritating, that the BizAv industry will not be impacted by the eco crisis.
* OEMs backlog will not ride the recession, all will be heavily impacted- some more, some less (already proven by Textron, HBC)
* Demand will come back, but different as we all experienced in the past
What will come – what is necessary
* I think the speed of industry consolidation will increase (Yes! Agree nothing new, but who will have the power? Lean towards big players? Yes, but screen for innovative companies with a solid BM)
* The time of “Nice Weather Captains” is definitely over, leadership with profile is necessary
* Innovative concepts for operations, marketing, and strategy are needed more than ever
* Look for and recruit innovative staff and combine their thoughts with your industry knowledge
* Nothing said to get rid off experienced staff, but change managment is needed, honestly change managment
* The demand will come back – that`s sure; but for sure in a different structure and we all need to be prepared for it. Everybody (!!!!!!) must recognize this.
* The politic associations like EBAA must react, but they need to be restructured and prepared for the future more effective
* There are tendencies, which I really recommend to all of you think about – it`s worth reading and thinking (some good perspectives)
Quote :
The various players in Business Aviation, be it Charter Operators, Airports, FBOs, Route Planners or Service Providers should now consider finding ways of cooperating.
Working together means a joint effort to get a significant share of the pie.Collaboration can mean different things to different minds. If there is still such a thing as a hatchet in business, it better be buried fast. Fast changing business environments and markets movements need smart concepts, not hatchets.
How Small Can Beat Big?
Never Underestimate Small Companies in Big Groups
By banding small companies and their services together, the synergy will enable them to develop and provide a range of better complementing products and services for their respective clients. Unification can increase the potential for more market share and higher profits. By working together, rather than competing against one another, small united companies can acquire the clout of a big company without losing their individuality. By placing cooperation ahead of competition, smaller companies are then able to take on larger projects that they couldn't have undertaken on their own.
Banding together means forming a “virtual company.” It does not mean merging or take-over; however it does not exclude such steps in the future. Time and experience will prove whether a joint venture or remaining separate will have the best advantages. The virtual company, the way I see it, will be the emerging "coop-company" with the best potential for future success in our field of business.
None Of Us Are Us Good As All Of Us
The virtual company may be a temporary network of independent companies who join forces quickly to exploit fast-changing opportunities and, linked by information technology, share skills, costs, and access to one another's “markets”. Together, they could accomplish what they couldn’t have done alone. It may mean restructuring the way the companies work to improving monetary results and increasing efficiency. It may mean reorganizing ways to conduct research and development together. It may mean jointly exploring for tax advantages. The virtual company does not need a central visible office in a high traffic area, nor does it need a hierarchy. An organizational chart will show how emphasized tasks are handled from different locations.
Strength Of Going Virtual - Uniqueness Of Each Individual
The intention is not to wipe out all differences, but to unite with all differences intact. Member companies need to look for a central focal point that would give them the strength of a big company. Yet it leaves each member-company’s dedicated management and individual skills in place. There will be more flexibility, added skills, and availability. It will be much easier to pull together a crew or task force to handle larger and more complicated projects or tough deadlines. Unlike major companies that have large, vertical teams all under one roof, the operating teams of the virtual company will be kept small and flexible.
Since small companies mainly consist of dedicated senior professionals or highly talented and skilled pioneers, they can work faster and more efficiently on their own without supervisors, secretaries and clerical workers.
1 + 1 = 3; All Are Greater Than The Sum Of Its Parts
The virtual company has significant advantages and joint resources for its members:- Enhance product-features, lines and services.
- Access to each others expertise, information and advice.
- New available creativity, resources, talents, skills and innovation.
- Avoid isolation, collaboration in new developments
- Precisely selecting and pulling the right resources together on the spur of the moment.
- Sharing joint project workloads
- Assigning specific types of work to specialized members.
- More opportunities for new ideas, where before time and funding were not available to the individual member.
- Joint implementation of more complex projects.
- Cooperation accomplished more than working alone.
- Overhead can be kept significantly lower.
- Working faster and more cost-effectively.
- More powerful and influential image.
- Enhance individual reputation.
- Opportunities to acquire investments or find more financial support.
- Acquiring support services for mutual benefit, which individually none could afford.
- Extend projects in more geographical areas or adjust to local or regional needs.
New Culture In A Changing Environment
The virtual company will not change the world nor anyone's own little world It will adjust to a changing environment in the most practical way.
Who understands that synergy, not domination, will lead to sustainable progress and success, will fit in the virtual company culture. Any candidates joining the virtual company are obligated to incorporate this new culture; otherwise they cannot be accepted. A prospective member who is looking for anything easy in the virtual company is not an appropriate party! There is no easy way to get in the market, no easy way up the ladder of success, no easy way to get out of a problem.
Food For Investors
The growth of a company may be explosive; a downfall may also come with a bang. Either way makes investors nervous. A company with little exposure has a slim chance to receive funding from major investors. On the other hand, the virtual company can be instrumental in acquiring funding and let its members benefit from it while the investors will enjoy:- the spread and thus lowered risk
- the joint potential for success
Being independent entities, the individual members of the virtual company can still have own funding, while others may opt for investment. One member of the virtual company could also become an investor in the other. After the initial cooperation experience of learning to know, appreciate, and trust each other there will be a base for deepening relationships.
Joining Forces Means Becoming A Major Force
The virtual company relationship will open doors to success and growth. Standing strong united has the potential to sell as much service as possible in the shortest possible time. Looking at the global marketplace, competing companies are finding ways to join forces and be successful individually. If there is a desire and a will to work together, all else is just a matter of logistics to be worked out.
Source:http://www.newslett.co.uk/bluesky/articles/teaming_up.htm
I know very bad news and progonis: But we all need to wake about and recognize, that it is time for change – NOW! I love the BizAv and my heart beats for it. Looking back, we can be proud of for what we have achieved in the last three years.
Comments are more than welcome of all of you
With my best regards
Chrispler
Last edited by chrispler; 9th Jan 2009 at 10:47.