14 September 2006

Boeing is not Ford - some musings

So Alan Mulally has decided to jump ship to take on one of the biggest and
sickest companies in the world. I am sure he is going to get a bucket (make
that a backhoe's worth) of cash.

So interesting to speculate on why he made the jump and why now. Given the
stellar amount of sales by Boeing's salespersons over the last 3 years
particularly the 787 - it seems unlikely that the same achievement can be
replicated beyond what is on the books now - so quit at the top of your
game. Or could it be something more sinister - like an impending delay for
the 787's very aggressive delivery schedule. Some could be very cynical and
argue that perhaps Boeing's salespersons fudged delivery dates in order to
keep out the competing Airbus A350.

With Boeing's production lines now based on a moving line system and being
managed by former Toyota folks - it seems that turnabout is fair play that
they should get an aircraft salesman to run what was once the world's
largest car Marque.

While the US car industry and Ford's troubles are well documented and so
obvious a monkey could fix them, I am going to be very skeptical that an
Airplane driver sales guy can fix them. I just hope that Alan M has the
smarts to hire in some good people and then work at slashing the bloated
payroll that dogs Ford and others of its ilk. I hope he realizes that the
much vaunted second turnaround at Chrysler has never really happened.
Mercedes while trying to follow the US model of buying as many Marques as
they could realized that actually buying a dog leaves you with - well a dog.
Nevertheless they decided to see if they could build their own dog with
someone else's brand - SMART move guys.

So do we have a lesson here that applies to Travel? Yes. several:

1. Size isn't everything (so don't believe the UK Renault ads!)
2. It is very easy to screw up a brand and you can do it very quickly too.
3. Listen to your customers. And KEEP listening - day in and day out
4. Watch your overhead
5. Compromise costs money
6. As Mims says - staying in your comfort zone never begets winners

However I still think that the lesson I want to take away from watching the
shenanigans in the Auto Industry is that TIME COSTS MONEY. In a closed
market you can delay - particularly when your competitor is already on the
ropes. The car industry is way more competitive. Remember that the consumer
always has one other choice. He can choose NOT to buy that shiny new car.
For us who are providing services to our industry of choice - we have to
remember that and be humble. The decision can always be to wait or not to do
it at all. Let's make sure that we do the right things right, all the time.

Oh yes and my prediction - if Alan M is still at the helm of Ford in 3 years
I will make a donation to charity in his name.


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