![]() It all comes back in the end to value for money. Many service companies ignore the fact that there also are plenty of customers in the lower end of the market who are willing to pay a little more for superior service. We don’t just mean people who fly business class, first class, or the Concorde. They are the people we’ve been trying to attract and retain as customers. But even for a seeming commodity such as air travel, an element of the traveling public is willing to pay a slight premium for superior service. Sir Colin Marshall: You’re always going to be faced with the fact that the great majority of people will buy on price. HBR: How can a large competitor such as British Airways differentiate itself in a commodity services business that is so cutthroat? Prokesch about competing in service industries. From his offices in London, Marshall talked with HBR senior editor Steven E. If delivering consistent, high-quality service in a complex people business is tremendously difficult for one company, think about trying to get a group of companies to do it. It has taken sizable stakes in USAir, Australia’s Qantas Airways, France’s TAT European Airlines, and Deutsche BA. In a bid to become the first truly global airline, British Airways has been forging alliances with other carriers around the world. Although Marshall certainly isn’t yet proclaiming victory on that front, a much larger challenge is now looming. Marshall, who joined British Airways as CEO and succeeded King as chairman in 1993, has presided over British Airways’ metamorphosis from a company that seemed to disdain customers to one that strives to please them. Together, King and Marshall transformed the airline, which they privatized in 1987. Appointed by Margaret Thatcher, the industrialist was in the midst of his struggle to turn loss-ridden, state-owned British Airways into a competitive airline that investors might want to own. Sears, the British retailer and shoe manufacturer, lured him back to London in 1981 by offering him the deputy CEO’s job. After the conglomerate Norton Simon acquired Avis in 1979, Marshall’s responsibilities expanded to include Hunt-Wesson foods, which instilled in him an appreciation for the power of brands. He then worked all over the world as a manager for Hertz and later Avis, where he became CEO in 1976. Then again, he is not a product of the industry. With his talk of building brand equity and commanding a premium by “orchestrating service to fill customers’ value-driven needs,” Marshall, who is 61 years old, is clearly an iconoclast in the airline industry. It may sound crazy, but just look at British Airways’ profits: While the world airline industry has racked up billions of dollars in losses in the last five years, British Airways has remained solidly profitable. Even in a cutthroat, mass-market business such as air travel, he argues, there are plenty of people who will pay a premium for good service-even among those who travel economy. But Marshall doesn’t think it has to be that way. carriers-seem to have made cutting costs the top priority at the expense of their service quality. Convinced that travelers care mainly about price, many airlines-most notably the major U. But just because the competition is tough, that’s no reason to be tough on customers, says Sir Colin Marshall, the chairman of British Airways. Few businesses are as brutally competitive as airlines.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |