Question: Class Competitiveness, strategy, and productivity Mini case: Porter Airlines In 2006, Bob Deluce thought, Why not use the Billy Bishop Toronto City Airport as the

Class Competitiveness, strategy, and productivity

Mini case: Porter Airlines

In 2006, Bob Deluce thought, Why not use the Billy Bishop Toronto City Airport as the hub, providing a quick and hassle-free alternative for Toronto business travellers? This small regional airport is within five minutes of downtown Toronto and on an island in Lake Ontario (accessible by ferry or a pedestrian tunnel), whereas Pearson International Airport is one hour away on a busy highway.

Deluxe bought the small, old airport and spent $50 million to renovate and expand it. He then bought several Bombardier Q400 Dash 8 turboprops (no jets are permitted at the airport). Their range is limited but sufficient to reach major cities around Toronto. Porter Airlines started having 10 to 15 daily scheduled flights between Toronto, Ottawa, and Montreal.

Deluxe initially terminated the landing and take-off rights of Jazz, Air Canadas regional subsidiary, thus protecting his competitive advantage, the airport. However, one year later, Air Canada was given a very small number of landing/take-off slots.

To compensate for the disadvantage of turboprop airplanes (relative to jets), Porter offers a lounge with free Wi-Fi and beverages, courteous service, and leather seats with plenty of leg room and free beverages in the planes.

Recently, Porter Airlines introduced a newly designed low-fare class for more price-sensitive travellers that must be booked 21 days in advance without itinerary changes or cancellations.

More than 2 million travellers use Porter in a year. Now, Porter has 29 planes and flies to more than 23 cities, most within 1,000 km of Toronto, including 6 in the United States. It appears that Porter has found a way to survive in the tough airline business.

Class Competitiveness, strategy, and productivity Mini case: Porter Airlines In 2006,

Productivity problem

At Toronto City Airport, 14 baggage handlers are processing 1,800 suitcases in two shifts (8 hours per shift).

What is the labour productivity for the baggage-handling process?

The Airport manager has a plan to instal an automated conveyor that will increase the baggage-handling process to 2,200 suitcases in two shifts.

What would be the labour productivity after installing the conveyor? Calculate the labour productivity growth.

1. Identify two categories of strategic decisions that Bob Deluce undertook to operate with Porter Airlines at the at Toronto City Airport. Explain your choices. 2. Identify two activities/tasks at the tactical/operational level that airlines like Porter deploy to support their operations strategy. These can be activities to manage -or tasks to maintain-, their operations

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