Luxaviation focuses on creating single culture
In the last 10 years the company that is now Luxaviation Group has grown from a financier with an idea to a global company with 1,700 employees.
Since 2011, the Luxembourg company has bought Fairjets in Germany, Abelag in Belgium, Unijet in France, the UK’s London Executive Aviation, French and Portuguese operator Masterjet and – most significantly – ExecuJet, a truly international business aviation company. Luxaviation now has 14 air operators’ certificates, 25 FBOs and 15 maintenance facilities. And it wants to keep growing.
Gerrit Basson, former CEO of ExecuJet and now president of Luxaviation Group, has spent a lot of time trying to create one company. “Integration starts at a high level but involves every level,” says Basson. “We created the post of chief integration officer with Hervé Laitat [CEO of Abelag, now Luxaviation Belgium] taking it on and integration is a huge focus of the executive committee.”
But changing the logos on 1,700 business cards and more than 40 buildings in 32 different places is simple compared to the softer human resource challenges. Many of the employees have spent years at different operators (some have even founded them) and getting them to feel they belong to a large global operator is not easy.
“The cultural issues are without doubt the hardest. Even changing someone’s email address can be emotional,” says Basson. “It may seem like a little thing but for someone that has worked at a company for a long time it can mean an awful lot.”
A Ritz-Carlton culture
The management team has spent a lot of time looking at how to create single global culture. One solution comes from the basement of every Ritz-Carlton hotel. The hotel company employs more than 40,000 employees at 91 hotels in 30 countries (putting the size of one of the largest business aviation operators into perspective).
Ritz-Carlton takes company culture seriously. It believes that it is the key to customers receiving what it calls Gold Standard Service. The company – and its individual hotels – have won many human resource awards. In 2000 it created the Ritz-Carlton Academy both for its employees and to train other companies.
There was also a cultural fit between the two companies as both aircraft operators and hotels focus on keeping demanding customers happy. “We looked around at other companies that have developed strategies but really liked the way Ritz-Carlton focused on culture and customer service,” says Basson.
If you have stayed in a Ritz-Carlton hotel you will not have noticed it, but a key part of their integration is what they call a Daily Line-Up. The same thing happens at 9am every morning outside the CEO’s office in Atlanta.
“Line-Up is the opportunity to reconnect each employee with their purpose and their mission before they start their day,” says Ritz-Carlton’s blog. “Although there may be many elements to your Line-Up—such as corporate announcements and birthdays—the emphasis should be on your culture and values.”
Ritz-Carlton Line-Ups are led by one employee who reads a company newsletter containing information on what is happening at other hotels, stories relating to corporate values and updates relevant to each hotel.
It sounds simple but Ritz-Carlton says it is crucial: “This is our number one form of communication with our employees around the world. It is the glue that connects us daily and keeps our culture alive.”
The Daily Line-Up is just one thing that Luxaviation has learnt from Ritz-Carlton – others include ‘four step service’ and Gold Standard.
Luxaviation’s management team now sends out its own Daily Line-Up email to all employees. They then meet in groups to go through it. A typical Luxaviation Line-Up includes safety messages, stories about how one team has delivered great service to a customer and other information such as new hires.
Employees in different parts of the business aviation company have reacted differently to this idea. Some have embraced it completely and love the initiative. Others have been more sceptical.
“It has been fascinating looking at how different cultures react to the idea,” says Basson. “But it has definitely brought parts of the business together.”
Building an integrated business is also crucial to the company’s future plans.
“There are a lot of internal reasons why most mergers and acquisitions do not work,” says Basson, “and we understand the risks, but the ability to add businesses effectively is core to our future.”
Although Luxaviation has grown to be one of the largest business aviation operators in the world, it still has a market share of less than 3% of all business jets. Luxaviation wants to keep consolidating business aviation.
“We still have not completed integrating Luxaviation’s businesses with ExecuJet, but when we do, we will still keep wanting to consolidate. We are keen to keep acquiring and Hervé as chief integration officer will be a key part of that.”
As Luxaviation’s largest group, ExecuJet has provided a lot of systems and structures that are now being used to integrate the company.
Luxaviation has centralised operations in Cambridge. The Central Operations Support department there provides flight planning, dispatches aircraft, manages Continuing Airworthiness Management Organisation (CAMO) requirements and deals with any aircraft needing urgent maintenance. Crew training, planning, travel and administration is also run centrally.
The operator has also created a centralised Group Broker Desk to sell charter on all its AOCs. The desk provides brokers and clients with access to Luxaviation’s fleet of aircraft from every entity of the business, offering more solutions and a quicker and easier charter process for brokers.
“We are keen to free up our local management teams to spend time with our customers,” says Basson. “The more things we can centralise the better.”
Luxaviation is also investing in new technology to both make aircraft management more efficient and also give customers access to reports on maintenance, flights and other information.
“The whole industry needs to improve its reporting. It is common to find operators sending bills months later,” says Basson. “We give customers their final bills seven days after the end of the month and a monthly report, but soon we will be at the point where they can log into an app and go straight into our operating system and see things in real time. You could not invest in this as a smaller operator.”
Basson believes that size matters to aircraft management. “It is a low margin business so economies of scale really make a big difference,” says Basson. “There is a role for smaller operators – up to 10 or 15 aircraft when a lot of it is about client relationships – but above that it gets hard.”
Although, he admits, he is biased as he relishes the bigger challenge. “Business is good across the group. Diversity and multiple business streams help,” says Basson, “and I am enjoying the bigger company. The bigger geography and the bigger variety. But we have just started.”
Basson and his colleagues are now looking for new companies, and more people, to add to Luxaviation’s Daily Line-Up email list.