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Wing and a prayer: Rags to riches tale of how a bold new Qld company took flight


Without the glitz and glamour of traditional airlines, a Queensland aviation minnow is spreading its wings, writes Michael Blucher

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As corporate Queensland emerged from its summer slumber last week, an interesting announcement lobbed on news desks around town.

The Queensland Reds had a new sponsor – Alliance Airlines, a commercial partner that would provide them with no less than their very own private jet.

That of course was how it was packaged for media purposes, the commercial terms of the arrangement are in truth a little less glamorous, but nonetheless, the announcement was enough to have plenty of other sporting franchises pouting in their grandstands.

You can just imagine the pre-season chatter among other athletes in rival dressing sheds – “private jet – why can’t we get one of those?”

As big a fillip as this latest corporate partnership might be for the Reds and rugby in general, given the financial challenges the game has endured in recent years, what’s even interesting is the background of Alliance.

The airline emerged out of the carcass of Flight West in 2001, ironically around the same time as planes were ploughing into buildings in New York. On the surface, not an ideal time to be launching an aviation business, but the principals, two practical down to earth executive types in chairman Steve Padgett and CEO Scott McMillan, used it to their advantage.

If nobody else wanted aircraft, they could buy them cheaply.

There’s the fabled story of Padgett and McMillan in the early 2000s, lobbing at the head office of a large pension fund in Montgomery, Alabama, carrying “a brief case full of nothing”. They emerged just 40 minutes later with six unwanted US Airways jets, the deal sealed with a handshake and celebratory lunch in a ramshackle Jambalaya restaurant on the banks of the Alabama River.

No slick powerpoint presentations, no corporate gobbledygook – just an emphasis on being likeable, capable, diligent and trustworthy. Do what you say you’re going to do. It’s the way Alliance has been run since day one .

Over the past two decades, a period in which countless airlines around the world, weighed down by unsustainable debt, have crash-landed and perished, Alliance have continued to go quietly about their business.

Significantly, they are the only airline in the world to record an operating profit in every year of operation, a statistic that speaks as much to the complexity of the aviation industry as it does to Alliance’s consistency of performance.

Their business focus is unerring – safety, on-time performance and profit – anything outside those three commercial imperatives is seen as peripheral.

The profit comes from owning their own aircraft, aircraft that are bought at the right price, in bold numbers – 21 Fokker jets from Austrian Airlines in 2015, and just recently 30 Embraer 190s from American and Copa Airlines, giving them a current fleet of 73 owned aircraft.

Over time, as the business grows, the aircraft are gradually put to use. Build it and they will come.

A couple of years ago, I was invited to write the airline’s corporate history, not for the purpose of beating chests and banging drums publicly, but instead to help the airline’s 600 staff (and shareholders) better understand the back story to the business – how Alliance came to be what it is today.

What I found was a company that flew in the face of all the modern day management nomenclature, in particular the “PC bullshit” that threatens to ever so slowly strangle corporate Australia.

The Alliance business is underpinned by “FIFO” – principally it’s what they do – ‘Fly in, Fly Out”, their major clients large mining companies, shuffling shift workers in and out of remote regional areas.

FIFO also pertains to their stock management system – “First In, First Out”. But most refreshingly, it’s their key cultural platform – you want to work there? “Fit In or Fall Out”. Or words to that effect.

“We’re probably not an employer who suits everybody, but we’re proud of that,” Scott McMillan explains. “It ensures those who are in, are in boots and all. I’m comfortable we have a team of people who are highly engaged. Above anything else, that’s what’s made us successful – the passion of our people.”

In an industry known for bleeding money – Virgin’s debt for instance has now swelled beyond 10 billion – Alliance comparatively speaking, is run on the smell of grubby cabin napkin.

A few years ago, so worn was the carpet in the Alliance head office that it threatened to become a workplace hazard. “For God’s sake Scott – we need new carpet – somebody it going to trip down the stairs and break their neck,” the CEO’s PA, Nicky Clark eventually piped up.

“Nicky, the thicker the carpet, the thinner the dividend,” he reminded her.

In true irreverent Alliance fashion, the carpet was replaced while the CEO was on holidays. The first square was ripped out as he his disappeared out of the driveway.

In the past 18 months, the airline has gradually started to step out of the shadows, and further engage in the local corporate community. Their commercial partnership with the Reds is the most recent and obvious example, but truth be known, they’ve been doing much the same for ages, Cowboys, Lions, Broncos.

They just haven’t had the need to tell anybody about it.

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