Why airships should replace jets for moving freight

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The Globe's monthly roundup of research from business schools.

The desire for financial efficiencies has long been a great driver of innovation. But, with global warming bringing the threat of super storms and rising seas (literally in some cases) to our doorsteps, it appears that environmental sustainability is providing equally powerful motivation to change.

That's certainly the thinking behind University of Manitoba professor Barry Prentice's latest research exploring the futuristic realm of airship technology.

His paper, Sustainable Transportation: Airships Versus Jet Airplanes, was presented at the recent Canadian Transportation Research Forum in Toronto.

Dr. Prentice, an expert in supply-chain management at the Winnipeg university's Asper School of Business, and co-author Robert Knotts of the British-based Airship Association envisage a world in which giant, cigar-shaped aircraft, fuelled by methane or hydrogen, are used in place of traditional jets to transport goods and services around the world.

The authors argue that the shift to a lower- or zero-carbon emission transport system will significantly reduce greenhouse gasses and other dangerous pollutants that contribute to climate change.

"Without question, jet airplanes used for dedicated freight transportation are the most polluting segment of the aviation industry. These are typically the oldest and least fuel-efficient jetliners, but they are also the segment of air transport that might be replaced most easily," the paper states.

According to the authors, "limited but viable" investment into the development of airship technology is already taking place globally, with a number of companies looking into "heavy lift transport airships."

So far, though, most designs are still in the conceptual phase. The only full-scale transport airship, Hybrid Air Vehicle's 92-metre Airlander 10, was unveiled this spring.

The limited availability so far hasn't lessened Dr. Prentice's enthusiasm for the technology. He's pushing for a national airship policy to focus Canada's talents and investment into an economic opportunity that, he says, "is not just green, it is golden, too."

It would allow Canada to open up its northern regions to resource development, and, ultimately, carry goods to Asia and Europe via efficient polar routes.

The ultimate bonus? "Airships are a green technology that can reduce transport costs and create thousands of jobs directly and tens of thousands indirectly," he says.

Change isn't always a good thing

When it comes to memorable marketing flops, few stand out quite like the 1985 launch of New Coke.

At the time, parent company Coca-Cola Co. was working hard to keep its share of the market in its heated rivalry with competitor Pepsi-Cola Co. Coca-Cola decided a radical shakeup of Coke's classic product was exactly what the customer ordered.

Problem was, no one told the customer. Sales flatlined as consumers were put off by a marketing gimmick that ran counter to what they'd come to expect from a previously trustworthy brand.

Three decades on, brands can still learn from Coke's folly – namely, that "brands are very much like people in that they have particular personalities and traits," says Theodore Noseworthy, an associate marketing professor specializing in consumer psychology at York University's Schulich School of Business in Toronto.

Dr. Noseworthy's latest research into the topic, co-authored by Aparna Sundar of the University of Oregon, is published in the Journal of Consumer Research. The study delves into the intersection of brand personality and product packaging and how that affects consumer decisions.

Dr. Noseworthy says consumers react differently to products depending on how their brand "personality" is perceived. Brands deemed to be exciting and creative, such as Apple, can benefit from presenting a product in a way that takes consumers off-guard.

However, the study found that those brands thought of as more sincere, including Nokia, were penalized for any sensory innovations introduced by marketers. In some cases, participants punished sincere brands even when the sensory tactic revealed superior product quality, and awarded exciting brands even when the sensory marketing tactic revealed inferior quality, the study states.

Dr. Noseworthy cautioned that "sincere" is not synonymous with lacking innovation.

"In this day and age where everything innovates and everything changes, [many brands] believe they have to change, too," he says. "They don't understand that, for some of these brands, consumers engage with them because they don't change."

The nuances of foreign direct invesment

David Moloney isn't suggesting that foreign direct investment (FDI) is necessarily the best indicator of Canada's economic health.

But, after decades as a senior public servant with the federal government, Prof. Moloney feels strongly that FDI is important enough to the country's future growth and prosperity that it's worth understanding in a nuanced way.

To that end, the economist and adjunct research professor at the University of Western Ontario's Ivey Business School has co-authored a research paper analyzing Canada's ability to attract corporate investments in plant, equipment, technology and acquired skills in the face of rising competition from the world's developing nations.

The paper, entitled FDI: By the Numbers, was co-authored by Sandra Octaviani and is part of a series of related studies from Ivey's Lawrence National Centre for Policy and Management touching on Canada's global competitiveness.

The authors find Canada has consistently been a top-10 destination for foreign direct investment over the past 15 years – with its global FDI share well above its gross domestic product share.

"When you look at that, we have punched above our weight. It all looks good," says Prof. Moloney.

Drilling deeper, however, "that's where our relative performance doesn't look as strong."

Among the chief concerns outlined in the research is an overreliance on the resource-related sectors and a marked shortfall of greenfield investment when compared with Canada's closest trading economies, the United States and Mexico.

For example, despite a doubling in announced projects in Canada between 2003 and 2014, U.S. projects have increased from triple the original Canadian level to more than four times that level over the same time period, according to the report.

"The bottom line is that Mexico and the U.S. have been outdoing us over time when we look at greenfield investments, including the number of new projects announced and the value of those projects," says Prof. Moloney.

The study concludes that Canada's approach to FDI needs to be reviewed.

Story ideas related to business school research in Canada can be sent to darahhansen@yahoo.ca.