Ever since the dominance of traditional airline operating models have become seriously challenged by the appearance of low-cost carriers which proved that business simplification can improve operational efficiency, on-time performance, and bring the cost of air travel down – exactly what the majority of passengers wanted.
Many traditional airlines that operate complex and costly hub networks have become synonymous with high costs and poor punctuality. The space in between these two groups is filled by growing number of carriers operating hybrid models, delivering ‘mixed’ operational and financial results.
So, what kind of model is the best to aim for? In search for an answer while writing Beyond Airline Disruptions, I came across the following inspirational text in Richard Koch’s book The 80/20 Principle:
‘...because business is wasteful, and because complexity and waste feed on each other, a simple business will always be better than a complex business. Because scale is normally valuable for any given level of complexity it is better to have a larger business. The large and simple business is the best.’
The question is how many airlines can achieve this?
There are no recipes, but Southwest proved it possible.
