Looking Beyond the Runway

354 Pages·2010·6.22 MB·English

by  Nawal K. Taneja

Looking Beyond the Runway
To my wife, Carolyn
Looking Beyond the Runway
airlines innovating with Best Practices
while Facing Realities
nawaL k. taneja
© nawal k. taneja 2010
all rights reserved. no part of this publication may be reproduced, stored in a retrieval
system or transmitted in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise without the prior permission of the publisher.
nawal k. taneja has asserted his moral right under the Copyright, designs and Patents act,
1988, to be identified as the author of this work.
Published by
ashgate Publishing Limited ashgate Publishing Company
wey Court east Suite 420
union Road 101 Cherry Street
Farnham Burlington
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British Library Cataloguing in Publication Data
taneja, nawal k.
Looking beyond the runway : airlines innovating with best
practices while facing realities.
1. airlines--Management. 2. organizational change--Case
studies. 3. Strategic planning--Case studies.
i. title
387.7'068-dc22
978-1-4094-0099-8 (hbk)
978-0-7546-9997-2 (ebk)
Library of Congress Cataloging-in-Publication Data
taneja, nawal k.
Looking beyond the runway: airlines innovating with best practices while facing realities
/ by nawal k. taneja.
p. cm.
includes index.
iSBn 978-1-4094-0099-8 (hardback) -- iSBn 978-0-7546-9997-2
(ebook) 1. airlines. 2. airlines--Customer services. 3. automobile industry and trade.
4. aeronautics, Commercial. 5. Consumer satisfaction. i. title.
he9776.t365 2010
387.7068'4--dc22
2009050842
Contents
List of Figures xi
List of Tables xiii
Preface xv
Foreword by William Ayer, Chairman and Chief
Executive Officer, Alaska Air Group xxi
Foreword by Jim Compton, Executive Vice President
and Chief Marketing Officer, Continental
Airlines xxiii
Foreword by Enrique Cueto, Chief Executive Officer,
LAN Airlines xxv
Foreword by Hugh Dunleavy, Executive Vice President,
Strategy & Planning, WestJet Airlines xxix
Foreword by Peter Harbison, Executive Chairman,
Centre for Asia Pacific Aviation xxxv
Foreword by Henry H. Harteveldt, Vice President,
Principal Analyst, Forrester Research, Inc. xxxix
Foreword by Pedro Heilbron, Executive President and
Chief Executive Officer, Copa Airlines xli
Foreword by James Hogan, Chief Executive Officer,
Etihad Airways xliii
Foreword by David V. Jones, President and Chief
Executive Officer, Amadeus IT Group xlv
Foreword by Bob Jordan, Executive Vice President
– Strategy and Planning, Southwest Airlines xlix
Foreword by Alan Joyce, Chief Executive Officer, Qantas
Airways liii
vi Looking Beyond the Runway
Foreword by Wolfgang Kurth, Member of the Board, Air
Berlin Group (Former Managing Director
of dba, Hapag-Lloyd Flug Express, and
Hapag-Lloyd Flug) lv
Foreword by Andrew Lobbenberg, Airline Analyst,
European Transport Equity Research,
Royal Bank of Scotland lix
Foreword by Samer Majali, Chief Executive Officer, Gulf
Air lxi
Foreword by Hussein Massoud, Chairman and Chief
Executive Officer, Egyptair Holding Company lxv
Foreword by Robert McGeorge, General Counsel,
International Air Transport Association lxix
Foreword by Gary R. Scott, President, Bombardier
Commercial Aircraft lxxiii
Foreword by Robert Solomon, Senior Vice President
and Chief Marketing Officer, Outrigger
Enterprises Group lxxv
Foreword by Andrew B. Steinberg, Partner, Jones
Day (Former Assistant Secretary
of Transportation for Aviation and
International Affairs, U.S. Department of
Transportation; and Chief Counsel, U.S.
Federal Aviation Administration) lxxvii
Foreword by Junku Yuh, President, Korea Aerospace
University lxxxi
Acknowledgements lxxxiii
1 Outlining the Chaos, Evolving Strategies, and the
New Normal 1
The Chaos 1
Evolving Strategies 5
The New Normal 11
Takeaways 19
Contents vii
2 Learning from Other Struggles: The Auto Industry 21
The Focused Competitors 22
Toyota 22
Porsche 24
Alliances 27
Insights for Airlines 29
The Unfocused Competitors 30
The Detroit Three 30
Insights for Airlines 37
DaimlerChrysler Merger Case Study 39
Insights for Airlines 44
What’s Next for the Automakers? 45
The American Automakers 45
The Changing Global Market 49
The Potential Game Changers 51
Fiat and Volkswagen 52
Tata 52
Better Place 53
Insights for Airlines 55
3 Learning from Other Successes: The Customer
Experience Industry 61
Customer Groups 62
Millennials 63
Other Generations 72
Consumer Behavior in Economic Downturns 74
Insights for Airlines 77
Employee Capabilities 87
Processes, Systems and Incentives 99
Case Studies in Consumer Experience 104
In-N-Out Burger 104
Ritz-Carlton 106
Zappos 108
Takeaways for Airlines 113
viii Looking Beyond the Runway
4 Innovating around Airline Realities 121
Major Drivers of Innovation 122
Challenging Conventional Thinking 122
Airline Examples Relating to the First Pillar of
Innovation 126
Observing Trends and Experimenting 128
Airline Examples Relating to the Second Pillar of
Innovation 130
Leveraging Competencies and Resources 131
Airline Examples Relating to the Third Pillar of
Innovation 134
Acquiring Supportive Leadership 134
An Airline Example Relating to the Fourth Pillar of
Innovation 138
Business Model Innovation 139
Airline Examples of Business Model Innovation 146
Case Studies in Innovation 149
Cirque du Soleil 149
Mahindra & Mahindra 151
Procter & Gamble 152
Nintendo 155
Allegiant Air 157
Google 158
Zipcar 160
Insights for Airlines 164
5 Firing on All Cylinders to Stay Ahead 173
Elevating Business Intelligence, Analytics, and
Agility 173
Value and Pricing 183
Airline Application: Pricing Airline Services Using a
Merchandising Model 191
Insights for Airlines 194
Contents ix
6 Viewing the Changing World Map 197
The Global Economy 197
Four Examples of Growing Economies and
Opportunistic Markets for Businesses 200
Chile 200
Egypt 203
Malaysia 205
Turkey 208
The Paradox of Africa 211
Generalized Pessimistic Perceptions 211
Generalized Optimistic Perceptions 214
Potential Business Opportunities 217
Challenges and Opportunities for Airlines 221
The Paradox of Latin America 228
Generalized Pessimistic Perceptions 229
Generalized Optimistic Perceptions 230
Potential Business Opportunities 232
Challenges and Opportunities for Airlines 234
Takeaways 239
7 Flying with Tailwinds against Headwinds 245
Game-Changing Technologies 246
Transforming Aircraft Technologies to Right-Size and
Re-Shape Networks 246
Transforming Information and Communication
Technologies to Improve Customer Experience and
Operational Efficiency 252
Game-Changing Leadership 254
Closing Thoughts 260
Index 263
About the Author 269