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DATELINE: LONDON

Employee
Employee

This is London. 

Okay, I'm no Edward R. Murrow, and the blitz is long over.  But I *was* in London recently, to attend (and report on) the annual Low Cost Carrier Conference.  To say that the conference was fascinating is a huge understatement, but it was also very apparent that all low-cost carriers are facing many of the same issues.  And one--Southwest--is facing those issues in a very different way.

Carriers from Europe, Africa, the Middle East, and Asia were in attendance, as were dozens of consultancies, vendors, and members of the media.  The three of us from Southwest were the only attendees from a U.S. low-cost carrier.  The agenda was a mixture of keynote speeches from heads of carriers and industry pundits, panel discussions about industry hotpoints by airline and airport leaders, and case studies on specific topics related to low-cost carriers worldwide. 

Day one, first out of the chute, a panel discussion on "Competition, Consolidation, and Business Model Innovation" moderated by CNN's Richard Quest ... and the panel included our Vice President of Network Planning (the head of my Department, and my friend!), Pete McGlade.  And the first thing Mr. Quest brought up (calling it "the elephant in the living room") was the Southwest/AirTran announcement as proof that the winds of change were brewing in the LCC world.  However, Quest proved to be a very astute observer of the airline industry--Pete called him "a real airline geek" later, to which he heartily agreed!.  The points covered were almost all of those addressed in www.lowfaresfarther.com as they're pretty much all any Southwest Leader can address without giving a "no comment."  But Pete did so in his own unique, mentoring style.  And he was a definite crowd pleaser! 

Other panelists on the dais with Pete included senior leaders from Brazil's GOL, the UAE's Air Arabia, Norwegian Shuttle, Malaysia's Air Asia X, and Latvia's airBaltic.  Sr. Pereira of GOL said that Brazilian airlines currently can access less than 20% of the potential air market in Brazil because of traditional high airfares, and that their main competition is the country's inter-city bus network (sounds a LOT like the scene when Southwest was born in 1971, doesn't it?).   Much of the panel's discussion centered around how LCC's can continue to compete as the lines between service levels and Customer expectations blur compared to the legacy carriers.

After that, the day split into numerous concurrent panel discussions and presentations.  One of the highlights of my day was attending a presentation co-hosted by an old friend of this blog, Paula Berg, who did a MAGNIFICENT job explaining by using thorough case studies why airline participation in social media is SO worth it!  Our once and forever Blog Queen is doing well and living in Denver, and she sends her best to all of our friends here at "Nuts!"

The LCC Conference was also the scene of the "Budgie Awards" in which LCC's from around the globe were nominated for various awards.  Southwest was nominated for several, and while we didn't win this year, it really is an honor to be nominated (kind of like the Academy Awards and the Emmys!).

After two days of listening to the panels, discussions, and presentations, I found myself getting lots of information but little wisdom.  Even though, for the most part, we all shared the same problems, most of the potential strategies and solutions that every other airline espoused just didn't feel right for Southwest.  I was certain I was right, but couldn't put my finger on just why

And then it hit me.  All of the other airlines strategies were focused on minimizing cost/maximizing revenue at the expense of people.  There was no mention of the human factor--whether it was the Customer and their experience, or their own Employees and their Corporate Culture, all of which are huge drivers of Southwest's model (and great factors in our success).  I engaged in several discussions in which other LCC workers expressed disbelief that we don't charge for bags ("paying for bags is a good thing--airlines should charge more for it!" was one direct quote I wrote down by an unnamed European LCC colleague).  They simply couldn't believe that core to Southwest's principles are such simple concepts as The Golden Rule and "doing the right thing."  They are missing the fact that simply treating people right and not behaving as if they're just a number in either the debit or the credit column of the balance sheet can create lasting success. 

So, I flew nearly 5,000 miles to network and to hear about industry issues, problems, and trends, just find out one very comforting fact:  nearly 40 years into the game, the other low-cost carriers--many of which used Southwest as their model--still just don't "get" what differentiates Southwest from the rest.  It's our heart.  It's our Culture. It's the way we treat each other. It's the way we treat our Customers.  As Southwest moves into even more incredibly exciting times, knowing that no other airline has yet to figure out our "Secret Sauce" makes me feel even more confident about our future.

So since I started this blog post quoting Murrow--and since I'm finishing it at about 11:45 p.m. on a Saturday night, I'll end it by paraphrasing another of Murrow's signature lines.  Good night, Southwest Airlines, and good luck!

 

 

 

 

 

 

 

 

2 Comments
Not applicable
Hi Bill, I remember the strong impression that Herb left at the LCC conference a couple of years ago, lighting up on stage (biiiiig issue in the UK, definitely a no go!). Certainly had the organisers nervous! Only Herb could've pulled that one off :o)) Indeed it is strange that almost all the LCCs out there have copied the SWA model, but not the culture... a typical example of that is Ryanair, who pretty much charge for everything they can think of, and use blackmail techniques as part of their business practices. I will always remember when they promised Bournemouth Airport (UK) that they would turn them into a secondary hub. The airport built a new terminal (financed by local taxes!) for them and about a week before it opened, Ryanair pulled out of the airport completely allegedly due to low profit margins! Some day I guess they'll hit trouble! Raphael
Not applicable
It is very inspiring to read the story of starting Rollin King and Herb their Airline. It proved that if you want to do anything in life, you must be crazy about that. My all wishes with Rollin King and Herb for their better and prosperous future. May God bless them.