ONE: This article is fully appropriate to review because Binggeli, et al., writing in the McKinsey Quarterly explained that a survey of 17 major airlines worldwide revealed that "even the most sophisticated" among those carriers have "only a rudimentary understanding of who their most valuable customers are or could be." Nor do those airlines understand which free rewards programs "are most effective in ensuring loyalty. Indeed, many airlines cannot identify "their most valuable customers" because their frequent flyer programs are "little more than a general ledger system" that basically tracks how many miles a traveler has accrued and how many he or she has spent.
TWO: Meanwhile, how does an airline known which of its rewards programs is making a profit? First of all, according to Gujarathi in Issues in Accounting Education, it's appropriate to explain that Sun Airlines Incorporated (SAI) records free rewards as a liability, and it is included in accounts payable; SAI's incremental costs are tallied to include the cost of providing service for what would otherwise be an empty seat. SAI redeemed 1,357,00 awards in 2002; 1,148,000 in 2001; and 878,000 awards in 2000. The awards reflected 12% of SAI's "total revenue...
Continental recovered from each event in good time and generated overall benefits worth tens of millions of dollars. ("Continental Airlines wins INFORMS best practices award," 2002, website) The company has managed against great odds to continue to serve customers, some would say even more effectively than previous to the 2001 disaster, even recently expanding services. (FACTS: A Quarterly Digest of Interesting Information from Continental Airlines 4th Quarter 2004) Though, in
Strategic Planning in IT IT Impact on Service Industry Performance Cooperative Competitive Competitive Advantage Implementation of IT Innovations 1992 U.S. VALUE-ADDED AND EMPLOYMENT BY INDUSTRY AVERAGE ANNUAL GROWTH IN GDP PER HOUR, MAJOR SECTORS OF THE U.S. ECONOMY Management TASKS IN BUREAUCRACY VS ADHOCRACY ORGANIZATIONS This paper addresses the following problem statement: "Without information technology (IT), a business will not be able to compete globally in any industry, nor in any market it wants to enter. It will
Delphi Study: Influence of Environmental Sustainability Initiatives on Information Systems Table of Contents (first draft) Green IT Current Methods and Solutions Green IT and energy costs Green It and Email Systems Green IT and ICT Green IT and ESS Green IT and TPS Green IT and DSS Green IT and other support systems Green IT and GHG reduction Green IT and the Government Sector Green IT and the Corporate Sector Future Prospects of Green IT in the software industry The paper focuses on how the
(Southwest Airlines Corporation) The employees are always put first at Southwest Airlines, and according to the CEO Herb Kelleher, who was responsible for founding the company Southwest Airlines, the philosophy that employees come first is deeply embedded in the psyche of the company, and if the employees of the company are happy and contented and fully satisfied with their work, then they will most definitely take better care of the
Southwest Airlines Value chain and resource-based view of the firm Southwest Airlines has a famously unique business model for an airline, one which has enabled it to sustain a profit even during times when the rest of the airline industry's fortunes were flagging. Southwest is a budget airline that offers relatively limited flights to a fixed number of destinations, in comparison to its competitors. However, it strives to offer superior service, thanks
American Airlines: Analysis and Discussion American Airlines History (adopted from American Airlines, 2011) American Airlines was formed in 1934 through the consolidated act of American Airways Inc. And several airline subsidiaries that had been acquired by the Aviation Corporation between 1929 and 1930. Cyrus Smith Rowlett was elected president -- a position he held until his appointment as U.S. Secretary of Commerce in 1968. By 1940, American had become the leading domestic carrier
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