Today’s WSJ Middle Seat Column (Southwest Lands at Logan, Bringing Low Fares Mainstream, Aug 6) is about Southwest Airlines’ decision to fly into Boston’s Logan Airport. This is a boon to air travelers in The Hub but it also means a tweak is required to teaching basic operations strategy. One of the first points to make in teaching Operations Management is that processes must be aligned with strategy. The professor then illustrates this by leading a discussion of two well-known firms that have distinct strategic positions paired with distinct sets of processes and resources. Southwest versus Name Your Favorite Full Service Airline has been the stock example and much of the discussion has then focused on Southwest’s choosing to fly into less crowded, cheaper secondary airports. That is, Southwest serves metro Boston from Manchester, NH, not Logan. Turns out Manchester is my home town. I would be able to boldly assert that I had 20+ years of data proving that there was no reason to go to Manchester except to get to Boston. It was all good.
Now Southwest is flying to Boston itself. So what is wrong with the usual Southwest versus the field story? Nothing really. Two key things have changed and both are highlighted in the story. First, Logan has gotten better. They have finally added another runway and delays are way down. Things that made it a high cost location have been addressed. Second, the industry has changed. Turns out that enough trips through Chapter 11 will turn traditional airlines into discount airlines. If everyone is a discount airline, serving Boston through Manchester won’t cut it. Serving Logan becomes more important.
As an aside, the same column talked about how on time performance at O’Hare has improved since its new runway opened (How a New Runway At O’Hare Makes Travel Easier for All, Jul 22). That allows me to plug a segment from Chicago Public Radio’s Eight Forty-Eight program from a few years ago (Reducing Delays at O’Hare, Aug 4, 2004). This is an interview with an industry consultant about the difficulties in improving service at O’Hare in particular and airports in general. It also provides an excellent discussion of congestion externalities.