Limits to growth
I see that icon of ‘not even the sky is the limit’, Ryanair, is finding gravity still exists. In a curious ‘threat’ to curtail growth, lively CEO O’Leary says it’s not as easy to pick up dirt-cheap aircraft as he did in 2002. He’s not quite so open about the company’s experience of opening hundreds of routes between city-pairs. I’ve tried reconciling their statements of routes opened, operated and closed, and it’s not easy – lots of hype about huge numbers of new routes being started, but curious shyness about how many close.
It rather looks like the love-affair with flying everywhere for nothing – no matter the inconveniece involved - is fading, so both routes and service frequency might have to fall. The parallel with Starbucks over-expansion of stores is uncanny.
Profiting from the downturn – e.g. airlines
Nice example of what looks like a strategically sound business [Lufthansa] pouncing on valuable resources shaken loose when a feeble competitor [Alitalia] stumbles. The Economist reports they will be offering new services to eight other European cities from under-served Milan. Read more
Smart airline strategy for the melt-down
Seeing the sector is anticipated to lose $5bn this year, and more in 09, who managed strategy well over the last 5 years? .. which of course would include anticipating and planning for the inevitable down-turn? Competent strategic management for most firms would imply Read more