Easyjet and Ryanair fly high with the Southwest modelTrack the highs and lows of low-cost airlinesAbstractPurpose – Analyze the latest management developments around the world and identify the resulting practical implications from cutting-edge research and case studies. Design/methodology/approach – This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Results – There was a time when the idea of daily commuting between Rome and London would have been considered far too timely – not to mention expensive! But today, for Italian financier Ettore Thermes, this is a daily occurrence thanks to the advent of low-cost airlines. Practical Implications – Provides strategic insights and practical reflections that have influenced some of the world's leading organizations. Originality/value – The briefing saves busy executives and researchers hours of reading by selecting only the best, most relevant information and presenting it in a condensed, easy-to-digest format. Article Type: General Review Keyword: Airlines; Management strategy.Journal: Strategic directionVolume: 22Number: 6Year: 2006pp: 18-21Copyright ©Emerald Group Publishing LimitedISSN: 0258-0543There was a time when the idea of moving daily between Rome and London would have been considered all too appropriate , not to mention expensive! But today, for the Italian financier Ettore Thermes, this is an everyday fact thanks to the advent of low-cost airlines. These budget, no-frills airlines have revolutionized the airline industry, making European and global travel affordable for everyone and forcing established brands to take a long look at their operations. There is no doubt that this low-cost model has been a resounding success. However, some airlines have been much more successful than others. Low-cost model The first LCC to rival major airlines was Southwest. Introduced in 1971 in the USA, this LCC implemented the original low-cost model including: low fares; high frequency flights; point to point service; no free meals or drinks on board; no seat assignment; short flights; and flights to secondary airports. This approach is in line with Michael Porter's theory that there are three main strategies that companies can adopt to gain competitive advantage: Cost leadership – where an organization seeks to be the lowest cost producer by selling mass-produced standard products . This is where the original LCC model emerges. Differentiation – where companies introduce a unique dimension considered important to the market. Some LCCs have switched to this strategy. Focus: involves addressing a specific market segment and is rarely adopted by LCCs.
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