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Wendy is an IFE Agent responsible for aggregating airline news specifically related to Inflight entertainment. She compiles stories relevant to business travelers, airline industry folks, marketers and tech geeks. IFE News doesn't create original content, but rather posts compelling editorial from global media outlets.

Richard Branson: How To Succeed In Business By Really Trying

Richard Branson: How To Succeed In Business By Really Trying

Richard Branson: How To Succeed In Business By Really Trying

Suffering Philadelphian air travelers: help is on the way!

I was cheered to hear last week from CEORichard Branson that Virgin America is starting flights into Philadelphia. In May 2011, I described here the horrors of US Airways and its Philadelphia hub. Last week, on CNBC’s SquawkBox, on the introduction of the new service, Branson offered pointed insights as to why US airlines are doing so miserably as well as making us miserable. He gave five suggestions as to how things need to improve.

1. Increase quality of service

Branson said he had set up Virgin America to increase the quality of air travel for poor Americans who have suffered for many, many years domestically. Virgin America, he said, was opening a lot of new routes around America. Philadelphia has almost no competition between Philadelphia and Los Angelesand Philadelphia and San Francisco. He said that Virgin would give US Airways “a run for their money.”

2. Offer quality equipment

Branson said, “US Airways doesn’t have any plugs for plugging in your equipment, no entertainment system. But with Virgin America, we have the kind of airline that people from Philadelphia and the West Coast enjoy to fly and I think we’ll do well on this route.”

3. Don’t nickle and dime your customers

As CNBC host Becky Quick notedrecently air travelers in the US have been getting nickeled and dimed for everything. One airline is even proposing to charge people $35 if they want to bring any carry-on luggage with them to store in the overhead compartments. Branson agreed: “Virgin likes to come in to businesses where people are being nickeled and dimed and where the quality of services is pretty dire. What’s happened in America is you have got these enormous airlines that are getting bigger and bigger and, now, the last thing they seem to think about is quality of service. In every other industry in America—hotels, restaurants, clubs, et cetera—quality is of paramount importance. However on a competitive basis, the airlines play into our hands, the more they make decisions like this which the public dislike.”

4.      Allow actual competition

Consolidation of airlines in the US has made the airlines stronger but prices have also gone up. In fact, Virgin made its name going up against a virtual monopoly: British Airways. Branson said, “Consolidation is not good for the consumer and it’s incredible that the competition authorities keep allowing it to happen. In Britain, in their wisdom, the Comptition Authoriy has just allowed British Airways to take over British Midland. You wonder how they got the title, “Competition Authority”. A competition authority should be telling airlines to compete and if you don’t compete successfully to go away so you can make room for new up and coming companies with better ideas. You shouldn’t be able to be propped up by getting together with an even bigger carrier and then being able to monopolize and put fares up because you have no competition. It’s madness in what’s happening in the airline industry in the last five years.”

5.      No resurrection: let dead airlines actually die

Branson continued: “You also have this bizarre thing in America where if a company goes bust, it doesn’t actually go bust: it goes into Chapter 11. It screws its competitors by screwing its creditors, comes back out of Chapter 11 and then most likely goes back into Chapter 11 again few years later. Continental has been in chapter 11 four or five times. There’s not one carrier in America that we competed with over the last 25 years that hasn’t gone bust, at least once. Generally four or five times.”

Not unique to the airline industry

These problems are obviously not unique to the airline industry. I have described elsewhere how they play out in other sectors including:

In effect, we are not dealing with an airlines problem. We are confronted with an economy-wide management problem. Organizations are not sufficiently agile to cope with the demands of today’s emerging Creative Economy. The Fortune 500 must master the radically different management principles needed for continuous innovation that delights customers, with a different role for the managers, a different way of coordinating work, a different set of values and a different way of communicating. This is not rocket science. It goes by different names: “management 2.0″, “customer capitalism” or “Agile managment.” I have called radical management. Whatever we want to call it, as Richard Branson explains, it’s very different from traditional management.

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  1. Developing and Empowering Leaders – Richard Branson (Part 2) « CoachStation - April 24, 2012

    […] Richard Branson: How To Succeed In Business By Really Trying (ifenews.wordpress.com) […]

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