Flying Sideways

We’ve often spoken of lateral thinking in this space, although I don’t always call it that. Any discussion of competitive advantage in business – certainly any discussion of strategic management or organizational theory – will eventually include the concepts of creativity and innovation, and why having a sufficient amount of each is critical to the long-term survival of the company. What often surprises people – even people who should know better – is that the goal here isn’t having as much of each as you can possibly get in every department and work group of every commercial enterprise. All forms of innovative thinking introduce uncertainty into the calculations of running the firm, and uncertainty is inherently difficult to manage; this is why so much of the early work in Scientific Management was focused on making a company as mechanistic – as automatic – as possible. Consequently, the more common problem is getting management teams to show any creativity at all – despite the fact that sometimes the answer is as simple as just not booking certain seats on an airliner…

A story being reported by the Globe and Mail Online brings us the case of WestJet, a Canadian airline that was facing the interesting problem of wanting to transport passengers to destinations in Hawaii, but lacking the long-range aircraft necessary to do so. At the same time, the carrier was also seeking new ways to add value to its tickets, as most airlines are currently doing, because of the falling revenues in that industry. Ordering new, longer-ranged aircraft (like the 767 or 787 from Boeing, or the equivalent Airbus) would cost a small fortune and cause a delay of some years – by which time any current demand for travel from Canada to Hawaii would almost certainly have been absorbed by other carriers. But all of the company’s current aircraft were medium-range machines like the Boeing 737, which doesn’t really have the range for the Calgary to Hawaii run. Which meant either increasing the airplane’s designed range – or lightening its load…

Which led to the rather clever scheme WestJet is proposing, of leaving some of the middle seats empty, effectively creating a premium economy class, where passengers willing to pay a small premium (they’re thinking about making it $20 US) would be guaranteed of having an empty seat next to them. The lower weight requirements should lower the plane’s fuel consumption enough to cover the extra distance, but such a program would not require any modification to the existing fleet, let alone the acquisition of additional aircraft. Unlike the introduction of a Business Class section or even an Enhanced Coach Class section (more room between rows of seats, for example), such a program wouldn’t cost anything to set up; the same aircraft could even be used at full capacity on shorter runs when not needed for the flight across the Pacific…

Whether or not the relevant government authorities will approve this scheme remains to be seen, of course. And there’s no word yet on whether WestJet will keep the prices for this new class of seating down to a pittance level (to attract more customers) or if other carriers will try it simply as a means of increasing value to the customer (providing more space in return for a higher fare. But for our purposes, it can serve as an excellent example of lateral thinking – and a reminder that some crazy ideas are also brilliant ones…