Well, seeing as my tickets are for a Southwest flight out of Manchester, I decided to do some investigation. OK, so I just went to Google News. As it turns out, none of the fees apply to me anyway, as they're simply increasing the overweight-baggage fee, allowing pets in the passenger cabin for a fee, and discussing onboard WiFi. Want.
But one of the articles I read, specifically this one from the Chicago Tribune, was the one that got me thinking. The author states that Southwest is "under pressure from Wall Street to offset the [money] it is forfeiting by not charging travelers" for checked bags, then compares Southwest's baggage-fee take in 2008 to American Airlines' take, which is about ten times that.
Now, of course, that's that particular author's spin. I skimmed a couple more articles that suggested Southwest was going against the no-fees mantra it had always followed, that it shifted from lampooning its competitors' fees to charging fees itself. I felt like that was kind of an unfair dig; Southwest's new fees are directed toward additional services like pet fare or unaccompanied minors, not the standard elements of air travel like pillows and blankets or checking a bag.
But the Tribune author's approach to the subject grated on my nerves. It's the word "forfeit" that got me. It's as if this author thinks that there's a missed opportunity here, that Southwest needs to be cashing in where everyone else is. To say they "forfeited" the money makes it sound like they up and gave away money that was rightfully theirs. And so I imagine a bunch of suits in some boardroom, acting as if the money that wasn't charged for baggage fees is money that was rightfully theirs to begin with.
I can't help but wonder if it's that kind of greed that got us into the mess we're in now.
I'm not suggesting at all that a company doesn't have title to what it earns. It's been proven, time and again, that the lack of a profit motive is the fastest way to stifle production. What I'm questioning is this reflection in the business world of our instant-gratification culture. Everything seems like it's measured in immediate results and short-term gains, not long-term outlooks. This is one of those situations; a lot of people fly Southwest because of the no-fees approach, the fact that they can check a bag for nothing and move forward. That goodwill is surely worth something, even though it's not a tangible on the balance sheet. Is it a good reason to charge a fee just because everyone else is doing it? Is the risk worth the potential income?
Carmine and I discussed this a bit, and Carmine suggested a bit of an "MBA effect." Back at RPI, we were reminded how all these successful entrepreneurs did their MBA five or ten years after their undergrad. Now, granted, most of them were trying to get a startup going before they went for the MBA to get some degree cred. However, the reason that our professors preached it to us was because they felt like the real-world experience would be far more useful to us entering the MBA program. There was one dude who wanted to do a five-year bachelor's/MBA program and they sort of discouraged it, though I'm sure he did it anyway.
But for every person who delays their MBA, I'm sure plenty just press forth while they're still in the student mode. Now, they have the credentials to do Serious Business. Well, credentials in the form of a degree. But what do they really have? A few years of reading Harvard Business School case studies? I'm not saying management is easy. But senior year at RPI, I took a course called Strategy & Policy that turned out to be a management capstone. I took it to flesh out a complete semester's worth of classes. I got an A in the class, even though I hadn't dosed up on management terms and specific theories since Intro to Management and Marketing. A lot of it was just common sense, and having to apply a name to that. Maybe it's the nature of HBS case studies, too...no one writes about marginal successes or subtle failures.
But even with quite a few case studies under my belt, from the Robert Mondavi wine empire to the Suzuki Sidekick, I'm not ready to make managerial decisions. Book learning is exactly that; real-world experience is the only thing that can prove that, and temper you to make better decisions in real-world situations. And yet, the business decisions made in all sorts of industries these days smack of some booksmart straight-A MBA who figures that if it worked for Alaska Airlines, it's sure to work for him. Or if it can make a shareholder satisfied today, it'll buy time to figure out something to keep him happy tomorrow.
The whole fare thing itself goes back to a changing paradigm in the airline industry. American, Delta, US Airways and their ilk were essentially premium airlines, as much as you can say so for a company whose name is said to stand for "Doesn't Ever Leave The Airport." Southwest was a no-frills, cattle-car airline, offering cheap rates and not much else. That's great for me most of the time; I can eat when I land, I bring my own entertainment, and if I'm traveling alone, I only have to find one seat. The problem is that when fuel went out of sight, the other airlines looked to the success of the spartan Southwest, and basically created an à-la-carte approach to flight, while still charging the same premium rates. The blanket and pillow you once got for free? The meal? The soda? The checked bag? No one was going to accept fees for things that had always been included in the airfare. If the airlines had gone up on ticket prices, there would have been grumbling, but people wouldn't have felt like they were being held hostage. An à-la-carte approach works great for something like, say, cable TV, where I would love to have Speed Channel but have no need for BET or TV Land. Those are essentially premium services. Basic amenities - a soda or a blanket - are not premium services. After years of serving free in-flight meals, it's a big paradigm shift to tell people they have to pay for that now. I suppose you'll need a quarter to get into the bathroom before long. Imagine how many climactic scenes during movies that take place in an airplane that that would screw up.
It's not just the people in power, though. It's the shareholders, the ones who dictate the results they want to see according to how much they've bought in for. It's the analysts, who call it however they see it, and the media, who reports it in whatever way will garner the best ratings. We all expect results now, and we need to realize that sometimes, "now" results aren't going to be good results in a specific context. Deadlines are fine, but sometimes they encourage a rash and tactically unwise decision for the sake of making some kind of decision. We're spoiled; we've become used to a world of immediacy where an e-mail that doesn't get responded to within seconds is followed up by an immediate phone call, where nothing is fast enough.
Maybe we've got to slow down and be just a little patient, and see some results before we start counting on them.
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