Michael Lapré, an Owen faculty member who studies operations and performance in the airline industry, sees many challenges ahead for the major airlines. Maintaining customer satisfaction will continue to be a problem, he predicts, as fuel costs continue to soar and the industry works to keep costs down. “Right now the biggest issue is cost,” [...]
Grounded. In airplane parlance, it’s an ironic way to describe someone who oversees the fifth largest airline in the country, but that’s exactly how friends and colleagues of US Airways Chairman and CEO Doug Parker, MBA’86, view him. While he’s adept at managing the 30,000-foot view, they say he remains one of the most down-to-earth people they know—even as his embattled industry confronts soaring costs and plummeting customer satisfaction.
Michael Lapré, an Owen faculty member who studies operations and performance in the airline industry, sees many challenges ahead for the major airlines. Maintaining customer satisfaction will continue to be a problem, he predicts, as fuel costs continue to soar and the industry works to keep costs down.
“Right now the biggest issue is cost,” says Lapré, the E. Bronson Ingram Associate Professor in Operations Management. “They need to figure out an appropriate cost structure that makes it at least appealing to compete with an airline like Southwest. That’s not easy. You want to pay your employees appropriately. But that’s tough because other airlines, the discount airlines, have much cheaper labor. Then there are fuel costs, and figuring out how many different types of planes you can profitably have in the fleet. So there are cost-structure issues, fleet issues, labor issues. It’s not easy.” keep reading »