FlyerTalk Forums - View Single Post - LHs strategy: discussion thread for customers, investors, consultants & armchair CEOs
Old Nov 4, 2015, 5:13 am
  #2269  
N1003U
 
Join Date: Jul 2010
Location: BSL/FRA or PHL
Programs: LH Miles and More, DL SkyMiles, Bonvoy, Hilton
Posts: 2,335
Originally Posted by oliver2002
Come again? While that may apply to the pilots, the FAs go thru a 6 week training and are let loose on the public after that. Same goes for ground staff. While the quality is debatable, the outsourced staff in outstations seems to do the job on minimal training and wages as well.
Yes, it wouldn't be the first time a company has scrimped on product development and then tried to make excuses about the crap that results.

I claim there is a strategic choice. To increase productivity, you can either cut pay (reduce the cost/employee), or you can increase value (increase the revenue/employee). You can also reduce the number of employees, which will of course typically also raise revenue/employee, at least in the short term.

The first choice is easy: fire everyone and automate the process. Oh wait, that technology doesn't exist yet. OK, just fire the expensive people and hire drones where automation doesn't work (maybe even use the drones to direct people to the automated bits ). Yea might work, but in DACH it doesn't save so much money anyway, and outsourcing won't do your premium image much good in the longer term (unless of course you don't care about your premium image anymore, but if you lose that, you bump very quickly against your cost structure, which is difficult to reform and very uncompetitive within the industry).

The second one is harder: train and empower people to provide value-added services/experiences for the customer. Hmmm...not sure how to do that either.

However, an airline is a service, and if one thinks about it a little bit, an airline does a little bit more than just getting people from point A to point B. If it is only about transport, you could slap people in animal carriers with a bowl of water and a bit of dry food and transport them VERY inexpensively, but I am not sure how many customers would sign up for that, even at very low prices. I am betting there are some experiential parts of the shopping, purchase, product delivery, and post-delivery that people will actually pay money for.

But to address the criticism directly, IME, if one makes a direct comparison of average education, communication, thinking, social, and problem solving skills, I would pit an average LH front-line service person (both on board and on the ground) against just about anyone in the industry. But they need to be motivated and enabled to use their skills.

So yes, one might argue (especially given the past 8-10 years or history) that a logical and sensible attempt to increase value might work as well or better than trying to reduce high structural costs. Not sure, but I wouldn't be so fast to discard the idea.
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