Now this is data from 1996.
It is interesting to contrast this data with the year 2011.
In 2011, you'll notice that the frontier has changed very dramatically.
In fact, Southwest that has been playing
across the game relying on low pricing has emerged as
the airline that has been able to charge the highest prices in the industry.
Yet, they had to sacrifice on the productivity side.
They've been overtaken on the productivity side by companies such JetBlue and
Virgin America.
So you'll notice how that frontier in the industry has shifted.
New business models have arrived,
companies have played different strategies, and
because of their operations, the industry landscape now is a very different one.
All right, what have we learned today?
First of all we notice that you cannot have it all.
Just like in normal life, we have to set priorities,
a business has to prioritize some of the four dimensions of
operational performance, cost, quality, variety and responsiveness.
You have to decide on which of these four dimensions you want to compete.