Business Intelligence

The Era Of Outcomes: Emerging Pharmaceutical Business Models For High Performance

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Executive Summary

Southwest Airlines transformed the economics of the airline industry and introduced a sustainable, profitable business model. Many full-service airlines tried to follow suit by creating low-price divisions with the belief that they can leverage their existing infrastructure to gain scale efficiencies that will enable them to compete with or duplicate the results of Southwest. Ultimately, almost all these low-cost divisions failed. Why did they fail? They failed because the parent companies did not recognize that Southwest was not simply incrementally modifying an existing business model to operate more efficiently. Southwest was operating a fundamentally different business model.

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