Strategy Dynamics
07 September 2008

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LoFare Airlines Microworld

Start-up or grow a low fare airline in a highly competitive market.

Can you develop new routes quickly in this intensively competitive industry, and make the pricing and marketing choices to win passengers? Can you provide enough aircraft for a reliable service, and still make money, while competing with other low-fare operators and full service airlines trying to hold onto their business?

Description
With LoFare Airlines teams taken on the challenge of creating a new business from nothing or else joining an existing business . Teams can either chase this opportunity when they are the only significant low-fare airline in the market, or if they really like a challenge,try to beat other aggressive competitors in the low fare sector.

The LoFare Airline Microworld reflects the emergence of the European low fare airlines industry, as it grows over a 20-year time-horizon. The market opportunity is not ‘hard-wired’ into the game, but grows as the management team [and optionally, competitors] successfully develop and serve emerging demand for low-cost air travel.

The team decides how fast to open new routes and how many aircraft to lease in order to deliver the service on those routes. The overall demand for air travel is growing and simply opening up a new low-fare service on a route brings new passengers into the market, as well as capturing passengers from the established airlines. However the more routes the team starts up, the less attractive remaining route opportunities become, so marketing and attractive fares are vital to building a robust business.

Teams can pursue a range of objectives such as rapid growth or high profitability, and decide how quickly to achieve them. However the business must be financially viable, so the cash flow from passenger revenues must be sufficient to pay for operating the routes, buying new aircraft and to cover marketing the business. Management must also make sure the business can cope with the demand it generates otherwise customers will leave.

Features
Like all our microworlds, this game is a self-contained PC application, for use by individuals or small teams. It plays out business performance over a time-scale that is long enough to experience the complexity of strategy and decision-making. Teams control strategy by making a small number of key decisions, and can progress through the simulation at their own pace, trying alternatives and saving scenarios.

There are four pre-set challenges built in to this game, each of which includes a full range of data to help guide performance. These offer the opportunity for progressive learning, as teams take on simple scenarios first, followed by the tougher challenges of intense rivalry.

For teachers & trainers, an annotated slide set, suggested teaching schedules, teaching plan, instructions on using the simulation, background information and references. The game also makes an excellent addition to any of the popular case-studies on the low-fare airline industry, allowing participants to move on from mere class discussion to actually take on some of the strategy challenges this industry presents.

System Requirements

Windows 2000 and above with .Net Framework 2.0 installed. This is a free download (20Mb) if required.

Licensing and registration

Note that single user licences are linkes to your PC and registration is required.

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Screen shots:
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