Competition Flies With Airlines
Here's the paradox: the more aggressively a firm competes, the greater its performance. But by competing so aggressively, it also forces its rivals to compete more aggressively, thus improving their performance, too. At the same time, if competition is too intense, it can be difficult for any firm to make money. Case in point: the U.S. airline industry.
In this edition of Smith Business Close-Up with the University of Maryland's Robert H. Smith School of Business, Dr. Curt Grimm talks about how the brutal pace of competition, while it may have negative as well as positive effects for individual firms, creates stronger and fitter industries as a whole. He points to the airline industry as an example.