In order to improve or develop innovative products, there are four main principals that we can follow. These include development of new products, improvement in the existing processes, re-positioning of the company or product in the existing market and finally re-defining the paradigm that is business model of the company (Francis and Bessant, 2005).

 

 

       We have chosen the Southwest Airlines for our iSearch 2 and we believe that it has adopted a paradigm innovation for its business model. Through this paradigm innovation, Southwest Airlines introduced a new business model in the existing market.

 

 

 

 

 

 

       In the past, there were only full-service carriers which used to run as a luxury way of transportation and air travel was one of the most expensive modes of transportation compared to road or rail travel. However, Southwest Airlines introduced a new business model into the US airline industry which gave intensive competition to the full-cost air travel system. This business model is known as low cost carriers (LCC), it offered a low-cost of transportation to the general public while still satisfying the need of air travel. LCC focuses more on operational practices to decrease the costs; for example, flying with only one type of plane and one class of fares. The differences between full-service carrier and low cost carrier can be seen in the table below. (Sabre Airline Solution, 2010; Boeing, 2016)