Selecting the type of plane with the appropriate capacity when
operating a particular air routes would be another source of economy of scale [9]. Various types of
planes have various capacities for transferring passengers. Long-haul carriers with high capacity
can incur less cost to the airline when transporting more passengers. Overhead costs would be 30%
less in long-haul planes than the short-hauls [10]. In addition, they have less cost in distribution and
airport handling. As long as enough passenger traffic exists, emphasizing on big carriers is very
much appropriate in the airline industry [11]. As an example fare for a round trip flight from
Adelaide to London would be around $530 when an Airbus 380 with 760 seat is used [10]. If other
smaller planes are to be used, a higher fare would result even for a single trip. In general, firms with
larger organizational size are often able to purchase specialized equipment and facilities that can
increase their productivity and efficiency. Although business spending may reduce due to the
increase in size of the organization, some cost disadvantages can arise if companies become too
large. Managerial diseconomies and staff demotivation are the most important side effects of
growth of firm size [6, 12]. Whereas processes in firms with large organization are quite complex,
manager’s ability to control and operate can fall extremely. Also with the growth of the
organization, the role of staffs become transparent leading to staff demotivation; moreover,
productivity and quality can suffer from loss of employee motivation [6]. Managerial diseconomies
and staff demotivation could be very costly and even dangerous in airline industry. In addition, staff
demotivation could cause in fewer customers due to abuse and less service quality. As an example
of LCC airline, Ryanair has dealt with customer dissatisfaction and loss of organization knowledge
because of staff demotivation and high turnover [13]. Software technologies such as information
technologies (IT) in organization is another source of cost advantages that can deal with managerial
diseconomies and staff demotivation in airline industry. Any system that can reduce the distance
between top manager and staff can be a powerful source for decreasing the cost such as quality
circles that increase the involvement of organization employees and let managers to hear their
concerns [14, 15]. As a good example for quality circles, durability of airplanes tires in AA have
been more than duplicated just with a little advice from the maintenance chief engineer [16]. These
small improvements can cause huge cost saving in different parts of organization. In addition, the
more being in touch with the customers of airlines, the greater sales will be achieved. To be in touch
with costumers is an important issue in the airline industry that can reduce costs and further rise
sales by increasing the costumers’ experience. IT is a useful method that allows customers to get
closer to the firm and simplify the ticket registration process and cost [17–19]. This technology
enables airlines to bypass agents and conduct ticket sales directly to customers.