“Swarm Intelligence: A Whole New Way to Think About Business”, Harvard Business Review, 2001.

Order online through the Harvard Business Review website or request a free reprint from Icosystem. A little more than a year ago, Southwest Airlines was having trouble with its cargo operations. Even though the average plane was using only 7% of its cargo space, at some airports there wasn’t enough capacity to accommodate scheduled loads of freight, leading to bottlenecks throughout Southwest’s cargo routing and handling system. At the time, employees were trying to load freight onto the first plane going in the right direction–a seemingly reasonable strategy. But because of it, workers were spending an unnecessary amount of time moving cargo around and sometimes filling aircraft needlessly. To solve its problem, Southwest turned to an unlikely source: ants. Specifically, researchers looked at the way ants forage, using simple rules, always finding efficient routes to food sources. When they applied this research to Southwest’s problem, they discovered something surprising: it can be better to leave cargo on a plane headed initially in the wrong direction. If, for example, they wanted to send a package from Chicago to Boston, it might actually be more efficient to leave it on a plane heading for Atlanta and then Boston than to take it off and put it on the next flight to Boston. Applying this insight has slashed freight transfer rates by as much as 80% at the busiest cargo stations, decreased the workload for the people who move cargo by as much as 20%, and dramatically reduced the number of overnight transfers. That’s allowed Southwest to cut back on its cargo storage facilities and minimize wage costs. In addition, fewer planes are now flying full, which opens up significant opportunities for the company to generate new business. Thanks to the improvements, Southwest estimates an annual gain of more than $10 million.

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