I have seen this strategy before in the IT industry. I knew Qantas was going that way the minute I heard Margaret Jackson talk about a "Legacy" airline and then others talk about "(business transformation".
This style of talk is pedaled by consultants and dumb arse Boards and Management buy it.The approach is attractive to management and a Board because it absolves them of any blame for the current state of affairs
The line is always the same; all your business problems are caused by old thinking and old business practices that are associated with an ageing business culture. What your business needs is new thinking, new business practices and of course a new business culture - we are going to go through a "transformation" process.
The first thing that the consultant does is trot out the "legacy business" model and invite the Board and management to buy in to this concept. Various parts can be labelled as "legacy" bits as well as the people who inhabit them. What that does is gives management permission to completely ignore any input from the aforementioned "legacy" staff, no matter how truthful, constructive, valuable and innovative it is. This is because you are seen as part of the old culture, with old attitudes and old thinking. You are not part of the future of the company.
To put that another way; Once you are labelled as part of a Legacy group, you are simply dead men walking. It matters not how profitable, experienced or valuable you are TODAY, because you are not part of the new TOMORROW!
In the Qantas case, nothing the engineers. for example, can say will make the slightest difference to anythig Qantas does because every single one of them has been labelled as yeterdays man. Their minds are made up and nothing you can do will change it. I would assume that the various pilot groups are similarly labelled.
At the same time as the legacy groups are being marginalised they are "harvested" nd every drop of cash that can be squeezed out of the legacy groups is reinvested in the "New transformed" entity, in this case Jetstar. Special groups of employees will be identified, usually young, bright but gullible and a lot of money wil be spent training them way beyond their demonstrated abilities because they are going to operate the new transformed business when the legacy groups are taken out back and quietly disposed of. the transformed business groupies also get the latest toys.
Of course the consultants usually leave just before the final step in the "transformation" is attempted - the cut over from the legacy groups who have been carrying the load for decades to the newly transformed groups. Of course you can guess what happens....The newy transformed golden children can't carry the load and the business collapses in a heap. This is usually because the consultants and management stopped listening to the legacy folk when they tried to tell them what would and wouldn't work.
If the Board and Management are smart enough not to have irrevocably destroyed the legacy part of the business, as the consultants will have exhorted them to do, there may be enough talent and greybeards left to pull the chetnuts out of the fire, shoulder some of the load and send the consultants and their idiot management sponsors packing.
The IT company? Well they labelled all their middle aged COBOL programmers "legacy" employees and the mainframes that ran the COBOL systems as "legacy technology". They identified and hired some bright young good looking people and trained them up in a new conscept called object oriented programming - running on DIgital Equipemnt Corporation mini computers. The COBOL programmers were marginalised and told they had no future, they were simply too old and with the wrong attitudes.
WHat happened ? The DEC machines with their Obect oriented software were switched on and couldn't handle the massive transaction load that the industrial strength mainframes and COBOL programs were handling. Neither could the young staff.
The COBOL programmers? They had a happy ending. There was huge demand for COBOL programmers due to Y2K the year 2000 problem. They al worked as consultants for a few years, made a killing and retired. COBOL still rules the business computing world today. The company? It was sold at bargain rates to its biggest competitor.