Essay about Southwest Airline Analysis
3142 WordsJul 1st, 201213 Pages
Southwest Airline Analysis
The goal of this paper is to explain the prominent success of Southwest Airline in the United States through a single case study analysis making use of the McKinsey’s 7-S framework. Developed in the early 1980s at the McKinsey & Company consulting firm by Tom Peters and Robert Waterman, this framework looks at 7 internal factors (Structure, Strategy, Systems, Style, Staff, Skills, Super-ordinate goals) which, according to its authors, need to be aligned for an organization to be successful. In this paper, we will analyse each of its internal elements through the case study “Southwest Airlines in 2008, Culture, Values, and Operating Practices”.
The organizational structure of Southwest…show more content…
Being convinced that customers are more likely to travel with Southwest if its flights are reliable and on time, managers pay great attention to on-time arrivals and departure. For this purpose, Southwest managers and employees are all proactive when it comes to suggestions for improving practices and procedures. As a consequence, Southwest Airlines had the lowest operating costs in 2008 (13.85 cents per passenger seat mile versus an average of 19.05 cents for the other 7 major U.S airlines).
The management style of Southwest airline is characterized by how greatly it takes care of its employees’ well-being. The management considers it as a mean to achieve higher customer satisfaction: “Keep employees happy, then they will keep customers happy”.
Management highly believes that treating their employees well and making them loved their job will naturally lead them to treat customers warmly and courteously in return. In this regard, Southwest looks for fun loving and spirited people whose natural warmth and compassion contributes to superior customer service. This is the reason why Southwest particularly takes the pledge of hiring employees for “attitude” prior to “skills” as corroborates this quote from the former C.E.O Kelleher “At Southwest, our People are our greatest assets, which is why we devote so much time and energy to
Southwest Airlines Case Study
1444 WordsApr 22nd, 20086 Pages
This Case Study Analysis will attempt to take an objective look at the key issues and underlying implications of Southwest Airlines with respect to its impact on the airline industry. It will offer meaningful recommendations and plans for implementation.
This will be done by looking at Southwest’s pricing strategies, costs, and competition and putting it in context with the industry as a whole.
History, Development, and Growth
Southwest, founded by Rollin King and Herb Kelleher, began as a small Texan airline almost 35 years ago and has grown to become one of the largest airlines in America. It was created on the following premise: “If you get your passengers to their destinations when they want to get there, on time, at the lowest…show more content…
The other airlines are trying to sell these luxuries in their marketing to maintain a competitive edge.
Another weakness of southwest Airlines is their use of only the Boeing 737 airplane. Limiting itself to one type of aircraft leaves them without the flexibility they might require in the event that type of plane receives a bad reputation of a critical flaw is found. It would cost the company a fortune to find replacement aircrafts.
Southwest was slow in catching up with the other airlines in the amount of time customers would have to queue up in the gate area while waiting for boarding passes. In 2003, the company made efforts to improve in those areas where this weakness was found.
External Environment (Opportunities and Threats)
Because Southwest is so effectively able to differentiate itself from its competitors based on price, others may want to duplicate the airline’s efforts. With Southwest’s limited range, larger carriers could effectively emulate Southwest’s low-cost strategy and encroach upon Southwest’s share of the market, since they already serve a wider community. It might then be possible for them to outdo Southwest Airlines.
An effective strategy Southwest could adapt to inflict damage to its competitors is to further slash its already low prices. This “squeezing” would be particularly effective because most of the airlines are already at or have filed for bankruptcy.