...SOUTHWEST AIRLINES CASE STUDY COMPANY OVERVIEW Southwest Airlines Co. (“Southwest”) is a major U.S. airline that primarily provides short haul, high frequency, point-to-point, low-fare service. Southwest was incorporated in Texas and commenced operations on June 18, 1971 with three Boeing 737 aircraft serving three Texas cities-Dallas, Houston, and San Antonio. Southwest has the lowest operating cost structure in the domestic airline industry and consistently offers the lowest and simplest fares. It also has one of the best overall customer service records. LUV is Southwest’s New york Stock Exchange symbol, selected to represent the company’s home at Dallas Love Field, as well as the theme of Southwest’s employee and customer relationships (Southwest Airlines Investors Relations statement at www.southwest.com10/10/04). Vision: To have a conservative increase growth, capitalize and cutback schedules of other airlines. To continue expanding conservatively in long-haul success. The company’s mission is clearly stated and communicates its information throughout the organization and to its customers. The Mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and company Spirit. To our employees we are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth. Creativity and innovation are encouraged for improving the effectiveness...
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...Southwest Airlines 2002: An Industry Under Siege Harvard Business School: 9-803-133 Executive Summary Southwest Airlines in 2002 faced a serious of important management decisions after the 9/11 tragedy in order to continue the record breaking company growth that Southwest had experienced since the 1970’s. Southwest Airlines revolutionized the airline industry with what is known as the Southwest Effect: low cost fares, point-to-point service, “10 minute turnaround” and an enjoyable friendly atmosphere. After the Airline Deregulation Act of 1978, Southwest adopted a polity that irregardless of the profitability of expansion opportunities, the company wanted to commit to a manageable annual growth rate of about 10-15%. The following questions and discussion will address the historical challenges of Southwest airlines, the direction the company contemplated in 2002, and a brief look at the challenges of today. 1). What is the competitive business environment The airline industry has always been competitive. In an analysis of the most profitably investments as per our class discussion, surprisingly, airlines come in at the lowest return on each dollar invested at around 2.5%. Southwest Airlines experienced 30 consecutive years of profit a mere two years after it’s founding in 1971. Many airports began requesting Southwest service for their passengers, but throughout Southwest’s expansion, the company aimed to maintain a manageable growth rate and focus...
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...Polygamy in the South West Hawaii Pacific University PSCI 1400 June 13, 2008 MCP Term 4-08 Article #4 Polygamy in the South West Polygamy has been a problem in our country for over one hundred and fifty years. In 1862 the first Anti-Bigamy law in the United States, The Morrill Bill, was signed by Abraham Lincoln. Our government has since passed several laws to discourage polygamy, and yet they still battle polygamist sects to this day. I believe that our government’s main concern is not the multiple marriages, but the children affected by them. Young girls are being forced in to marriages with much older men, to have sex and bare children. Young boys are excommunicated, and thrown out of their communities to make more young girls available to older men. Women and girls are being forced to marry first cousins, half-brothers, and uncles. There have been several cases of incest and in-breeding, which has led to children being born with severe abnormalities, from physical deformities to mental retardation, and genetic diseases. They continue to bare these children regardless of warnings from physicians. Despite all the laws against polygamy and to protect children, our efforts to enforce these laws have made very little impact. These polygamist sects continue these practices in spite of arrests and heavy fines by the government. Former Fundamentalist LDS Church leader Warren Jeffs sect is recently the most notorious group in the news today. For the past several years...
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...South West Airlines The Mission of Southwest Airlines The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit ("The mission of," 2012). Southwest’s Strengths Southwest started out as a small airline only servicing three cities, Dallas, Houston and San Antonio, but my, how times have changed for this company. Southwest has flourished mainly because they have been able to get such a tight reign over their costs and by marketing low domestic fares, becoming well known in the industry for being a low cost carrier ("History of southwest," ) ("Marketing mix," 2012). With almost 3100 flights carried per day, according to the number of passengers, Southwest has been termed the largest airline in the world. Southwest offers a diverse fleet of 547 Boeing 737 aircrafts, which has made Southwest the third largest fleet for carrying passengers in the world ("Marketing mix," 2012) Southwest also maximizes its bookings through web site services. It also gives customers the option to change reservations without paying any additional costs. Giving options to passengers is a strength that will play out well for them in the future as the demand for customer options increase ("Marketing mix," 2012). Overall, Southwest Airlines has an abundance of strengths. They have a very good safety record, employees are encouraged to use their sense of humor, their flights...
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...FEDERAL RESERVE BANK OF DALLAS Issue 2 March /April 2003 Southwest Economy . . . . . . . . . . . . . . . . . . . . . What Wages and Property Values Say About Texas Two principal factors determine which cities experience the most rapid economic growth: business investment and labor growth. Business investment is high in cities where productivity is high relative to the cost of production. Workers are most attracted to cities where the amenities and wages are high relative to the cost of living. Together, wages and property values convey considerable information about a city’s productivity and amenities, and therefore about its growth potential. Taken independently, however, neither provides a complete measure of amenities and productivity. Wages could be low in a city because productivity is low, but they could also be low because people are willing to accept lower wages to live in a place with so many amenities. High wages could indicate either high productivity or the need to compensate workers for a lack of amenities. Similarly, high property values indicate either that high productivity has attracted enough business to bid up property values, that high amenities have attracted enough residents, or both. A simple economics framework—one that takes into account the role labor and capital (Continued on page 2) . . . . . . . . . . . . . . . . . . . . . . Debunking Derivatives Delirium INSIDE: The Giant in Mexico’s Rearview Mirror Banks have gotten a lot of bad...
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...SOUTHWEST AIRLINES Situation Analysis: Southwest Airlines was cofounded in June 1971 by chairman Herb Kelleher. Southwest started out with three planes and flew into and out-of three major cities in Texas: Houston, Dallas, and San Antonio(Coulter). Their mission was to offer passengers low rate air fare, convenient travel times, and a hassle free experience. Southwest wanted to be able to get its passengers to and from their destinations as quickly and as fun as possible. Southwest has accomplished more and been more successful than anyone would have ever imagined possible. It has grown from just three Boeing 737 aircraft’s to more than 530 737’s. It has set an airline-industry record of being profitable for 36 consecutive years, it continues to be the leader of customer satisfaction with the fewest customer complaints, and has been named one of the most admired companies in Fortune magazine for its 13th consecutive year. Southwest also has its fair share of competitors that are trying to figure out exactly how they remain so successful. Their closest competitors are JetBlue and AirTran which are both a lot like Southwest in the sense they are both strong, innovative, and low-cost. The difference is their competitors have not been able to lower their costs in the way that Southwest has. One of the reasons Southwest has been and remains so successful is its core competencies. They have figured out how to keep their cost low and remain profitable. Southwest airlines...
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...S.W.O.T. Analysis Strengths Southwest Airlines has several key strengths that make the company leader in the airline industry. First and most important one is that the company was a low-cost leader. When the airline began operations in 1967, its strategy was focused on keeping cost low enough to enable Southwest to establish fares below the cost of driving a car over the same route. This has been a key to Southwest’s success through 2002. In addition, Southwest also focused on providing a high level on-time service. From the very beginning, the company focused on short distant, frequent flights and the customers found their service very reliable and fast. By 2002, the company began to offer long distance flights, but focus was still on providing fast, on-time and reliable service. Fast turnaround time of flights helped Southwest sell more seats in a shorter period of time. Southwest was also focused on being a fun airline for its customers and employees. Employees were encouraged to be creative when making required announcements to passengers. This helped Southwest to stand out as a fun airline and provide customers with a memorable experience. Lastly, Southwest’s most important strength is their hiring process and the employees themselves. Southwest was featured as a top 5 employer in Forbes “Top 100 Companies to Work For” year after year. Southwest had a similar number of employees as its competitors, but Southwest’s employees had to work more efficiently...
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...ANALISIS PEMECAHAN MASALAH Dapat terlihat bahwa dalam menghadapi persaingan industri penerbangan yang semakin kompetitif, SWA harus melakukan perubahan strategi di semua lini. Penulis menyimpulkan perubahan strategi yang dilakukan SWA terbagi 3, yaitu operasi, sumber daya manusia dan marketing. Pada akhirnya, pilihan-pilihan stategi inilah yang menentukan SWA sebagai maskapai penerbangan jarak pendek tersukses sepanjang 30 tahun. Operation Strategy * Pemilihan airport kelas menengah dimana penerbangan dilakukan dengan sistem point-to-point dan hanya memiliki satu jenis pesawat Pilihan SWA untuk mengambil market baru dengan melayani penerbangan jarak pendek merupakan keputusan yang tepat, dimana maskapai lainnya bermain dengan sistem hub. Selain itu, SWA juga bermain di airport kelas menengah sehingga lalu lintas penerbangan tidak terlalu padat. Dengan sistem yang lebih sederhana (tidak perlu ada koordinasi dan sistem reservasi yang rumit dengan hub) serta turunnya tingkat keterlambatan penerbangan tentu akan memberikan kepuasan bagi penumpang. Hal ini dapat terlihat dari tabel 1.1 dimana On-time performance SWA berada di atas rata-rata OTP industri, sedangkan tingkat komplain penumpang SWA paling kecil dibanding kompetitornya. Tabel 1.1 Industry Performance tahun 2000 Hal penting lainnya yang menentukan hasil SWA adalah strategi hanya menggunakan satu tipe pesawat, Boeing 737 ssehingga menyederhanakan penjadwalan, maintainance, operasional penerbangan, dan training...
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...Southwest Airlines COM/530 Communications for Accountants March 24, 2014 Abstract Southwest Airlines is the most respected airline in the United States for their philosophy, mission, vision, and values. More than 38 years ago Rollin King and Herb Kelleher started in 1971 as a small 3 airplane carries operating with in Texas. Southwest has dedicated themselves with providing the highest quality of customer service, provides safe reliable air transportation service at a cost effective pricing. “Southwest Airlines is the nation's largest carrier in terms of originating domestic passengers boarded and has acquired AirTran Airways, now a wholly owned subsidiary of Southwest Airlines Co. Southwest serves 73 cities in 38 states and remains one of the most honored airlines in the world known for its commitment to the triple bottom line of Performance, People, and Planet.” (PR Newswire, 2012) SOUTHWEST AIRLINES This paper will discuss the culture of Southwest Airlines philosophy, mission, vision and value statements. The mission of Southwest Airlines is its ongoing dedication to provide the highest quality level of customer service. “Air Transports World’s selection for Airline of the Year for 1991 is Southwest Airlines of Dallas. Created in 1967 by Herbert D. Kelleher and Rollin King, the airline started up in 1971 as a small, 3-airplane carrier operating entirely with Texas. Southwest has dedicated itself to providing safe, highly reliable and frequent air transportation...
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...Introduction: Southwest Airlines has carried more customers than any other U.S. airline for combined domestic and international passengers. Southwest Airlines is one of the world’s most profitable airlines, posting a profit for the 36th consecutive year in January 2009. Southwest has built a successful business on an unusual model: flying multiple short, quick trips into the secondary (more efficient and less costly) airports of major cities, using primarily only one aircraft type, the Boeing 737. Brief History Suppliers, Customers & Rivals: Customers include both residential and commercial sectors. There is no bargaining power for customers, as there is no threat of backward integration; it is unlikely that customers of Southwest Airlines are going to build their own airplanes and fly themselves. Rivalry among competitors sets the price-Southwest Airlines is a discount airliner. Rivalry is increasing, as the market decreases, and competitors downsize, the competitors become more or less equal in size and capacity. This means that as economic conditions worsen, competitors downsize and then compete for the same remaining market. Few of their main competitors are Continental Airlines and American Airlines. Substitute products include the train (Amtrak) and bus (Greyhound) which cover long distances. While these alternates cannot offer the speed of travel, most of Southwest Airlines' customers are attracted to the low price. *Key Success *Strategies of SWA: Organization...
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...Southwest Airlines Julie Cortez-Knapp Management 103 Week 1/May 25, 2013 Instructor Holly Andrews Southwest Airlines The corporate culture of Southwest Airlines has changed over the years. From a culture of hot pants wearing flight attendants; who were liable for any telecom contest with passengers. Emerging to shared goals, shared knowledge and mutual respect for the national company. In order to relieve workers from the high stress environment; they offer pajama day and rocking chairs for meetings. To prevent layoffs during low passenger flight attendance, Southwest employees were willing to take pay cuts. They increased their turn around gate time to get flights out sooner, from one hour to twenty minutes. They also encourage feedback from employees to improve business. Southwest wants their employees to feel like a team, to have fun/be goofy, to be efficient and have corporate loyalty by loving the corporate culture. Southwest treats their customers like kings and queens and their employees even better. (http://managers.emeraldinsight.com/quality/articles/pdf/southwest.pdf) The Current CEO of Southwest airlines is Mr. Gary Kelley. Mr. Kelley could ride first class and be snooty, like most CEO’s, But he likes to get the perspective of the passengers. He is a laid back people person who rides in the back of the cramped plane with the passengers. He likes to get a feel of the company, just...
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...Case: _______Southwest Airlines 2002___________ Name____Kacey Kurtz__________________________ Southwest Airlines is currently competing in the airline industry. The company’s currency strategy is to carefully advertise its image so that consumers can clearly differentiate Southwest Airlines from other airlines. Southwest Airlines does this by being the only low fare, high frequency, short-haul, and point-to-point carrier in America. Southwest Airlines low fares creates brand equity, because consumers want low fares, and Southwest Airlines is one of the only major airlines that offers this attribute to consumers. Southwest Airlines was also the first airline to offer the frequent flyer program where flyers get credit for the number of trips taken and not the number of miles flown. Since Southwest offers low fares and short travel customers may see that flying is a better alternative than traveling in a car. Some outside conditions that affected Southwest Airlines was deregulation which made the airline industry much more competitive. Everything dealing with air travel is regulated by the government now. Airlines operate in a highly competitive environment where fixed costs are very high and this made it one of the toughest industries to compete in without a lot of airlines going bankrupt. Fuel cost were outrageous that were out of airlines control. Airlines had to fund a lot more towards security since the 911 crisis to keep passengers protected and they...
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...Southwest Airlines in 1966 started off as a small commuter air service owned by an entrepreneur named Rollin King. After over hearing business men complain about there routine drive between San Antonio, Dallas, and Houston Texas. After overhearing these complaints in 1967 King filed papers to incorporate the new airline and submitted an application to the Texas Aeronautics Commission for the new company to begin serving Dallas, Houston and San Antonio. After several years of legal problems from rival airlines by 1971 Lamar Muse was bought in as the CEO of the small commuter air service to get operations underway. Muse was a self confident veteran of the airline business that had the skill needed to send the small service in the right direction. In a short time Muse raised $7 million in new capital which was used to purchase planes and equipment. Below I will discuss the corporate culture at Southwest Airlines and how it leverages its culture to achieve a competitive advantage, evaluate the company’s financial performance by calculating and interpreting the profitability ratios. Describe the characteristics of company’s culture and how you think it affects company performance. Given the strategic decisions in the case, I will recommend actions that management should take to sustain/strengthen the culture (or implement a change), based on the situation given. Given the strategic decisions in the case, I will also identify three leadership actions that the company would need to...
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..... The Mission of Southwest Airlines The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual “Our people are our single greatest strength and most enduring longterm competitive advantage.” Gary Kelly, CEO Southwest Airlines Time flies when you’re having fun! More than 38 years ago, Rollin King and Herb Kelleher got together and decided to start a different kind of airline. They began with one simple notion: If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline. And you know what? They were right. What began as a small Texas airline has grown to become one of the largest airlines in America. Today, Southwest Airlines flies over 100 million passengers a year to 66 great cities all across the country, and we do it more than 3,200 times a day. To illustrate our steadfast focus on a triple bottom line—our Performance, our People, and our Planet—we have highlighted these three elements of sustainability in a new format, our first annual One Report. This comprehensive document combines a report on our 2009 financial performance and updated content from our 2008 Southwest Cares report—our corporate responsibility and environmental report—while elevating our triple bottom line through adherence to the Global Reporting Initiative...
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