...The Effect of Consumer Behavior on Southwest Airline’s Market Strategies Southwest Airlines provides flight transportation to leisure travel and business travel clients. While they specifically cater to each of these areas of segmentation, Southwest Airlines organizationally competes on a low cost strategy. The company’s approach to the market is to provide a low cost option to both consumer segments, while providing top-notch service and convenience. Southwest’s strategy targets business class travelers, making corporate partnership agreements a large part of their marketing and finance strategy. In catering to the business class bargain hunter, Southwest has established a value concept of customer loyalty and convenient services. Southwest has been able to capitalize this market segment to become the largest domestic airline while also able to maintain the highest customer satisfaction level in the industry. The company is able to maintain partnerships and brand themselves as an affordable business travel option by providing discount partnerships with affiliate businesses. This allows the airline to maintain market share by providing financial motivations for its business partners to incentivize them to continue to patronize Southwest Airlines. They actively promote their schedule of frequent non-stop flights to major city hubs as well as surrounding cities, proving to be a practical option for business class travelers. Southwest’s business traveler value concept extends...
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...Southwest Airlines Organizational Behavior Herbert David Kelleher led Southwest Airlines to over 30 consecutive years of profitability, first as the company's cofounder and legal counsel from 1966 to 1982, then as its president, CEO, and chairman from 1982 to 2001. Southwest Airlines was incorporated in Texas and is headquartered at Love Field just outside of Dallas. Customer Service started on June 18, 1971, with three Boeing 737 aircraft serving three Texas cities; Houston, Dallas, and San Antonio. Today, Southwest operates 550 Boeing 737 aircraft among 72 cities. Southwest topped the monthly domestic originating passenger rankings for the first time in May 2003. Yearend results for 2010 marked Southwest's 38th consecutive year of profitability. Southwest became a major airline in 1989 when it exceeded the billion-dollar revenue mark. The company has roughly 35,000 employees located in 72 cities throughout the country. In 2010, Southwest Airlines had total operating revenue of 12.1 billion and net income of 459 million. The culture at Southwest Airlines prides itself on their unique and positive organizational culture, an encouraging working environment, and exceptional customer satisfaction. Southwest proudly declares their distinguishing factors in the airline market, “[w]e are a company of People, not planes. That is what distinguishes us from other airlines” (Buller & Schuler, 2006, p.118). Not only do competing airlines attempt to mimic this strategy but also...
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...Mission and Vision Statement Today, in the 21st century, when the borders between countries erased, and people travel all over the world and within their countries, the airline industry has become more popular. Air carriers have become more sophisticated and aware of their customers’ needs; thus, they operate at all levels providing a valuable service to their customers. Talking about the US airline industry, I want to analyze such companies as Southwest Airlines and Jet Blue Air. In order to analyze these companies, it is necessary to start with what are the company aims, what is important to it, what it wants to achieve, and who the groups are. All this valuable information is reflected in the company’s mission and vision statement. Thus, let’s take a closer look at mission and vision statements of Southwest Airlines and Jet Blue Air. According to the Southwest Airlines Annual Report (2013), “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.” Moreover, the company has expanded mission statement, “We are committed to quality service for the everyday person. Southwest provides air transportation to cities all around the United States. We fly the most luxurious planes on the market with the latest technology money can buy. We competitively provide the lowest airfare price in search for the greatest advantage in today’s busy world. We provide the...
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...Environmental Scan Paper MGT/498 November 26, 2013 Environmental Scan Environmental scanning is an essential element in monitoring and analyzing trends that can affect an organization. A tool used as a part of environmental scanning is the SWOT analysis which pinpoints the Strengths, Weaknesses, Opportunities and Threats of an organization. This paper will present a SWOT analysis of three companies from three different industries, Starbucks Coffee, southwest Airlines and Wendy’s Old Fashion Hamburgers. In addition to the SWOT analysis there will be information regarding the company’s competitive advantage, strategies used, how value is created by each company along with the measurements guidelines used to verify strategic measurements SWOT Analysis: Starbucks Coffee, Southwest Airlines & Wendy’s Starbucks Coffee, Southwest Airlines, and Wendy’s operate in three different industries, something each company has in common is utilizing as a tool the internal and external environments based on the SWOT analysis. Starbucks Coffee began as a single store in Seattle; now, the number one coffee chain in the world located in over 62 countries with 18,000 stores. In order for Starbucks to have its current success and continued success a SWOT analysis breaks down the favorable and unfavorable factors to determine the appropriate strategy to stay on top in the premiere coffee industry. The Strengths of Starbucks Coffee to name a few are the experience the...
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...Southwest Airlines: Leadership Matters Latrice Alston University of Phoenix COM 530: Communication for Accountants Tonya Boddie September 12, 2012 Southwest Airlines: Leadership Matters Leadership styles affect the way organizations function and interact with employees, consumers, and business partners. Leaders develop a style of communicating based many times on experience. Southwest Airlines, a leader in the airline industry has enjoyed unparalleled success due to its business plan and dynamic leadership. For Southwest Airlines, senior management places great emphasis on employees realizing satisfied employees are pivotal to the success the organization has and will continue to experience. Effective leaders are critical to advancing the vision and mission of the organization. Southwest Airlines continues to make strides in the airline industry based the strategic vision of management. Southwest’s mission to provide excellent customer service delivered in with warmth, friendliness and pride is the mantra of the organization. Leadership comes with a price and those tasked with leading must be able to balance both the mission of the organization and the needs of employees. Unlike other organizations Southwest Airlines, due to the multi-faceted leadership style has a very low rate of negative attrition. Factors impacting attrition within organization can most time be attributed to the way organizations are managed. Having weathered...
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... Relationships to Achieve Magnificent Performance at Southwest Airlines Submission date: 11-06-2015 Group: 2 Members: Stanley Agus Sardjono Stevie Faverius Jaya Johan Indra Wiratanto Ervina Yelena Introduction to Topic Southwest Airlines Co. is a major U.S. airline and the world's largest low-cost carrier, headquartered in Dallas, Texas. The airline was established in 1967 and adopted its current name in 1971. The airline has nearly 46,000 employees as of December 2014 and operates more than 3,400 flights per day. . In summary, operational-wise, Southwest Airlines has three distinctive characters which have been copied by other airlines: 1. Flying just one aircraft type – to cut down on training and maintenance costs. 2. Using smaller, less congested airports – to avoid schedule disruptions caused by multiple aircraft demands. 3. Eliminating meal service and seating assignments – to allow aircraft to be turned around more rapidly. However, the heart of the Southwest success story are in fact summarized into these three “magnificent recipe”: 10 Organizational Practices + Their Business Environment + Their Business Communication Technique 1. Outstanding Business leadership We have learned about credibility from Southwest airlines. Credibility is built up one episode at a time over an extended period, but...
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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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...Introduction to Southwest Airlines 3 1.1 Overview 3 1.1.1 History 3 1.1.2 Southwest Airlines’ offerings 4 1.2 Reasons for choosing Southwest Airlines as a case study on HR practices 5 2 Literature review 5 2.1 HR strategies 5 2.2 Training and development 7 2.3 Compensation 8 2.3.1 Financial compensation 8 2.3.2 Non-financial compensation 10 3 Human resource practices in Southwest Airlines 11 3.1 Human resource strategies in Southwest Airlines 11 3.1.1 Southwest Airlines Strategies 11 3.1.2 Role of HR Strategies in implementing Southwest Airlines’ strategies 12 3.1.3 Southwest Airlines human resources strategies and tactics 14 3.2 Training and development in Southwest Airlines 20 3.2.1 Southwest offer the employees the freedom to learn and grow 20 3.2.2 Safety and security training and outreach 21 3.2.3 Environmental and sustainability training 22 3.2.4 Diversity and inclusion education and outreach 23 3.2.5 University for people - leadership 23 3.3 Southwest Airlines’ Compensation and Benefits for People 27 3.3.1 The Freedom to Travel 28 3.3.2 The Freedom to create Financial Security 29 3.3.3 The Freedom to pursue Great Health 30 3.3.4 The Freedom to Learn and Grow 32 3.3.5 The Freedom to Work and Have Fun 33 3.3.6 Employee Recognition Programs 34 3.3.7 Distributed Leadership 35 CONCLUSION 37 REFERENCE 38 Introduction to Southwest Airlines Overview History Southwest Air was founded...
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...Organizational Behavior & Human Resource Management ECM62BUS Assessment 2: Individual Business Report Name Date Abstract The role of human resources management is indispensable in Southwest Airlines and the Coca Cola Company. The department has the power of steering the companies to success and greatness. Indeed, this department deserve due attention because of the role it plays in the two organizations. However, the two companies, Southwest Airlines and the Coca Cola Company manage their human resources in somewhat different ways. Some of these ways employed by the company contravenes the conventional way of managing human resources. This paper therefore, made a critical evaluation of the human resources management of the two organizations. Apart from critically organizing the human resources management, the paper also highlights the organizational structure and change management issues in the two organizations. From this analysis, the paper claims that the because the two organizations operate in different industries, aviation industry and hotel industry, the manner in which the human resources management practices are conducted is unique for each of the organizations. It is also noted that each of the organizations has a distinct organizational culture. In the same note, it is observed in this paper that the two organizations have different organizational structure. Because of these differences, the PESTLE and SWOT analyses...
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...Implementation Corporate Culture/Leadership Actions for Strategy Implementation Assignment #5 Southwest Airlines Strayer University BUS599016VA016-1116-001 Strategic Management September 4, 2011 Abstract This paper examines the corporate culture at Southwest Airlines. The paper will also evaluate the company’s financial performance. Strategic decisions Southwest management should take in order to sustain their cultural strength will also be discussed. Corporate Culture/Leadership Actions for Strategy Implementation Assignment #5 Southwest Airlines Southwest Airlines is a major domestic airline. They provide short-haul, high-frequency, point-to-point, and low-fare service. Southwest has one of the best overall customer service records and they are among the lowest cost structures in the domestic airline industry. Discuss the corporate culture at Southwest Airlines and how it leverages its culture to achieve a competitive advantage. Corporate culture is defined as being created by corporate vision, values, principles, and rules (p. 92). The corporate culture at Southwest Airlines believes their employees are the company’s greatest asset. Most companies say customers come first, but at Southwest Airlines their operative principle is , “employees come first and customers come second.” They believe happy employees will keep customers happy (C-419). Southwest employees come first and they keep employees happy through their promotion, compensation, employee...
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...Culture Profile BUS 520 March 2, 2015 The organization that I chose to research was Southwest Airlines. This particular Airline Company has been around for over thirty eight years. The creators Rollin King and Herb Kelleher only had one priority and that was their customers. Their goals were to get each passenger to their desired destination in timely matter, at an affordable cost, and have while doing it. Because of their remarkable customer service experience, Southwest has named one of the top Airline Organizations in the United States. 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 (www.southwest.com). The Organizational Culture of Southwest Airlines is to connect with the customer through kindness, consideration and reliability. It requires many skills to be a part of an interpersonal group. Being an employee of Southwest Airlines, you will encounter many experiences dealing with all sorts of people. It requires organizational culture, which consists of ways of thinking, acting, and understanding work that are shared by members of an organization and that reflect an organizations identity (Wood, 253). It was very important to be able to identify interpersonal group work as its own degeneration, and how it is associated with other variables such as social, cultural, academic background and gender. As employees interact, they create, sustain...
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...commercial airline industry started in 1978 when President Carter signed the Airline Deregulation Act. Before deregulation, airlines were under the strict rules of the Civil Aeronautics Board that governed all aspects of the airline industry. This included the regulations of fares, rates of return, routes, and mergers. Plus, there was no price competition and a very limited number of carriers. After October 1978, fares fell dramatically and new companies began to enter the market. There were several difficulties in the subsequent years contributing to the early 1980’s recession and within the first ten years 150 carriers went bankrupt. The three largest airlines that remained ended up having 80% of the United States air traffic. The market rebounded in the mid-1990’s when the demand for airlines was greater than the supply which resulted in continued entrance in the market and continued failure. In recent years, the industry has gotten more condensed as companies begin to acquire each other. Price competition is still a major part of the industry as well as the struggle for lowering fixed cost to raise profit margins. The airline industry is not attractive to compete in because of its mature state in the product life cycle. The projected growth rate of the airline industry is small because it has become so well developed. Competition is also very fierce in the airline industry, especially after the Airline Deregulation Act created price wars. This same reason is why the airline industry...
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...Assignment 2: Competitive Strategy Presented By: Carolyn Campbell Presented To: Prof. Laura Pogue Class: BUS 508 Date: November 4, 2012 Assignment 2 1. Determine how each corporate culture differs from the other. Southwest Airlines culture was very unique among all of its employees. The company generated a culture around prioritizing their workers over their customers. This family oriented atmosphere that was created enabled worker retention and customer service to skyrocket. Southwest was ranked number one among all major US carriers several times on a customer service as well as safety, price, on time performance, and baggage handling basis. Both customer and employees were expected to be treated with respect and dignity. This would soon be incorporated with red hearts on banners and posters as reminders of compassion that was expectant toward employees and customers. Fun was also incorporated into the company’s core value as a form of behavior that employees exhibited while performing their jobs. The company’s day-to-day operations included jokes and pranks, as well as frequent company-sponsored party to boost employee morals. The management team within Southwest Airlines was given roles to ensure that employees were proud of the company that they worked for. Managers were expected to spend at least one-third of their time amongst their workers, observing and ensuring that demands were met and also listening to employees concerns and suggestions. Managers and...
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...Company Analysis Project – Final Paper – Southwest Airlines Charles M Mohr MBA 6008 – Global Economic Environment Capella University Doctor Halstead February 19, 2016 Abstract The aircraft carrier business contends in an oligopoly showcase. This implies just a few of airline companies control the significant bit of the business. Southwest Airlines is one of these organizations. They make up 16.6% of the business sector, second only to Delta. The motivation behind this paper is to talk about the microeconomic and macroeconomic situations that Southwest Airlines faces every day. The Airline Deregulation Act that was passed in 1978 was a huge impact on the aviation industry. There are administrative contemplations on financial choices, for example, group clamor and air quality. Southwest Airlines has moral (ethical) contemplations that should be tended to at whatever time financial choices are made. This paper additionally touches on the monetary hypotheses and models, including the Bertrand Model that Southwest Airlines ought to audit and consider for future accomplishment of the organization. Southwest Airlines must take after the Sustainability Accounting Standard for Airlines for all their bookkeeping purposes. Table of Contents Abstract 2 Microeconomic Environment 5 Macroeconomic Environment 8 Economic Implications 10 Regulatory Considerations on Economic Decisions 11 Ethical Considerations on Economic Decisions 13 Economic Theories and Models 14 ...
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...People make Southwest Airlines one of the world’s most admired companies. As our greatest asset, our People create a FUN travel experience; respond with compassion when travel plans change; generate innovative ideas that enhance the Customer Experience; and donate their time and LUV to those who need it. At Southwest Airlines, we’re a Family dedicated to our Employees, our Customers, and the communities we serve. Our unique corporate Culture, commitment to giving back, and putting Employees first contributes to our being recognized as a best place to work. Southwest Airlines offers our Employees the freedom to pursue good health, create financial security, travel, make a positive difference, learn and grow, create and innovate, work hard and have FUN, and stay connected. In return, our Employees respond with passion, commitment, and a rich diversity of perspectives that translate into better Customer Service and a dedication to doing the right thing. Our Customers fly Southwest Airlines not only for programs like Bags Fly Free,® but because they like us. Together, as the hometown carrier that cares, we aspire to make a positive difference by giving back to the communities we serve. Our commitment to giving back gives our Employees a sense of pride and purpose that Southwest Airlines does the right thing. With a Warrior Spirit, a Servant’s Heart, and Fun-LUVing Attitude, we strive to do what’s right by our stakeholders and each other. It’s the Southwest Way. 2010...
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