Comparing Southwest and Continental Airlines Essay example

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Introduction In order for companies to maximize profits and productivity, it is important that they implement managerial economics on both a day-to-day and strategic basis. This paper will compare and contrast Southwest and Continental Airlines from a managerial economic perspective. The goal of the paper is to critically analyze both companies on their use of managerial economic practices. The Airline industry is a capitally intensive industry, and because of this companies within the Airline industry focus greatly upon cost, as well as revenue generation. If costs increase beyond control, profitability will soon decrease. Southwest were quick to learn that if they were going to run their company in a profitable manner they had to…show more content…
Cost Effective Hiring; Determining Potential Productivity Southwest put a lot of time and effort into their hiring process. Southwest and outsiders considers them to be one of the best companies to work for in the United States. For this reason Southwest implements procedures to ensure they receive the best possible skilled workers. This is not to say that southwest only employ academic high flyers, but they have become a company known for operating outside the box. Potential employees have to have a sense of fun, and entrepreneurial attitude. “Southwest has tailored the general principles of targeted selection to hire people with a special kind of spirit.” (Freiburg, 1996, p67) It could be said that Southwest employ what other companies consider “risky workers.” Southwest look upon so called “risky workers”, as employees who have the ability and potential to take the company to the next level. Southwest allow their employee’s freedom and empowerment to make decisions that would otherwise be held for upper management, if employees have to side step the rules to make on the spot decisions, they are encouraged to use their own intelligence and

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