Southwest Airline

Company’s Strategy: Southwest’s strategy is to improve efficiency in its operations and pass cost saving to its customers by offering them low and competitive prices. Southwest Airlines is dedicated to providing the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and company Spirit.

What is Southwest's competitive strategy? What are the sources of its success? How does it make money in this business?

Southwest Airlines (SWA) maintained a low-cost, low-price and no frills strategy. The small Texas carrier began as a concept, its business plan detailed on a cocktail napkin in 1971 and grew into the nation’s fourth largest airline. Known as an innovator with low operating costs, dominating smaller airports, with a humorous customer service, SWA saw its 40th profitable year in 2013. Like all companies, SWA underwent leadership changes in 2001, and said goodbye to the company’s founder in 2008. Unfortunately, the changes in leadership were not the only changes; the organization proceeded to alter their beliefs and activities.

Over 35 years ago, Rollin King and Herb Kelleher decided to create a different type of airline. They began with the simple notion: If you get your passengers to their destinations when they want to get there, on time and at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline. They were right (Southwest Airlines, 2004)!

They serve no meals, do not offer seat assignments, and do not baggage to other airlines. They avoid airports with high landing fees or frequent delay. All of this enables them to make quicker turns and fly more legs each day, resulting in lower fares. Today they are without question the most successful airline in America-if not the world.” (p.8, 2002)

Southwest had an edge over its competitors because of its people and their people management. The culture practiced at Southwest ensured progress towards their primary goal of customer service and low cost. The HR programs at Southwest were based on the preserving the values and special culture of Southwest Airlines (SWA).

There are interesting facts that Southwest’s approaches to business are based on fun, trust, community, and family. For example, at Southwest, there is little cross training except for only two formal teams: the marketing and reservations department. This means that Southwest promotes mingling with the employees for informal networking and helping each other out, in spite of their job assignments. “Flight

As the low-cost leader, Southwest spends an inordinate amount of time focusing on its mission, vision, culture, and goals. This concentration allows Southwest to rank as one of the 100 Best Companies to work for in America. The employee’s attitudes and efforts lead to fewer customer complaints and more on-time arrivals and departures.

Southwest Airlines' strong organizational culture is reflected in its mission statement "dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit" (Southwest, 2012). Southwest serves not only as a prime example of a company that excels in customer service and profitability, but as one that has utilized employee development as a means to meet these ends. Southwest makes a strong commitment to foster ongoing relationships with human resources. They demand that their employees are responsible members, however

Herb Kelleher care for his people in Southwest as family and look forward to his employees act the same way as him: treat each other and their customers as family also. And the new leaders have participated with Herb continually building their vision and unique culture (D'Aurizio, 2008). According to James Parker, who is the former CEO of Southwest Airlines, said that the top management should put high intention to build a strong corporate cultures prioring to others and goading the capability of employees to make profits (Holstein, 2008). Thus, Southwest Airlines is well known for its positive culture and emphasis on its employees. The former officer of Southwest Airlines, Dave Ridley, described the corporate culture in Southwest Airlines can’t not departed with people. They embrace people-oriented and treat people mannerly, resulted the positive way which frontline people treating their external customers. Ridley said, the employees have been considered as internal customers also, and employees’ welfare has been treated fairly or even more important than the external customers. He also indicated that they aimed to construct a happy working environment which can make their employees adore the workmates, the workplace, and the people they serve(Peel, 2015). The culture

To formulate a strategy that will help Southwest Airlines maintain its competitive edge in the US airline industry.

When Herb Kelleher and Rollin King founded Southwest Airlines in 1971, their mission stated the “dedication of the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride, and company spirit” (Smith, 2012). With that mission in mind, Herb Keller and Rollin King managed to make Southwest the only profitable airline in the United States (Smith, 2012). Southwest’s mission is not the only reason why the airline continues to grow. Without the way, Herb Kelleher former CEO of Southwest, had developed a particular leadership style, power base, and a set way the organization motivates its’ work force, the company would not be as successful as it is

Building the Brand: Southwest Airlines is well known as a Texas-based company that has a human side and a “down-home” attitude. Because of its large size, Southwest Airlines uses a variety of larger promotional methods, such as national advertisements and strong public relations to promote an image of a fun-LUVing brand. But, flight crews are the closest interactions that a customer has with the product, budget flights, which are a simple, undistinguished product. The quirky commercials and cheap flights appeal to a target market that is budget-conscious but still enjoys the fun side of life. The flight crews bridge the gap between the fun, unique commercials and the actual flight experience. By interacting with customers and joking around with passengers, they are able to grow customer allegiance in this market by acting in the same way that the brand has tried to portray itself.

Southwest Airlines: Culture, Values and Operating Practices (in Thompson, A. A., Strickland. A. J. and Gamble, J. (2005) Crafting and Executing Strategy (Fourteenth Edition), McGraw-Hill, New York, pages C-636– C-664).

When one guises at organizational culture, one should correspondingly look at the principles, beliefs, and the vision of the Company. Southwest Airlines’ CEO, Herb Kelleher, is a man whose approach of treating all individuals with dignity and admiration helped the Company gain a competitive advantage over major airlines. The responsive customer service, reliability,