Southwest Airlines

On October 1st, 1994 when United Airlines introduced their “Shuttle By United” high-frequency, low-fare, minimal amenity, short-haul flight operation, Southwest Airlines was already the industry leader in this market segment. Southwest was the eighth largest airline in the United States based on the number of passenger miles flown

Investors saw favorable returns from airlines in 2014. The airline industry’s average return on invested capital (ROIC) reached 5.4% in 2014, which is up from 3.7% in 2012, and 4.4% from 2013. All of the growth in the airline industry has occurred in spite of a decade of terrorist fears, a 1.8 billion annually fare hikes from 2002 through 2011, and the implementation of many risk management travel screening measures. As the years have passed after the 9/11 attacks, the fear of traveling and rise of fares has ceased due to the security measures and great customer service the airline industry as a whole provides travelers.

However there are several cost drivers that could break the airline and cause a large loss of income. A few are; excess flight

The other airlines are trying to sell these luxuries in their marketing to maintain a competitive edge.

Southwest for many customers have been known for being one of the best companies in the country. Its organizational structure was based on gaining respect in the industry and also being known for having great customer service and fewer flight delays than any of its competitors. Southwest did this while remaining competitive and also being profitable (Nisen, 2016). Herb Keller played a great role in the development of culture for Southwest. Herb placed great concerns on culture and also the customer experience, this philosophy was in place from other CEO’s as well. Many companies want to know the reason that Southwest is so successful. Kelly stated that “ it's not a job that you do for six months and then you just say, "Well, that's behind

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

2. The company’s combination of low fares compared to other airlines and superior customer services.

Southwest Airlines has responded well to the control mechanisms in place at the airline. The corporate culture at the airline breeds new leaders. The people of Southwest Airlines are

Product Positioning: Southwest portrays itself as the only low-fare, short-haul, high frequency, point-to-point airline in America which is fun to fly. Southwest Airline focuses mainly on families and casual business travelers who look for reliable, fast and convenient travel in an economical price. The Company doesn’t provide any first class, doesn’t serve any food, no assigned seats and doesn’t transfer baggage to other airlines. But in return the company emphasizes on ultra-low fair, customer service, no cancellation or rescheduling fee, quick turnaround for planes, on-time arrival and frequent non-stop flights, often from less congested airports not served by other airlines. A southwest plane can reach a terminal and leave within 25 min whereas the industry average is 60 min. On top of that Southwest has a product differentiation strategy of “bags fly free”, to allow two free

Southwest Airlines (SWA) is the world’s largest ‘low-cost’ air carrier that is headquartered in Dallas, Texas, and operates more than 3,400 domestic flights on a daily basis. The company provides scheduled airline service to 42 states and Puerto Rico, carrying the most domestic passengers of an airline based in the United States [9]. Founded in 1967, and commencing operations in 1971, Southwest Airlines has always had a unique and breakthrough business model which has allowed the airline to maintain its loyal customer base and profitability [2]. Over the years, Southwest has maintained one of the best customer service records, and its safety record is unmatched in the industry [9].

3. Tickets are expensive compared to other airlines that provide the same services at cheaper rates.

The work force owns 11% of the company, and this helps in aligning their interests to those of the airline. The company has managed tri achieve a team spirit which can only be an envy of others. The company provides their employees with enormous information aimed at enabling them to better understand the company, its mission, its customers and its competitors (Hallowell, 1996). The employees are made to understand that they must at all times comply with the company concept of never inconveniencing the valued customer. It’s by virtue of sticking to its formula of excellent customer service and a positive working environment for employees that the company has managed to remain profitable for over 30 years. The company has had only one strike in its history and has only three employees laid off in 25 years of who were rehired immediately. It is through this job security that loyalty to the company is enhanced. Efficient working practices and low employee turnover help to reduce Southwest’s costs, thereby making it much more successful competitively (.Slack, F. J., Orife, J. N., & Anderson, F. P. (2010).

Southwest Airlines is a passenger airline based out of Dallas, Texas that provides air transpiration throughout the United States. Southwest is currently the 6th largest U.S. airline based on revenue. It currently has more than 3,100 flights in 73 cities, making it the largest U.S. carrier passenger airline. They provide good options, such as early check-in, hotel packages, car rental, and free luggage up to two bags, which are one of their techniques to provide bad news to the customers.

A motivational profile can provide insights into whether a company is doing the right thing or requires improvements. Although nearly every company proclaims its goal is to deliver exceptional service, research confirms that the service quality of many corporations is below consumer expectations. Southwest Airlines has created a competitive advantage through valuing employees’ needs as a strategy that motivates them to provide better customer service (Hallowell, 1996). According to Czaplewski, Ferguson, and Milliman (2001), Southwest Airlines was one of only two companies to place in both the top-10 most admired organizations and best places to work. Even though there are specific steps

Due to globalisation, the flow of people is more rapid among the world. The demand for fast and easy transport increases in the past few years, and the passenger airline benefits a lot from the change which becomes a huge and important industry in the globe. Unlike some other industries, passenger airline business actually has target customers all around the world including you and me. There are a few main kind of purposes for taking a flight, for example, business, leisure, students etc. As there is a broad base of customers, different companies are set to target different customers group, such as Ryanair and Easyjet targeting the budget customer group and Singapore Airlines aiming for the high-end business and leisure customer group. The basic inputs of airline business are fuel, labour and aircraft leasing and others such as food and entertainment vary between companies. The outputs are the flight itself and the services provided in the journey.