Southwest Airlines is a well known name in the American aviation industry. It is the largest domestic carrier in United States operating more than 3000 flights a day. The company is a huge success story due to its record continuous profits, even in years when other airlines were suffering. The company was founded in 1971 and since 1973 to 2003 the company never recorded an annual loss. This strong financial record has forced management gurus to study the company in detail in order to understand the factors behind its success. Southwest Airlines only flies within United States and even then the company has done extremely well over the past three and a half decades. The friendly organizational culture of the company may be one of the reasons behind this tremendous success. In this report Southwest Airlines will be discussed in great details and a thorough SWOT analysis will be conducted. Organizational behavior and leadership within the company will be discussed alongside with human resource management issues. Details of organizational culture and structure will also be included in the report. In the end future directions of the company will be analyzed and discussion will be made on how it will try to launch its operations globally. Recommendations will also be made at the end. Background Southwest Airline has always used a strategy that is not widely practiced in the aviation industry. The company uses cost leadership approach in its business operations. Since its inception the company has targeted shorter routes and has tried to fly more flights between cities. Due to this approach Southwest Airline has been successful in gaining a significant market share in the country. The company has been successful in lowering costs to an amazingly low level and by doing this it has knocked out its competitors (Bunz & Maes, 1998). With very low fare it is a first choice of cost conscious frequent travelers. The company uses a variety of techniques to lower its costs down and maintains profitability by utilizing its resources in an efficient manner. An example would be the plane of Southwest Airlines where there is no first class seating available. All the seats are labeled economy class because it allows more seats in the plane. This is one example of how lower costs is achieved by South West Airlines. Southwest Airline has also achieved success because of its inspirational leadership. The CEO of the company for a long time was Herb Kelleher. His charismatic leadership is one of the major reasons why the company did well for a long time (Gibson & Blackwell, 1999). The business strategy of the company has been of lowering costs and increasing efficiency, and charismatic leadership blends well with such a strategy. The organizational culture of the company is also commendable. Southwest Airline has a very friendly culture and employees are encouraged to take initiatives. Employees are also treated in a good manner and this is what motivates them to work hard. Workers of the company are a major reason why company has always been successful even in tough economic times. Employees are given power to take decisions and this is why they are able to come up with innovative ideas and this helps the company at the grass root level. The company only flies short routes with United States and it
Southwest Airline is a success story in the aviation industry of United States of America. The company has displayed a strategy of cost leadership strategy with great success. Leadership of the company has been charismatic since the foundation of Southwest. The management style of the company is friendly…
First of all, it sets the tone for management and governance at all levels of the organization. Secondly, controllership determines to long-term growth and survival of the company. Thirdly, controllership provides the background for a company to provide the best services to all the people concerned with its operations and existence.
Running Head: Competitive Advantage through People Southwest Airlines: Winning America’s Airline Industry through Successful People Management Name Course Title Name of Professor Date of Submission Introduction Southwest Airlines, since its foundation, exercised the power of endorsement to ‘inform’ and ‘attract’ its target customers about the quality customer service and low fares of the company (Lauer, 2010).
A background of Southwest Airlines will be followed by a detailed SWOT analysis plus Porter’s 5 forces analysis with respect to the strategy pursued by the company. The issues and challenges currently facing Southwest Airlines will be explored for which recommendations will be given followed by an appraisal of the lessons learnt from this case study.
This study provides a short overview of the airline industry and the concept of hedging in the industry before focusing on Southwest Airlines approach to hedging. The performance of the airline when applying their approach to hedging, as well as the relevant literature, is used henceforth to provide a rationale for fuel price hedging by Southwest Airlines.
Putting these factors together, it is very obvious that the market structure of Southwest Airlines industry is that of perfect competition. For example in terms of the number of sellers or competitors, it can be said that there are as many airline companies as possible in America and China where Southwest Airlines operates (Prince and Simon, 2009).
Furthermore, the hub-and-spoke system as well as costly reservation system along with price wars and heated competition all made it difficult to fragment the network of airlines. However, owing to deregulation and the resultant fall in fares the industry saw an influx of a host of new entrants, including Southwestern Airlines (Inkpen 1).
Proper managing of human resources is essential in recruitment, selection and maintenance of all staffs and it improves employee’s morale. These services among others enable heath care organizations to provide quality services hence improving patient’s health.
The value of these assets may not show up directly in the balance sheet of a company, nevertheless it has greater impact on the success of a business. Since human resources are major determinants of the ultimate business success, managing human resources effectively has been embedded in the practice of management.
However, in the present scenario, the latter group, led by the vibrant Southwest airlines has provided some relief to shareholders by posting an uninterrupted profit for the 36th consecutive year (Jody
r times, human resource department was almost invisible, with most of the activities included as a function of the other departments; for example, the appraisals were the responsibility of the concerned department, salaries were disbursed through the accounts and finance
6 pages (1500 words)Research Paper
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