Case Analysis of Southwest Airlines Term Paper

Pages: 5 (1510 words)  ·  Bibliography Sources: 1  ·  File: .docx  ·  Topic: Transportation

Southwest airline has emerged as leading airliner with dedicated workforce and enthusiastic executives whose innovative minds are always willing to improve and experiment certain goals. The company has launched a strategy to survive travelers with possible reduced traveling fares; this is the policy that company formulated since its inception in 1970. The company has always subsidized its rate of profitability over the satisfaction and ease for the passengers. The company has been facing major threat from its rivals since its operations, legal suits and stay orders have created implications for the company and company's certain objectives were delayed.

The management of the company has been very sincere towards their commitment with the employees and customers of the airline. Due rights of the employees and customers have been respected and fulfilled by the management. All this is successfully hampered possible threats from the rivals.

The company has been taken financial matters seriously, the company has maintained minimum debt and possible cash assets to face unexpected financial, political and security lapse. The airliner has kept itself technological motivated and in lieu with the ongoing advancement and modifications within the airline technology.

Most significantly the company has formulated policy of no-layoff for its employees. The jobs of the employees are secured and stable. In parallel the employees are provided successive opportunities to blossom and progress through training programs.

1. Evaluation of current objective and current strategy.

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The new CEO of the Southwest Airline, James Parker renewed the company's commitment towards its employee and the customer. The company views employees as significant contributor towards the profitability of the airliner. Barrett, the secretary of Parker contributed towards improving the company's customer service culture.

Term Paper on Case Analysis of Southwest Airlines Assignment

The company's current policy is based on the policy initiated and adopted by the former CEO of Southwest airline, Herb Kelleher. The company's core objective revolves around the employee, later focused on the customers. The company has built strong finances for itself, and has avoided heavy debts. The company shares maximum cash liquidity, and irrespective of political, social and economic constraints the company has performed miraculously.

The company has adopted liberalized recruitment policy, where employee is purely recruited on the basis of his skills and attitude. Offers training programs to the recruited employees, previously the employees were suppose to enroll for 100 hours of training period. The employees on the basis of their experience, expertise and skills are offered promotion. The hiring and recruitment for the major designations is internal. The employees are offered benefits and other incentives apart from their basic salary.

The company has adopted devoted and strong working environment where fun and related activities are encouraged. The company during its launch promoted itself with campaign of LOVE, each and every offerings of the airline was branded with LOVE, the policy of LOVE enhanced the image of the airline, and company even after 35 years of its inception adopts the same image of LOVE and FUN.

2. Analysis of current environmental opportunities and threats

The company never expected that the airline industry will experience unexpected financial hue due destabilized market. The terrorist attacks of 11th September 2001 was horrible nightmare for the U.S. economy, the attacks had significant impact on the U.S. airline industry. All the main stream airlines reported decline in profits, it was reported that airline industry faced $220million lost for successive three days after the attack; the government imposed partial restrictions on air travel. However the management of the Southwest industry was much relaxed, and handled the situation calmly, the company reported profits worth $500million during 2001, the only U.S. Company which had bullish trend.

Following factors protected the company from negative spell,

Hiring was annulled temporarily.

Heavy investment plans were delayed temporarily

Negotiation deals with Boeing for the acquisition of new aircrafts was postponed.

The company launched its new air travel facility to Virginia, as per plan.

Non-essential operating cost was deferred.

Expansion of flight schedules.

3. The Company's current strength and weaknesses.

According to report the Southwest Airline has earned consecutive profits since its launch. The successful operation of the airline is the function of the efforts put by management, employees, and investors. The company has adopted consistent policy about its employees, and customers. The company focuses on offering air travel opportunity to the customers on subsidized rates. The employees are welcomed to share and adopt unique practice, and are provided with enough liberty to decided and shape their work task. The employees are continuously trained. At present the company is focusing on expanding its network, the flight schedules and deals are offered such that the customer can benefit out of it.

The company has been awarded several auspicious awards which includes MOST ADMIRED AIRLINE, BEST COMPANY FOR EMPLOYEE, AWARD FOR CUSTOMER SATISFACTION. The airline has subsequently hold leading ranking in the list of reputed American Airlines. The website of the Southwest airline has won acclamation from Business Week and PC Magazine. The company has also won award for 100 Best CORPORATE CITIZEN.

However economic and political uncertainty affects the performance of the airline industry, Southwest Airline should be ready to prepare it for even worst, and for that reason increased capital investment and market expansion have to be conquered.

Legal suits by the rival companies hurt the performance of the company, and imposition of certain barriers delay the execution of profitable operations. It is important for the company to develop an understanding with the rival companies, instead of facing each other in courts.

4. Stakeholder Analysis.

Government Agencies: The Southwest Airline is belief to have developed unwritten understanding with the government agencies. This has helped the Airline in finding support for itself during debate and discussion related to airline industry within different governmental organizations. Certain governmental individuals have supported the airline during its legal suit. The company has been offered permission to operate under its limited operation; no far any major embargo has been placed on the company. The airline has been offered incentives related it to traveling affairs, the airline earlier had the permission to land at Houston Hobby, which increased its number of customers.

Labor Unions: 80% of the Southwest Airlines' workforce is represented by union. The company is regarded as highly unionized airline within U.S.. Different unions represent different segment of workforce involved in the airline industry. The company is credited for building harmonious and friendly understanding with the unions, the employer-union relationship are viewed to be healthy, and up-to-date not major scuffle has taken place between both groups.

Competing Organizations: Southwest has influenced the profitability ratios of the other airline industry. The company has used its justified means, appropriate research and resources to compete and gain supremacy over the competitors. The company has successfully won major legal suits against the rivals, and have proven as credible corporate in an environment of professional envy.

Employees: Employees have been offered all possible financial incentives, along with training facilities. The positive attitude and skills of the employee are well received. Employees are offered promotions, and report suggests that the company has many promotional activities. By avoiding layoffs the company has avoided major scuffle with the employees. The employees are offered suitable financial offerings at senior age.

Suppliers: Southwest Airline borrows many of its part and aircrafts from Boeing. The Boeing being company of repute has brought further laurels to the Southwest Airlines for its aerospace technology.

Customers: The Southwest Airline has stressed on providing quality customer service. The customers are offered various deals according to their limitations. The customers are offer favorable flight schedule, flight destination and airfares. The customers are offered different flight packages depending according to their requirements. The Southwest Airlines offers all possible packages to the different groups of the customers.

5. Identify current problems.

Should the company stress more on purchasing latest and advanced aerospace technology, or capital should… [END OF PREVIEW] . . . READ MORE

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