Preview

Southwest Air 2008

Satisfactory Essays
Open Document
Open Document
307 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Southwest Air 2008
Krishane Pillay
HRM 5804 Reaction Summary #1: Southwest Air 2008
SWA (Southwest Air) has been very successful, but that is no guarantee of success in the future. What do you see as the key challenges and threats to SWA's future? Are you optimistic about SWA or pessimistic? Despite the prior success of SWA, the company potentially faces an internal threat to its continuing success. Having lost their CEO, Herb Kelleher, SWA is in a similar position as Apple. Kelleher has played a vital role in building SWA, through his interpersonal skills and sharp business acumen. Given the competitive nature of this industry, without the strategic leadership and direction of Kelleher, SWA faces numerous challenges and critical decisions that could impact its future success. One of the challenges that Southwest may face relates to its investment in the B737s. While this investment was initially a competitive advantage for southwest, it could potentially work against SWA in the future. The continued rising cost of oil has prompted new technological changes in the airline industry. Additionally, the introduction of smaller and faster regional jets could give new entrants or existing carriers a technological advantage over SWA given that SWA is currently locked into more outdated technology. Despite the challenges SWA faces, I am optimistic about the future of SWA. For 30 plus consecutive years Southwest air has been able to sustain its advantage and profit, while not falling into the growth trap. The company’s financial stability enables it to finance new ventures and pursue innovative technologies. The internal strengths of Southwest Airlines are vast and include a great work climate for employees. They are heralded as one of the greatest companies to work for due to a strong internal support network for employees. The culture and image of the company are also widely known to and favored by
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Powerful Essays

    Mkt 500 Assignment 1
    • 1860 Words
    • 8 Pages

    Mkt 500 Assignment 1

    Southwest Airlines was started 45 years ago in 1967 by two entrepreneurs: Herb Keller and Rollin King who had the right vision and culture by which to become successful entrepreneurial leaders. This vision was achieved as Southwest Airlines became the greatest airline in the USA. As a young business in the airlines industry, Southwest Airlines in the initial years confronted very tough situations, and it was due proper planning and with the assistance of its employees that kept Southwest Airlines afloat from sinking. There were already pioneer big companies well established in the airlines industry when Southwest Airlines joined the industry. Some of these companies had a good share of the market and with low over head costs. Such a scenario makes it problematic for a new comer to get a solid footing in the industry. Through these decades, times have been changing and Southwest airline have been changing its waste of operation to keep up with the time. Gould stated, “Core competencies are not constant. They tend to change as the organization changes. Therefore, it’s important that the competencies are flexible and not etched in stone.” (p.5, 2008) The history of the air industry is characterized with very tough competition among companies. Besides, it is even tougher for new companies to enter the industry.…

    • 1860 Words
    • 8 Pages
    Powerful Essays
    Read More
  • Good Essays

    Southwest Airlines Strategic Plan
    • 5067 Words
    • 21 Pages

    Southwest Airlines Strategic Plan

    Due to the economic crisis, fuel prices, and act of god environmental crisis, airline industries have suffered in the last ten years. However, these major threats do not seem to threaten Southwest Airlines. In fact, Southwest has been achieving consistent annual profitability for 38 consecutive years. (“Annual Report,” 2010)…

    • 5067 Words
    • 21 Pages
    Good Essays
    Read More
  • Satisfactory Essays

    Southwest Airlines
    • 474 Words
    • 2 Pages

    Southwest Airlines

    Southwest Airlines strict adherence to its mission to provide the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride, and company spirit is a key factor to the company’s success (About Southwest Airlines Co, 2013). The airlines ability to commit to employees to provide them with a stable work environment that ensures equal opportunity for learning and personal growth. Southwest prides itself on allowing all within the company to be creativity and innovative to help improve the effectiveness of Southwest Airlines. The most important benefit, employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest Customer.…

    • 474 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Southwest Internal Analysis
    • 1766 Words
    • 8 Pages

    Southwest Internal Analysis

    This internal business analysis is on Southwest Airlines, which was founded in 1967 by Rollin King and Herb Kelleher. The main focus for Southwest Airlines was to provide low cost flights for their customers, and also have exceptional customer satisfaction. Southwest is a leading airline company that continues to do well in an industry that has been historically challenging. For instance, in the span of two years (2005-2007) five major airlines have filed for bankruptcy. The challenges are great in the airline industry, because competitors are trying to imitate the “low-cost” offering of Southwest. Many companies have tried to do what Southwest has done, and many have failed to stay in business. Surprisingly, many of those companies were started by ex-employees of Southwest. Southwest currently has a profitability record for the past thirty six years, which is spectacular in such a challenging industry. Herb Kelleher has been replaced by Gary C. Kelly, as the president when he resigned in May of 2008. Southwest is in the process of expanding the locations they serve so that they can increase market share, and also find ways to cut costs without losing their quality. In order for southwest to continue their consecutive financial success there is a necessity for excellence in the execution process of their strategy.…

    • 1766 Words
    • 8 Pages
    Powerful Essays
    Read More
  • Better Essays

    Southwest Airlines Merger
    • 1237 Words
    • 5 Pages

    Southwest Airlines Merger

    In order to make up for increasing expenses Southwest needs to expand. My recommended strategy for Southwest to pursue, is to merge with Air-Tran and expand into areas where Air-Tran has a heavy presence and Southwest has none. With Southwest having a weak presence in the southeastern U.S., a key area to expand would be Atlanta’s Hartsfield-Jackson International, which is the busiest airport in the U.S. There is obviously a need for the low air-fare company at this site. Southwest’s unique approach of no extra charge for luggage and extra friendly service should help Southwest. The merger is estimated to cost Southwest $1.4 billion dollars; Air-Trans income for 2010 was around $128 million, and along with the 138 new planes and locations Southwest will acquire, the benefits to cost seem great. Competition at Atlanta’s Hartsfield-Jackson International is fierce. Delta Airlines flew nearly 56% of the total passengers from Atlanta in 2009 and will be Southwest’s major competition (Challenges Delta with $1.4B Deal). Southwest will by far be the biggest low-fare option at the Atlanta hub.…

    • 1237 Words
    • 5 Pages
    Better Essays
    Read More
  • Better Essays

    Culture at Southwest Airlines on the Eve of Merger with Airtran
    • 1257 Words
    • 6 Pages

    Culture at Southwest Airlines on the Eve of Merger with Airtran

    Despite Southwest’s conservative approach to change, its commitment to doing everything possible for customers still comes through. Management does not dismiss opportunities for improvement without due analysis. Upgrading planes and expanding internationally is challenging, but Southwest is looking into that. To attract business customers, it reworked the boarding process.…

    • 1257 Words
    • 6 Pages
    Better Essays
    Read More
  • Powerful Essays

    Final Research Paper: Southwest Airlines
    • 2171 Words
    • 9 Pages

    Final Research Paper: Southwest Airlines

    Southwest Airlines embodies the best that a large company can be. The structure is designed to allow quick action and support of its large body of employees rather than complete control and bureaucratic red tape. It is widely recognized as one of the most desirable places to work and is constantly emulated by its competitors, not to mention other business not in competition. It is an entity that holds its employees in the highest regard, even above its external customers. Its culture is unique and strong and based on love and respect. Even after its current leaders are gone, the culture will continue because of the policies in place to perpetuate their rituals and values. Southwest is conservative in its business dealings and very liberal in its care of its employees. Who would not want to be part of an organization like this?…

    • 2171 Words
    • 9 Pages
    Powerful Essays
    Read More
  • Good Essays

    Southwest Airlines Risk Management
    • 867 Words
    • 3 Pages

    Southwest Airlines Risk Management

    Let us review some of the risks that airlines face and what Southwest has done to combat these to remain the only airline to be profitable in the 31 years of their existence. First airlines usually have to fly each flight, even if a flight is only half-full. The emptier a flight is, the less revenue it generates. Southwest has dealt with this risk by pursuing a low-cost/low-price/no-frills strategy that features offering passengers a single class of service at the lowest price possible fares making air travel affordable to a wide segment of the U.S. population.…

    • 867 Words
    • 3 Pages
    Good Essays
    Read More
  • Better Essays

    Southwest Financial Analysis
    • 2611 Words
    • 11 Pages

    Southwest Financial Analysis

    Total Resource Network (TRN) congratulates Southwest Airlines for thirty-eight years of consecutive profitability. This is a major accomplishment that should be applauded especially during this economic recession and recovery period. Southwest’s success has been attributed to their core values and mission that begin with their employees and exceptional customer service. These two attributes along with low airfares have translated back into sound financial performances year after year. It would seem that Southwest is at a cruising altitude with so many multiple years of profitability. TRN understands that Southwest is always striving to elevate to a higher level with their employees, services, fares, and customers therefore an in depth financial analysis was conducted to evaluate Southwest’s financial health. The following financial ratios listed below, along with industry averages and Jet Blue financials, were utilized to gauge Southwest’s financial stability to champion your successes and review your challenges as opportunities.…

    • 2611 Words
    • 11 Pages
    Better Essays
    Read More
  • Good Essays

    Southwest Airline Case Analysis
    • 633 Words
    • 3 Pages

    Southwest Airline Case Analysis

    Southwest Airline’s successful strategy consists of three complementary qualities which are focus, divergence and compelling tagline. This short-haul airline believes that by focusing on friendly service, speed and frequent point-to-point departures, its low pricing is able to compete against car transportation. While other competitors try to delight customers by investing in meals, airport lounges and seating selections, Southwest chooses to eliminate or reduces investments in these industry’s competitive factors. As a result, Southwest’s low prices are unbeatable making them the preferred airline in the industry. With a divergence element in Southwest’s strategy, it is able to innovate and stand apart from its competitors. Instead of competing in the existing hub-and-spoke systems, Southwest created a new competitive factor by pioneering point-to-point travel between midsize cities. This niche strategy turns out to be a huge success as by avoiding congested major airports in big cities, travelers are able to reach their destinations on time and closer to downtown areas compared to major airports faraway from cities. A compelling tagline is another crucial element for effective strategy. Southwest’s tagline which goes “The speed of the plane at the price of the car- whenever you need it” is memorable enough to stay in the minds of travelers. It delivers a clear message and promotes exactly what Southwest Airline has to offer.…

    • 633 Words
    • 3 Pages
    Good Essays
    Read More
  • Powerful Essays

    Southwest Airline case study
    • 2348 Words
    • 10 Pages

    Southwest Airline case study

    For the purpose of this study we shall be taking southwest airline as a case study, Southwest Airline is a major U.S. airline that primarily provides short haul, high frequency, point- to point, low fare service. Southwest was incorporated in Texas and commenced operations on June 18, 1971 with three Boeing 737 aircraft…

    • 2348 Words
    • 10 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Southwest Airlines
    • 4766 Words
    • 20 Pages

    Southwest Airlines

    possible for a small company such as Southwest Airlines to completely satisfy their customers since 1971? (Bovier, 1993). What…

    • 4766 Words
    • 20 Pages
    Powerful Essays
    Read More
  • Good Essays

    Southwest Airlines Case Study
    • 792 Words
    • 4 Pages

    Southwest Airlines Case Study

    1. Southwest Airlines was successful for many reasons, including low airfare cost, “quick turns” , and “spider web” system. But, probably most important was their Corporate Culture of putting their employees first and really taking care of them. Southwest believes by doing this makes their employees happy and in turn, they will take care of them….. and ultimately that means repeat business.…

    • 792 Words
    • 4 Pages
    Good Essays
    Read More
  • Better Essays

    An Assessment of Southwest Airlines
    • 1383 Words
    • 6 Pages

    An Assessment of Southwest Airlines

    The airline industry is fragile and especially vulnerable due to increase security demands, the cost of fuel with limited resources, highly expensive industry, very highly regulated industry, and labor intensive industry. Despite the vulnerability of this industry Southwest Airlines has managed to survive despite the odds, when larger airlines were forced to merge, have huge lay-offs of employees and some even when under. It is interesting to review just how Southwest Airlines survived the rapid changes, while presently recognizing a growth spurt.…

    • 1383 Words
    • 6 Pages
    Better Essays
    Read More
  • Powerful Essays

    Southwest Airline Analysis
    • 5838 Words
    • 24 Pages

    Southwest Airline Analysis

    Southwest Airlines has been a strong growth company over the last 35 years. Using its low-cost, passenger friendly, point-to-point operational strategy, Southwest has been able to sustain considerable growth year after year and remain profitable for 33 straight years. While Southwest has gained market share in recent years, legacy carriers have struggled due to depressed market conditions. The entire airline industry has endured expensive labor contracts, soaring energy costs and reduced consumer demand. Southwest has continued to grow in the harsh airline industry because it‟s no frills business model focuses on controlling costs. Southwest targets routes with high consumer demand and the advanced experience of Southwest‟s personnel allow Southwest to quickly turnaround aircraft and keep their planes in the air more hours per day than its rivals. Though the airline industry appears to be on the mends, Southwest has firmly positioned itself as a price leader and a strong market force with the lowest CASM of any airline. Southwest has experienced remarkable growth in the airline industry by steadily taking market share from large legacy airlines. However, Southwest‟s success has brought considerable change to the market conditions of the airline industry. The struggling legacy airlines have been forced to streamline operations and new airlines with aggressive low-cost strategies have entered the industry. Damaging price wars have forced many airlines to drastically alter their cost structure in order to remain competitive. By its success, Southwest has begun to alter the market conditions that were partially responsible for its success. To ensure its future success, Southwest needs to maintain its cost advantages and find new growth opportunities even though Southwest has the most fuel hedging of any airline. Fuel costs remain a major concern and Pandora Group recommends that Southwest take steps to improve the fuel efficiency of its fleet by…

    • 5838 Words
    • 24 Pages
    Powerful Essays
    Read More

Related Topics