Southwest Airlines Case - HBR
Southwest Airlines: 1993 (A) - Just Plane Smart
-SummaryIntroduction:
During the summer of 1003, the company was about to receive two uncommitted airplanes. The director of schedule planning needed to find a way to put these machines to work and meeting growth objectives without damaging the company's focus. The main decision should be compliant with the
Southwest Airlines' organizational culture.
History:
Southwest started in 1971, after going through court battles caused by competitors that were against the entrance of a new competitor for the Texas area.
As a low-budget airlines, it initiated a price war in the market.
Initially it was operating from the Dallas' Love Field (LUV) airport.
By 1993, Southwest was the seventh-largest airlines in the US and had won the "triple crown" award of the airlines industry 12 times for overall performance.
The Southwest Model:
The company's model consists of several employee enhancing and empowering philosophies such as:
The usage of non-conventional models for low-cost, having fun at work, treating employees as if they were a family, hire people who are fun, involve employees in decision-making. Being the ultimate goal to achieve great performance through powerful employees.
Operations:
Southwest tries to design different operations for quality and accuracy differentiation purposes:
The company does its own ticketing, as a result it reduced the percentage of sales through agents.
It did not operate a hub-and-spoke route system and most passengers fly non-stop to destination.
It flies to smaller airports with less traffic.
It does not transfer luggage to other airlines "interline baggage".
Only drinks and snacks were served.
It achieved excellent and populous labor/union relationship.
Southwest only flew Boeing 737 jets.
It achieved minimum "turn" time.
Cost Control:
Southwest supported that: "Airlines don't have revenue problems, they have cost problems".
Cost cutting: Pilots help with new ideas
-SummaryIntroduction:
During the summer of 1003, the company was about to receive two uncommitted airplanes. The director of schedule planning needed to find a way to put these machines to work and meeting growth objectives without damaging the company's focus. The main decision should be compliant with the
Southwest Airlines' organizational culture.
History:
Southwest started in 1971, after going through court battles caused by competitors that were against the entrance of a new competitor for the Texas area.
As a low-budget airlines, it initiated a price war in the market.
Initially it was operating from the Dallas' Love Field (LUV) airport.
By 1993, Southwest was the seventh-largest airlines in the US and had won the "triple crown" award of the airlines industry 12 times for overall performance.
The Southwest Model:
The company's model consists of several employee enhancing and empowering philosophies such as:
The usage of non-conventional models for low-cost, having fun at work, treating employees as if they were a family, hire people who are fun, involve employees in decision-making. Being the ultimate goal to achieve great performance through powerful employees.
Operations:
Southwest tries to design different operations for quality and accuracy differentiation purposes:
The company does its own ticketing, as a result it reduced the percentage of sales through agents.
It did not operate a hub-and-spoke route system and most passengers fly non-stop to destination.
It flies to smaller airports with less traffic.
It does not transfer luggage to other airlines "interline baggage".
Only drinks and snacks were served.
It achieved excellent and populous labor/union relationship.
Southwest only flew Boeing 737 jets.
It achieved minimum "turn" time.
Cost Control:
Southwest supported that: "Airlines don't have revenue problems, they have cost problems".
Cost cutting: Pilots help with new ideas