Abstract This paper examines SouthwestAirlines' many identified weaknesses, such as poor short-term liquidity, lack of strategicalliances, and declining revenue yields. The paper asserts that it is imperative that the firm forms more strategicalliances, especially in the airline industries. The paper contends that the advantage of this is that the SouthwestAirlines will then have a larger market share and, when collusion takes place, it is tantamount to acting like a monopoly, resulting in more profits in both the long and short run for the airline. The paper also suggests that the firm incorporate technology in its operations. To summarize, the paper suggests that both strategicalliances and the implementation of recommended technology will improve the business.
Outline:
Introduction
Incorporating Technology in its Operations: Increasing StrategicAlliances for Southwest Benefits from Technology for SouthwestAirlines Conclusion
From the Paper "Southwest Airlines can incorporate this aspect of operations by using its exceptional profit margin to gain acquire more cost efficient and technologically advanced assets. The Airbus 380 landed in Los Angeles International Airport which is one of the biggest and cost efficient jets, Southwest Airlines should be at the forefront in debuting improvements in technology like this one to leverage alliances and increase the choices for consumers. Southwest currently uses Boeing 737s because it does smaller frequent flights from city to city. However increased technology can be achieved with upgrades to the current fleet or an introduction of fixed assets."
A discussion of high employee loyalty at SouthwestAirlines and how this can be maintained in order for Southwest to remain a market leader in the industry.
Abstract This paper analyzes how the idea of high employee loyalty has transcended Southwest's business model and has allowed the airline to become a market leader in a very volatile industry. The paper also examines how high employee loyalty can be maintained and the costs that are associated with it. Lastly, the paper provides a recommendation centered on a more strategic approach to human resource management.
Table of Contents:
Introduction
Achieving High Employee Loyalty at SouthwestAirline: Recommending an Integration with SouthwestAirlines' Strategic Model
Why Focus on the Strategic Development of Employee Loyalty?
Conclusion
From the Paper "Southwest Airlines need to be able to explore other strategic practices that embody effective human resource management. Also, Southwest's human resource model should afford the company the luxury of risk-taking without putting the firm in jeopardy financially or otherwise. In wake of the present industry changes identified or speculated - possible merger between United Airlines and Continental Airlines, and the consolidation prompted by US Airways bid to acquire Delta Air Lines out of Chapter 11. If these trends continue, then employee loyalty will just not be enough, a profit sharing scheme will be inadequate, the fact is, Southwest Airlines, needs to be involved in more expansive programs; the recommendation from this analysis is one that is focused on strategic development."
Abstract This paper presents a case study of SouthwestAirlines, examining its history, background and current problems. The paper analyzes the case in terms of the rational model, the political model and the cultural model.
From the Paper "According to the report filed with the US Securities and Exchange Commission, Southwest is a major domestic airline that provides predominantly short haul, high-frequency, point-to-point, low-fare service. Southwest was incorporated in Texas. It commenced service with three Boeing aircraft, serving three Texas cities. The airline employs relatively simple fare structure, featuring low unrestricted, unlimited everyday coach fares, as well as even lower fares available on a restricted basis."
Tags: Case study, SouthwestAirlines, Power Model, Enviromonmental model, cultural model, strategic planning model
Abstract This paper addresses the company of SouthwestAirlines in terms of the effectiveness of the company's various strengths and weaknesses. A series of matrixes are used.
Tags: BUSINESS / CASE STUDIES, southwestairlines matrix
Abstract This paper discusses the intersection between entrepreneurship and strategicalliances and explores research opportunities related to this particular relationship. The paper contains four sections including background information relevant to entrepreneurship, research objectives, research methodology, and a conclusion with recommendations.
From the Paper "The purpose of this report is to examine the nexus between the entrepreneurship and strategic alliance literature and to explore research opportunities related to this ..."
This in-depth paper profiles the corporate and business practices of SouthwestAirlines while primarily focusing on the company's approach to business ethics.
Abstract The writer of this paper analyzes the on-going success of SouthwestAirlines which continues to remain a leader in the industry during an era when more and more airlines are facing closure and bankruptcy. This paper delves into the numerous crises faced by SouthwestAirlines which the company has successfully managed to weather. The writer delves into the history of the company which began in 1971 with only three aircrafts while also discussing the company's primary goals and vision. This well-researched paper analyzes the business ethics and corporate structure of Southwest which states that their employees are hardworking, dedicated and highly motivated and a significant contributing factor to the company's overall success. This paper also contains the results of published studies as well as statistics and data relevant to this particular topic.
Table of Contents:
Abstract
Introduction
An Overview of the Business Ethics of SouthwestAirlines How SouthwestAirlines Handles the Various Crises
The Ethical Responsibility of Southwest Today and for the Future
Conclusion
References
From the Paper "Donna Conover, the executive Vice President of Customer services, states that ever since she joined the company, more than twenty eight years back, she had always felt that the employees of the company were the greatest assets for the firm, and perhaps it is because of the policy that the company follows, which is that of never ever dictating pay cuts to its employees, that it has managed to keep all its employees happy and satisfied, and working hard at all times. This was seen in the fact that employees by themselves, during the Gulf War of the 1990's, when fuel costs skyrocketed, voluntarily reduced their pay for some time in order to cope with the escalating costs of fuel. In a similar manner, after the debacle of September 11, Southwest Airlines employees volunteered to take cut costs on their wages, so that the company may be able to cope better with its reductions in flying schedules. This type of loyalty for the company has as yet been unrivalled."
Abstract This paper is about SouthwestAirlines. The paper includes information about the company's internal strengths, internal weaknesses, financial ratios, and a 10 year score card. It provides graphs comparing major competitors and industry revenue and income.
From the Paper "Southwest Airlines Co is a domestic airline that provides predominantly short haul high frequency point-to-point low-fare passenger airline service in the United States. Southwest has a number of internal strengths. One of the most important of these internal strengths is its market position. Southwest is the largest airline in the United States based on total passengers and total passenger miles flown. This market position means that Southwest is the preferred carrier for many passengers. It is sometimes difficult for so-called no-frills airlines to ..."
Abstract The paper responds to a series of questions related to financial reports contained within a company's annual report. Specifically addressed are SouthwestAirline's 2005 Annual Report and the characteristics of its income and balances sheet statements. Also, Southwest's accounting and accounting oversight practices are discussed as are its notes to the financial statements.
From the Paper "Southwest's income statement is a useful document in underlining the overall performance of the company and provides key insight into the operational health of the company. While there are other key financial ratios that can and should be examined, the income statement provides important reference points for operational integrity. For example, Southwest's passenger, freight and other types of operating revenues all increased year on year from 2003 to 2005 moving from $5,937m to $7,584m respectively and, ideally, this increase in revenues should also come accompanied by an increase in profits (Southwest, 2005, p.48). An increase in revenues accompanied by a loss in profits would be indicative of poor operational management or an extraordinary increase in operational expenses related to market forces rather than management."
Abstract The purpose of this paper is to discuss how CEO Gary Kelly's style has set new directions for strategy, internal relations and SouthwestAirlines operations in an increasingly competitive and challenging environment.
From the Paper "The instability of macro-environmental forces and their impact upon the effectiveness and profitability of airlines indicates the need for multi-dimensional flexible and responsive management structure able to operate ..."
Tags:Southwestairlines, CEO, Gary Kelly, strategy, airline industry, competitiveness
This paper discusses the strategy of strategicalliances in the airline industry, the policy of partnering to share expenses and thus increase revenues for all the partner companies.
Abstract This paper discusses strategicalliances in the airline industry, which include partnering not only with other airlines, but also with other businesses related to the airline such as travel agents and food services. The paper relates that this strategy could mean higher ticket prices and more waiting time. The author feels that airlines who form strategicalliances will be more likely to improve their bottom line. This paper includes a SWOT Analysis.
From the Paper "The airline industry faces some tough issues and must work fast to come up with creative solutions to their problems. Currently, they are attempting short-term measures such as reducing the number and frequency of flights, laying off employees and other cost cutting measures in an attempt to ride out the storm. However, these measures are not sustainable and, if the situation does not turn around, some will simply cease to exist. One of the strategies the industry is using is strategic alliances. They are sharing resources; this new level of sharing may improve service for the customers of all of the airlines and may benefit everyone involved."
Abstract This paper focuses on the idea that with the relationship SouthwestAirlines has with substitutes, profits can be gained by pricing strategically across business and economy classes. The hypothesis examined is that Southwest focuses more on price discrimination, and has a clearer price difference between the two classes. It contends that by increasing airfare for the business class and continuing with the low price model for the economy class, Southwest would also be expanding its opportunity and increasing its revenue.
Outline:
Introduction
A Model of Price Discrimination: Opportunities Related to Substitutes for SouthwestAirlines
From the Paper "Price elasticity of demand refers to the percentage in quantity demanded due to a percentage change in price (McConnell, Brue, and Barbiero, 2002, p 145). If demand is highly elastic as it is for casual travelers, lower prices will cause total revenue for Southwest to increase. Look at Figure 1 below; even though price decreased by a smaller amount, movement from P2 to P1, the quantity demanded increased by a very large amount, Q2 to Q1 [compare the red and blue areas to see the difference]. So the recommendation based on the opportunity related to the closeness of substitutes is that Southwest Airlines continues to keep prices low for the casual travelers."
Abstract This paper discusses the history and growth of SouthwestAirlines Co. (SWA). Specifically, the paper discusses the strategic management of the company and its business plan. The paper provides both an internal and external analysis summary, discussing all aspects of the management, marketing and administration of this growing and profitable company.
Table of Contents:
Introduction
Current Mission, Goals and Strategy
Internal Analysis
Management
Marketing
Finance
Product
Internal Analysis Summary
External Analysis
Competitive
Economic
Target
Government
External Analysis Summary
Appendix
From the Paper "The most important macro economical factor that affects SWA is the rise of energy costs. This leads to extra costs, reflected in the fare prices. Other cost increases have a similar effect: increases in aviation insurance costs or the new federal ticket tax (introduced with the support of big carriers). Another economical problem worth looking into is the downsizing trend of the aviation industry. This puts pressure on the company stuck between the necessity of cutting costs and the traditional commitment to employees, to good and bad."
Abstract The paper examines the challenges facing SouthwestAirlines, which include the competition from other airlines, pending negotiations with worker unions and two significant leader retirements. The paper then analyzes the strategies of other low-cost airlines, with a focus on JetBlue, to determine how SouthwestAirlines can meet current and future challenges. The paper shows how SouthwestAirlines must maintain not only its internal culture, but also its external relationship with current and potential customers.
Outline:
Background and Challenges: Southwest Other Airlines and Strategies
Recommended Strategies for SouthwestAirlines
From the Paper "Both major and low-cost airlines face significant challenges in their business world today. Not least of these is the universal horror of rising oil and gasoline prices. The major airlines particularly have attempted to mitigate this by cutting onboard features such as free meals and in-flight movies (Kerensky, 2007). Others have increased the cost of their first-class tickets in order to keep their other fares as low as possible. However, the concept of the low-cost carrier has offered increasing competition to major airlines: in addition to maintaining lower costs on their fares, they also offer passengers a level comfort they have no longer come to expect from the major carriers. Hence, according to Kerensky (2007), there has been an increasing trend in passengers preferring to use low-cost carriers to the major airlines. "
Abstract This paper relates that organizational behavior strategies for effectiveness in decision making and leadership, for clarity of internal communication and for managing internal power and politics should be correlated to attain increasingly higher levels of revenues and profits. The paper points out that the essence of SouthwestAirline's ability to translate these three organizational areas into long-term revenue and profit growth is based on creating and sustaining a culture where risk-taking on behalf of customers is expected and rewarded. The paper uses examples of how the company's culture was tested by the events of 9/11.
Table of Contents:
Introduction
Decision Making at SouthwestAirlines Fuels a Unique Culture
Southwest Internal Communication
SouthwestAirlines Power and Politics
Appendix
Five Year SouthwestAirlines Financial Analysis
SouthwestAirlines Income Statement Analysis
From the Paper "This egalitarian and very open approach to describing what a difficult situation the company was in energized the ground crews. They internalized the challenge and met the 15 minute turn-around time and even created entirely new, innovative processes to make this possible. Management theorists who specialize in the airline industry credit this significant improvement in performance to standardization of the company on only Boeing 737 jetliners and the economies of scale achieved."
Abstract In this article the writer notes that SouthwestAirlines is the premiere low cost airline. The writer points out that Southwest operates only in the US market and this restraint that kept it from making unregulated expansion a primary forward strategy is also the strategy that kept it from facing the severe financial difficulties all of the major airlines suffered following 9/11. The writer maintains that in spite of its low cost operating strategy and business model, Southwest has been also negatively impacted by cyclical forces in the airline industry. The writer notes that although Southwest's more recent problems include satisfying employee contract demands and in integrating new executive leadership while trying to manage growth from 500 employees to 35,000, it becomes clear the corporate culture was one more of a cult of personality than any documented and canonized set of operational policies. The writer concludes that operationally, a corporate culture based on the personality of a single charismatic leader, while laudable in many respects, is also difficult if not impossible to reproduce and often leads to human resource concerns as far as impropriety, discrimination and harassment issues.
Outline:
Industry Environment
Financing Sources
Sarbanes Oxley Compliance
Competitive Advantages as Weaknesses
Partnering Exposure
Conclusion
From the Paper "Most major corporations, Southwest included, have at their disposal various financing strategies to fund ongoing operations and extraordinary expenses. In Southwest's case, its various financing strategies are mentioned periodically throughout its Form 10-K most notably in the Management Discussion & Analysis section. These financing options include: cash on hand, short term investments that total more than $2b, a $600m bank revolving line of credit, public debt securities, and various derivative strategies. This degree of leverage, in spite of the cash on hand is still significant and, if Southwest suffers any significant strategic missteps, this leverage can quickly become a negative."
