Southwest Airlines Complete
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Transcript of Southwest Airlines Complete
Presented By: -Mehak Kohli: SMBA 08116Praful Anchaliya: SMBA 08155Rohit Jain: SMBA 08189Sheetal Vishnoi: SMBA 08216
History of Southwest
• 1971-1994:• Unique low cost carrier is born• Golden Triangle (Dallas-Houstan-San Antonio)• Ten minute turn around time• Spreading on the “LUV” theme• Self-ticketing machines• Over 22 aircrafts• Ranked no. 1 in customer satisfaction• Wins the 1st monthly & later on annual Triple Crown• Introduces Ticketless Travel in 4 cities.
ORGANIZATIONAL CULTURE
“Doing the Right Thing”
Mission: “Dedication to the highest quality of Customer
Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.”
SOUTHWEST SPIRIT
Warrior Spirit– Work hard– Desire to be the best– Be courageous– Display a sense of urgency– Persevere– Innovate
Servant’s Heart– Follow the Golden Rule– Adhere to the Basic Principles– Treat others with respect– Put others first– Be egalitarian– Demonstrate proactive Customer Service– Embrace the SWA Family
SOUTHWEST SPIRIT
Fun-LUVing Attitude• Have FUN• Enjoy your work• Celebrate successes• Maintain perspective (balance)• Be a passionate Team player• Don’t take yourself too seriously
CASM Analysis
Stands on top of CASM
Increased fuel-price had no effect
Replaced 737-200s by 737-700s
(1976-2005)
Strategy MapHiring & Selection
-Hire for Attitude-Humor taken Seriously Organization Strategy
Mission: Dedication to the highest quality of Customer Service delivered with a
sense of warmth, friendliness, individual pride, and Company Spirit
Success-Customer Satisfaction-Increased Revenue-Employee retention-Productivity
Training & Development
-Orientation- fun activities-Ongoing advanced employee training -Mentorship Program for new hires-Departmental trainings
Employee Behavior & Competencies
-Right Competence-Quality Focused and Committed Workforce-Attractive Workplace-Participation encouraged-High employee Morale-Respect and Trust
Performance Management -SWA Magic Numbers
“Knowing the Score” Program-Employees Incentive Bonus Plan
Motivation-Hygiene Factors--Profit Sharing and 401(k) --Safety Standards--Flexible healthcare benefits--Job security --Stock purchase plan --Life insurance --Paid Time Off -Motivators--Responsibility--Ownership--Recognition and awards--Employee Initiative--Equal Employment--Opportunities
Competitive Analysis
Rivalry
Jetblue
Suppliers
Maintenance People
Fuel ProvidersFood Providers
Substitutes
1. Brand competitionContinental Airlines and
American Airlines
2. Generic competition train (Amtrak) and
bus(Greyhound)
Customers
Leisure travellers, Businessman, College
Students
Competitors
Braniff, United Shuttle, Delta, Trans
VALUES : 5 F’s
• Flamboyance
• Freedom
• Fun
• Freshness
• Family
Radio ad for Southwest
A FAQ
Children in ‘LUV’
•Designed for leisure travelers
•Frequent sing-a-long and warmth put forth by the flight staff
SUCCESS STORIES• Major airline to make profits(1990,1991 and 1992)
• Fewest Customer Complaints
• Ranked one in the airline industry
• Ranked second across industry
• More passengers, fewest employees
• Investment grade credit rating
SWOTStrengths
Fast Turnaround Committed
Workforce Strong
Management Team Focus on
PSP(People-Service-Profit)!!!
Competitive Advantage
First Mover Advantage
Opportunity
Weaker Competitors
International Expansion
Take up routes abandoned by competitors
Long haul flight - Tap undeveloped market
Dominant position -Offers pricing power
High fuel prices – Exit of unprofitable competitors
Weakness Threats
Fully valued Share Price
Limited Alliances
Competitor - Jet Blue Airlines
Internet reliance - Risks (system disruption)
No frills -> limit frills - Increase operation cost
Southwest’s Performance• Only major US airline in 1990, 91, 92 to make both net &
operating profits
• Averaged more than 12% return on investment & 23.6% return to shareholders
• One of the few airlines in the world with an investment grade credit rating
• Ranked first in the airline industry in fortune magazine’s 2002 America’s Most Admired Companies list
RECOMMENDATIONS
• Continued Gradual Expansion
• Maintain their success story
• No Internationalization
THANK YOU