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4. Culture Values And Operating Practices Management Essay
Southwest airlines performed successful in the airlines industry. The company demonstrated the
ability to quickly dominate markets. Here are some strategies that were really appreciable:
Price Strategy:
Southwest airlines had offered the lowest domestic airlines charges. There was a plan of profit
sharing with senior employees that was first in the airline industry (instituted in 1973) (Arthur A.
Thompson, 2008).
Promotion Strategy:
Southwest airlines wanted to concentrate more on customer preference and benefits. It
encouraged its employees to dress casually at work and this created a positive image in front of
the customers. (Arthur A. Thompson, 2008).
QUESTION 3
What are the key policies, procedures, operating practices,
and core values underlying Southwest's efforts to implement
and execute its low-cost/no frills strategy?
Some policies for the low cost are:
The company was operating only one type of aircraft having 737 seats which minimized the
spare parts, inventories, maintenance training, and proficient improvement.
The company offered ticketless journey which eliminated the expenses of printing and
processing paper tickets.
The company was serving airports near metropolitan areas and medium sized cities that
minimized fuel cost and helped to reach destination on time.
Southwest was using point-to-point scheduling of flights instead of hub-and-spoke system which
was more efficient in comparison with the later.
Southwest didn't have first class section in any of the flights and offered only beverages and
snacks (Arthur A. Thompson, 2008).
QUESTION 4
What are the key elements of Southwest's culture? Is
Southwest a strong culture company? Why or why not?
What problems do you foresee that Gary Kelly has in
sustaining the culture now that Herb Kelleher, the
company's spiritual leader, has departed?
The company provided free and satisfied environment to the employees. It had positive,
innovative and simple culture which contributed to the growth of the company. (Arthur A.
Thompson, 2008).
Garry Kelly was appointed as vice chairman of the board of directors in 2004. There are some
problems that I foresee when Gary Kelly has sustaining the culture:
Other rival airlines can copy their spirit and culture that can be problem for the company.
Gary was applying changes according to his taste and the company was facing continuous
changes. Hence it became difficult to survive in rapidly changing environment.
There was no market stability because of the rapidly changes environment (Arthur A. Thompson,
2008).
QUESTION 5
What grade would you give Southwest management for the
job it has done in implementing and executing the
company's strategy? Which of Southwest's strategy
execution approaches and operating practices do you believe
QUESTION 6
What weaknesses or problems do you see at Southwest
Airlines as of mid-2010?
This essay is an example of a student's work
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There were some problems that came in the mid of 2010 at the southwest airlines:
It depended on only one producer. Southwest was running only one flight of 737 seats there must
be some optional flight.
Booking of flights became difficult because southwest had eliminated the intervention of agents
because of commission amount.
Southwest were only focusing on the economy class but have no attention towards business class
who were willing to pay for their seats. Money was not the big issue for them (Arthur A.
Thompson, 2008).
QUESTION 7
Does the Air Tran acquisition make good strategic sense for
Southwest?
Southwest have a very distinctive and unique culture. The Air Tran acquisition put significant
risk. Southwest has one type of plane 737. With the acquisition of Air Tran it started flying the
717 to Mexico and the Caribbean. It was a big shift for southwest (Arthur A. Thompson, 2008).
The main base of Air Tran was Atlanta that was a huge delta hub while southwest had started to
fly their flights out of the United States. This proves that the acquisition made a good sense not
only in business perspectives but also for maintaining the cost effectiveness of the service
(Arthur A. Thompson, 2008).
QUESTION 8
What strategic issues and problems do Gary Kelly and
Southwest executives need to address as they proceed to
close the deal with the Air Tran acquisition and contemplate
how best to integrate Air Tran's operations and Air Tran's
employees into Southwest?
Some problems that need to address Gary and the southwest executives are:
Southwest needed to incorporate Air Tran employees into the culture of Southwest that was
serving good customer service, lowest costs and lowest charges.
To analyze the level of Air Tran employees and the Southwest employees.
They have to look on the opportunities and try to enhance business share.
They have to analyze that how to conduct flights outside the United States (Arthur A. Thompson,
2008).
QUESTION 9
What recommendations would you make to Gary Kelly and
Southwest executives as the company heads into 2011?
The following are the recommendations for the company:
The company has to work on the long term goals.
Strategies should be made in accordance with the fuel prices which usually act as a barrier to
conventional business growth.
Provision should be made for reservations to be performed directly on the site of southwest.com
without any intervention of third parties.
There must be opportunity for internet marketing.
The management of the company should start travelling outside the United States for increasing
the market shares.
The turnaround time should be improved.
The prices of the services should be kept as low as possible.
Offering of different types of seating classes with different rates should be helpful for increasing
the revenue (Arthur A. Thompson, 2008).
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