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Southwest Air line

Introduction
The airline industry is an area facing immense competition and with high fuel and maintenance
costs, the margins in this industry are proportionately very low. As a result of this it is an area
undergoing constant consolidation through a number of mergers and acquisitions. This means
every airline is fighting tooth and nail to stay afloat and not go bankrupt, yet at the same time
they need to find a method to create competencies for itself. On the basis of this it would create
competitive advantages for itself and become a market leader.

Southwest has been the most successful airline in the United States for 36 years, making it
possible for customers to take advantage of convenient and affordable traveling. It began with
only three aircraft flying to Dallas, Houston and San Antonio, and today it is the largest domestic
carrier operating more than 400 jets to 63 cities. Southwest Airlines Company is an American
low-cost airline. Southwest is the largest airline in the world by number of passengers carried per
year (as of 2007).Southwest, the 6th largest U.S. airline by revenue, maintains the third-largest
passenger fleet of aircraft among all of the world's commercial airlines. Southwest is
headquartered at 2702 Love Field Drive in the Love Field area of Dallas, Texas, adjacent to Love
Field airport.

Mission of the Southwest Air line

The Mission of Southwest Airlines is “dedication to the highest quality of Customer Service
delivered with sense of warmth, friendliness, individual pride, and Company Spirit”

Premium features of the Southwest Air lines


 Southwest Airlines has carried more customers than any other U.S. airline since August
2006 for combined domestic and international passengers according to the U.S.
Department of Transportation's Bureau of Transportation Statistics. Southwest Airlines is
one of the world’s most profitable airlines, posting a profit for the 36th consecutive year
in January 2009.
 Southwest's successful business model involves flying multiple short, quick trips into the
secondary (more efficient and less costly) airports of major markets, and using only one
aircraft type, the Boeing 737.
 In an industry where most of the airlines have been forced to either cut back
or cease operations, Southwest has sustained its profitability in the face of
severe obstacles.

 As of May 3, 2009, Southwest operates approximately 3,500 flights daily

Southwest air line hold records as

• 7th Largest Operator of Jets


• 6th Largest US Airline in Customers
• 5th Largest US Airline in Daily Departures
5% behind US Airways
20% behind American Airlines
• 2nd Largest US Airline in domestic
• departures
• The Largest operator of 737’s

Southwest air line is very keen to out source but they says that

“We outsource everything except core Competencies”


South west air
They earn there core competency through

- Lower cost, in less time, with more features.


- Balance between competitive advantage and strategic Vulnerability.

* Competitive Advantage:
- Cost, cycle time, quality, performance, and flexibility

But if vulnerability then they have to pay cost

* Vulnerability:
- Supply interruption, cost increase, quality, and performance

Competitive advantages
Southwest Airlines' successful and profitable business model has been driven by
several strategies:

 high aircraft utilization


 standard fleet
 charismatic leadership
 low fare carrier
 excellent customer service practice
 attractive frequent flier program
 innovative and creative marketing program
 performance focused organizational culture
 Strategic human resources management and lean operations.

Cost effective air line strategy


Southwest fleet is made up of mainly Boeing 737 fuel efficient airplanes which spent
an average 11 hours in the air daily compared to an industry average of 8 hours
and average 10.5 flights per gate versus 4.5 which yields more income by virtue of
more flight available. By using a single type aircraft, the company has save on
maintenance and training costs, which also has contributed to the company's
immaculate safety record.

Southwest's strategy of short-haul, point-to-point flights using less congested


airports have contributed greatly to the airline's efficiency.
A significant cost saving factor is the productive and motivated workforce. In 1991,
with reference to industry standards, southwest had fewer employees per aircraft
(79 versus 131), flew more passengers per employee (2,318 versus 848) and had
more available seat miles per employee (1,891,082 versus 1,339,995). Unlike other
large airlines, Southwest did not buy into the expensive computerized reservation
systems. It sells essentially a product with a higher level of service, offering more
frequent departures, low airline fares with a low frills approach.

South west airline competitor


 Fort Worth, TX
 Orlando, FL
 Seattle, WA
 Houston, TX
 Atlanta, GA
 Denver, CO
 Forest Hills, NY
 Eagan, MN
 Chicago, IL
 Tempe, AZ

Future of Southwest Airline


In future the target of the southwest air line is to become

Southwest want to list itself in $7B Corporation in next 5-7 years

By Maintain:
o Low Costs
o Dedication to Employees
o Focus on Customers

 350 Airplanes by 2008


 35000 People
 Concentrate on Business Partnering

SOUTHWEST AIRLINES

“THE BEST COMPANY IN AMERICA TO WORK FOR IS SOUTHWEST AIRLINES”


FORTUNE MAGAZINE JAN. 1998

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References
- Southwest Airlines - Wikipedia, the free encyclopedia.htm
- Southwest Airlines - Using Human Resources For Competitive Advantage - Research Paper - Vinton
Brown.htm
- Management 4th Edition - Building Competitive Advantage.htm

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