SOUTHWEST AIRLINES (A)

Group No. 16
Ghanshyam Dethe - 2023PGP115
Shubh Garg - 2020IPM131
Nidhi Kadian - 2023PGP225
Srinidhi U. S. - 2023PGP360
Aakriti Rawat - 2023PGP002
Problem Statement

Strategic Challenges for Southwest Airlines: Navigating Competitive Threats and Ensuring
Sustainable Success
Southwest Airlines faces critical strategic challenges amid escalating competition from United
and Continental Airlines. The organization must formulate robust strategies to navigate these
competitive threats, safeguard its distinctive family-oriented culture, and fortify long-term
success and resilience within the ever-evolving dynamics of the airline industry
Context Analysis
Industry:
• High Competition (United & Continental) & Dynamic Industry

Company:
• Estd. 1971
• Profitable since inception, a record achieved by no other major US Airline
• Average of 11hrs in the air daily vs an industry average of 8 and average of 10.5 flights per gate
vs 4.5 for the industry
• CEO, Herb Kelleher's vibe is all about being fun and in a party/ celebration mood
• “WE” culture

Employee & Recruitment Practices:

• Involvement of Employees and Customers in the recruitment process
• Emphasis on cultural fit and Family Culture
• Positive reception from all its employees and Excellent Customer Service
Context Analysis
Strategies:
• Low costs, low fares and frequent flights while also keeping its fares simple
• Point-to-point strategy vs Hub and Spoke Model

Concerns & Threats:

• Managing challenges associated with growth while preserving the initial small-firm
dynamics
• Ensuring the family-oriented culture remains intact amid expansion
Stakeholder Analysis
Workforce ( ‘The Southwest Spirit’)
Pilots, Flight Attendants, Maintenance - ensure productivity that makes low-cost structure possible
Customers
Influence the airline’s customer-centric approach to quality services promoting brand recognition and loyalty
The People Department
Responsible for maintaining organizational culture ensuring diversity in terms of gender, minorities as well as
geography
Unions
Responsible for pay and seniority contracts, and identified well with the company due to SW leadership
capabilities
Stockholders
About 80-90% of the employees hold stock in the company
Regulatory Bodies
Example played a key role in the Wright Amendment that prohibited Southwest from providing direct service in
the love field, the legal battle also drained SW financially thus impacting it.
Key Characteristics of Herb Kelleher

Charismatic Servant Leader Unconventional

Collaborative Empowering Fun-loving

 Leadership styles
1. Transformational Leadership: With his charismatic personality and vision he inspired
employees to follow his lead and strive for excellence. Also, his genuine care for his employees
made them feel valued and respected.
2. Servant Leadership: He prioritized the well-being and happiness of his employees, believing
they were the foundation of Southwest's success.
3. Situational Leadership: While Kelleher does a lot of unconventional things as a leader he
adjusts his leadership style based on the needs of the situation and the people he is leading, and
properly clear direction and instructions to ensure tasks are completed effectively.
4. Leader-Member Exchange (LMX): Kelleher built strong relationships with his employees,
based on trust and mutual respect. provided clear expectations and support to his employees,
enabling them to perform effectively. Also, Kelleher showed genuine interest in his employees’
well-being and development.
Cultural Characteristics of Southwest Airlines:

Employee
Fun and
Empowerment Customer Service
Informality
and Ownership

Teamwork and Innovation and

Care and Respect
Collaboration Change
 Culture Models Applicable to Southwest Airlines
1. Competing Values Framework (CVF): Southwest primarily fits a Clan Culture, emphasizing
collaboration, teamwork, and a strong community feel. While not as dominant, a Market
Culture orientation is also present, reflected in a focus on customer satisfaction and exceeding
expectations.
2. Schein's Organizational Culture Model: Southwest's culture is strongly influenced by its
informal dress code, open office layout, and humorous advertising (artifacts) which are the visible
artifacts of the company culture. Also, core values like fun, informality, customer service, and
teamwork (values) guide employee behavior and shape the company's identity.
3. Denison Organizational Culture Model: Southwest's strong mission statement and employee
involvement drive its success. The company's adaptability to change and embrace of new
technologies (adaptability) is crucial for its competitive edge. A consistent focus on customer
service and reliable practices (consistency) ensures a positive customer experience. The
company's unique culture and values set it apart from competitors (differentiation).
THANK YOU