Case study analysis of Southwest Airlines Presented by:Pujara PratikModi VickyMoriya HasanabbasKalor ChetanChuhan Aanad

Overview of the companySouthwest Airlines based in Dallas was founded in 1967 by Rollin King and Herb Kelleher. It is one of the major domestic airliners which provides carrier and transportation service. This company has 35,499 employees and it runs over 500 Boeing 737 aircraft in 67 cities in the US.

Southwests principal values are Providing low-fare and Quality service.Offering the highest quality of customer service.Putting a lot of importance on the fair treatment to its customers.Building friendly relationship between its customers and employees.

Culture of South West AirlinesCasual dress codeField visitStrong guidelines for every one.At par with industry norms.Pension through profit sharing plan

Their strategySouthwest Airlines has achieved a great position in the airline industry by adopting five important strategies.

First, using the minor league airports which have helped the company to reduce traffic delays and increase passenger convenience.Second, flying one kind of aircraft has helped it to achieve lower training cost.Third, reducing turn-around time by using point-to-point strategy, has avoided the use of complicated reservation process system.

Forth, not offering assigned seating and preferential treatment on frequent fliers, has led the company to have better ticket price. Lastly, emphasis on building good relationship between passengers and attendants has been a well valuable factor.

Seven secret strategies of southwest

One Plane Fits AllPoint-to-Point FlyingSimple In-Flight ServiceCustomer perspectiveStrong ManagementA Relatively Happy WorkforceAggressive Fuel Hedging save after 1999 $3.5 billion.

Southwest Airlines main competitorUSAir ways Delta United airlines American Airlines Alaska AirlinesAmerica west Airlines

QuestionsQuestion no: 1 What is mission and objective of Southwest Airlines?Answer: The mission of southwest airlines is to is dedication to the highest quality of customer services delivered with sense and warmth, friendliness, individual pride, and company spirit. Long term objective

Reduce employee turnoverIncrease product quality by Decreasing operating cost Increase internet salesDecrease customer complainProvide customer satisfactionContinue to effectively hedge price

Conti..Question no: 2 What is the strategy of Mr. Lamar muse to reach the success?Answer: Muse is a very intelligent and very much self confident person and his strategy is we do whatever we have to do to get the job done. that is his main strategy towards to get the success. He sought all his team member as his own he select those person who is innovative and do work differently from others.

Conti.Question no: 3 What is the struggle of southwest to gain market foothold?

Answer: They were adding more and more flight Muse come up with $10 fare at Friday night between Houston Dallas flight. While other were taking $13. Before 7pm the price was $26 per passenger. Southwest was the only one airlines who provide alcoholic during day time.

Conti.4.They try to fill empty seats at lower rate from $26 to $13 5. Southwest was the only airlines who provide new station like Houston hobby through this station the business of southwest is double.So these struggle helps to southwest to get market foothold

Conti...Question no: 4 What is the strategy of Mr. Herb Kelleher to reach the level of success?Answer: Mr. Herb Kelleher was the person whose style was to listen, observe, and offer encouragement. His simple strategy was to provide encouragement to all employee and do best for each work.

ContiQuestion no: 5 What is the legal regulatory hurdles to southwest airlines?Answer: it is nothing but rival airlines were protest against southwest airlines for the arguments that these market were already well served if southwest enter in Texas it will costlier to all other airlines.

Conti.Question no: 6 SWOT analysis of Southwest airlines?Answer:

Strength Sensible expansion policyStrong market capitalizationEfficient operationProduce positive of profit every time

Conti..(2) Weakness Little room for strategic developmentNo established allianceFully valued share price

(3) Opportunity Low cost positionGeographical expansionContinue streamliningMerger and aquisition

Conti.(4) ThreatCost of operationUnstable airlines industry

Conti.Question no: 7 What is current position of southwest airlines?Answer: Southwest Airlines has succeeded because of their marketing orientation. This marketing orientation has led to target pricing, or pricing from the customers perspective of value backwards to the product definition and cost. The result has been one of the most profitable airlines in the history of commercial air traffic.

Contithe current performance of southwest airlines is very good.The ROI of the company is steadily increasing and Southwest has consistently rank 1st by getting 80%-90% market share by top 100 city pair routes.While in overall industry in 2000 the total market share is 9.4%.

ContiSouthwest airlines is profitable since 1973 and till this year. In between this period 1or 2 year they suffer from loss.In 2001 their profit was $511.1 million for the full year

RecommendationFirst, the main problem will be solved by giving clients, such as , the opportunity to decide their seats with extra fee. In addition, this solution will keep the companys customers more satisfied and at the same time increasing their loyalty. Second, solution number two will increase the companys revenues. According to The Wall Street Journal, by receiving extra fee on assigning seats, Southwest could add seven hundred fifty million dollars ($750.000.000) in its year revenues. it is a long-term solution. By giving an advantage to the customers who make their reservation earlier, Southwest will strengthen its position among competitors, and the major problem will be solved.