Southwest Airline Essay Sample

Southwest Airline Essay Sample Southwest Airline Case Study Southwest Airlines is one of the major US airlines and the world’s largest low-cost carrier. It has headquarters in Dallas, Texas. Southwest Airlines business model has always been an inspiration to other low-fare carriers such as Ryanair and EasyJet, and it has been copied many times around the world. The Company Overview The company was founded in 1967 by Herb Kelleher and was named Air Southwest and it got its current name, Southwest Airlines, in 1971 when it started operating as an intrastate airline within the state of Texas. It began as a small Texas airline and has grown to be one of the biggest airlines in the United States of America. In 2014, the airline carried more domestic passengers than any other US airline. Nowadays, Southwest Airlines offers flights to 101 cities in 41 states, Mexico, Puerto Rico, Caribbean, and Central America. Southwest Airlines has more than 53, 000 employees and in peak travel season, the company operates about 3, 900 departures. The Company’s Business Model The company has been consistently profitable mainly because of two factors: low-prices for Southwest Airlines flights and the loyalty of its customers. Southwest Airlines is a cheap, no frill company. Such approach to customer service means that the passengers are not served meals on board and there are no first-class seats. From the very beginning, Southwest Airlines has operated only one type of aircraft, the fuel-efficient Boeing 737 that allows to keep maintenance and training costs low. The loyalty of the company’s customers is a result of a number of factors. First, having a low-cost structure, Southwest Airlines offers the company’s customers low prices which make the foundation for the loyalty. Secondly, the company has a good reputation among customers as the most reliable carrier among all the airlines. Thirdly, Southwest Airlines has the quickest turnaround time that allows to keep flights to schedule. Besides, the company is popular among customers because it listens to them and tries to meet their needs. The key factor that determines the success of the company is a very productive workforce. The personality traits and the behavior patterns of the company’s employees have been a crucial factor in the southwest airlines recent success. Of course, the competitive advantage of Southwest Airlines business model lies in simplicity, a very targeted business plan, streamlined nature of the company’s product and operation, and their slow expansion. The company’s business model is difficult to initiate and keep to in the airline industry so the unique spirit of their employees is vital for implementing such a challenging strategy. Southwest Airlines work more hours and are paid less for that but they are committed to making the company a success. Besides, Southwest Airlines has a reasonable stock options plan that extends to all staff members. The employees own 10% of airline’s stock and that additionally motivates them to work hard. Customer Experience The company has developed customer-friendly policies and has taken measures necessary to ensure a pleasant customer experience. During the flight, Southwest Airlines offers free non-alcoholic beverages and alcoholic beverages for money at a flat rate of $5 per beverage. Rapid Reward members receive vouchers for drinks with their tickets. At most flights, the passengers are offered free Nabisco snacks. All 737 Next Generation aircraft are equipped with free streaming live television, Wi-Fi, Beats Audio, free eBooks and video on demand. In 2017, all passengers can get access to live in-flight video as well as real-time flight tracking information via Wi-Fi for free, and full Internet access is available for a small fee for the company’s regular passengers. Besides, A-List Rapid Rewards members can access the Internet for free. Southwest Airlines has excellent customer satisfaction ratings and has the lowest number of complaints among all US airlines. Southwest Airlines is a good example of a company that is dedicated to its important competencies and effective operations to achieve its low-cost structure, innovative HR management practices, and outstanding customer service.