Southwest Airline

Only available on StudyMode
  • Download(s) : 54
  • Published : May 25, 2013
Open Document
Text Preview
Southwest Airlines in 2010 : Culture, Values, and Operating Practices

Corporate Business Strategy Group Assignment

Domeniko Wikarda | Endah Widiastuti | Haris Suhendra | Marisa Karsen | Pramita Wardani 1

Table of Contents:
 The Journey of Southwest Airlines  Business Strategic Analysis  Recommendations

2

The Journey of Southwest Airlines in 2010 :

3

Southwest Airlines Is a low-cost/lowfare airline. • Their concept is attract passengers by flying convenient schedules, get passengers to their destination on time, make sure they have a good experience, and charge fares competitive with travel by automobile. • Target market : Business Travelers and Price-sensitive leisure travelers

4

Southwest Airlines Leadership
1981| Herb Kelleher • Principal : Employee comes first • Becoming the market share leader In domestic air travel

2001-2008| Colleen Barret • Principal : to ensure the employee felt good on what they’re doing and felt empowered • The first women appointed as a CEO

5 4

1996 | Rollin King • Starting a lowcost/low fare airlines

3

2

2001-2001| James Parker • Personality : Honest, straight-arrow

1
1971| Lamar Muse • Personality : Aggressive, selfconfident airline veteran • He recruit talented senior staff that included a number of veteran executives from other carriers

Strategy : • Attractive stewardess • Free Alcoholic beverages during daytime flights • Attractive marketing campaign • In Operational, 25 minutes average turnaround time • Focus on business travelers and price sensitive leisure travelers

5

Key Success Factor of Garry C. Kelly leaderships :
• • • • • • • • • Hire great people and treat them like family Care for the customers warmly Keep fares and operating cost lower than competitor Prepared for bad times with strong financial strategy Be the best place to work Be the safest and more efficient airline Offer customers a convenient flight schedule Give the best over all travel experience Do all of the things in an effective way to maintain the 6 low cost

6

2008 - … Garry C. Kelly

5 Objective Strategy of Garry C. :

Southwest Airlines Financial Performance
per year in 2005-2009

800
600 400 200 Net Operating Expenses Net Income

2005
-200 -400

2006

2007

2008

2009

Net Operating Expenses Net Income Revenue per passengers

-

2005 54 484 77,693,875

2006 144 499 83,814,823

2007 267 645 88,713,472

2008 171 178 88,529,234

2009 98 99 86,310,229

Revenue per passengers
90,000,000 85,000,000

80,000,000
75,000,000 70,000,000 2005 2006 2007 2008 2009

7

Business Strategic Analysis

8

The Strategy Canvas of Southwest Airlines

9

Southwest Strategies
• Low cost/low-price/no frills strategy • Tagline : Freedom to Fly • Fare promotions to stimulate ticket sales on flights that otherwise would have had numerous empty seats • Bags fly free • Shrewd practitioner of the concept of price elasticity, proving in one market after another • Southwest designed a carefully route system to concentrate flights between pairs of city to allow Southwest sizable number of daily flights(Point-to-point scheduling of flights) • Southwest frequent flyer program and giving a reward • • Standard Awards; accumulated 1 free roundtrip after 16 credits within 24 months Companion Passes; accumulated 1 free roundtrip after 100 credits within 12 months 10

Southwest Strategies

• Gradual expansion into new geographic markets • Adding flights in areas where rivals were cutting back services • Curtailing flights on marginally profitable routes where numerous seats often went unfilled and shifting planes to routes with good growth opportunities • Putting Strong emphasis on save, high quality maintenance and reliable operations

11

Southwest Airlines Marketing Strategies

12

PESTEL Analysis
• Politics
Terrorist attack US Housing bubble cause a lot of unemployed and lay off, 10% unemployment rate on 1...
tracking img