Southwest Airlines 2008
Southwest Airlines 2008
Problem Identification:
Will Southwest Airlines able to maintain its top position and level of customer satisfaction whilst expanding its business domain?
SWOT Listing:
Strength:
* Attractive fares and marketing strategies. * Point to Point flights. * Best turnaround time compared to its competitors. * First to sell seats through Internet sites. * Positively Outrageous customer service. * Maintained Co-operative labor relations. * They always worked towards the employee development by constantly motivating, training and awarding them with accolades. * Low operating costs. * Service changes adopted in 2007 further helped improve its standing in the industry. * Financials were secure(debt- equity ratio much lower than industry average).
Weakness:
* Operated without a hub and spoke model which was considered as a cost saving method for other airlines. * Formulations of expansion strategies in the Northwest were unclear. * With inclusion of Northwest region in its flight schedule, its operation costs were going high.
Opportunities:
* Expansion into the Northwest region, the most densely populated area of the country posed tremendous growth for Southwest airlines. * Venturing into the International market. * Air Traffic in its functioning areas more than doubled after its establishment increasing its opportunities.
Threats:
* Fluctuating oil price changes. * Unprecedented rise in operating expenses. * In cases of insufficient demand, point to point flights proved to be economically unfeasible.
PESTL:
Political:
* Airline Deregulation Act of 1978 led to entry of many players in the market and intense competition with low fares. * September 11 2001, terrorist attack led to tremendous losses(about $30 billion) of the airline industry due to the fear that was instilled in the flyers. * Fuel crisis of 1979 caused due to the Iranian Revolution caused
Problem Identification:
Will Southwest Airlines able to maintain its top position and level of customer satisfaction whilst expanding its business domain?
SWOT Listing:
Strength:
* Attractive fares and marketing strategies. * Point to Point flights. * Best turnaround time compared to its competitors. * First to sell seats through Internet sites. * Positively Outrageous customer service. * Maintained Co-operative labor relations. * They always worked towards the employee development by constantly motivating, training and awarding them with accolades. * Low operating costs. * Service changes adopted in 2007 further helped improve its standing in the industry. * Financials were secure(debt- equity ratio much lower than industry average).
Weakness:
* Operated without a hub and spoke model which was considered as a cost saving method for other airlines. * Formulations of expansion strategies in the Northwest were unclear. * With inclusion of Northwest region in its flight schedule, its operation costs were going high.
Opportunities:
* Expansion into the Northwest region, the most densely populated area of the country posed tremendous growth for Southwest airlines. * Venturing into the International market. * Air Traffic in its functioning areas more than doubled after its establishment increasing its opportunities.
Threats:
* Fluctuating oil price changes. * Unprecedented rise in operating expenses. * In cases of insufficient demand, point to point flights proved to be economically unfeasible.
PESTL:
Political:
* Airline Deregulation Act of 1978 led to entry of many players in the market and intense competition with low fares. * September 11 2001, terrorist attack led to tremendous losses(about $30 billion) of the airline industry due to the fear that was instilled in the flyers. * Fuel crisis of 1979 caused due to the Iranian Revolution caused