Southwest Airlines: A Case Analysis
It is evident that the greatest strength that Southwest Airlines has is its financial stability. As known in the US airline industry, Southwest is one of those airlines who are consistently earning profits despite the problems the industry is facing. With such stability, the corporation is able to make decisions and adjust policies, which other heavily burdened airlines may not be able to imitate. Having a low amount of cost in their operations is one of the contributing factors in Southwest Airlines’ financial success. Such low cost model of the corporation is brought about by an effective strategy. Southwest uses only one type of aircraft – the fuel-efficient Boeing 737. This tactic keeps training and maintenance costs down. Moreover, the no-frills approach to customer service contributed to the low cost of operations for Southwest. The airline does not serve meals on board, and there are no luxurious or first class seats offered. Services like these have been seen by the airline as unnecessary for an airline that provides a short-haul trip from city to city. By these, Southwest were able to offer low price tickets to customers, which was good for the company because most people would prefer to fly without those services mentioned if it meant for cheaper ticket price.
Even though Southwest offers no-frills, there is still a high degree of customer satisfaction that continuously builds customer loyalty for the company. As mentioned, Southwest offers low prices on their airplane tickets. Also, Southwest is renowned in the airline industry for its short turnaround time on arrivals and departures. And since people's biggest concern nowadays is money and time, having low price airline tickets to cater their traveling needs in a shorter period of time will surely satisfy them. Moreover, aside from the low prices offered, what attracts to customers is Southwest’s way in dealing with them. The employees of the airline treat their customers well and really listen to their needs.
Southwest Airlines is also well-known for having a very productive and loyal workforce. Such loyalty and productivity among the employees were brought by the way Southwest’s management treats them. As they say, the employees are willing to work hard for the company because they feel appreciated by the top management. Southwest maintains good employee relations because what they believe in is that if employees are happy, satisfied, dedicated, and energetic, they'll take real good care of the customers. And by having staff that enjoy their positions and present themselves in a friendly, professional manner, it adds quality and value by inserting a positive element in to a traveler's Southwest experience.
However, though coupled with several strengths, Southwest Airlines is not without weaknesses. Among such weaknesses is their use of only the Boeing 737 airplane. As it contributes to low training and maintenance costs, limiting itself to only one type of aircraft causes Southwest to have no flexibility at the time Boeing 737 receives bad reputation due to a critical flaw found in it. And it would be a costly undertaking to find a replacement aircrafts for the company who’ve consistently used only one type of aircraft. Another weakness of Southwest Airlines is the fact that it currently serves only few states in the US, mostly in the South. This limited area of service limits the number of geographical market for Southwest. And this causes the inability of the company to compete against the larger airlines that serve both nationally and internationally, with hubs that allow them to reach a much larger share of the overall market than Southwest.
Throughout the years of its operation, because of its no-frills approach and low cost model, Southwest Airlines has consistently been very profitable, unlike other airlines that are experiencing bankruptcy. And...
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