Southwest Airlines Case
Southwest Airlines 2002:
An Industry Under Siege
Case Study
“Discussion Format”
MGMT 5113
Team 7
Dag Yemenu
Sachin Gupta
Michelle May
Shaun Evans
November 22nd 2003
Problem Overview
Southwest Airlines has employed unique operational strategies, incorporating industry revolutionizing methodologies, while developing and sustaining a strong corporate culture that has allowed Southwest Airlines to be profitable for a phenomenal 30 straight years and capture the Airline Industry Service Triple Crown five years in a row from 1992 to 1996. Southwest Airlines own success threatens whether it can maintain the strong corporate culture responsible for its prosperity while growing and adding additional routes. More pressing than the long-term strategy however were the terrorist attacks of September 11, 2001 that created uncertainty in the general environment of US economic trends and the task environment coping with new government security regulations that challenges whether the business model Southwest Airlines was founded on needs to adapt to continue to provide profits to stockholders.
Southwest Airlines Organizational Structure & Culture
Southwest Airlines began in concept in 1967 and took its first flights in 1971 connecting three underserved metros in Texas: Houston, San Antonio, and Dallas. Founding members Rollin King and Herb Kelleher pursued a strategy that focused mainly on cost-leadership (goal to make flight less expensive than driving between destination points) and niche strategies (business and pleasure fliers with simple itineraries and short trips) while also offering differentiation (high frequency departures to destinations via point-to-point flights) that did not demand a premium from the customer.
The founding strategy drove decisions that resulted in Southwest revolutionizing the industry. Although the aviation industry is considered highly technological, much of Southwest’s organizational design dimensions reflect
An Industry Under Siege
Case Study
“Discussion Format”
MGMT 5113
Team 7
Dag Yemenu
Sachin Gupta
Michelle May
Shaun Evans
November 22nd 2003
Problem Overview
Southwest Airlines has employed unique operational strategies, incorporating industry revolutionizing methodologies, while developing and sustaining a strong corporate culture that has allowed Southwest Airlines to be profitable for a phenomenal 30 straight years and capture the Airline Industry Service Triple Crown five years in a row from 1992 to 1996. Southwest Airlines own success threatens whether it can maintain the strong corporate culture responsible for its prosperity while growing and adding additional routes. More pressing than the long-term strategy however were the terrorist attacks of September 11, 2001 that created uncertainty in the general environment of US economic trends and the task environment coping with new government security regulations that challenges whether the business model Southwest Airlines was founded on needs to adapt to continue to provide profits to stockholders.
Southwest Airlines Organizational Structure & Culture
Southwest Airlines began in concept in 1967 and took its first flights in 1971 connecting three underserved metros in Texas: Houston, San Antonio, and Dallas. Founding members Rollin King and Herb Kelleher pursued a strategy that focused mainly on cost-leadership (goal to make flight less expensive than driving between destination points) and niche strategies (business and pleasure fliers with simple itineraries and short trips) while also offering differentiation (high frequency departures to destinations via point-to-point flights) that did not demand a premium from the customer.
The founding strategy drove decisions that resulted in Southwest revolutionizing the industry. Although the aviation industry is considered highly technological, much of Southwest’s organizational design dimensions reflect