group d - southwest case

8/12/2019 GROUP D - Southwest Case

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Case Analysis

Group D Ali Asghar Poonawala, Syed Taha Owais, Mohib Umr

Mohammad Ibad Desmukh, Maisam Ali Shams, Jehan

Hassan Khan, Minhaj Ahmed



Proposed Vision

“Our vision is to be the Global Leader in

transportation, while providing highest valu

customers at an affordable price”



Mission: Focus on Employees

“The mission of Southwest Airlines is dedication to the highe

of Customer Service delivered with a sense of warmth, friendindividual pride, and Company Spirit.

We are committed to providing our employees a stable work

environment with equal opportunity for learning and person

Creativity and innovation are encouraged for improving the

effectiveness of Southwest Airlines.

Above all, employees will be provided the same concern, res

caring attitude within the organization that they are expected

externally with every Southwest Customer.”



Current StrategyLow Cost, Low

Fare

High

Frequency

No Frills

Almost No

Interlining

No Hubs, No

International

Regional

Service HQ inTexas

Point-to-Point

Short-Haul

Service



ManagementPlanning

– Consistent Philosophy

– Higher Level CEO, Vice Presidents, Kelleher and Muse

Organizing – Functional (Procurement, Finance, Operations)

Leading

– Employees preferred over customer

– Special treatment.

– Flexible Working Hours

– Higher information dispersion

Staffing

– No excessive staffing

– No Excessive firing

– Employee retention policy: strong sense of loyalty



Strengths

Low Cost Fast TurnaroundWork F

commitm

flexib

Differentiation: not justlow cost but better

service (on time, no

lost luggage, fewer

complaints)

Operational Simplicity Strong C



Weaknesses

Low Economies of Scale (small relative to other

competitors, short routes)

No Hub System

Can sell only tickets from its own offices

No International Routes

Conservative Growth Strategy



Opportunities

Market Expansion possible to over 100 cities

Longer Flights

International Expansion to Canada and Mexico

Introduce a better security system

Focus toward faster growth strategies.

Layoff Experienced Staff



Threats

Weak Demand

Increased Competition: if they lose their Love F

Restrictions

Increased Regulation (noise)

Dependence on Domestic Markets

Competitors are adopting Southwest Airline’s st

to win more customers.



Porter’s 5 Forces

•Competitors offering similar low fare service

Rivalry among Firms: HIGH

•High Capital Investment

•Strong Competition

•Unique Organizational Knowledge

Threat of New Entrants: LOW

•Railway, Car, Buses

Threat of Substitutes: Moderately LOW

•Many low fare service providers

•Buyers look for best value

Bargaining Power of Buyers: HIGH

•Airline Manufacturers (High Switching Cost) Boeing, Airbus

•Fuel Suppliers

Bargaining Power of Suppliers: HIGH



What should Southwest do?

Market Penetration: Seeks to increase market share for present products or services in pre

markets through greater marketing efforts.

Market Development: Involves introducing present products or services into new geograp

Continue Present

Strategy: limitedgrowth?

Expand

Geographically: Point

to Point, serve otherregions efficiently

Expand

Geographically, Major

Hubs

Remain Regional

through numerous

hubs



Recommendations

Geographic expansion to cities such as Atlanta and N

Flights to more cities both domestic and internationa

For domestic expansion, Southwest should continue

strategy of providing frequent, "point to point" flights

The expansion into new cities should be at a moderat

ensure adequate coverage of new markets

Ideal new cities will allow for non-stop flights. As the

the aircraft expands, the potential markets will also e



Recommendations

Southwest should embrace new technologies

New technology includes new aircraft (safer, longer ran

Technology will allow: reduced costs, expand to more mand maintain image as a safe and reliable carrier

In the future, a fast growth strategy adopted by compemay hurt Southwest

Hence, Conservative growth strategy should now be cointo fast growth opportunities

Expanding into new cities would be less costly than expinternationally

Wh l f S h ?



What can we learn from Southwest?

A simple, consistent strategy

Strong culture, family, performance

Both aspects of strategy (e.g., low-price, high-service) must be in harmony sustain internally derived competitive advantage.

Harmony among operating processes, organizational culture, and HR practic

another in the creation and conversion of value.

Created through satisfaction of employee needs, converting to customer and shar

capturing as competitive advantage through lower costs and superior service (pro



Thank You

group d - southwest case

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