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southwest airlines overview
southwest airlines overview
southwest airlines overview
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According to their main website, their mission statement is, “The mission of Southwest Airlines is dedication to the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride, and company spirit.” This reveals Southwest’s true mission: To please their customers.
For their loyal customers, Southwest offers a “Rapid Rewards” program which gives the customers free tickets based on the number of times they fly with Southwest. Customers who make 8 round trips or 16 one-way trips receive a free ticket. Programs such as the “Frequent, Frequent Flyers-Companions Travel” offer a year of free trips to customers. Customers who make 50 round trips a year can designate someone to fly with the customer free of charge for an entire year. Award programs such as these show that they appreciate their loyal customers and that they are willing to take cuts, such as giving away free tickets, to prove to their customers that their patronage is valued.
Another aspect of their great customer service is their online travel booking center. The customer can rent a car and make reservations at a hotel all online. This allows the customer to thoroughly plan their vacation or trip. Since Southwest was a relationship with Alamo, Budget, Dollar, and Hertz, customers have the ability to pick what kind of car they will get upon arrival. By making friendly relations with other companies Southwest is making their customers’ job easier by consolidating all the necessities of travel under one roof. This shows that Southwest is willing to go the extra mile for their customers and do more than just provide transportation by air, but also transportation by land, and also accommodations at hotels.
As a part of their “low fares, no frills” campaign, Southwest does not offer any in-flight meals to their customers. They believe that by offering the bare minimum, so they can offer low customer rates. However during the flight they do offer complementary juices, cold drinks, and nuts to the passengers. They also encourage the passengers to bring their own meals on board for their own pleasure and convenience. Actions like this show the honesty of Southwest Airlines. Although they could make a sizeable amount of revenue by offering in-flight meals, Southwest allows passengers to bring their own meals so that the customer saves money.
A big part of Southwest’s game plan is cost reduction; this shows that Southwest is very customer-oriented.
Southwest airlines is one of the most widely respected companies among those profiled by Firms of Endearment. They are recognized for having one of the best corporate cultures, which is emphatically encouraged from the top down. Southwest’s model clearly exemplifies the concept of servant leadership, and we will elaborate on how this creates a firm of endearment.
Despite Southwest’s long standing reputation as an employer who makes their employees and customers happy, there have been storms brewing in the company’s labor relations and customer relations sector. As was mentioned before, Southwest recently acquired AirTran Airways and revealed plans to take its already successful domestic business international with flights to Mexico and the Caribbean (Martin, 2014). This organizational restructuring is causing Southwest to have what Time Magazine’s Brad Tuttle calls an “identity crisis” for the airline whose new advertisements have removed the humor they are famous for and the messages of “bags fly free” from commercials. Bob Jordan, a Southwest executive, explained the change as a new era for Southwest and chance for consumers to see them in a brand new light. Some speculate that this “new light” will not be positive for the airline; after all, one of the reasons Americans love Southwest is because it has always differed from other large and impersonal airlines, such as American Airlines and Delta. Southwest has always seemed like the underdog taking on the giant, overpriced competitors; now they seem to have hopped on board with the “big boys” of the airline industry. Another disturbing trend is that studies show Southwest’s fares have risen 39% over the last five years compared to a 10% rise in the rest of the industry, while Southwest still lets bags fly for free. There is some debate if that will be one of the items swept away in the airline’s big restructure. Time will tell if Southwest’s top-notch customer service will still be enough to set them apart from other airlines or if their new, “stiff” image will leave them with shaking heads and deficits on the balance sh...
Southwest Airlines founder Herb Kelleher studied other airlines to try and figure out what culture he wanted to bring to Southwest Airlines. Herb Kelleher and President Lamar Muse ended up using a model copied almost word for word from an airline out of California called Pacific Southwest Airlines. (Southwest Airlines, n.d.) Pacific Southwest Airlines (PSA) motto was pretty simple as they wanted to also be known as the “The World’s Friendliest Airline” You could tell PSA wanted to be the friendliest airline by the big smiley face that was on the front of each of the companies Boeing 727 airplanes. (Pacific Southwest Airlines, n.d.) Kelleher and Muse saw the success that the culture brought to PSA and they wanted to bring that success to Southwest Airlines. Muse later confessed that creating the operations manual for Southwest Airlines was pr...
Spirit addresses “price” by attempting to get the lowest possible fair for their potential customers. They have instituted their “unbundling” strategy that essentially removes all the conveniences that other airlines afford. Fees for checked bags, fees for flight changes, and no complementary in-flight beverages are just a few of the cost-trimming techniques employed. This strategy allows Spirit to come up with impossibly low fares. It also conforms to customers who just want to get from point A to point B without paying extra for services they don’t use. This strategy, coupled with an in-your-face “promotion” ploy, has made Spirit Airlines “the most profitable airline in the U.S.” (Nicas, 2012).
In 1971 Southwest Airlines started their operations with a vision of being a low cost/low fare carrier for passengers traveling between San Antonio, Dallas and Houston. After early legal battles and struggles gaining market share, their fighting spirit, integrity and will to succeed paid off. Over the course of the next 40+ years, Southwest has become the world’s largest low-cost carrier, while carrying more domestic passengers that any other U.S. airline (“Southwest Corporate,” 2015). Their culture, values and operating practices are what have driven this company to its current success and will continue to do so for the foreseeable future.
“Our people are our single greatest strength and most enduring long-term competitive advantage,” reports CEO Gary Kelly on the Southwest Airline website (https://www.southwest.com/html/about-southwest). The company works hard to hire great individuals and then rewards and supports them to make satisfied, productive employees (Ross & Beath, 2007). In fact, Southwest Airlines has received repeated recognition as a great place to work (“Southwest Corporate Fact Sheet,” n.d.). As a result, Southwest Airlines is able to provide a low-cost, fun-cultured experience with excellent customer service (Ross & Beath, 2007). This has allowed the company to build its final strength in this evaluation: a strong brand
Southwest Airlines faced many barriers to entry from the fierce competition of other airlines in the industry. Though competition was fierce, Southwest Airlines managed to succeed by doing things differently. Their mission was to provide affordable air travel to those who would not normally fly. Contradictory to the rest of the airline industry, Southwest maintained a profit while keeping its fares low. Southwest was unique to the industry in two ways. They focused on the short haul traveler and used a point-to-point method of flight connections.
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.
Since 1987, when the Department of Transportation began tracking Customer Satisfaction statistics, Southwest has consistently led the entire airline industry with the lowest ratio of complaints per passengers boarded. Many airlines have tried to copy Southwest’s business model, and the Culture of Southwest is admired and emulated by corporations and organizations in all walks of life. Always the innovator, Southwest pioneered Senior Fares, a same-day air freight delivery service, and Ticketless Travel. Southwest led the way with the first airline web page—southwest.com, DING, the first-ever direct link to Customer’s computer desktops that delivers live updates on the hottest deals, and the first airline corporate blog, Nuts About Southwest. Our Share the Spirit community programs make Southwest the hometown airline of every city we serve.
The marketing approach of Southwest Airlines is built upon their strong business model. They have successfully managed to target two specific market segments of the airline industry while remaining profitable. Their strategy is simple, to offer frequent non-stop flights with the lowest costs which appeal to both the business and budget travelers. By segmenting their target audience to specific demographics and ticket pricing, passengers know exactly what they are getting for the price they pay.
Southwest has done what others in its industry seem to struggle to do, which is to make flying fun. This has been the cornerstone for how the Southwest operates, thinks, and plans. Many of the policies, procedures, and practices Southwest has used are aimed directly at providing patrons with a unique, fun, and enjoyable experience. This value and the effort Southwest has made to place customers at the forefront of its plans and strategy, has paid off as the company is one of the most popular and well-respected in the transportation industry.
Spirit makes our fares so low because they know that draws in the attention of the consumer. Once they have your attention you’re shocked at the price so you go for the deal, oblivious to the fact that you walked into their trap. Southwest’s symbol for shareholders is LUV while Spirit’s is SAVE. They are not the only companies to start to enter into these paths. Hotels, rental cars and cruises are all faced with the same choice to embrace the LUV or the thriftiness with SAVE (Elliot
Although many companies are in business to make a profit, Southwest claims that their primary goal is not profit maximization. However, they have been consistently profitable by making air travel affordable to those who previously could not afford it (Freiberg, 1996).Southwest says the customer comes second, showing their devotion to employees. By taking care of their employees, the company encourages employees to take care of the customers. Employees are...
Southwest has comprehensive strategy and they work with harmony. They are low cost airlines which make the customer feel like royalty. Southwest have a winning strategy is proven by their profit year after year even thought they had economy crisis. Since 1973 Southwest reported a profit each year even when they lost billions of dollars from the year 1980 to 2009 because of the low operating cost strategy, low fares and customer service. Since the start of Southwest they have stay faithful of keeping low cost across the industry. Their value in corporate culture reflected through their prices and customer service.
It all started in 1971, when Rolling King and Herb Kelleher decided to challenge the existing rut of charging high prices for air travels. They considered the railways and roadways their competitors and decided to offer cheaper travel for smaller routes. The company was incorporated in 1967, apart from initial entry troubles, Southwest has been the only US airline to have earned profits since 1973. The eccentric company’s outlandish way of conducting themselves has been the sole reason for Southwest Airlines to succeed in a highly competitive and packed industry.