Southwest Airlines Strategy Introduction Southwest Airlines Co. was founded in 1957 as an airline that flew between the major Texan cities, and over the years, it has grown to become the largest low cost airline in the world. Southwest Airlines has approximately 58,000 employees and makes around 3,000 to 4,000 departures daily. The airline’s services now cover one hundred and one destinations within the United States, and ten countries. Southwest Airlines is making plans to extend its routes to Canada and Europe. After serving Southwest Airlines in different capacities for the last 33 years, Gary Kelly recently stepped down as the chief executive of the airline, and I was appointed to step into his shoes. Gary Kelly was a transformative CEO who grew Southwest Airlines to what it is today, and I am honored to take on the challenge of stepping into the role that he performed so well. In this report, I will outline my plans for Southwest Airlines with regard to long-term success and profitability. SWOT Analysis Strengths Southwest Airlines has five decades’ experience in intrastate air travel, during which it has perfected its business operations. Unlike most airlines, it is able to offer quality service at a low cost, thus becoming the airline of choice for many passengers. For many of its routes, the airline offers point-to-point service thus saving the time that would have been spent on getting connecting flights. Buy this excellently written paper or order a fresh one from ace-myhomework.com
snacks, Wi-Fi, inflight entertainment, travel insurance and accommodation arrangements. All these will be offered by the airline at an extra charge. Customers who purchase these offers will earn more loyalty points than customers who purchase the regular ticket. The third financial objective is to diversify the airline’s sources of income by adding freight carriage to the services it offers. The airline currently concentrates mostly on passenger travel, and has not sufficiently explored the transportation of cargo to various destinations. This provides a major opportunity for the airline to offer affordable courier services in this sector, and thus earn higher profits for the corporation. The fourth financial objective is increasing the cost of a ticket. The airline’s tickets are significantly cheaper compared to its industry peers and while this may attract many customers. it also makes the airline more vulnerable to losses should a major expense or event occur. It is therefore imperative for Southwest to increase the average price of its tickets such that it is neither expensive nor cheap (So, King, Sparks, & Wang, 2014). The airline can also classify its customers into different segments and offer different products according to their ability to pay for them. The fifth financial objective is to lease as opposed to purchasing aircraft. This can be achieved through making arrangements with aircraft manufacturers such as Boeing to provide aircraft to the airline at a certain monthly or annual charge. The aircraft manufacturer will be responsible for maintaining and servicing the aircraft while Southwest will only cater for fuel charges. As the President of Southwest Airlines, my role is to understand what customers really want and offer it at a fair price, and in doing so, increasing the airline’s revenues sustainably. For a long time, we have concentrated on the cost leadership strategy, but to enhance our
competitiveness, it is essential to cater for different market segments adequately. Some clients need comfort and others need affordable prices, it is essential to arrive at a median. Methods of Control and Feedback My role as the president of the organization is to provide the team with the resources it needs to achieve its vision, mission and goals, and regularly assess the corporation’s progress in attaining the goals (Kim, 2014). To do this, the goals will be divided into short, medium and long term. The management will gauge what the team has actually achieved against what was actually supposed to be achieved. Conclusion Under its new leadership, the vision, mission and objectives of Southwest Airlines will change significantly. However, the airline still needs to maintain its standard as a leading organization in the aviation industry by adopting the appropriate strategies and practices. The best way of achieving market leadership is by understanding who its target market is, what this market needs, and thereafter developing products that adequately address the needs of the market. To enhance its competitiveness in the dynamic aviation industry, Southwest Airlines will ensure that it maintains excellence in everything it does and also be agile enough to adapt to different business environments internationally.