Analysis Of Southwest Airlines Business Level Strategy

Improved Essays
Southwest Airlines Key Strategies
Business Level strategy.
Business level strategy is a process in which an organization focuses its core competencies on satisfying their customers, it details actions that should be taken to provide maximum value to the customers and gain competitive advantage over the firm’s competitors within an industry.
Southwest Airlines employs a cost leadership business strategy which focuses on competing for a wide range of customers based on price of the goods or service being offered. Southwest Airlines is truly loyal to this strategy and that can be seen in the company’s low cost strategy initiative. Southwest Airlines has been able to maintain its pricing strategy by controlling several internal efficiencies such
…show more content…
The airlines website is currently responsible for over 75% of sales. (Southwest, 2015).

Global Level Strategy Organizations that apply the global level strategy treat the world as largely one market and one source of supply with little local variation. Importantly, competitive advantage is developed largely on a global basis. Given that the services an airline provides isn’t a something that can be imported or exported, it makes taking a look at the global strategy within this industry a little more complex than most. In most cases, airlines rely on alliances, mergers or acquisitions as a way of expanding into new markets or for global penetration. Southwest Airlines is one the largest domestic operations in the United States, and recently the company acquired AirTran in a bid to boost its global
…show more content…
At Southwest Airlines, they believe that customer service starts first with employees. Southwest Airlines consistently ranks in Fortune 's top 10 businesses to work for, and has been regarded as one of the world 's most admired companies. The family-oriented, fun, and flexible atmosphere has led employees to take ownership and a general reverence for the company. This esteem shines through all employees, and is passed along to customers, who in tum value and regard Southwest Airline’s service (Mouawad

Related Documents

  • Superior Essays

    The Airline industry is characterized by strategic management and competitiveness. The paper seeks to provide information concerning the impacts of the changes in technology and globalization on the airline industry. Furthermore, the paper would also integrate the resource based model and the industrial organization model to try and determine the above average returns witnessed in the Airline industry. The paper seeks to analyze a case involving the Southwest Airlines.…

    • 1083 Words
    • 5 Pages
    Superior Essays
  • Improved Essays

    By locking up fuel hedging contracts, Southwest was able to pay less for the fuel than other competing airlines. While facing possible layoffs, Kelly challenged his ground crews to reduce the turnaround times from 55 minutes to 15 minutes. The crews were at to achieve that goal and eliminated the possibility of layoffs. By having a fleet of only having Boeing 737s, Southwest has been able to keep maintenance cost extremely low. Southwest has had their flight attendants play games with their customers, while in flight.…

    • 684 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    9/11 Case Study

    • 1159 Words
    • 5 Pages

    As it began to appear that the aviation industry’s economic status was starting to improve, the industry was faced with three more worldwide disasters; an increase in jet fuel prices, a declining economy, and Hurricane Katrina (Money.cnn.com, 2014). Airlines began making operational cuts in order to stay afloat financially and rise above their competition during this financial crisis (Money.cnn.com, 2014). Delta airlines cut seats on international and domestic flights and reduced and ended flights flying from “Cincinnati to London 's Gatwick Airport and Frankfurt” and “Atlanta and Detroit to Mexico City” (News, 2014). To remain competitive during this economic downfall Southwest Airlines, one of Delta’s competitors, cut non profitable flights, added fees, and continued to have airfare sales and promotions to gain new and keep old customers (News, 2014). This was a rough and unsteady period for the aviation industry.…

    • 1159 Words
    • 5 Pages
    Improved Essays
  • Improved Essays

    ( citation) In June of 1971, with only three Boeing 737 aircrafts, Southwest commenced providing service to the San Antonio, Houston and Dallas. Just 18 years later, Southwest gradually became a major airline with a revenue mark over a billion dollars. Over the course of 2 years in the early 90’s Southwest offered ticketless travel and created a website that launched “Home Gate” ( citation) During the years 2013 and 2014 Southwest transitioned into an International airline by providing flight services to Puerto Rico, Bahamas, Jamaica and Aruba. (…

    • 564 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    According to Elliot, Southwest is known for its customer service and higher prices, while Spirit is known for its low rates and poor customer service. This essay will discuss Elliot’s point of view on the subject and the evidence he uses to support his claims. In Elliot’s article, he suggests Southwest Airlines is the better of the two airlines. This is evident in the language that is used in “A Tale of Two Airlines.”…

    • 791 Words
    • 4 Pages
    Improved Essays
  • Decent Essays

    Successful firms intentionally align the three components of the IS strategy triangle. According to Pearlson & Saunders, collectively a firm's business, organizational, and IS strategy must be synchronized to carry out their business objectives (2013, p.24). In the case of Air Canada they took several unique approaches to align their strategy such as outsourcing, introducing innovative technology, organizational restructuring, and effective resource management. In particular, Air Canada understood that they must align their IS strategy triangle to remain a dominant competitor in the industry.…

    • 368 Words
    • 2 Pages
    Decent Essays
  • Improved Essays

    Southwest airlines are the eight largest airline around the globe (Tracy). Even though it is a very powerful and influential company they still have many competitors that that compete with on a daily basis. The biggest being America Airlines, Delta Airlines, United Continental Holding, Virgin America, and Jet Blue Airways. American Airlines is one of the country’s oldest airline company and subjectively Southwest biggest competitor. American Airlines are largest airline in the entire world according to it’s revenue, fleet size, and number of passengers, and it’s second in the number of destinations that they travel to around the world (Tracy).…

    • 1063 Words
    • 5 Pages
    Improved Essays
  • Improved Essays

    Primaries is the analysis of how Southwest Airlines company a competitive…

    • 976 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Southwest Airlines History

    • 1256 Words
    • 6 Pages

    Southwest During 1967 a gentleman who went by the name of Rollin King formed what we know as Southwest Airlines. This airlines began offering flights in Texas from Houston to Dallas, San Antonio to Dallas and vice versa. Other airlines such as Braniff International Airways and Texas International Airlines did not offer these short flights. In order to fly to Houston or Dallas someone would have to board a flight that is already coming from another state and exit when it landed.…

    • 1256 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    According to the J.D. Power 2017 North American Airline Satisfaction Study, Southwest Airlines ranked #1 in its segment for customer satisfaction (J.D. Power, 2017). It is also on the Forbes list of America’s Best Employers for 2017 (America’s Best Employers, n.d.). To achieve this success, Southwest Airlines has implemented effective managers and management policies. Specifically, they have reinforced their mission statement, implemented a strategic management plan, and created a positive organizational culture. The company has also incorporated an effective decision-making process, as well as adhered to the principles of ethics and uses human resources to develop personnel.…

    • 616 Words
    • 3 Pages
    Improved Essays
  • Great Essays

    Starbucks corporate-level strategies are the main factors that led to Starbucks success. According to Bradley (2016), “corporate level strategy is concerned with the strategic decisions a business makes that affect the entire organization. Financial performance, mergers and acquisitions, human resource management and the allocation of resources are considered part of corporate level strategy.” There are many strategies of Starbucks corporate level strategies, such as value Neutral strategy (Bradley, 2016).…

    • 1350 Words
    • 6 Pages
    Great Essays
  • Improved Essays

    FCL Case Study

    • 821 Words
    • 4 Pages

    “With global strategy, a business has operations in multiple countries with the same business-level strategy in each country” (Ahlstrom & Bruton, 2010, p.147). Based on this definition, FCL’s global strategy can rely on its current business model which contains various fundamental elements needed for global expansion. Like diversification in organic growth, the vertical integration of FCL increases corporate scope and capture more of the profits in a value network (Johnson et al., 2014). FCL plans vertical integration into travel operations through acquisition (Travel Bulletin, 2013).…

    • 821 Words
    • 4 Pages
    Improved Essays
  • Decent Essays

    When creating any product - no matter how great your product is- it is vital you have a marketing and business plan. I believe no business can or will succeed without a Mission, Objective, Budget, and Marketing Plan. I have witness several businesses from a variety of people fail or not succeed because they fail to develop a Marketing and Business Plan. Without the proper preparation for any business or any product they will face higher chances of lacking its full potential. In addition, there are so many other contributing factors to a business not being successful which includes but not limited to: not employing an accurate staff, paying of wages to staff as well a lack of training can have a negative influence on a business or product’s success.…

    • 717 Words
    • 3 Pages
    Decent Essays
  • Improved Essays

    Southwest’s mission statement was, “dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit” (Southwest, 1988). Though their great customer service didn’t stop there, when the Department of Transportation started ranking all airlines solely based on baggage handling, on time arrivals and customer service, Southwest out did its larger, more costly competitors to win the first “Triple Crown” for them in 1992. The “Triple Crown” award is given to an airline when an airline wins in three top categories. They kept winning them year after year. This was amazing for such a new airline, compared to the richer, bigger ones like American airlines or Delta who started in the 1930’s era and have had a big lead.…

    • 1430 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    4.0 The organization business strategy 4.1 Business level strategy of Zara Michael Porter also formulated a theory of how company can select a business level strategy. The organization must choose between two basic ways of increasing the value of an organization’s product which is differentiating the product to add value or lowering the costs of value creation. Based on Zara’s company the business level strategy is based on focusing both and differentiation cost leadership. Most important point of this strategy is to maintain balance between low cost and differentiated products.…

    • 858 Words
    • 4 Pages
    Improved Essays