Case Analysis

Group D
Ali Asghar Poonawala, Syed Taha Owais, Mohib Umrao,
Mohammad Ibad Desmukh, Maisam Ali Shams, Jehanzeb
Hassan Khan, Minhaj Ahmed
Proposed Vision


Our vision is to be the Global Leader in flight
transportation, while providing highest value to our
customers at an affordable price

Mission: Focus on Employees
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.
We are committed to providing our employees a stable work
environment with equal opportunity for learning and personal growth.
Creativity and innovation are encouraged for improving the
effectiveness of Southwest Airlines.
Above all, employees will be provided the same concern, respect, and
caring attitude within the organization that they are expected to share
externally with every Southwest Customer.

Current Strategy
Low Cost, Low
Fare
High
Frequency
No Frills
Almost No
Interlining
No Hubs, No
International
Regional
Service HQ in
Texas
Point-to-Point
Short-Haul
Service
Management
Planning
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 Turnaround
Work Force
commitment and
flexibility
Differentiation: not just
low cost but better
service (on time, no
lost luggage, fewer
complaints)
Operational Simplicity Strong Culture
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 Field
Restrictions
Increased Regulation (noise)
Dependence on Domestic Markets
Competitors are adopting Southwest Airlines strategy
to win more customers.


Porters 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 present
markets through greater marketing efforts.
Market Development: Involves introducing present products or services into new geographic areas.
Continue Present
Strategy: limited
growth?
Expand
Geographically: Point
to Point, serve other
regions efficiently
Expand
Geographically, Major
Hubs
Remain Regional
through numerous
hubs
Recommendations
Geographic expansion to cities such as Atlanta and New York.
Flights to more cities both domestic and internationally.
For domestic expansion, Southwest should continue its
strategy of providing frequent, "point to point" flights
The expansion into new cities should be at a moderate pace to
ensure adequate coverage of new markets
Ideal new cities will allow for non-stop flights. As the range of
the aircraft expands, the potential markets will also expand

Recommendations
Southwest should embrace new technologies
New technology includes new aircraft (safer, longer range)
Technology will allow: reduced costs, expand to more markets,
and maintain image as a safe and reliable carrier
In the future, a fast growth strategy adopted by competitors
may hurt Southwest
Hence, Conservative growth strategy should now be converted
into fast growth opportunities
Expanding into new cities would be less costly than expanding
internationally


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 to create and
sustain internally derived competitive advantage.
Harmony among operating processes, organizational culture, and HR practices reinforce one
another in the creation and conversion of value.
Created through satisfaction of employee needs, converting to customer and shareholder value and
capturing as competitive advantage through lower costs and superior service (productivity)
Thank You