Southwest Airlines In 2016

Culture, Values and Operating Practices

Prepared by :
1. Ricky Imanda 17/421942/PEK/23519
2. Alfianita Dewi S 17/421848/PEK/23425
Content
I. Company Background
II. Herb Keller : The CEO who
transformed southwest into a major
airline
III. Executive leadership at southwest : 2001-
2016
IV. Southwest Airlines Strategy in 2016
V. Southwest’s people Management Practise
and Culture
VI. Cast Highlight
VII. Conclusion & Recommendation
I. Company
Background
1971

Dallas City

3 cities

4 airplane
I. Company Background
.
The Vision of
Southwest Airlines :
“Become the world’s most
loved, most flown, and most
profitable airline.”
The Mision of
Southwest Airlines :
“Is dedication to the highest
quality of customer service
delivered with a sense of
warmth, friendliness,
individual pride, and company
spirit”
The Value of
Southwest Airlines :
LUV grew into Southwest’s code
word for treating individuals
employees and customers with
dignity and respect and
demonstrating a caring, loving
attitude.
FUN occurred throughout the
company in the form of the
generally entertaining behavior of
employees in performing their
jobs, the ongoing pranks and jokes,
and frequent company-sponsored
parties and celebrations.
II. Herb Keller : The CEO who transformer
southwest into a major airline
TRANSACTIONAL LEADER

Herb • Constantly interaction with

Keller
employees
• Relaxed management style

1981
• Use contingent rewards to
motivate employees
• He puts himself on the same
level of other employees

“You have to treat your employees like your costumers.

When you treat them right, then they will treat your
outside costumers right”
III. Executive leadership at southwest :
2001-2016
James Parker CEO [2001-2004]
Personality : Honest, good sense of
humor, Straight Arrow
3 financial strategy
1 2
Colleen Barrett, SWA President [2001-
2008]
Principal : to ensure the employee felt good
on what they’re doing and felt empowered
The first women appointed as a CEO
Gary C. Kelly CEO [2004-Present]
Key Success:
1. Hire great people and treat them like
family
2. Care for the customers warmly
3. Keep fares and operating cost lower than
competitor
4. Prepared for bad times with strong
5 Objective Strategy of Garry C
1. Be the best place to work
2. Be the safest and more efficient airline
3. Offer customers a convenient flight
schedule
4. Give the best over all travel experience
5. Do all of the things is an effective way
to maintain the low cost
IV. Southwest Airlines Strategy in 2016

Create and Integrating, Marketing,

Controlled,
Fare sustain a Make it Fun Modernizati Advertising,
Business Sollid
Structure low cost to fly on on, New and
consisted growth for
STrategy operating southwest reservation promotion
the airline
structure system strategies
V. Southwest’s people Management Practise and Culture
Operative principle Gary Kelly
“Employees come first and customer come second" “Our people are our single greatest strength and our
(Keep employees happy then they will keep customer most enduring long term competitive advantage”
happy)

Personal Traits, Attitudes and Behaviors

V. Southwest’s people Management Practise
and Culture
“Now There’s Somebody Else Up There Who
Loves You”

Airport: Dallas Love

Field
Drinks: Love Potion
Route: Love
Triangle
Peanuts: Love Bites

Planes: Love Birds

Coupon: Love Ticket

V. Southwest’s people Management Practise and Culture

Culture-building Efforts
• Southwest executives believed that the company’s
growth was primarily a function of the rate at which it
could hire and train people to fit into its culture.

• Southwest’s monthly employee newsletter often

spotlighted the experiences and deeds of particular
employees, reprinted letters of praise from
customers, and reported company celebrations of
milestones.
VI. Case Highlight SWOT analysis
VI. Case Highlight

five generic competitive strategies Southwest Airline = Focused low cost

Create and sustain a low cost operating structure

VI. Case Highlight
Substitutes
Train & Bus )

LOW

Porter’s 5
Rivalry among Competing
forces Suppliers US Airways, Delta, United Airlines, Customers
(nacks, Fuel, Beverages
Analysis American Airlines (High) Low Cost

LOW LOW MEDIUM

Porter’s 5 Forces Potential New Entrans

Ticket Online, Ding!
 VII. Conclusion
 "It's part of our culture. We've always said we'll do whatever we can to take care of our people.
That's what we've tried to do.“
 Southwest Airlines Coroporation uses a cost-cum differentiation strategy, where Southwest
Airlines has the lowest operating cost structure in the domestic aviation industry, because of its
short flight routes and minimal recruitment costs.
 In addition, Southwest Airlines Corporation does not serve seating reservations and does not
use crowded airports. The pilots were recruited from those who were not included in the
national trade unions and their contracts were flexible as needed.
 To expand the market, Southwest can open new flight routes over long distances. Southwest
Airlines can conduct cost analysis so that it can offer long-haul flight routes at lower prices than
its competitors. However, Southwest also must continue to focus on short distance flights.
VII. Recommendations
• increase the number of existing aircraft, companies will be able to
improve services and facilities from their plane
• Installation and using new information systems and software
programs will enables companies to encourage internal
communication and more effective external
• Offering enhanced accessibility and minimizing delays.
• Expand to new territories and international flight
• Improve in-flight facilities, first class
TERIMA KASIH