Southwest Airlines Case

September 24, 2009

The primary problem facing Southwest airlines is figuring out how to deal with the threat posed by the low cost offerings from United and Continental. The company must also find a way not to lose its “family feeling” despite its recent growth.  These problems are, to some extent, intertwined as finding a solution to the later problem can assist in the resolution of the former problem.  As the case study indicates, Southwest’s biggest asset is its people. They are what set it apart from the other airlines. So, if Southwest can keep its family atmosphere, which appears to play a big role in the performance of its employees, that can help facilitate its ability to remain successful in the face of this new competition.

Southwest looks to hire different kinds of employees than other airlines and these people are the ones who have made Southwest a success. They give the airline its quirky personality, they help ensure quick turnarounds and on-time departures, they represent the airline and help set it apart by providing good customer service with a sense of humor and style.  While Southwest’s hiring methodology is no doubt a big factor in why the airline is able to provide all around excellent service, the airline’s “family feeling” appears to play a big role here as well. This atmosphere makes employees feel more connected to the company and helps keep employee satisfaction high. Happy employees are productive employees and, as Southwest’s success shows, these employees put on their best face and provide excellent customer service and all around performance that keeps customers coming back to Southwest. 

United and Continental, however, appear to operate under very different workplace cultures from that at Southwest, which may present a significant obstacle to the success of these new ventures. As noted in the case study, complaints and doubts already seem to be surfacing amongst employees with regard to these new ventures.  If employees are unhappy with the changes and any salary or benefit sacrifices they may have to make, that will dampen their enthusiasm for the new venture and result in less satisfactory customer service. Thus, if Southwest can maintain its family atmosphere and keep employees engaged, happy, and providing excellent service, it will have a significant advantage over its new low cost competitors. The difficulty, however, is in figuring out how to maintain that “family feeling” while the company continues to grow.

Because of the increasing number of Southwest employees and the fact that many of these employees are scattered across the county, it will be difficult for Southwest to maintain its “family feeling” on a company wide basis. With that in mind, I would advise a change in emphasis towards maintaining that atmosphere using a station-by-station approach. Maintaining and nurturing this work environment should be a primary focus of each station manager.  For example, while it may be impossible for the CEO to regularly show up and log face time with the employees at each station; the station manager should step into this role and do his or her part to maintain the team approach that CEO Herb Kelleher has instilled. Likewise the station managers should organize team building activities and celebrations within their stations. If possible, it would be helpful to continue to allow employees to have interactions with the CEO as that seems to be something that has worked for Southwest in the past, but as the company grows that will become more and more difficult. I would recommend, however, that the CEO make time to visit each station at least once every few years and interact with the employees at the station. This will be especially important if there is ever a change in leadership at the top of the company, as it will allow employees to get to know the new boss and help maintain the atmosphere that Kelleher brought to the company. 

Maintaining the “family feeling” of the company with an eye towards maintaining Southwest’s excellent service reputation is, of course, only one piece of the puzzle, albeit an important one. People fly Southwest for a variety of reasons—because of their tendency to have on-time departures and arrivals, because of the efficient boarding process, because the seats may be more comfortable then competitors, and, of course, for cost reasons. But, as the case study illustrates, Southwest’s workforce and the attitudes that have been engendered in that workforce provide the airline with a big advantage over United and Continental when it comes to running a low cost carrier. Because the “family feeling” of the company appears to play such a big role in maintaining these attitudes, if Southwest can maintain that feeling as it continues to grow, Southwest will, in all likelihood, continue to succeed despite the entrance of United and Continental into the low cost carrier market.

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