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Southwest Airlines
             Case Analysis



                   Sandra Guzman
                     Lisa Ikkanda
                     Laura Lopez
                    Gerame Wong
              Dr. Chandler - MGMT 449
 Summer 2012, Tuesday, Wednesday, Thursday 8:00 a.m.
Problem
• What recommendations would we make to
  Southwest CEO Gary Kelley after the
  acquisition of AirTran for the Company to
  remain successful heading into 2011?
Recommendation 1
Building an Organization Capable of Good Strategy Execution

  • Choose a company strategy that best executes
    the goals and objectives of Southwest Airlines
    after comparing the strategies of AirTran and
    Southwest
  • Rationale: It is crucial to keep only one
    strategy to avoid decision making dilemma.
  • Objective: Strategy decision making will take
    3–5 years.
Recommendation 1
                  Execution
•   Step 1: Put together a talented management team.
•   Step 2: Allocate sufficient resources.
•   Step 3: Institute policies and procedures.
•   Step 4: Strategy needs to relate to Southwest culture.`
•   Step 5: Strategy needs to support Southwest
    organizational structure.
•   Step 6: Exercise strong leadership.
•   Step 7: Employee decision-making authority.
•   Step 8: Install information and operating systems.
•   Step 9: Tie rewards and incentives to the strategy.
Recommendation 2
           Managing Internal Operations

• Implement the best practice operational
  activities among AirTran and Southwest that
  will help Southwest maintain low-cost
  leadership and high employee and customer
  satisfaction.
• Rationale: Effective operational strategies will
  improve Southwest Airlines’ core competency
• Objective: Execute within 3 years after
  acquisition
Recommendation 2
                Execution
• Step 1: Measure effectiveness
• Step 2: Select the most effective (Voting Process)
• Step 3: Create and improve policies & procedures
• Step 4: Implement best practice operational
  activities
• Step 5: Re-evaluate effectiveness
Recommendation 3
        Corporate Culture and Leadership

• Integrate AirTran Company into the Southwest
  culture
• Rationale: Southwest is a more established
  airline and is the low-cost leader in the
  industry
• Objective: Focus on teaching AirTran
  employees about the culture within 3–5years
Recommendation 3
              Execution
• Step 1: Compare and contrast the core
  competency for both companies
• Step 2: Identify actions and behaviors for the
  new culture
• Step 3: Identify problems and find solutions
  about Company policies, operations, or
  management
• Step 4: Identify and execute visible and
  forceful actions
Figure 12.2 Steps to Take in Changing a
       Problem Culture (p. 406)
         Compare and contrast the core competency of both companies
Step 1   Compare and contrast effective strategies and key success factors
         for both companies

         Keep employee morale high
Step 2   Provide excellent customer service
         Be the industry leader of low-fares

         Employee feedback through blog (Nuts about Southwest) and
Step 3   annual surveys


Step 4   Substantive: Attend Southwest’s University for People
         Symbolic: Hold ceremonial events (annual awards banquets)
Culture of Southwest
Warrior Spirit       A Servant’s Heart            Fun-LUVing Attitude
• Work Hard          • Follow The Golden Rule     • Have FUN
• Desire to be the   • Adhere to the Principles   • Don’t take yourself
  best               • Treat others with            too seriously
• Be courageous        respect                    • Maintain
• Display urgency    • Put others first             perspective
• Persevere          • Be egalitarian             • Celebrate successes
• Innovate           • Demonstrate proactive      • Enjoy your work
                     • Customer Service           • Be a passionate
                     • Embrace the SWA              Teamplayer
                       Family
Culture of AirTran
Our Guiding Principles      Our Values
•   Safety                  • A total commitment to safety
•   Courtesy                • Compliance with regulatory
•   Pride                     standards
•   Teamwork                • Technical excellence and
•   Innovation                continuous learning
•   Cleanliness             • Honesty, trust and integrity
•   Anticipation            • Respectful responsibility for
                              resolving issues
•   Results
                            • Acting with purpose and urgency
                            • Hard work
                            • Fun
                            • Profit

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Southwest Airline Case Analysis Wiki

  • 1. Southwest Airlines Case Analysis Sandra Guzman Lisa Ikkanda Laura Lopez Gerame Wong Dr. Chandler - MGMT 449 Summer 2012, Tuesday, Wednesday, Thursday 8:00 a.m.
  • 2. Problem • What recommendations would we make to Southwest CEO Gary Kelley after the acquisition of AirTran for the Company to remain successful heading into 2011?
  • 3. Recommendation 1 Building an Organization Capable of Good Strategy Execution • Choose a company strategy that best executes the goals and objectives of Southwest Airlines after comparing the strategies of AirTran and Southwest • Rationale: It is crucial to keep only one strategy to avoid decision making dilemma. • Objective: Strategy decision making will take 3–5 years.
  • 4. Recommendation 1 Execution • Step 1: Put together a talented management team. • Step 2: Allocate sufficient resources. • Step 3: Institute policies and procedures. • Step 4: Strategy needs to relate to Southwest culture.` • Step 5: Strategy needs to support Southwest organizational structure. • Step 6: Exercise strong leadership. • Step 7: Employee decision-making authority. • Step 8: Install information and operating systems. • Step 9: Tie rewards and incentives to the strategy.
  • 5. Recommendation 2 Managing Internal Operations • Implement the best practice operational activities among AirTran and Southwest that will help Southwest maintain low-cost leadership and high employee and customer satisfaction. • Rationale: Effective operational strategies will improve Southwest Airlines’ core competency • Objective: Execute within 3 years after acquisition
  • 6. Recommendation 2 Execution • Step 1: Measure effectiveness • Step 2: Select the most effective (Voting Process) • Step 3: Create and improve policies & procedures • Step 4: Implement best practice operational activities • Step 5: Re-evaluate effectiveness
  • 7. Recommendation 3 Corporate Culture and Leadership • Integrate AirTran Company into the Southwest culture • Rationale: Southwest is a more established airline and is the low-cost leader in the industry • Objective: Focus on teaching AirTran employees about the culture within 3–5years
  • 8. Recommendation 3 Execution • Step 1: Compare and contrast the core competency for both companies • Step 2: Identify actions and behaviors for the new culture • Step 3: Identify problems and find solutions about Company policies, operations, or management • Step 4: Identify and execute visible and forceful actions
  • 9. Figure 12.2 Steps to Take in Changing a Problem Culture (p. 406) Compare and contrast the core competency of both companies Step 1 Compare and contrast effective strategies and key success factors for both companies Keep employee morale high Step 2 Provide excellent customer service Be the industry leader of low-fares Employee feedback through blog (Nuts about Southwest) and Step 3 annual surveys Step 4 Substantive: Attend Southwest’s University for People Symbolic: Hold ceremonial events (annual awards banquets)
  • 10. Culture of Southwest Warrior Spirit A Servant’s Heart Fun-LUVing Attitude • Work Hard • Follow The Golden Rule • Have FUN • Desire to be the • Adhere to the Principles • Don’t take yourself best • Treat others with too seriously • Be courageous respect • Maintain • Display urgency • Put others first perspective • Persevere • Be egalitarian • Celebrate successes • Innovate • Demonstrate proactive • Enjoy your work • Customer Service • Be a passionate • Embrace the SWA Teamplayer Family
  • 11. Culture of AirTran Our Guiding Principles Our Values • Safety • A total commitment to safety • Courtesy • Compliance with regulatory • Pride standards • Teamwork • Technical excellence and • Innovation continuous learning • Cleanliness • Honesty, trust and integrity • Anticipation • Respectful responsibility for resolving issues • Results • Acting with purpose and urgency • Hard work • Fun • Profit