Operations Management in Southwest Airlines

Introduction Southwest Airlines was founded in 1976 and has its base at Dallas. The company has grown so much since its inception (Lee and Maxton, 2000). It is now serving fifty-nine airports and has three hundred and eighty one planes in operation. This expansion is ongoing and it is expected to grow further (Oldham, 1996). Southwest Airlines is well known for its number of offers and its uniqueness among other known airlines.Advertising We will write a custom report sample on Operations Management in Southwest Airlines specifically for you for only $16.05 $11/page Learn More These offers include the lowest fares among other airlines, its low costs, having the best labor relations, the level of asset usage that surpasses the rest and paying the highest wages to its staff. It seems to offer the best in everything! To some, the success of the company may be thought to have come from some malpractice from the side of management but in the contrary, everyth ing practiced there is legit. These are among the strategies that the airline has employed in order to achieve its success. It has also targeted and concentrated on markets that have been disregarded by other airlines as being unimportant. This paper will analyze the service delivery (and manufacturing process), identify what should be done to improve these processes and discuss the reasons why the Southwest Airlines is successful (Compart, 2009). Service delivery and manufacturing process One thing Southwest Airlines is known for in terms of service delivery is its very low fares. This has been made possible by the fact that the airline has targeted the middle-sized airports and hence experiences less competition. Less congestion in the airport also implies that service is fast. This helps eliminating queuing for services hence customer satisfaction (Blanco and Shimoda, 2005). The airline offers fares at competitive rates, provides swift and efficient service and hence encourages t ravelers to shift from other modes of transport including trains and vehicles to using air travel. This has led to the success of the airline in increasing the numbers of its passengers, which is one of the goals of the company. The company respects the customer’s choice and a passenger is allowed to leave the airport when they so desire. They operate more like buses. The passengers get to choose what time to leave and it is not the airline’s choice. This makes it very reliable and flexible and hence a choice for many.Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Another aspect that makes the services attractive is the fact that the hustle of getting ticket reservation and collection is eliminated. People only need to swipe their cards at a dispenser and it takes only about twenty seconds before they are good to go. Another advantage of boarding the Southwest Airlines is t hat there are no connection flights. This also means that there is no need to transfer baggage. This eliminates the hustles and bustles associated with other airlines. The airline has clearly defined its niche as being the commuters since such people usually need to go places for particular reasons and need to do so as quick as possible and with the least distractions as possible. Reasons for company’s success One of the reasons for the success of Southwest Airlines can be attributed to its great management, courtesy of its president and founder, Herb Kelleher. This leader has been very inspirational and has influenced the company by maintaining a good working environment. He also created strong and lasting culture at the workplace. The other reason for its success is the fact that the activities in the company, since inception, have been based on some specific success principles. The airline also readily embraces change but at the same time, tries to avoid change in order to avoid some risks. Some of its basic strategies employed when the company is considering change include those that specifically touch on either cutting its costs or increasing the number of its passengers. Among its strategies in fighting off competition with other big airlines is the employment of what may be referred to as a guerilla war. This involves being anywhere but where the other airlines are. This is the reason why the airline is situated far from where the other airlines are. This included targeting airports and routes that were avoided by other airlines. They stayed apart and maintained routes located far from the overused airports. The airports mainly targeted by the airlines include the middle-sized ones.Advertising We will write a custom report sample on Operations Management in Southwest Airlines specifically for you for only $16.05 $11/page Learn More This strategy of choosing mid-sized airports means that the airline faces less competi tion in terms of fares, faces less traffic and less congestion. With these conditions, the airline can easily compete with the other airlines by offering faster service and lower prices compared to the rest. Most of the flights by the company are short distance flights, which is avoided by other airlines. However, this strategy has worked for the airline since – in most of the airports it operates – it is the airlines with the largest number of passengers. Southwest Airlines has been identified for having the ability to enter a market and making it very profitable (Kaiser, 1997; Maxton, 1996). One example is given of a case where the airline established a new route between Oakland and Burbank in order to avoid other existing busy and congested routes (Mutzabaugh, 2011). Using its cheap fares, it was able to attract many passengers and made the route the 21st busiest, rising from the previous 200th position. Southwest Airlines has been regarded as not only competing wit h the airlines but with all other modes of transport including road and rail since they offer short trip flights (short-haul commuting). Another strategy employed by the airlines to ensure its success is the lack of a central base. There is no particular center of operations and its routes form a kind of a network that resembles a spider web. This way, the airline avoids the risks of being vulnerable to competition and consequently losing market. Southwest Airlines avoids several costs incurred by other airlines. One of them is the cost of selling tickets through agents since there is the payment of agents’ commissions. Another is the avoiding of costs incurred with the installation of computerized systems required to process reservations and other customer services.Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More To cut down on costs incurred in maintenance of aircrafts, Southwest Airlines invested on only one type of aircraft. This is the Boeing 737. This ensures the maintenance practices are made standard (Ivanovich, 2008). The airline also works with new aircraft rather than maintain old fleet that is not fuel-efficient (Lunsford, 2008; Koenig, 2005). Kelleher, the founder, has contributed a lot to the success of the company by leading by example. He has practiced the art of employee motivation and made the working environment conducive. When an employee works over time, Kelleher goes there in person to thank him or her. This way, he maintains good relationships with the employees. Once in a while, he goes and works with the employees, serving drinks, moving baggage and selling tickets in order to lead by example instead of leading by direction. Another aspect that the company employs in order to be successful is the involvement of the customers. The customers are allowed to give feedback about the services and this helps the company to make adjustments where needed. Both the manager and the employers make a point of interacting with the clients at a more personal way and the staff members are often known by their first names by the customers. This allows them to report about their likes and dislikes about the staff and this gives the company good grounds on dealing with any form of misconduct. Thousands of letters stream into the company’s office every month and the company takes every issue very seriously and answers all of them (Sartain, 1998). What should be done to improve the services Too much has been done by the company already and that explains why it is very successful. It has exploited every aspect of service delivery and has succeeded in making an impact both within and without the company. I would only recommend that the company with the same team spirit and hard work. Conclusion Southwest Airlines is a company that has grown over the many years and has been one of the most successful airlines around. This success has been attributed to many factors, some of them including the good management, good working conditions and good working principles. The customer service is amazing and this has led many customers to choose Southwest Airlines. References Blanco, C Shimoda, N 2005. Airlines hedging strategies: The shareholder value perspective. Pearson Prentice Hall, Upper Saddle River, NJ. Compart, A 2009. Southwest offers $170 Million for frontiers, The McGraw-Hill, New York. Ivanovich, D 2008. ‘Inspector: Southwest’s FAA ties let planes fly with cracks’, Houston Chronicles, vol. 2, no. 1, pp. 12-15. Kaiser, R 1997. ‘Southwest may add cities to Iceland deal’, Baltimore Business Journal, vol. 15, no.1, p 131. Koenig, D 2005. ‘Airlines that hedged against fuel costs reap benefits’, The Washington Post, 21 October, p. 3. Lee, C Maxton, T 2000. ‘Southwest to announce expansion at the Love Fields $72 million project would add jobs, but no more flights’, The Dallas Morning News, 13 March, p.2. Lunsford, J 2008. ‘Airlines dip into hot water to save jet fuel’, Wall Street Journal, vol. 4, no. 3, pp 102-107. Maxton, T 1996. ‘Council OKs Southwest land lease Headquarters addition, training center planned’, The Dallas Morning News, 14 March, p. 4. Mutzabaugh, B 2011. ‘Oakland gets Mexico City nonstop on Volaris’, USA Today, 22 August, p.1. Oldham, J 1996. ‘Southwest Airlines expands its corporate headquarters to prepare for the next century’, Business Wire, 11 December, p.7. Sartain, L 1998. ‘Why and how Southwest Airlines uses consultants’, Journal of Management consulting, vol.21, no.3, pp.10-16. This report on Operations Management in Southwest Airlines was written and submitted by user Kayden Roth to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.