A Case Study

Presented by:
Adarsh | Divij | Abhishek | Chhavi | Mani

 Worlds largest
Established in

low cost carrier

1967, it is headquartered in Dallas, Texas

Make Love. Not War. had become its theme called as

Love

Airline

Has LUV as its stock ticker symbol as well!

The Southwest Model

Use nonconventio
nal
models for
low cost

Have fun
together

Treat
employee
s as
family

Controlled
solid
growth

Hire
people
who form
the fit

Involve
employee
s

Strategies
Arenas
Vehicles
Differentiatio
n
Staging
Economic
Logic

Strategies
Arenas
Vehicles
Differentiatio
n
Staging
Economic
Logic

Arenas
SW airlines has always focused
on the domestic airline market
of the US with complete focus on
being efficient and a leader in the
short haul flight markets. Also,
it targeted margin expansion as
one of its goals in 1997.
Its mission includes dedication to
the highest quality of Customer
Service at reasonable prices.

Strategies
Arenas
Vehicles
Differentiatio
n
Staging
Economic
Logic

Vehicles
Several means to attain the
objectives
Less travel agency exposure
less commission.
Emphasis on less crowded
secondary
airports
allowing
easier expansion.
Brilliant labor relations of the
company.
A
Positively
Outrageous
Service(POS)
strategy
for
providing top quality service.
Identifying target markets and
dominating the ones having high
population densities.

Strategies
Arenas
Vehicles
Differentiation
Staging
Economic
Logic

Differentiation
Being the best as far as price,
convenience and service to
customers are concerned.
Placing special emphasis on
employee relations , training
employees
and
a
rigorous
selection process(less than 5%
selection rate) ensures that they
always get the best employees
who replicate the good behavior
as
they
receive
from
the
organization.

Strategies
Arenas
Vehicles
Differentiatio
n
Staging
Economic
Logic

Staging
SW is not a company which has
emphasized growth as its major
objective(a go-slow philosophy)
and makes it a point to not enter
markets unless it perceives
favorable conditions(which range
from
wishes
of
the
local
community to the availability of
an appropriate labor supply).

Strategies
Arenas
Vehicles
Differentiatio
n
Staging
Economic Logic

Economic Logic
SW airlines has always been
categorized as a Low Fare/No
Frills airline, while still providing
its customers with a high level of
convenience and service. Also, it
widens its markets by attracting
large number of patrons who
relied on ground transportation
and also targeting markets in
which it had a clear competitive
advantage, all of which led to the
airlines having a return of over
21,000% compounded annually
for the 20-year period between
1972 and 1992.

Strengths
Point-to-point service strategy increases
revenues
Strong fleet base enhances ability to deliver
effective service
Integration of AirTran's network and
operations to enhance growth prospects

Weakness
Heavy dependence on passenger revenues
could increase risk
Lawsuits and litigations could adversely
affect operating results
Dependent on single aircraft and engine
supplier could impact the operations

Opportunities
Network expansion initiatives to create a
positive impact on topline performance
Positive outlook for the global tourism
industry
Favourable outlook of global air freight
market could help to grow sales and profit

Threats
Intense competition could negatively impact
margins
Stringent government regulation could
increase operating costs
Consolidation in the airline industry may
impact business performance

Thank You