Strategy Formulation

SOUTHWEST AIRLINES

Company Profile

Southwest Airlines Co. ("Southwest") is a major domestic airline that provides primarily short haul, high-frequency, point-to-point, low-fare service. Southwest was incorporated in Texas and commenced Customer Service on June 18, 1971 with three Boeing 737 aircraft serving three Texas cities - Dallas, Houston, and San Antonio. Today Southwest operates over 400 Boeing 737 aircraft in 62 cities. Southwest has the lowest operating cost structure in the domestic airline industry and consistently offers the lowest and simplest fares. Southwest also has one of the best overall Customer Service records.

Overview:

Strategic overview encompasses the vision, mission, core values and the overall objectives the organization seeks to achieve. Leaders who learn how to use the strategic overview of the company effectively can draw on it to build and boost morale, attract committed employees and get people to go beyond themselves to contribute to something bigger than themselves. It is a powerful tool that when well articulated, orchestrated and implemented, can help make management easy.

Mission, Vision and Values

The vision, mission and core values together define the foundations of the organization’s culture and help with internal relationships as well as behaviour. They also provide a framework to judge the organization’s trustworthiness. When the organization structure and functional relations are defined, it becomes possible to predict the organization’s cultural framework. For a start-up, defining this framework is important because it determines the organization’s ability to attract, retain and grow people who contribute to its growth and success.

Southwest Airlines has been able to do this since Herb Kelleher, one of its founders, decided to build a flat organization, where rank was no excuse for not delivering exceptional customer service. Thus, unlike most other unionized airlines, it is not surprising to see a Southwest Airlines’ pilot picking up customers’ baggage to