It continues to be one of the lowest-cost airlines in its markets. Bigger airlines could not help but incur losses when tried to live up to its standards. SWA still operates at the lowest cost per available seat mile and this is around twenty five percent lower than its rivals. One big reason behind the lost costs is its enviable record when it comes to maintaining and using planes of the same time. They are and always have been Boeing 737s which has always helped them curb their operating expenses in the process. This was also substantiated by this realization on South West’s part that the planes can only earn money when they are in air, hence they focused on faster turnaround on the ground. Their on ground services became faster and rapid/ it has a turnaround time of twenty minutes or less while that of other companies is 1 hour. (Southwest Airlines)
They have also been unhindered and completely successful in rapidly turning around planes but post September 11; this could not be done without incurring expenses. As government added new security procedures and measures, longer check-in times, operating expenses rose up. Yet another plus point of Southwest is the team spirit with which it works. This is more so, because the company holds this belief that employees come before customers. It is reputed in the market for providing ample amount of information to its employees about southwest, its mission, its purpose, its history and it’ long term goal. It believes that information is power and tries its utmost to capitalize on this bountiful resource. (Connections on The South West Network)
Issues and Conclusion:
At the moment, SWA is providing service in at least fifty eight cities round the globe. Thus there exist innumerable opportunities for expansion all over. However there is a hitch. Competitors have now learned from Southwest and its unique management strategies. They are trying to implement the same tactics to woo and win over customers. SW has always believed in conservative growth tactics but this may bounce back provided that its rival competitors opt for faster growth strategies. Thus it is incumbent that southwest carefully chalks out a strategy which will help it meet any eventuality in near future. The best way out could be to develop a strategy that is a mixture of both conservative and fast growth strategies.
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