Culture and Strategy at Southwest Airlines*

            


Details

Case Code : CLBS035
Publication date : 2004
Subject : Business Strategy
Industry : Aviation
Length : 03 Pages
Price : Rs. 50

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Key words:

Southwest Airlines, September, 11, 2001 crisis, layoffs, culture, Herbert D. Kelleher, hub-and-spoke, point-to-point.


* This caselet is intended for use only in class discussions.
** More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US $16) per copy.

 


Abstract: ICMR India ICMR India ICMR India ICMR India RSS Feed

The caselet looks into the impact of the September 11, 2001 terrorist attacks in the US aviation industry in general and Southwest Airlines in particular. The ways in which Southwest airlines tried to mitigate the problems that the downturn in the industry had created forms part of the caselet. The caselet also delves into the role played by senior management to maintain the morale of the employees at the organization.

Issues:

 » The impact of September 11, 2001 crisis on the aviation industry.
 » The role of organization culture in increasing the efficiency of the company.
 » The role of leadership in building trust among the employees.

Introduction

After the September 11, 2001 terrorist attacks, Southwest Airlines (Southwest) and the entire airline industry in the US faced devastating losses. To reduce their losses, airlines in the US cut the number of flights by 20% and laid off 16% of their workforces in the weeks following the attacks.


However, Southwest avoided layoffs altogether and stuck to its mission of caring for its employees. It was felt that avoiding layoffs in the face of a dramatic decline in demand would jeopardize Southwest’s short-term prospects. However, Southwest was willing to suffer damage even to its stock prices, to protect the jobs of its people. Southwest’s no-layoff response to September 11 was a reminder to its employees of the organization’s tradition of caring for its people....

Questions for Discussion:

1. Southwest demonstrated tremendous commitment towards its employees. Explain how Southwest demonstrated this commitment towards its employees?

2. Southwest’s objective was to provide safe, reliable and short duration air service at the lowest possible fare. Describe briefly, how it met its objective?