Southwest Airline Corporation Essay

1057 words - 5 pages

Chapter 3
Case Analysis of Management Control System
Southwest Airlines Corporation
Southwest Airlines actually could hit the company goal on achieving profitability for consecutive 32 times which is really good compared to others airlines corporations. The company could offer low cost fares to its customer mostly through website and also provides point to point flight majoring on short haul and medium flight. Besides, to ensure the organization reach company goals, the company put more effort on creating comfortable environment and culture for its employees. The company strategy is align with Anthony and Govindarajan (2005) statement about good management control system that is created ...view middle of the document...

Thus, it creates in low efficient process and customer satisfaction. Moreover, if company use congested airport, it will increase fuel consumption because of the queuing delay.
Use point-to-point flight. Southwest uses point to point flight in which the plane travels directly to the destination. This way will reduce additional congestion charge because the airlines could bypass hubs (especially congested airports) and operates hubs more efficiently. In addition, plane will use less crew because it bypass hub. Thus, it results in more efficient cost and time management. From the customer point of view, this action offers non-stop flight, gives more choice and flexibility, and also reduces travelling time.
Set up online booking system. About 60% of passenger revenue is come from online booking system from southwest.com. This strategy is relatively cheaper than set up new booking office because it could cut employee, building, and land investment.
Moreover, in the Internet era, online booking is faster method so the customers can book the ticket everywhere and whenever they want. To push customer buy from the online booking system southwest make more interesting application such as mobile site application for booking and Ding!, a desktop application that provided exclusive deals. This system may attract more and more customer to book from Internet and make conventional booking system from the office not becoming the priority. However, conventional booking office still important in case the Internet is down but not that much. Overall this strategy could minimize operational cost in order to achieve company low cost strategy.
The pilots not belong to national union. This strategy consideration may because of the low cost strategy implementation. By choosing low cost strategy, company should sell more seats to increase profitability. However, if company choose to put the pilot belong to the union, their pilot will have limited hours to fly. So this strategy could make the pilot to fly far more hours than pilots at other airline so it is mean more flight and seat available. As the compensation, the airlines give more salary to the employee. And the salary based on the trip.
Furthermore, company uses good management control system toward employee in order to set goal congruence between company goal and employee goal as Anthony and Govindarajan stated in the book. Several management systems done by company to reach organization maximum...

Other Papers Like Southwest Airline Corporation

Accounting Essay

3425 words - 14 pages Southwest Airlines Kaushal Desai Vaishali Patel Debra Quach Introduction Although the airline industry is no longer experiencing the rapid growth it exhibited before 1990; commercial air travel in the U.S. remains the preferred method of transportation for a majority of Americans due to cost-effectiveness and timesaving characteristics. From 1980 to 1990 the number of passengers traveling by air increased by approximately 72%, in contrast

Southwest Essay

4955 words - 20 pages ……………………………………………………………………....19 Southwest Airlines Southwest is an airline that was incorporated in Texas on June 8th, 1971. The company began their venture with three 737 aircrafts. In the beginning they only serviced three cities; Houston, Dallas and San Antonio. Today they have incorporated just over 550 Boeing 737s and provide services to 72 different cities. Southwest became a major airline in 1989 after exceeding the billion-dollar in revenue mark

Analysis of the Airlines Industry

2557 words - 11 pages . The strategic group that is best positioned in the airline industry is Delta Air Lines Corp. and United Continental. Their strategic grouping indicates that they are strong rivals. Both firms are high-cost providers and have national geographic coverage. This strategic positioning allows these companies to gain a greater market share, leading to increased profitability. The strategic groups that are worst positioned are Southwest airlines

Boeing Leadership and Management

2344 words - 10 pages service possible to their customers. A major way that they are implementing the best customer service possible is their continuance of lower airfares. Lower airfares help to attract customers to their airline. Southwest Airlines tries to set themselves apart from the other airlines. One way they set themselves apart from other airlines is to allow two check- in bags for free.   The only stipulation is that the bags are no larger than fifty pounds

Leading by Example at Soutwest Airlines

1266 words - 6 pages be effective motivators. According to Robbins and Judge (2007) the expectancy theory argues that a tendency to act depends on expectations of the outcome and the attractiveness on that outcome. This falls in line with the “work-hard play-hard” philosophy at Southwest. Work hard and have fun while doing it. Gain personal satisfaction from a job well done. Professionalism of the corporation transfers to customer satisfaction. Company maintains its

Benchmarking: A Quantitative And Qualitative Look At Southwest Airlines And British Airways

5333 words - 22 pages British Airways have formed "Oneworld Alliance," a global marketing campaign. According to Media Week, a leading advertising industry magazine, Oneworld's campaign is the best in the world. "The magazine named the airline alliance's global campaign, featuring the customer-focused message 'Oneworld revolves around you,' as the 'Best International Campaign' for 1999" (American Marketing Research Corporation, 1999). This ability to work with

Coca Cola

4894 words - 20 pages 2006, but a substantial disproportionate rise in net income. There was a strong revenue growth in 2006, excellent cost controls despite 50% increase in hedged jet fuel prices/gallon; Revenue trends also softened in August due to the London terrorist threat and related carry- on baggage restrictions (Southwest Annual Report 2006). In 2003, the Iraq War coupled by a weak economy drove high energy costs and terrorism related concerns for airline

Assignment 4

1714 words - 7 pages as snacks player, acquisition of additional snacks brands would probably be needed for increasing their portfolio. For the corporation that does not operate internationally, propose one business-level strategy and one corporate-level strategy that you would suggest the corporation consider. Justify your proposals. With 41 years of service, Southwest Airlines Co. (Southwest), a low-fare major domestic airline, continues to differentiate itself

Delta Sirlines and Singapore Airlines

1634 words - 7 pages aircraft to 15% from 10%. Following suit were Delta Air Lines, Inc. (“DAL”) and America West Holdings Corporation (“AWA”) during 1998 and Southwest Airlines Company (“LUV”), AMR Corporation (“AMR”), and UAL Corporation (“UAL”) during 1999, while Alaska Airgroup Inc. (“ALK”), Northwest Airlines Corporation (“NWAC”), Trans World Airlines, Inc. (“TWA”), and US Airways Group, Inc. (“U”) have all apparently made no recent changes in their policies. CFRA

Southwest Airlines

1353 words - 6 pages | 2012 | | Southwest Airlines Megan Wilson | [The Future of Southwest airlines] | Good Evening board members and staff, I am Megan Wilson, the Chief Executive Officer (CEO) of your company, Southwest Airlines. We have gathered here this evening to take a look at the current position of our company, how we are measuring up to our competition, and what I am proposing we do to continue our success within our future. First I will start

Aa Executive Summary

1672 words - 7 pages ............................................................................................................................................................... 5 References ............................................................................................................................................................. 6 1 Introduction AMR Corporation (AMR), incorporated in October 1982, operates in the airline industry. The Company’s principal subsidiary is American Airlines, Inc. (AA). AA provides scheduled jet service to

Related Essays

Southwest Airlines Essay

741 words - 3 pages Introduction:Southwest Airlines Corporation was incorporated in Texas in 1971 with only three Boeing 737 aircraft's and gradually expanded to 417 Boeing 737 jets that drive the company to success. Southwest provides services to 60 airports in 31 states throughout the United States competing with airlines such as United, American, Delta and JetBlue. Southwest Airlines prides themselves as the nation's low-fare and high customer satisfaction

I Don't Know Essay

1303 words - 6 pages no. 2-0012 Southwest Airlines Corporation In 2001, Southwest Airlines Corporation’s (Southwest) year-end results marked 29 consecutive years of profitability. Southwest, which was incorporated in Texas, commenced customer service on June 18, 1971, with three Boeing 737 aircraft serving three Texas cities: Dallas, Houston, and San Antonio. The company grew to become the fourth largest U.S. airline (in terms of domestic customers carried). In

Southwest Airlines Case Study

830 words - 4 pages MBA 610 Case Study: Southwest Airlines Corporation 1. Southwest Airlines Corporation is an extremely popular and profitable company due to their strategy of being the nations’ low-fare, high customer satisfaction airline. Southwest is able to offer the nation’s lowest fares due in part to their low operating-cost structure, the lowest in the domestic airline industry. This low operating-cost structure (refer to Exhibit 1 for 5 year financial

Southwest Airlines Essay

2899 words - 12 pages United| |States. Although the industry suffered a major blow from the terrorist attack of September 11th, the company is still holding | |strong; while other airline companies are in debt. The information was majority gathered and analyzed from the internet; sources| |such as "News Week," and "Wall Street Journal." According to the acquired knowledge of Southwest, the company maintains steady | |sales. The major success to their continued