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Southwest Managing People Analysis

1741 words - 7 pages

1. Airline Industry

According to most of the airline companies, labor is the second cost behind fuel in the airline budgets . The companies have to pay pilots and flight attendants, but also most of the employees on ground such as baggage handlers, customer service, dispatchers and others. In other words, labor in airlines companies includes and brings together completely different jobs with different skills needed from loading luggage to repairing aircrafts.

545’000 people are employed by 100 U.S airline companies. We can define four main groups of workers. Airline flight operations combine pilots, who earn the highest salary in the industry, and dispatchers who work hand-in-hand with ...view middle of the document...

If carrier’s pilots, mechanics, flight attendants or other work groups decide to go on strike, it shut down the whole process and cancel all operations in the industry. As transport services cannot be shifted or stored in time, everything is lost and will caused important cost to the company. Due to high costs of strikes, it is rare that it occurs. But the menace of strike allows unions to capture wage gains for the representatives.

Southwest Airlines is unique in its industry in term of human and labor relation. First of all, it is the only airline present in the top 100 of the best corporate citizens in the U.S. and, moreover is a low-cost company; which is even more difficult to have good relationship with the employees. To show how the company takes care of its employees, after the 11 September 2001 attack, passenger traffic drastically decreased and most of the airline companies started to lay-off personnel; but Southwest people were willing to take pay cuts to avoid laid-off. Subsequently, no employees were fired due to this decrease.

2. Southwest History

Southwest Airlines is a major U.S. airline based in Dallas, Texas. It is the world biggest low-cost carrier and has the largest commercial fleet in the world with 696 aircrafts. The company employs 46’000 people. As a low-cost airline, it operated with one single type of aircraft (Boeing 737s), which facilitated the logistic and reduce costs related to facilities needed for the different types of aircrafts on the ground. It was founded in 1967 and started to operate 4 years later. The company is traded through the New York Stock Exchange and is for the 40th consecutive year profitable at the end of the year.

The company received many different distinctions and rewards such as eco-friendly recognition and top ranked in the best corporate citizen organizations. It is the best-ranked airlines in the best corporate citizens. The company also received a lot of price for its customer service sector. Compared to the industry average in terms of labor unions (almost 50%), the company is about 80% unionized.

The company set some special vocabulary on its mission statement and objectives in order to give the employees a sense of belonging to the company and help to clearly identify themselves to the company. For example, the company talks about the basic “Golden Rule” which means that consumers and employees are treated the way they want to be treated. Another concept in which the whole process of human relation relies on is “Live the Southwest Way”. This concept defines specific behaviors to adopt in order to have a safe, profitable and fun place to work.

The official website of the company is sharing a report about the company’s missions and actions and one of the three main topics of this report is “People”. We can see that the company defines their employees and customers as first asset and most important element in the company’s health. This, shows that it is not a...

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