This website uses cookies to ensure you have the best experience. Learn more

Why Is Parts Inventory Management So Important At Southwest Airlines?

629 words - 3 pages

Case Study #2
1. Why is parts inventory management so important at Southwest Airlines? What business processes are affected by the airline’s ability or inability to have required parts on hand?

Southwestern airlines are very high profile airlines with over 500 aircraft in 68 cities, and revenues of upward to $10.1 billion (Laudon&Laudon 2011). In order to maintain and to keep their good reputation Southwestern must be able to keep available supplies and extra inventory in stock and readily available. With over $325 million in service parts and inventory (Laudon&Laudon 2011), the company needs a strategic plan to manage this process on a daily basis to insure that all supplies are on hand. Richard Zimmerman, southwest’s manager of inventory management, stated that “there’s a significant cost when we have to ground aircraft because we ran out of a part. The long term, cost effective way to solve that problem was to increase productivity and to ensure that our maintenance crews ...view middle of the document...

Information about what replacement parts were available at a given time was difficult or impossible to acquire, and that affected response times for everything from mechanical problems to part fulfillment (Laudon&Laudon 2011). This glitch in the system could cause for major misunderstanding because the information needed to get the correct inventory was not available. If an aircraft were to need maintenance the parts would be on hand because of the systems failure.

Laudon, K. C., & Laudon, J. P. (2012). Management Information Systems: Managing the Digital Firm. Upper Saddle River, N.J: Prentice Hall.

3. How did implementing the i2 software change the way Southwest ran its business?
I2 Demand Planner Software has helped Southwestern in many ways. The system improves Southwest’s forecast for all of the part location combinations in its system, and provides better visibility into demand for each part. Planners were able to differentiate among individual parts based on criticality and other dimensions such as demand volume, demand variability, and dollar usage (Laudon&Laudon 2011). By implementing i2 technology Southwest Airlines will now have a better flow, accessibility, and better data management. The implementation of the i2 system will help Southwest maintain their customer relationships, it will help to keep ticket cost down, and supplies will be readily available in case a mishap occurs.

Laudon, K. C., & Laudon, J. P. (2012). Management Information Systems: Managing the Digital Firm. Upper Saddle River, N.J: Prentice Hall.

4. Describe two decisions that were improved by implementing the i2 system.
The decision to improve their current Legacy Information System was very critical to the airlines business. By not obtaining the proper technology to maintain or manage the supply chain and inventory it could have caused a loss in revenue, aircrafts, and reliability of service. Implementing the i2 system increased availability of parts, increased speed and intelligence of decision making, reduced parts inventory by 15 percent, saving the company over $30 million, and increased service levels from 92 percent to over 95 percent (Laudon&Laudon 2011).

Laudon, K. C., & Laudon, J. P. (2012). Management Information Systems: Managing the Digital Firm. Upper Saddle River, N.J: Prentice Hall.

Other Papers Like Why Is Parts Inventory Management so Important at Southwest Airlines?

Management of Spare Parts Inventory in a Manufacturing Organization

4401 words - 18 pages depending on issues, receipts, or other transactions that take place in the storeroom. Doing so would create dramatically different results depending on the day the snapshot of data is taken. 2. From a warehouse management perspective, there are definite benefits to analyzing inventory by activity level (number of issues or quantity of parts issued). However, using this method to prioritize inventory may negate some of the more important benefits of

Describe at Least One Conflict in the Written Text. Explain Why the Conflict Was Important to the Text as a Whole

1178 words - 5 pages and overcomes the conflict, the conflict also showed that at times it is important to not take everyones opinion to heart, and the conflict showed that it is important to move on from a bad situation. The conflict that Leila faced was that the fat man had said to Leila that her youth wouldn’t last forever. In the text the fat man had told Leila that one day she will have lost her youth, and become an old lady who is unhappy and no longer

An Assessment of Four Function of Management within Southwest Airlines

1390 words - 6 pages thanks to Southwest mission state which said "The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit"(Southwest, 2005).This is why they are so successful when other airlines are falling. Southwest Airlines has done just that, in a world of high competition and drastic changes they paid close attention to their customers needs

Impession Management. It's Negative Impact And Why Awareness Is Important?

692 words - 3 pages Impression Management. It's negative impact and why awareness is important?Impression Management is the process by which people attempt to manage or control the perception others form of them. There is often a tendency for people to try to present themselves so as to impress others in a socially desirably way. Thus, impression management has considerable implications for areas such as validity of performance appraisals and it is a pragmatic

Why English Is Important

5263 words - 22 pages language in the world today is the fact that Britain was the global superpower in the nineteenth century and America is the global superpower in the twentieth and twenty-first. For example, these two English-speaking countries were the most important countries in terms of the military and trade. By conquering and colonising so much of the world, their customs, culture and way of life became common in those parts of the world. This is why

Why English Is Important

2343 words - 10 pages difficult languages to learn it is important to focus on exactly why it is you want to learn English. Here we will look at ten great reasons why English is so important. Post this list somewhere you can see it and it will montivate you to keep going even when you are tired of trying to figure out which witch is which! 1. English is the most commonly used language among foreign language speakers. Throughout the world, when people with

Why Marketing Is Important

969 words - 4 pages “Marketing is the activity, set of institutions, and process for creating, communicating, delivering, and exchanging offerings that have value for customer, clients, partners and society at large”(AMA, 2007). So, why it is so important to create value for all of those persons above? And what the reason could be to do so for entrepreneurs? Let’s try to find some answers. When we speak about founding new business we used to think about

Why College Is Important

792 words - 4 pages Assignment 1 “Why college education is important to me” Achieving Academic Excellence February 6th, 2014 The purpose of this essay is to show the importance of a college education and to provide many reasons why a college education would be important to me. I will incorporate a few quoted references along with some statistical data and my personal opinion. About twenty years ago I couldn’t give an answer to “why college is important to me

Why Is College Important

877 words - 4 pages Abbegail Brown AC1603435 EN110 Achieving Academic Excellence Assignment 04 12 May 2016 Why college education is important to me There are many reasons why a college education is important in general and important to me. Many employers will not even interview candidates who do not have a college degree. There are many more benefits to having a college education than just for interviews. Therefore, there is plenty of reason for attending

Why Is It Important

1473 words - 6 pages Donald Fletcher bravo company 302d bsb  Camp Casey Korea why is it important to follow orders Donald Fletcher bravo company 302d bsb  Camp Casey Korea why is it important to follow orders There are many reasons why a soldier should follow all of the orders they are given because every one of them is important in any circumstance. An order is a task given to a soldier that has to be done in a certain period of time in an efficient manner

Why Accounting Is Important

676 words - 3 pages Why accounting is important The significance of accounting has never been more needed than today in the market, with the economic crisis and the worlds market in decline. Maybe a lot of people are losing their jobs in many fields, accounting stays is staying strong. The reasons why this is happening is because accounting is a very important aspect in the economy and the society. If we ask an accountant, why we need accounting, he will say

Related Essays

Why Is The Initial Consultation So Important What Factors Will An Ethical Therapist Cover At This Time

2440 words - 10 pages “Why is the initial consultation so important? What factors will an ethical therapist cover at this time?” Year One – Module Three (Word Count – 2226) This essay endeavours to document the importance of the initial consultation within a successful therapeutic treatment plan. It will comprehensively describe ethicality, before applying this fundamental component of treatment to a beneficial, healing and professional environment. It

Why Is The Law So Important In Social Work?

1129 words - 5 pages Why is the law so important in social work? When the new degree in social work was being planned, all four countries in the UK outlined an understanding of the law as being a required part of the course. It is now more necessary than ever before that social workers understand the laws which are relevant to their own conduct and to service users. They must also possess the skills to use those laws for the benefit of the service user and

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

5333 words - 22 pages analyzing processes and setting targets for performance. However, output performance measures are not able to help management understand why a practice is effective. This understanding is a result of personal interpretation of the process. Organizations must look to other firms for ideas to borrow from global leaders, regardless of the scope of the necessary improvement. Equally important as data collection is the actual implementation of the

Why Is The Initial Consultation Important? What Factors Will An Ethical Therapist Cover At This Time?

2014 words - 9 pages WHY IS THE INTIAL CONSULTATION IMPORTANT? WHAT FACTORS WILL AN ETHICAL THERAPIST COVER AT THIS TIME? Why is the initial consultation important? In this essay I will discuss the pros and cons of the initial consultation from the Therapist and Client perspective and whether it is essential to offer an initial consultation to clients coming for therapy. First of all I will describe what an initial consultation is and involves. The