[Virtual Presenter] Let us take a look at the strategic management of Southwest Airlines. Southwest Airlines has differentiated itself from other airlines in many aspects and has reported profitability in 47 consecutive years until the 2020 COVID pandemic. Furthermore, Southwest Airlines recently made it to the list of "Most Admired Companies in the world" by Fortune and is America's leading domestic airline in terms of domestic originating passengers. We will be analyzing the strategies utilized by Southwest Airlines in order to sustain their success and profitability in the airline industry. Shall we start?. 

Scene 1

[Audio] We will be discussing the strategic management of Group 2 Southwest Airlines, an established airline in the U S that has grown immensely since its conception and has become a successful example of strategic management. We will be examining the U S airline industry and utilize the Five Forces Model to analyze it. Furthermore, we will be addressing the introductions within the table of contents to discover the strategies that have made Southwest Airlines successful.. 

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A brief introduction to 
Southwest and the 
industry

Analysis of the industry 
based on the Five Forces 
Model

You can describe the topic 
of the section here

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[Audio] Southwest Airlines is the largest low-cost carrier in the world. They offer fewer comfort features such as in-flight meals, reclining seats and legroom, for a lower price. It currently takes almost 30 % of the domestic airline market in the U S due to its single-class service and regional flights. Southwest Airlines is the leader in terms of market capitalization and revenue.. 

Scene 4

●
Fewer comfort features (ex. In-ﬂight 
meals, reclining seats, legroom, etc.)

●
In U.S, LCCs take around 30 percent 
of the domestic airline market.

●
Southwest Airline is the world’s 
largest LCC in terms of market 
capitalization and revenue.

[Audio] Southwest Airlines is a leading US airline, the biggest domestic airline in terms of originating passengers. It maintained a profitable margin for 47 years until the COVID pandemic in 2020 and was featured on Fortune's "Most Admired Companies in the world". From February 2022 to January 2023, it has achieved a strong market share with high revenue passenger miles - the number of miles traveled by paying passengers.. 

Scene 5

Other 8.1%
• United Airlines 15.6%
Revenue Passenger Mil
traveled by paying pass

-
Proﬁtability for 47 consecutive years

-
America’s largest domestic airline in

• Hawaiian 1.9%
• SkyWest 2.8%
• Frontier 3.3%
• spirit 4.9%
• JetBlue Airways 5.5%
• Alaska Airlines 6.2%
Other 8.1%
• United Airlines 15.6%
• American Airlines 17.5%
• Delta Air Lines 17.3
• Southwest Airlines 16.9%

Revenue Passenger Mile(RPM): total # of miles 
traveled by paying passengers

[Audio] Southwest Airlines is part of a highly competitive industry with tight margins, yet it stands out due to its unique strategies that made it one of the most successful companies in the industry. This includes offering the lowest ticket prices and providing superior customer service compared to its competitors. As the airline industry evolves, Southwest Airlines must take into account the impact of new regulations and emerging technologies to ensure its continued success. It is necessary to investigate the strategies and future challenges that Southwest Airlines is facing.. 

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[Audio] In the U S Airline Industry, the Five Forces model shows that competition is high with several driving forces. Southwest Airlines has been able to differentiate itself from the competition and stay competitive by providing low airfares and a customer-oriented approach. This has helped Southwest expand their customer base and become the third largest airline in the country. Their success stems from their unique business model, which allows them to keep costs low while treating customers well. This includes having a small aircraft fleet, no traditional hubs, and organized operations. In addition, economies of scale in their operations have allowed Southwest to become one of the most successful airlines in the U S. 

Scene 7

Analysis based on Five Forces model
U.S. Airline Industry

[Audio] The threat of new entrants into the airline business is low when considering Southwest Airlines' ability to deter potential competition. This is largely attributed to the immense capital investments that are necessary to enter the industry, with the average price of a commercial aircraft ranging from $80 million to $250 million. Furthermore, other costs such as equipment, hangar and airport fees, fuel, and the need for a skilled workforce are other key financial barriers that make it difficult for new entrants to enter the market.. 

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[Audio] Entry into the airline industry is heavily regulated due to the requirement of an Air Operator's Certificate from the government, in addition to stringent safety and national security regulations, inspections, and monitoring. Incumbent firms, such as Southwest Airlines, may retaliate if new entrants are seen to present a threat by reducing prices or implementing other strategies. We will be discussing the threat of new entrants to Southwest Airlines today.. 

Scene 9

1. Threat of New Entrants (LOW)
Entry Barrier #2: Government Policy
-
Air Operator’s Certiﬁcate(AOC) is mandatory
-
Relatively strict regulations
-
Safety & National security 
-
Regular inspections & monitoring
Entry Barrier #3: Threat of Retaliation
-
Incumbent ﬁrms may retaliate with 
strategies such as lowering price if new 
entrants are expected to aﬀect their 
overall revenue

[Audio] Regarding the threat of new entrants, the risk is overall low for Southwest Airlines due to entry barriers like economies of scale, making it difficult for new entrants to join the market. Since Southwest Airlines has already established itself and roughly 80% of its operating costs are fixed or semi-variable, it is essential to maximize capacity utilization to minimize cost per passenger and guarantee a profitable sector.. 

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●
About 80% of operating costs are ﬁxed or

●
Only few variable costs are calculated on a

●
Maximizing capacity utilization is the most

[Audio] Discussing the bargaining power of suppliers for Southwest Airlines is important for their strategic management plan. Major suppliers of Southwest Airlines include aircraft manufacturers such as Boeing and Airbus, fuel suppliers, and aircraft leasing companies. These suppliers possess a high degree of bargaining power over Southwest Airlines and can result in higher costs, more stringent terms, and limited access to certain services.. 

Scene 11

1.
Aircraft Manufacturers(Boeing and Airbus)

[Audio] The airline industry is highly dependent on aircraft manufacturers like Boeing and Airbus. These companies possess strong bargaining power due to their highly specialized and costly products. Airlines are reliant on them for their fleets, and as a result must accept their terms concerning pricing, delivery timetables, and customization options. We will be analyzing the bargaining power of suppliers of Southwest Airlines.. 

Scene 12

1. Aircraft Manufacturers(Boeing and Airbus)

●
Highly specialized and expensive products

●
Airlines depend on them for their ﬂeets

●
Signiﬁcant bargaining power in terms of

[Audio] Discussing the strategic management of Southwest Airlines, we will focus on the bargaining power of suppliers the airline has to deal with. Southwest is heavily dependent on suppliers, particularly for aviation fuel. Despite this, the airline has limited control over global oil prices, potentially leading to large price fluctuations. This can have a considerable impact on Southwest's ability to maintain its profitability.. 

Scene 13

●
Airline’s limited control over global oil prices

[Audio] Slide 14 focuses on the bargaining power of Southwest's suppliers. There are limited sources of suppliers for aircrafts and leasing companies, with International Lease Finance Corporation (ILFC) and Air Lease Corporation being two of the largest. The ability of these leasing companies to determine lease terms and rates can prove a great challenge for Southwest.. 

Scene 14

[Audio] "Southwest Airlines have customers in three main categories: passengers, corporate clients, and travel agencies and online booking platforms. Additionally, they have frequent flyers and loyalty programs, all of which have a high bargaining power as a collective. This requires the airline to take into account the different customer needs when establishing their strategies. Southwest Airlines has a range of strategies in place to ensure that their customer base is kept satisfied, which is essential for their success.. 

Scene 15

3.
Travel Agencies and Online Booking Platforms

[Audio] As many of us know, Southwest Airlines is a popular American low-cost airline with a distinctive business model. One of their main strategies to stay competitive in the market is by understanding their customers. Southwest Airlines has a high bargaining power of buyers due to their customers being a diverse and fragmented group. Passengers on Southwest Airlines prioritize cost and convenience when it comes to their travel plans.. 

Scene 16

●
Diverse and fragmented group of buyers

[Audio] Southwest Airlines has a strategy of attempting to retain and attract corporate accounts by offering tailored services like volume discounts and preferential treatment. This highlights the high bargaining power of buyers over the Airlines.. 

Scene 17

●
Airlines want to provide tailored services

and perks to retain and attract corporate

[Audio] The bargaining power of buyers is high for Southwest Airlines. This is due to the fact that they have access to a large customer base through travel agencies and online booking platforms. This gives buyers more choices and bargaining power when choosing an airline. Southwest Airlines is highly aware of this and is constantly innovating to keep customers loyal to their services.. 

Scene 18

3. Travel Agencies and Online Booking Platforms

[Audio] Bargaining power of buyers in the airline industry is quite high due to the customers typically choosing the lowest-priced options. Airlines must compete in order to keep their customer base. Southwest Airlines has implemented loyalty programs that recognize customer loyalty and reward frequent flyers which helps it to stand out among its competitors. This strategy works in the airline's and customers' favor, the customer stays loyal to the airline even if it is not the cheapest option, and Southwest Airlines maintains a higher proportion of recurring customers than its competitors.. 

Scene 19

Emilyvisits
aidine
website
Books d
flight
to
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Aviation Loyalty
receives a digut of
coffee co.mEt*y S"ys she
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a tank

[Audio] Southwest Airlines confronts a medium danger of substitutes because of different transportation alternatives, for example, trains, transports and vehicles, just as the expanding prevalence of online transportation alternatives for short separations. Subsequently, the organization must stay aggressive in its market by offering great client assistance and appropriately estimated tickets.. 

Scene 20

1.
Other transportations
2. The growth of Online

[Audio] Southwest Airlines is a well-known trailblazer of the low-cost carrier model. It is one of the top carriers in the low-cost airline industry, and it stands out from the rest because of its high level of competition within the group and its competitive advantages. Its success can be attributed to its strategic management that has enabled it to become the leader in the low-cost airline industry.. 

Scene 21

1. Strategic Groups
Copynght O McGraw-Hill Perrnission for reprcxiucbon or display.
High
Low
Mobility
Barrier
Group 2
Low-cost,
point-to-point
strategic group
Virgin
Atlantic
Alaska
Airlines
Delta
United
Airlines
American
Airlines
JetBlue
Southwest
Airlines
Routes Serviced
Group 1
Differentiated,
hub-and-spoke
strategic group
High

●
Airlines in the same group usually have

[Audio] The US airline industry as of Jan 2023 is an oligopoly, with the big four companies possessing around 65% of the market share. It is extremely difficult to become a major player in this industry due to high entry barriers. Nevertheless, the existing players continuously strive to maximize their capacity utilization, as the industry's fixed costs are quite expensive.. 

Scene 22

• Hawaiian I
SkyWest 2.8%
• Frontier 3.3%
• spirit 4.9%
• JetBlue Airways 5.5%
• Alaska Airlines 6.2%
• Other 8.1%
• United Airlines 15.6%
• American Airlines 17.5%
• Delta Air Lines 17.3
• Southwest Airlines 16.9%

Domestic market share of leading U.S. airlines

●
Big 4 companies ⇒About 65% of market share

However, competition is aggressive to maximize

the capacity utilization since the industry’s ﬁxed

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[Audio] Good morning everyone. Today I will be talking about the Southwest Airlines Group 2 strategies. Southwest Airlines is well-known for their point-to-point network and customer focus. The airline emphasizes not only on customer service, but also on fostering an employee-centered culture. This supports the unique organizational culture of Southwest, which has enabled them to develop unique strategies, such as their no-frills service model and low cost strategies.. 

Scene 24

[Audio] Strategic Management for Group 2 Southwest Airlines will be discussed. Southwest Airlines has adopted a cost leadership strategy to provide customers with a low-cost carrier. This entails a lack of in-flight services, single fleet type which is fuel-efficient, turnaround times for optimal efficiency, point-to point flights, and a high frequency of flights. Additionally, Southwest Airlines has cultivated an extensive employee culture which helps maintain their operations. To gain further insight, let us analyze how the airline has been able to sustain a low-cost model for all these years.. 

Scene 25

Sectors
Rapid Turnaround Time
Operational Efficiency
Point-to Point Flight
High Frequency
Stron Employee Culture

; Minimizing expense to oﬀer 
lower price than competitors

55.3%
"Providing relia
complemented
Service, has be
Southwest's Pu
years. Our ong
network to pre-
Minimizin
lower priCG

Fleet Composition
770
Total 737
(as of December 31, 2022)
426
737-700
207
737-800
137
737-8
26.9%
17.8%
55.3%
"Pro Viding relia
complemented
Service, has bee
Southwest's Pul
years. Our ongc
network to pre-

[Audio] Southwest Airlines follows a cost-leadership strategy to reduce expenses. Their no-frills approach includes not charging for checked bags and having a first-come, first-served seating system. Having a single fleet type of Boeing aircrafts helps reduce maintenance costs and makes pilot and mechanic training more efficient. Additionally, they operate fuel-efficient aircrafts, providing a substantial fuel cost reduction.. 

Scene 26

Cost-Leadership Strategy
a.
In ﬂight: No-Frills Approach
-
Not charging checked bags
-
First-come, First-served seating system
→ minimizing ancillary service expenses
b. Single Fleet Type(with Boeing)
-
Reducing maintenance cost & 
Enhancing pilot and mechanic 
training eﬃciency
c. Fuel-Eﬃcient Aircraft
-
Employs fuel-eﬃcient aircraft
-
Substantial fuel cost reduction

[Audio] Group 2 Southwest Airlines has adopted a cost-leadership strategy that includes having a very fast turnaround time between flights - in some cases, as little as 20-30 minutes, compared to that of other airlines which can take up to 90 minutes. This enables them to provide lower fares, through operating more flights with fewer aircraft, and an average flight duration of 2 hours and 2 minutes, with up to 6 flights a day, which helps to minimize overhead costs. In addition, they have a team of gate crew that is 50% smaller than other airlines. To further benefit their passengers, Southwest Airlines has adopted a point-to-point, short flights strategy, without utilizing major hubs. This focuses on direct routes, making travel more convenient.. 

Scene 27

Cost-Leadership Strategy
d. Rapid Turnaround Time
-A remarkably quick turnaround time b/w 
Flights ; 20-30 minutes(others 60-90 min)
-Operates more ﬂights daily with fewer aircraft 
;cost saving & ability to oﬀer lower fares
-Average ﬂight duration : 2 hours and 2 minutes
-Average Flight daily : 6 times(exceeding ave)
- Facilitate by a gate crew is 50% smaller
e. Short Flight(Point-to-point)
-
Without major hubs 
-
Focusing on direct routes 
-
Enhancing passenger 
convenience

[Audio] Southwest Airlines has utilized a cost-leadership strategy for over 30 years, granting their employees autonomy to create a positive work environment and optimize customer service. This effective approach is reflected by the company being regularly ranked first in the fewest overall customer complaints, according to the Department of Transportation’s Air Travel Consumer Report.. 

Scene 28

A Culture of caring
People come first. We're a Company that takes care of its People and its comm
Cohearts, after all!)
Our unique Southwest@Culture is woven into all aspects of our business, from
Hospitality to our Customers. All Employees are responsible for presewing and
which strengthens our Culture of caring. Its a source of pride among Employee

service ultimately
tently ranked first in
mer complaints
Isportation's Air Travel

-Empowers its workforce to make decisions 
autonomously

–Since 1987, consistently ranked ﬁrst in 
fewest overall customer complaints

(Department of Transportation’s Air Travel 
Consumer Report)

A Culture of caring
People me first. We're a Company that tak% care of its People and its communities, and our People take care of each other. (We're
Coheads, after all!)
Our unique Southwest@Culture is woven into all aspects of our busin$S, from how we treat each other to how we provide Next-Level
Hcspitality to our Customers. All Employ* are responsible for preserving and invigorating our Culture, regardless of Pßition or tenure,
which strengthens our Culture of caring. Its a source of pride among Employees and at the Heart of who we are.

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[Audio] Southwest Airlines have a history of over 50 years of flight operations. Their strategy has continually evolved in response to the ever-changing market, with one of the outstanding accomplishments being their unified fleet of aircraft. With 10% of the over 10000 Boeing 737 models produced to date, Southwest Airlines has shown its commitment to its unified fleet. This reduces operational costs as pilots only need to be certified for one type of aircraft and maximises the efficiency of their operations.. 

Scene 30

CURRENT FLEET
AIRCRAFT
Boeing 737
Boeing 737-200
Boeing 737-300
Boeing 737-500
Boeing 737 NG I Max
Boeing 737-700
Boeing 737-800
Boeing 737-MAX 7
Boeing 737-MAX 8
Total
STORED/
SCRAPPED
188
17
147
24
95
95
HISTOI
99
47
51
21
21
815
402
207
205
PARKED
815

AIRCRAFT
Boeing 737
Boeing 737-200
Boe,ng 737-300
Boeing 737-500
Boeing 737 NG I Max
Boeing 737-700
Boeing 737-800
Boeing 737-MAX 7
Boeing 737-MAX 8
Total
CURRENT FLEET
PARKED
815
402
207
205
815
STORED 1
SCRAPPED
188
17
147
24
95
95
HISTORY
99
47
51
21
21
ON ORDER
4
2
2
TOTAL
287
935
AGE
O Age

They are the buyers of 10% of the over 10,000

[Audio] Southwest Airlines is a renowned Low Cost Carrier (LCC) airline, renowned for their strategic management approach. By utilizing efficient aircraft management and a 'fly-by-night' style, Southwest Airlines has been able to remain competitive in their industry while keeping costs low. With a fleet of over 500 Boeing 737-300 aircrafts, they are able to operate over 4000 flights a day. Their effectiveness has enabled them to provide low fares and a great customer experience. Southwest Airlines is a pioneer in the airline industry, setting the benchmark for the LCC business. Their advances in operations and customer service, from their pioneering of boarding procedures to their loyalty rewards program, have made them a leader in the industry. It is no surprise that most other LCC airlines look to Southwest Airlines as an example to follow.. 

Scene 31

e..........R.Y.ANA.1R.V
CURRENT FLEET
AIRCRAFT
Airbus A320
Airbus A320-200
ATR 42172
ATR 42
Boeing 737
Boeing 737-200
Boeing 737-400
Boeing 737 NG 1 Max
Boeing 737-700
Boeing 737-800
Boeing 737-MAX 8
Total
ACTIVE
297
75
PARKED
297

e..........R.Y.ANA.1R.V
CURRENT FLEET
AIRCRAFT
ACTIVE
Airbus A320
PARKED

CURRENT FLEET
AIRCRAFT
Airbus A320
Airbus
ATR 42172
ATR 42
737
Boeing 737-200
Boeing 737-400
737 NG 1 Max
Boeing 737-700
Boeing 737-800
soeing 737-MAX 8
Total
ACTIVE
297
75
PARKED
297

CURRENT FLEET
AIRCRAFT
Boeing 737 NG / Max
Boeing 737-800
Dash 8
Dash 8-400
Total
ACTIVE
39
39
PARKED
39

[Audio] Southwest Airlines have adopted a no-frills approach, eliminating non-essential systems to reduce boarding time. There is no assigned seating or meals offered, but they do have an in-flight entertainment system. This approach to time-efficiency has been successful for them.. 

Scene 32

No reserved seating or 
meals oﬀered, in-ﬂight 
entertainment system

[Audio] Southwest Airlines has had significant success in extending their services. Notably, they provided reimbursement for customer delays, hotel stays and extra services. They also created an e-ticket service that was adopted by other major airlines, as well as introducing the novel internet-ticketing technology which customers can use to purchase tickets online. These strategies have enabled Southwest Airlines to become successful.. 

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[Audio] Southwest Airlines is a notable presence in the aviation industry, due to their innovative approach to strategic management. Herb Kelleher and the organisation's management have done a great deal to benefit their employees. The company's Positively Outrageous Service idea encourages personnel to make the customer's experience satisfying and memorable. Moreover, there are well-established internal communication protocols, which maintain customer service and company operations. Furthermore, Southwest is well known for its no-luxury air travel approach, which has been a hit with patrons and keeps the fares comparatively cheaper than those of competitors. In 2000, they initiated internet ticketing, allowing clients to book and check-in with their computers. Plus, each customer is allowed two complimentary checked bags and a two-tiered pricing structure is offered, enabling clients with more flexible timetables to save on their airfares. Finally, their swift problem-solving responses and dedication to prompt flights have kept customers loyal and helped assemble a large consumer database.. 

Scene 34

Unique Strategies of Southwest Airline
Leadership
- Herb Kelleher’s commitment to 
employees.
- Formed their own spirit 
(Positively Outrageous Service & 
Strong company communication) 
New Strategy
- They pioneered no-frill approach
 
- First to use internet ticketing 
allowing tickeless ticketing.
- Two free checked bags
Problem-Solving 
Ability
- Developed two-tiered pricing 
structure
 
- Reduction on the Turnaround 
Time

[Audio] Analyzing Southwest Airlines' core competencies, we will consider the challenges and opportunities that they face. Can their success be replicated? What are the key factors of their strategy, leadership, and extra services that made them successful? We will also consider their low-cost carrier strategies that have made them an industry standout.. 

Scene 35

Southwest Airlines Reports 47th Consecutive Year Of
Profitability

[Audio] Southwest Airlines has proven to be dedicated to sustainable practices. The company has put in place a number of initiatives to reduce fuel consumption, sourcing of renewable and recyclable materials and green technology solutions. Southwest has also taken a number of steps to reduce the emissions caused by air travel. It has implemented an aggressive plan to modernize its fleet of planes, which has resulted in significant reductions in fuel consumption and emissions. Additionally, Southwest Airlines has incorporated sustainability into its corporate culture to encourage its employees to pursue green initiatives. This commitment to sustainability is integral to the company's strategy for success." Southwest Airlines has a longstanding commitment to sustainability. They have taken aggressive steps to reduce their fuel consumption and emissions, such as modernizing their fleet of planes. They have also incorporated sustainability into their corporate culture, encouraging employees to engage in green initiatives. Their dedication to sustainability and the environment is a key element of their strategic management plan, and is helping them stay at the forefront of the airline industry.. 

Scene 36

You can describe the topic of the section here
Sustainability

[Audio] Focusing on the low cost strategy of Southwest Airlines and the V R I O Analysis, it is clear that they offer competitive fares to cost-conscious travellers, utilizing a no-frills service model and employee-centric culture. The company has adopted a point-to-point network model which requires substantial investment, time and eﬀort, making it valuable, rare and diﬃcult to imitate. Additionally, a unique customer-focused approach is adopted by Southwest Airlines, alongside a deep commitment to employee satisfaction and eﬃcient fleet operations.. 

Scene 37

Low-cost strategy
Oﬀering competitive fares 
For cost-conscious travelers
V.R.I.O Analysis
Imitability
No-frills service model, 
employee-centric culture 
Point-to-point model
; requires substantial 
investment & time and eﬀorts
Rarity
Point-to-point network
Unique-centric culture
Valuable
0rganization
Commitment to 
employee satisfaction
Fleet operation
Customer-focused approach

Scene 38

[Audio] The strategic management of Southwest Airlines is being discussed. This slide contains two theories regarding Mercury and Venus, followed by the literature review. Mercury is closest to the Sun and is the smallest planet in the Solar System, while Venus is the second planet from the Sun and is known for its poisonous atmosphere. The literature review refers to the study of past and current theories, research, and opinions related to Southwest Airlines.. 

Scene 39

Mercury is the closest planet 
to the Sun and the smallest 
one in the Solar System—it’s

the Sun. It’s hot and has a 
poisonous atmosphere

[Audio] For Group 2's Southwest Airlines, strategic management will be discussed. On the slide for the November social schedule, Mercury, the smallest planet, can be seen on the 16th and the cold planet Mars, despite its red color, will be on the 25th. These are examples of many interesting facts to be seen on this month's social schedule.. 

Scene 40

[Audio] Our methodology regarding Southwest Airlines has to take into account the environment in which we live - Earth - as well as the other planets in our solar system. An analysis of Jupiter, the biggest planet, and the research on the cold planet of Mars must be considered. Additionally, a data study on Venus, the second planet from the Sun, and a comparison of these elements, is essential for our strategic management.. 

Scene 41

[Audio] Southwest Airlines has achieved great success in the past few years with their successful implementation of the strategic management process. They have adopted a customer-centric approach to their operations, focusing on providing superior customer service and creating a unique and enjoyable travel experience. Furthermore, through the careful analysis of their financials, they have identified areas of cost reduction that have enabled the company to remain competitive in the highly competitive airline industry. Finally, their use of technology has allowed them to innovate in areas such as automated check in, online ticket purchases and more. All of these initiatives have led to notable successes for Southwest Airlines." As part of their success story, Southwest Airlines has successfully implemented strategic management processes to create an efficient and customer-centric airline. By focusing on providing a superior customer experience, Southwest Airlines has been able to stand out in the highly competitive airline industry. Additionally, the company has been able to reduce costs through careful analysis of their financials, allowing them to remain competitive in the industry. Finally, through the strategic use of technology, Southwest Airlines has been able to innovate their operations with automated check-in and online ticket purchases. All of these initiatives have led to notable success for Southwest Airlines in the past few years.. 

Scene 42

[Audio] It is often said that "A picture is worth a thousand words" when it comes to communication. To better our communication, we need to work on our language skills. This is why the following slide will show the importance of building strong language skills.. 

Scene 43

[Audio] Southwest Airlines is the world's largest low-cost airline, having attained its success through running a cost-effective business model that emphasizes customer satisfaction and efficiency. They have managed to maintain their competitive edge and stay a leader in the global aviation industry by modernizing their fleet and implementing pioneering strategies for ticketing, scheduling, and marketing. In addition, they have implemented social responsibility policies that create a positive working atmosphere and promote safety, sustainability, and wellbeing in the areas they serve.. 

Scene 44

Saturn is a gas 
giant and has 
several rings

Scene 45

[Audio] Southwest Airlines is renowned for being one of the most innovative airlines in the global marketplace. Their 2020 results demonstrate the success of their strategic management; their landing percentage of 75%, in comparison to competitor's 50%, stands as a testament to their proficient operations. The impressive landing percentage was achieved by Southwest Airlines through their continual implementation of innovative changes. This result analysis highlights the airline's success and their ability to remain ahead of the competition. This allows them to maintain their status as a top airline in the industry.. 

Scene 46

Jupiter is the biggest 
planet of them all

[Audio] Our investigation into Mercury and Venus has revealed that they are both the closest to the Sun and the smallest planets in the solar system. Venus has a lovely name but is also known to contain extremely high temperatures. From our research we can conclude that these two planets provide a unique look at the complexity of the solar system.. 

Scene 47

mmcu
It's the close
planet to the
and the
the Solar Sys

planet to the Sun 
and the smallest in 
the Solar System

[Audio] The strategy of Southwest Airlines has played a major role in its success. Its customer service, cost management, efficiency, and innovation have all contributed to the company's success. Southwest Airlines is well-known and respected for its customer service, allowing it to establish itself as one of the world's leading airlines. Cost management and efficiency also remain key focuses for Southwest, which is able to keep prices competitive in the market and remain profitable. Finally, Southwest's culture of innovation and forward-thinking have enabled it to stay ahead of the competition and remain a leader in the industry. All of these factors have worked in conjunction to ensure Southwest's success.. 

Scene 48

Despite being red, Mars. is a cold place. HERE YOU HAVE FOUR COLUMNS. 

Scene 49

[Audio] Strategic Management of Group 2 Southwest Airlines is the topic of discussion. Southwest Airlines is a global airline, with two airports - Airport 01 Venus located second from the Sun and Airport 02 Jupiter, the largest of all planets. Appreciate your time and consideration.. 

Scene 50

Group 2: Southwest Airlines

We will be discussing the strategic management of Group 2 Southwest Airlines, an established airline in the U S  that has grown immensely since its conception and has become a successful example of strategic management

We will be examining the U S  airline industry and utilize the Five Forces Model to analyze it

Furthermore, we will be addressing the introductions within the table of contents to discover the strategies that have made Southwest Airlines successful.

avatar

Southwest Airlines is the largest low-cost carrier in the world

They offer fewer comfort features such as in-flight meals, reclining seats and legroom, for a lower price

It currently takes almost 30 % of the domestic airline market in the U S  due to its single-class service and regional flights

Southwest Airlines is the leader in terms of market capitalization and revenue.

Southwest Airlines is a leading US airline, the biggest domestic airline in terms of originating passengers

It maintained a profitable margin for 47 years until the COVID pandemic in 2020 and was featured on Fortune's "Most Admired Companies in the world"

From February 2022 to January 2023, it has achieved a strong market share with high revenue passenger miles - the number of miles traveled by paying passengers.

Southwest Airlines is part of a highly competitive industry with tight margins, yet it stands out due to its unique strategies that made it one of the most successful companies in the industry

This includes offering the lowest ticket prices and providing superior customer service compared to its competitors

As the airline industry evolves, Southwest Airlines must take into account the impact of new regulations and emerging technologies to ensure its continued success

It is necessary to investigate the strategies and future challenges that Southwest Airlines is facing.

In the U S  Airline Industry, the Five Forces model shows that competition is high with several driving forces

Southwest Airlines has been able to differentiate itself from the competition and stay competitive by providing low airfares and a customer-oriented approach

This has helped Southwest expand their customer base and become the third largest airline in the country

Their success stems from their unique business model, which allows them to keep costs low while treating customers well

This includes having a small aircraft fleet, no traditional hubs, and organized operations

In addition, economies of scale in their operations have allowed Southwest to become one of the most successful airlines in the U S

The threat of new entrants into the airline business is low when considering Southwest Airlines' ability to deter potential competition

This is largely attributed to the immense capital investments that are necessary to enter the industry, with the average price of a commercial aircraft ranging from $80 million to $250 million

Furthermore, other costs such as equipment, hangar and airport fees, fuel, and the need for a skilled workforce are other key financial barriers that make it difficult for new entrants to enter the market.

Entry into the airline industry is heavily regulated due to the requirement of an Air Operator's Certificate from the government, in addition to stringent safety and national security regulations, inspections, and monitoring

Incumbent firms, such as Southwest Airlines, may retaliate if new entrants are seen to present a threat by reducing prices or implementing other strategies

We will be discussing the threat of new entrants to Southwest Airlines today.

Regarding the threat of new entrants, the risk is overall low for Southwest Airlines due to entry barriers like economies of scale, making it difficult for new entrants to join the market

Since Southwest Airlines has already established itself and roughly 80% of its operating costs are fixed or semi-variable, it is essential to maximize capacity utilization to minimize cost per passenger and guarantee a profitable sector.

Discussing the bargaining power of suppliers for Southwest Airlines is important for their strategic management plan

Major suppliers of Southwest Airlines include aircraft manufacturers such as Boeing and Airbus, fuel suppliers, and aircraft leasing companies

These suppliers possess a high degree of bargaining power over Southwest Airlines and can result in higher costs, more stringent terms, and limited access to certain services.

The airline industry is highly dependent on aircraft manufacturers like Boeing and Airbus

These companies possess strong bargaining power due to their highly specialized and costly products

Airlines are reliant on them for their fleets, and as a result must accept their terms concerning pricing, delivery timetables, and customization options

We will be analyzing the bargaining power of suppliers of Southwest Airlines.

Discussing the strategic management of Southwest Airlines, we will focus on the bargaining power of suppliers the airline has to deal with

Southwest is heavily dependent on suppliers, particularly for aviation fuel

Despite this, the airline has limited control over global oil prices, potentially leading to large price fluctuations