Company critical analysis - Research Paper Example

Before devising strategies it is also important to evaluate organizational capabilities after which resources are integrated to enhance these capabilities. Strategic Management: Southwest Airlines The airline industry is one chocked by intense competition and need for constant changes in strategy to outdo competitors. However, the advantage lies in the fact that it is a growing industry as a result of growth in globalization and tourism expands. This notwithstanding each airline is struggling to capture as big market share as possible.

The most competitive regions are Europe and North America with numerous airlines serving relatively small geographical areas. The United States airline industry has almost 100 carriers in both regional and major categories’ categories. The current airline industry is defined by a number of issues among them high oil prices, mergers, safety, flight delays and bankruptcies among others. It is therefore harder in the 21st century to run a sustainable airline than it was in late 20th century (Belobaba, Odoni & Barnhart, 2009).

In analyzing strategic management in this industry of choice Southwest Airlines will act as an example. . An example of these is engagement in corporate social responsibility. Southwest begins this by ensuring that it has offered quarterly dividends to shareholders. It is important to note that it is the only airline to have a record of 33 consecutive years of profitability (Southwest, 2011). The airline offers one of the best working environments as well as salaries. It has the best customer service record as well.

The airline has lured its customers into a charitable cause whereby Southwest donates a dollar each time a customer checks in for flights through Facebook. Industrial analysis in respect to Southwest brings into focus the Porter’s 5 Forces. Suppliers have a high bargaining power owing to the fact that Southwest uses only Boeing aircrafts. It is expensive to switch to another manufacturer i.e. Airbus since pilots and engineers will have to be retrained. Fuel costs keep fluctuating leading to high uncertainty and possible losses.

Fast trains and boats are acting as substitutes even over long distances (Grant, 2009). Video conferencing is also curtailing expansion in business travel. Bargaining power of buyers is moderate although airline customers are known to have low loyalty. There is a risk of new entrants especially from foreign carriers but it is unlikely that they will beat the low-cost low-fares strategy. Industrial rivalry is intense with delta, JetBlue, Northwest and others trying to adjust their strategies e.g. lowering ticket prices to align themselves to low-fares strategy.

The key success factors of this airline include its market share, price competitiveness, brand awareness, customer service and financial position as indicated in the table below. Fig. 1 Critical Success Factors (Belobaba, Odoni & Barnhart, 2009) Southwest boasts of