Hawaiian Airlines - Research Paper Example

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Running Head: SOUTHWEST AIRLINES Southwest Airlines Author’s name: Module: Lecturer: Abstract The airline industry is highly competitive especially in the US market where market players are numerous. Before the 1990s the industry players had a lucrative period but after this and with the increased completion, expansion of internet and intensified competition, few airlines have maintained a steady growth or even profitability…
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Hawaiian Airlines
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Download file to see previous pages Southwest Airlines is a low cost airline that has been in operation since 1971. Introduction Southwest Airlines is simply referred to as Southwest and it operates on short haul basis with point-to-point flights. It is primarily a low cost airline with no frills and it developed this strategy from its inception about 40 years ago. It is based in Dallas, TX and it started operations with only three aircrafts but now boasts of more than 540 Boeing 737, more than 3100 flights daily to over 70 cities, 35,000 employees, net income of almost $100 million and passenger capacity of well over 85 million (Southwest , 2011). The company also boasts of maintaining the best position in respect to customer service. Its management practices have tried to align the company towards low operational costs which in turn have enabled it to consistently charge simple and low fares. The company’s mission states; “… is dedicated to the highest quality of Customer Service delivery with a sense of warmth, friendliness, individual pride, and Company Spirit (Southwest, 2011).” Looking carefully into the mission statement is it clear that huge emphasis is given to customer service and company spirit (meaning the relations that the management maintains within the workforce and with other stakeholders). The company’s current Chief Executive is Gary Kelly who is also the Board Chairman and Company President. This paper aims at looking into this airline’s SWOT analysis, Porter’s 5 forces and PEST analysis together with the strategies it has applied in order to gain its current market leadership position. Southwest Airlines Core Competences The airline has taken the US market in its entirety gaining huge customer base and revenue. It has accomplished this through perfection and continuous appraisal of its core competences mostly towards product strategy, forecasting, facility location and process strategies. In respect to product strategy the airline offers the lowest fares and endeavors to operate at low costs per plane (Barnhart, Belobaba, and Odoni, 2009). This is possible due to the fact that it offers no frills thereby reducing expenses. Due to the low cost of operations, the passengers can pay low fares and easily breakeven. Forecasting is critical in the airline business which is affected by even the slightest economic or political turbulence (Stevenson, 2008). The airlines’ strategies are aligned in such a way that it is possible to maneuver even in the hardest of circumstances. An example is the profitability trend that it maintained between 2007 and 2009 despite the global meltdown crisis that heavily hit its target market. The company’s culture that revolves around customer service and cost cutting measures acts as another core competence that revolves around its process strategies. The airline is able to ensure that its planes remain in the air most of the time than in the airports by cutting heavily on turn-around time. This ensures passengers are not delayed while cutting costs on airport charges. These comprise its location and process strategies that have worked to the airline’s advantage. These are the main core competences that the airline has ...Download file to see next pagesRead More
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