Management Planning of Southwest Airlines - Essay Example

? MANAGEMENT PLAN Management Plan “Southwest Airlines Co Southwest is a major domestic airline that provides primarily short haul, high-frequency, point-to-point, low-fare service. Southwest was incorporated in Texas and commenced Customer Service on June 18, 1971 with three Boeing 737 aircraft serving three Texas cities - Dallas, Houston, and San Antonio. Today Southwest is the nation's largest carrier in terms of originating domestic passengers boarded and operates over 500 Boeing 737 aircraft in 72 cities” (Southwest.com, 2011). The four areas of management that need further analysis include Human resource management, financial management, strategic management and scientific management. The human resource function‘s main purpose would be to analyze the interviewing, recruitment and appraisal of staff within the company. Southwest’s human resource policy (prior to the acquisition of AirTran) showed that the company hired a low number of staff within its organization; this number was such that Southwest operated with an average of 62 employees per plane as compared to Delta’s 114 employees per plane. On acquiring AirTran, this number gradually increased the number of employees because of the fact that Gary Kelly (CEO of Southwest Airline) did not want to lay off any of the staff of AirTran and make them redundant. The Human resource function would need to get active in this case so as to combine different cultures of the organization concerned. Financial management within Southwest airline would require proper analysis of the financial functions within the organization such as preparing the financial statements, keeping up with the budgets, etc. Strategic management would require proper strategies to be build so as to keep the company growing in the long-run, an example of strategic management within Southwest airline is the decision made by its CEO of acquiring AirTran, Scientific management would involve aspects reading improvement of labor and economic efficiency. It can be identified as the policy of not offering expensive snacks during flights, nil baggage costs, etc (Whelan, 2011). These four departments would need to be linked effectively in order to make any strategy successful. The basic idea would be that the Strategic management department (at the top of the hierarchy of an organization) would make up strategies and communicate them to other departments down the line. Later, these departments would be highly involved in properly understanding and implementing the strategies in such as way that organization’s growth would become the motto of each and every personnel within the organization. Communication within the department would be made in such a way that knowledge sharing would be appreciated. The Human Resource department would only hire employees based upon the vacant job description i.e. efficient recruitment. The Finance department would be involved in preparing proper budgets and other financial statements for the organization. The strategic management division (which would involve top level employees e.g. CEO, Directors, etc) would be involved in formulating, evaluating and monitoring the policies and procedures within the organization. The four main areas of growth and change for each of the departments mentioned above would be: Human Resource department: i) Proper induction of employees, ii) Proper training for new and former employees, iii) Effective and efficient measure being put up for employee appraisal; iv) Dealing with redundancy issues Strategic Management Division : i) Strategies made should be have long term effect, ii) Company’s objective should be properly considered while such strategies are made, iii) Growth of the division would be possible when experienced directors/senior manager would be hired e.g. experienced non-executive directors, iv) Proper competitor analysis as a basis of not committing error being committed by them Scientific management: i) Proper training, ii) elimination of wastages, iii) learning through experience, iv) higher productivity Financial Management: i) Training, ii) employees kept updated with reference to changing financial standards, iii) Stricter but achievable budgets made iv) Experienced staff Corporate competition is judged as a fight between different business organizations (usually in the same industry) in order to excel and gain high profits its shareholders. The competition for Southwest airline is still on because of the different airline service providers present in the market. Southwest has fought off the competition in grand style by offering reduced costs to its customers and it is because of such reasons that the organization has excelled in recent years. This growth of the company can be reflected in the company’s enhanced profits (Whelan, 2011). A social responsibility plan for each of the four areas of department would be as follows: Human Resource Department: The best example of social responsibility for an HR department would be to hire employees having the highest merit and not through favoritism. In context with social responsibility, HR dept should encourage sustainable practices which should offer practical and theoretical new opportunities. Strategic Management Department: This department can do anything for social responsibility as any such act would improve the company’s image. The best examples would be to indulge in activities that would reduce carbon footprint i.e. by planting more trees or by promoting greener environment, Scientific Management: This department would act socially responsible by reducing wastages and reducing activities by which hazardous materials are emitted into the ocean or the air. Financial Management: This department can show its social responsibility by whistle blowing suspicious activities (such as money laundering) to the public at large. This entire plan would affect the management plan in such a way that strategies, policies and procedures made within the organization would carry aspects of Corporate Social Responsibility (CSR) within them and this would improve the company’s image as a result. Such activities would also boost the revenue for a company through better goodwill. Code of Conduct – Southwest Airline With adherence to the mission statement, the company is maintaining its low-cost leadership approach by successful and competent activities such as efficient purchasing/relationships with suppliers, better fuel management and effective utilization of funds in order to ensure that the owners of the company are properly rewarded (. The code of Conduct with respect to the four different departments would be as follows: Human Resource department: The department is involved in keeping strict policies over the recruitment, selection and appraisal of employees within the organization. Strategic Management department: would be involved in formulating and evaluating the strategies for the long term success of the organization. Strict adherence to these strategies being a strict code within the organization. Scientific Management department: would be involved in practices such as effective procurement systems with special adherence to the procurement ethics being setup within the company. Financial Management department: would be strictly complying with the financial codes and standards because non-compliance would result in negative audit opinions and hence bad publicity for the company (Annual Report, 2010). References Annual Report. (2010), “2010 Annual Report to Shareholders”, SouhtWest Airlines Co. Retrieved from: http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9ODk3NDZ8Q2hpbGRJRD0tMXxUeXBlPTM=&t=1 Company Profile. (2011), “Southwest Airlines Investor Relations”.Southwest.com. Retrieved from: http://www.southwest.com/html/cs/investor_relations/if_ir_index.html?int=GFOOTER-ABOUT-INVESTOR Whelan,D. (2011, June 29), “All Grown Up”. Forbes.com. Retrieved from: http://www.forbes.com/forbes/2011/0718/features-southwest-airlines-gary-kelly-midway-grown-up.html Read More