OL 215 : Management Southwest Airlines Final Project One Submission: Application of the Fundamental Principles of Management for a Successful Company

Running Head: SOUTHWEST AIRLINES CO.- 5-2 Final Project One 1

SOUTHWEST AIRLINES CO.- 5-2 Final Project One 2

5-2 Final Project One-Part III: Application of the Fundamental

Principle of Management for a Successful Company

Southwest Airlines Co.

Jane Doe
Southern New Hampshire University
Principles of Management
OL-215
Professor
Professor: Bekim Belica
April 4, 2021

Introduction

The conception of Air Southwest Co. began in 1967 at a hotel bar in San Antonio, Texas. It’s founders, Herb Kelleher and Rollin King, developed their original business plan with a depiction of a triangle, the three lines that connected Dallas, Houston, and San Antonio sketched upon a cocktail napkin (Kelly, 2019). The airline we know today adopted Southwest Airline Co., in 1971. Operating with just three planes, on June 18, 1971, Southwest Airlines took to the sky with flights within Texas, and they soon expanded flights to neighboring states in 1979. Southwest currently services 69 destinations in 35 states. Applying clever slogans to its advertisement, the Company to date utilizes “Low fares. Nothing to hide. That’s TransFarency!” (Southwest Airlines, 2020).
Southwest has become a victorious example for companies (a combination of ‘disruptive innovation’ and ‘customer intimacy’). Defining a clear and straightforward principal business purpose, choosing the right business model to support the business purpose, and demonstrates the core values and behaviors from the critical business purpose (Advance! Consulting, 2020). The Campus Reach Program and Companywide Culture Committee are examples relating to the fundamental principles of management and Southwest’s mission and vision statement. The Campus Reach program identifies and engages future Southwest Employees at an early age, hopefully inspiring an interest in a career in aviation. The Companywide Culture Committee (CWCC) is a dedicated group of Southwest Frontline and HDQ Employees who are passionate about serving others. They are selected from across the Company to recognize, celebrate, and appreciate all Employees across Southwest (Culture, 2020).

P-O-L-C Framework

There are four significant capacities to management, planning, organizing, leading, and controlling; otherwise called the P-O-L-C framework (Carpenter, pg. 18). Planning is one role of the management that includes setting targets and deciding a game-plan for accomplishing those goals. Starting with environmental scanning, planners must be aware of critical areas such as economic conditions, competition, and customers. Planners must establish objectives, both primary and alternate courses of action, and develop either strategic, tactical, or operational activity plans to implement, execute, and achieve the desired results. The organizational function follows, which assigns tasks within the organization itself. Also known as “job design” decisions, such critical factors as geography, customer, the product itself, and effective use of human resources are the driving factors behind decision making. Leading is formal and informal utilization of influence over others to inspire action. Leadership is heavily studied by such social sciences as psychology and sociology to understand better issues such as motivation, communication, and how different styles of leadership affect job attitudes. Lastly, controlling, which consists of establishing standards, evaluating performance against such, and taking actions due to deviation, maintains a pre-determined level of quality. Financial matters such as budgetary and performance audits act as performance control methods. Managers should not focus upon or manipulate employees’ values, attitudes, or emotions, but instead, ensure work-related activities directly contribute to the organization’s overall goals. Each of these four areas must be examined and evaluated to ensure an organization’s administration grasps each one.

Mission / Vision Statements

Overseeing a company is crucial for a successful organization. Management is one of the primary reasons why employees may or may not chose to remain and make their occupations their profession. Southwest Airlines exemplifies its strategic vision clarifications in both its operations and its alliance with employees. In 2013, Southwest Airlines told its employees:
Our vision is to become the World’s most loved, most flown, and most profitable airline
(WATERLOO Employee Involvement, 2015). It is apparent Southwest Airlines continues to uphold the firm’s founder Herb Kelleher’s commitment to innovation, encouragement, and inspiring individuals.
Southwest values its representatives and develops its remarkable administration work relations. This assists in limiting the danger of work struggle and builds worker fulfillment. An example that Southwest Airlines illustrates the significance of the mission and vision to employees and partners begins with employee engagement, including recruitment strategies in their prospective candidates by showing appreciation to their employees; in turn, the employees pass the same values, satisfaction, and loyalties to customer service.

How do they do it? Internal Communications for one. Every week Gary Kelly gives a “shout out”—public praise—to employees who have gone above and beyond to show excellent customer service. Each month the Southwest Spirit magazine features the story of an employee who has gone above and beyond. Southwest highlights positive behaviors through a variety of recognition programs and awards. Finally, internal corporate videos are filled with real examples and stories to help employees visualize how each step of the purpose looks and feels. While advancement and development are significant in any industry, administration, and client experience are, and will consistently be the bleeding edge of each industry as well as time. Southwest gets it, conveys it, and lives it (WATERLOO Employee Involvement, 2015).

Strategic Management Plan

Southwest Airlines focus on planning, organization, leading, and frontline employees significantly bolster control strategic management plan, management team, as well as administrators and executives, each contributing collectively. Southwest Airlines is a one team mission with a competitive advantage as the aircraft proceeds on separating itself from different carriers with excellent client care. In 2003 Southwest became the country’s most prominent residential air carrier and maintained that positioning based on the U.S. Division of Transportation’s most recent reporting of nationwide domestic consumers boarded. Southwest coined

Transfarency

® to describe its purposed philosophy of treating Customers honestly and fairly, and low fares, mostly staying low. Southwest is the only major U.S. airline to offer bags fly free (Southwest Investor Relations, 2019).

Organizational Culture

With his hands-off administration style, Herb Kelleher originator of the Southwest organization and its hierarchical culture puts his employees first. With his great cultural Company, he has developed a fun climate and workplace. His administration and regard for workers emphatically affected the organizational culture, which has evolved more into a family. Incentives in the workplace are always appealing; however, the airline takes motivation to a whole extra level. Would it be nice to get rewarded for coming to work? Southwest thinks so with the Southwest Airlines Gratitude program (SWAG) points are awarded monthly for perfect attendance and in other fun ways can be used to purchase merchandise or services, from $100 Visa gift cards to iPads. How about going virtual? As a part of recurrent pilot training, Southwest flight ops employees fly a $12-13 million virtual reality simulator through the toughest of conditions. Not satisfied yet, how about flying “FREE” Employees, their parents, and their dependents have the privilege to fly standby for free. It there is a seat, it belongs to you! You talk, I’ll listen, how about eating with the CEO. Company executives (who?) host dinners with frontline employees, just to hear what is on their mind. The commercial airline founder Herb Kelleher once described his approach to management:
“If you create an environment where the people truly participate, you don’t need control. They know what needs to be done, and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchies and control mechanisms you need.” (WATERLOO Employee Involvement, 2015)

Decision Making Process

Decision making by management considers the three core factors: customers, employees, and shareholders. Southwest seeks to do the best for all three (Southwestonereport.com, 2017). Having a dynamic center that starts with the question, “why should individuals consider us,” keeps Southwest efforts looking forward. The way personifies one example of the decision-making process that Southwest approaches its principles of management. Believing that it is the responsibility of those at the top to support those at the bottom, the commercial airline reversed pyramid establishes employees as subject matter experts and empowers them to make decisions. Solving problems quickly and at the lowest possible level results in happier customers who feel a more profound sense of connection from personalized service.

Principles of Ethics

In reading the entire 2008 Southwest Cares Report article, concerning President, CEO Gary Kelly Doing the Right Thing, I am astonished at how honorable administration is to their employees, their patrons, and the numerous ways Southwest offers positive contributions to the community. From monetary and in-kind gifts to Share the Spirit volunteer endeavors, Southwest Airlines connects to assist where necessary. Southwest community forces include the Adopt-A-Pilot program and Ronald McDonald House systemwide dinners, along with the Corporate Community Affairs Team developing connections that positively affect the communities they serve. Southwest magnanimous giving through their Human Resource Agency is a leading nonprofit organization for the less fortunate, seniors, and working poor. (McNamara, 2020) Southwest network relations groups, i.e., the federally funded employment program Workforce Investment Act (WIA), assist dislocated workers, the unemployed, incumbent workers, veterans, and residents with disabilities. Southwest does not stop there; the organization makes corporate gifts and boost volunteerism to the advantage of humanitarian associations in the networks served by Southwest Airlines (Southwest.com, 2008).

Southwest Airlines LUVS and respects its prestige and cherish their reputation on delivering excellent customer service, keeping the approach straightforward the Company is no stranger to the golden rule, treat others the way you would like to be treated (Southwest Airlines Co., 2018).

Human Resources of Management

Southwest is devoted to placing its employees; first, Human Resources (HR) alongside the executives use numerous methods to hire and retain the best representatives, beginning with the recruiting process. Southwest purposefully spends a long time on the selection, meeting, and employment process. Their “Hire for Attitude, Train for Skill” approach designed for each posted opportunity encompassing the highly skilled positions. In looking for the perfect candidate, southwest airlines perform behavioral interviews to assess the potential employees’ embodiment of a “warrior spirit, a servant’s heart, and a fun-loving attitude.” In 2015, the Company offered jobs to less than two percent of its applicants (6,000 hired out of over 371,000 applicants). Company officials have said they may interview more than 100 people to fill one open position (Hendricks, 2020). Southwest Carriers put stock in making a workplace rich with learning and advancement. To ensure they are getting it right, Southwest conducts a bi-annual Employee survey, gathering quantitative and qualitative assessments directly from Employees about what is working at Southwest Airlines, what is not, and what they value the most (Southwest.com, 2008).

Interrelated Systems

There are numerous reasons why one of the world’s top ten most admired companies is Southwest Airlines. Southwest at #8 is the only commercial airline amongst the top 10, marking the 24th straight year on the list for the firm. Chairman and CEO Gary Kelly of Southwest airlines attributes that to the employees. “Our employees are devoted to the basics—Reliability, Hospitality, and low costs—but their dedication makes southwest anything but basic. It’s what sets us apart” (PR Newswire, 2019). For whatever length of time that Southwest clings to the qualities and standards it has set, they will continue to thrive. Southwest’s executives have made an organizational culture that is employee-driven in customer connection and seems to be spreading a little more than their wings. Doing the right thing in the Southwest Spirit way offers more than just friendly and affordable air service – they offer their hearts! (Southwest Airlines Co., 2018)

Conclusion

Southwest Airlines has remained successful in the highly competitive airline industry by recognizing that its employees are the key to delivering excellent customer service and are what drives financial success. Co-founder and Chairman Emeritus Herb Kelleher stated: “the business of business is people” (Robertson, 2018). Advances in technology have removed the need for travel agents. They have placed the ability to book flights, hotels, and rental cars directly into the mobile phones of consumers, who seek a more personal experience, high-quality value service, and will quickly jump to a competitor to meet their needs. By the airline empowering its people, Southwest employees know that special treatment and personal interactions are built off the warmth of a friendly smile that can only be delivered by the human element ( Strategy Hub, 2020).
Without a heart, it is just a machine (Human Synergistics, 2018).

References
Advance Consulting. (2009). Retrieved from The Rise of Southwest Airlines: http://www.advancebusinessconsulting.com/advance!/strategic-alignment/strategic-alignment-business-cases/the-rise-of-southwest-airlines.aspx
Advance! Consulting. (2020, March 10). Retrieved from The Rise of Southwest Airlines: http://www.advancebusinessconsulting.com/advance!/strategic-alignment/strategic-alignment-business-cases/the-rise-of-southwest-airlines.aspx
Strategy Hub. (2020, February 2). Retrieved from Southwest Airlines: Vision | Mission | Values | Philosophy (2020): https://bstrategyhub.com/southwest-airlines-vision-mission-values-philosophy-2020/
Carpenter, M. (2013). Principles of Management Version 2.0. Irvington: Flat World Knowledge, Inc.
Culture. (2020). Retrieved from Southwest Careers: https://careers.southwestair.com/culture
Hendricks, B. (2020, March 21). HRM Case Study: Southwest & Innovative Recruitment Methods. Retrieved from Study.com: https://study.com/academy/lesson/hrm-case-study-southwest-innovative-recruitment-methods.html
Human Synergistics. (2018, May 29). Retrieved from Southwest Airlines Reveals 5 Culture Lessons: https://www.humansynergistics.com/blog/culture-university/details/culture-university/2018/05/29/southwest-airlines-reveals-5-culture-lessons
Kelly, G. (2019, April). Gary’s Greeting. Retrieved from Southwest: https://www.southwest.com/assets/pdfs/about-southwest/garys-greeting.pdf
McGee-Cooper, A., & Looper, G. (2018). Systems Thinker. Retrieved from SOUTHWEST AIRLINES: DOES THE “SOFT STUFF” WORK WITH TOUGH PROBLEMS?: https://thesystemsthinker.com/southwest-airlines-does-the-soft-stuff-work-with-tough-problems/
McNamara, J. (2020, March 21). Southwest Human Resource Agency. Retrieved from NEED HELP PAYING BILLS: https://www.needhelppayingbills.com/html/southwest_human_resource_agenc.html
PR Newswire. (2019, January 19). Retrieved from Southwest Airlines Again Among FORTUNE’s Top 10 World’s Most Admired Companies: https://www.prnewswire.com/news-releases/southwest-airlines-again-among-fortunes-top-10-worlds-most-admired-companies-300585259.html
Robertson, K. (2018, May 29). Human Synergistics. Retrieved from Southwest Airlines Reveals 5 Culture Lessons: https://www.humansynergistics.com/blog/culture-university/details/culture-university/2018/05/29/southwest-airlines-reveals-5-culture-lessons
Southwest Airlines. (2020, March 6). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Southwest_Airlines
Southwest Airlines Co. (2018, 09 08). Retrieved from investors.southwest: http://www.investors.southwest.com/~/media/Files/S/Southwest-IR/corporate-bylaws-articles-of-incorporation-corporate-policies/code-of-ethics-final-approved-by-board-9-18-08-clean-employee-handbook-version.pdf
Southwest Careers. (2020). Retrieved from Culture: https://careers.southwestair.com/culture
Southwest Investor Relations. (2019, January 18). Retrieved from Southwest: http://investors.southwest.com/news-and-events/news-releases/2019/01-28-2019-200023289
Southwest.com. (2008). Retrieved from Southwest Cares: https://www.southwest.com/assets/pdfs/corporate-commitments/southwestcares.pdf
Tony Robbins. (2020). Retrieved from SERVANT LEADERSHIP: SOUTHWEST AIRLINES: https://www.tonyrobbins.com/career-business/how-has-southwest-airlines-made-money-for-30-plus-years-while-other-airlines-barely-survive/
WATERLOO Employee Involvement. (2015, October 5). Retrieved from Southwest’s successful engagement with their employees: https://smbp.uwaterloo.ca/2015/10/employee-engagement-southwests-successful-engagement-of-their-employees/

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