Overall, if the simulation were to continue on with future quarter, we feel that our company would continue to see tremendous growth and continue to operate as fully functional airline even if we handed over our airline to someone else. Some of the advice we would recommend to the new management would be to continually invest within the company. From putting more money in operations, employee wages, maintenance, and promoting employees in the company; because when we did this in past quarter our airline received high praise, recognition, and positive profits which is something any business wants to see each quarter. Next, we would recommend to primarily focus on the airlines individual decisions, rather than trying to work with other airlines. …show more content…
Yet a few quarters later we were given an option of hiring either a head sales representative, and/ or, a maintenance chief of staff. We decided to hire neither one of them which resulted in our airline receiving a special award for our loyalty to our employees. So we would recommend for the new management to not take outside offers, that could have a long impact on the airline or the employees. Additionally, the biggest piece of advice our team can give, is that if you want bigger profit margins, buy/lease more aircraft! While we found our perfect decision mix, to max out our profit, we did not realise that it could of been applied on a much bigger scale. If expanded our routes and increase the number of aircraft available, we could of made a substantially bigger amount of income. Finally, avoid any short cut decisions, and always be honest with the public and the …show more content…
When it comes to our airline simulation experience we all agree that our company basically followed the economy market; so if the market was down so were we, and if the market was up, we were making money. But overall we are happy with our airline simulation, despite getting off to a little bit of a rough start in the first few quarters we were able to overcome most of those towards the middle and end of the simulation to the point where we think our airline could continue on if the simulation was longer than a semester. When it comes to changes for the simulation for future semesters, we agreed that it would be best to have the software with more up to date aircrafts since most of the aircrafts from our simulation are aircrafts that most airlines don’t even use anymore. Updating the aircrafts to more modern day aircrafts can help students actually feel like they are running a airline to the present day like American or Southwest airlines. Another major change that could be made to the simulation is possibly more decision making throughout the week than just once a week. The market is always changing and airlines try to do things like code sharing, or merging on a weekly basis which can definitely make the simulation more interesting and generate more competition between the teams. Finally, when it came to the
• Qantas had to make an increased profit and pay a dividend to its shareholders which increased over the years of management
Southwest Airlines: A Case Analysis. ORGANIZATIONAL ANALYSIS It is evident that the greatest strength Southwest Airlines has is its financial stability. As known in the US airline industry, Southwest is one of those airlines who are consistently earning profits despite the problems the industry is facing. With such stability, the corporation is able to make decisions and adjust policies, which other heavily burdened airlines may not be able to imitate.
More than 37 years ago, Rollin King and Herb Kelleher got together and decided to start a different kind of airline. They began with one simple notion: If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline. And you know what? They were right. What began as a small Texas airline has grown to become one of the largest airlines in America. Today, Southwest Airlines flies over 104 million passengers a year to 64 great cities all across the country, and we do it more than 3,400 times a day.
No matter how a business operates, change is inevitable and affects all businesses. CAMERON SMITH investigates the changes Qantas have had to undergo in order to keep up with their competitors, whilst navigating the challenges of low cost of fares.
As airline industry is a competitive marketplace, the airline companies use new technologies to improve their efficiency and decrease the overhead costs, including ‘advanced aircraft engine technology, IT solutions, and mobile technology’ (Cederholm 2014). The technology changes including technology improvement, new innovation and disruptive technology. The disruptive technology need to meet the characteristics of ‘simplicity, convenience, accessibility and affordability’ (Christensen 1995). The technology changes would bring both opportunities and threats to airline companies. Since Labour cost and fuel costs occupy 50% of most airlines operating cost (Groot 2014). Therefore, if new technologies could be disruptive in the two aspects, there will be important changes to current airline
For years, Southwest Airlines has been experiencing stable costs, low fares and traffic stimulation. However, the latest changes in the marketplace (See Exhibit 1: SWOT Analysis), including the higher energy costs and the entrance of new low fare/cost carriers are threatening the future of the airline. As a result, LUV needs to decide whether or not to acquire the slots and gates from the bankrupt ATA Airlines at LaGuardia (LGA) terminal in New York City (NYC) in order to expand its capabilities.
The Southwest Airlines company and its culture is one that is often cited in today 's business classes. The airline is widely known to be “different” compared to many of its competitors, a result of its founding values and strong corporate culture. This culture developed early in Southwest’s history and was deeply entrenched due to the competitiveness of the airline industry, as well as due to some of the pressures experienced as a result regulatory issues and stiff competition.
The aviation industry is very difficult to enter, and the threat of new entrants is low. The first and major threat to entry is the initial capital requirements. The development period is over 5 years, with very large initial investment costs, parts costs, and wages are necessary even before the company earn revenues and sell aircrafts. The economies of scale, when the airline company has a substantial order, there are reduction in cost because of discounts on large orders. The new entrant suffers a significant cost, which is a disadvantage compared to established companies. Another risk for the new entrant, the extra supply of products for the substantial order, will decrease prices. The result, the new entrant will
It has stayed relevant to the market through its propelled philosophy of relationships to generate profits in the business. Since its establishment in Monroe, Louisiana the once tiny airline has stretched to greater heights serving in 6 continents. It has also established a distinguishable name among its competitors with a reputation of leading customer services. However, even as an established venture, the company needs to maximize its profits in order to stay in business and expand in to new territories beyond its conquered boundaries. A strategic analysis was carried out by our team to establish the company’s current situation. A SWOT analysis was performed to come up with three referenced, strategic alternatives. This alternatives are meant to act as a strategic guidance to the company in order to enhance growth. The strategic recommendation provided will improve and enable the business to cope with the competitors while the implementation of the strategy section will outline the way to go about achieving these alternatives in the business setting. Lastly, we put up a discussion on the evaluation procedures and necessary controls for the
The mission of Southwest Airlines is a dedication to the highest quality of service delivered with warmth, friendliness, individual pride, and company spirit (Mission…, 2007). The company also provides opportunities for learning and personal growth to each employee. Creativity and innovation is very important and highly encouraged, for the purposes of improving effectiveness. Employees are to be provided the same concern, respect, and caring attitude within the organization that the employees are expected to share with the customer. Southwest Airlines was initially created to be a low-cost alternative to high price of intra-Texas air carriers (Freiberg, 1996). Southwest’s fares were originally supposed to compete with car and bus transportation. It was a little airline, and it would withstand the test of time. As a discount, no-frills airline, it would provide stiff competition for larger airlines. Their strategy was to operate at low cost, offering no food, no movies, no first class, and no reserved seats. They created their own market and provided increased turnaround times at the gate, by avoiding hub-and-spoke airports and opting for short-haul, direct flights. Through this market approach, Southwest has a majority of market share in the markets they serve.
There are few things that are impressive about Southwest Airlines first one is how they treat the employees. For Southwest Airlines employees are first and customers are second. If the employees are treated well that will bring in happy customers. Next is that Southwest is not only with their low prices but is able to create a competitive advantage by offering a fun and humorous experience when flying. Finally another impressive fact is when Herb Kelleher’s retire from CEO position yet remained a Southwest employee till July 2014. Even after the retirement he was still active with the Southwest Airlines that reflected his enthusiasm and dedication for the
The perennial crisis in the airline industry: Deregulation and innovation. Order No. 3351230, Claremont Graduate University). ProQuest Dissertations and Theses,, 662-n/a. Retrieved from http://search.proquest.com/docview/304861508?accountid=8364.
Southwest Airlines has come from an underdog to being one of the best airlines in the industry. This reputation translates from its strategic management of resources. The Co-founder and former CEO, Herb Kelleher, established a unique corporate culture that leads to high customer satisfaction, employees’ morale, and one of the most profitable airlines in the industry (Jackson et al., 2012). The corporate culture concentrates on empowerment the workforce. It shows through Southwest Airlines core values that “happy employees lead to happy customers, which create happy shareholders” (Jackson et al., 2012). Since its first grand opening in 1971, Southwest Airlines has shown steady growth, and now carries more passengers than any other low-cost carrier in the world (Wharton, 2010). To expand the business operations, Southwest Airlines took over AirTran in 2010 as a strategy to gain more market share for the Southeast region and international flights. However, the acquisition of AirTran brought upcoming challenges both internally and externally for Southwest Airlines. In this case analysis, the objectives are focusing on the change process post the merger with AirTran, and evaluating alternatives to address the impacts of the merger.
Golden, D., Smith, D. and Deighan, M. (2014). Airline The Strategy Simulation. [online] Schools.interpretive.com. Available at: http://schools.interpretive.com/fsui/data.php?token=0&c=filedl&id=ugohfu/mnmxohy_nugohfu&z=1398582366830 [Accessed 27 Apr. 2014].
As Boeing’s CEO, Frank Shrontz promised to increase earnings and return on equity. Boeing had a history of making money when its competitors did not, but Mr. Shrontz wanted higher returns. The airline industry was characterized by large cash outflows for R&D and manufacturing and long payback periods over long life cycles for each new airframe design. Companies had to have deep pockets to keep the operation going while waiting for a return on their investments. If Mr. Shrontz could increase the return on equity for Boeing, it would increase the likelihood of Boeing’s continued success well into the future.