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Southwest Airlines Company is one of the iconic trademarks in the United States aviation sector. It has been operating for more than 50 years, since 1967, serving most of the U.S. population. Herb Kelleher and Rolling King founded the company in 1967, and with the leadership of Herb Kelleher, the company was able to develop into an intrastate airline within a decade. Currently, the company has nearly 60,000 workers with up to 4,000 flights during peak seasons (Dru, 2019). The company’s success has been steadily growing because of the excellent management skills that are focused on both regional and local trends in the aviation industry.
Any organization’s performance is determined by its leaders’ willingness to use suitable theories and approaches to endow their followers and make tactical choices based on market forces. Managers use their expertise to support all critical activities and confirm that all stakeholders are involved in enhancing organizational performance. Southwest Airlines distinguishes out as a successful aviation corporation that assessed the nature of market competition and adopted evidence-based initiatives through its managers. This paper seeks to discuss the southwest managerial approaches to change management and decision-making strategies that influence the profitability and rivalry in the aviation industry.
Change is a frequent thread that runs through all businesses despite their size, industry, or age. With the advancement in technology and the economic shocks that the world is experiencing, companies are forced to change their management styles to help solve such situations, and the southwest airline is not an exception. Throughout its existence, southwest airline has undergone various changes in its management style. For instance, in the 2009 economic crisis, the aviation industry witnessed a competitive arena that sought to remove low-cost airlines from the market (Cote, 2018). As a result, the airline took a positive initiative to implement change that enabled its existence in the market as a low-cost airline. It focused on building an internal culture that was not easy to duplicate. At this time, the company introduced the servant leadership style of management, which was different from its first management style, primarily concerned with reducing costs (Voigt et al., 2017). The change largely focused on employee development and inspiration rather than the previous styles that were based on customer satisfaction that failed to look into employee development.
Subsequently, in 2012 under the leadership of Gary Kelly, southwest airlines undertook an initiative to expand its management operations from domestic to international flights. The airline agreed to invest 100 billion dollars tied to the upgrade, including building and designing a few new gates and custom facilities (Voigt et al., 2017). During this time the company underwent a change in its communication, transactional and transformational leadership model where the management shifted their focus to the modern business approach. The communication strategy is crucial in building good collaboration between the managers and the employees. Conversely, the transactional system is concerned with evaluating the employees based on their task performance (Northouse, 2021). In this approach, the company give its employees various incentives to achieve the company’s goals effectively and efficiently. For instance, the employees who complete their tasks as required are incentivized through rewards by giving them bonus (Cote, 2018). In contrast, those that fail to meet their target are given punishment as an incentive to keep them on a toss to fulfill their assigned targets. On the other hand, the transformational approach focuses on a people-oriented approach to reward its employees. Where the managers encourage, motivate and inspire staff to create transformation that will help improve and shape the future success of the organization.
In its current management style adjustments, the corporation employs proper management. Managers guarantee that all activities, procedures, and strategies are in line with the defined plans by implementing proper controls. The organization uses various tools to maximize operations while also looking for innovative ways to eliminate errors and waste (Tully, 2021). For example, all leaders keep track of employee performance and compare it to the established best practices. They even devise contingency plans to implement if the targeted techniques fail to provide beneficial results. Managers have been tracking the experiences and opinions of various customers to see if the actual practices of various employees are in line with the plan (Tully, 2021). The idea of implementing corrective techniques or solutions is crucial as the leaders continue to look for innovative ways to identify areas of weakness and improve service performance. As a result, the company leverages proper management tactics that are crucial for its daily operations.
The corporate airline trained its leaders to examine both the external and internal perspectives of the corporation during the current transformation. Managers, for example, were trained to take planning seriously to create change and a sense of direction (Northouse, 2021). Department heads worked together to make appropriate conclusions and assess the feasibility of implementing the recent transformation program (Roberts & Griffith, 2019). The transition in the change initiative was seen to be seamless due to the company’s iconic culture of established trust between its employees and the top management coupled with good communication channels. This enabled the top managers to seamlessly perform the change program without fear or threats from the employees and the customers as well. Furthermore, the company has always had the support of its employees in performing the change.
The airline’s decision to increase its supply chain through an increased vendor network and its spokespersons in various departments have had a significant impact on the organization’s well-being. With the decision to increase the vendor network and build sustainable relationships with its spokespersons (Voigt et al., 2017). The company can fulfill its operational needs, satisfy the expectations of the stakeholders and stimulate the economic growth of the communities that the company serves.
Through its low-cost model, Southwest Airlines should continue its acquisition and expansion into new markets internationally, predominantly in evolving markets. As a result, the company will expand its low-fare strategy to other new markets, increase its market share, and expand into other lucrative destinations. This will make the company experience growth in its revenues, market share, and profitability (Voigt et al., 2017). This approach shows how Southwest Airlines should focus on the future to create a competitive advantage. However, given the several challenges in the current economy, the airline industry requires flexibility to manage several unprecedented events. The airline should employ the geographic growth tactic to implement the acquisition to widen its operation in various terrestrial locations.
Southwest airline’s ability to adapt to the changing needs of the consumers and the market environment is unwavering. The company’s enhanced low-cost and servant leadership model, coupled with management objectives and policies focused on monitoring the experiences of different customers, gives it the ability to meet its changing customer needs (Cook & Billig, 2017). Consequently, the company’s policies to examine external factors such as emerging government policies, the competitive nature of the aviation industry, and trends enable the organization to react to the changing environment (Vasigh et al., 2018). The organization’s strengths are considered, and the suitable workforce are attracted to match the organization’s needs and the demands of its customers.
On the other hand, open communication will aid in easing the change process. For instance, it will create an integrated synergy that will promote the vital understanding between the management and the employees as well as the customers (Collazo, 2020). Additionally, open communication facilitates cooperation and helps develop a sense of belonging that is vital in keeping every stakeholder on the same page and up to the task (Collazo, 2020). As a result, it will enable the top management to convenietly share the vision of the change campaign and its objectives with the employees.
This study has demonstrated that the fundamentals of leadership management are crucial in any corporate organization. Business executives should have the necessary skills to develop the most effective model that integrates management and decision-making. Managers can take a step further by looking at the instance of Southwest Airlines to see how they can create the greatest atmosphere for employees to stay engaged, communicate effectively, support decision-making processes, and be rewarded for meeting performance targets. According to this research, firms can increase essential management functions to align with the adopted business model and support initiatives. Such considerations will help more businesses become profitable and overcome competition in their particular industries.
References
Collazo, J. (2020). The importance of communication: When there is a change in a company. Forbes.
Cook, G. N., & Billig, B. G. (2017). Airline operations and management: a management textbook. Routledge.
Cote, R. (2018). Leadership analysis: Southwest Airlines-Herb Kelleher, CEO. Journal of Leadership, Accountability & Ethics, 15(1).
Dru, J. M. (2019). Thank you for disrupting: The disruptive business philosophies of the world’s great entrepreneurs. John Wiley & Sons.
Northouse, P. G. (2021). Leadership: Theory and practice. Sage Publications.
Roberts, D., & Griffith, J. C. (2019). A tale of two airlines: A comparative case study of high-road versus low-road strategies in customer service and reputation management. International Journal of Aviation, Aeronautics, and Aerospace, 6(2), 4.
Tully, S. (2021). Strategy Session: Southwest CEO Gary Kelly’s guide to succession planning. Fortune.
Vasigh, B., Fleming, K., & Tacker, T. (2018). Introduction to air transport economics: From theory to applications. Routledge.
Voigt, K. I., Buliga, O., & Michl, K. (2017). Pioneer in the skies: The case of Southwest Airlines. In Business model pioneers (pp. 171-184). Springer, Cham.
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