Southwest Airlines is a low-cost domestic U.S. airline that primarily provides point-to-point, low-fare services. Founded in 1967, Dallas, Texas, it started its first flights operations in 1971, with three 737 Boeing aircrafts, serving Dallas, Houston and San Antonio. Nowadays, Southwest serves more than 64 destinations in 32 states, operates around 535 aircrafts, flies around 80 million passengers a year, more than 3,300 flights a day (Southwest airlines, 2007).
The company recorded revenues of $9,861 million during the financial year ended December 2007, an increase of 8.5% over 2006. The increase in revenues was primarily due to steady sales and increase in passenger numbers. The operating profit of the company was $791 million in 2007, a decrease of 15.3% compared to 2006. The net profit was $645 million in 2007, an increase of 29.3% over 2006.
Despite increasing fuel costs and the impact of terrorism on the American airlines industry, the company seems to be in a healthy financial shape due to stable revenues. The secret of their success is founded on a customer oriented approach, their dedication to high quality standards, an exceptional customer service (Kaplan-Leiserson E. 2003), effective leadership programs (Nowicki M. & Summers J. 2007), enhanced employee compensation program (Nelson J. E. 1998), strategic focus and vision.
Southwest Airlines has enjoyed in the last years a great reputation on the market in terms of shareholder values, performance, customers and employee satisfaction alike. But what makes, Southwest special? It’s quite simple, a charismatic leadership, a straight forward business strategy fueled by motivated and dynamic personnel.
First, let’s focus on the strategy. It seems...