Sunday, June 5, 2016

Coherence

The first thing Southwest is doing right is having a clear position – knew exactly what they wanted to present in the market.  They identified automobiles as being their primary competitor, specifically; they recognized the need to offer low fares and point-to-point flights.  That identity shaped every choice that came along, including which cities to fly into, to not offer food service, to its revolutionary seating arraignments.
The second is their culture or personality – which can be seen as a reflection of their position:  To be “the airline that made it fun to fly” using key words like “young, friendly, refreshing, and exciting.   Part of that culture is the expectation of employees to use good judgment when executing the policy of “do whatever you feel reasonable doing for a customer.”  This was also visible in the union contract agreements stating that all staff would pitch in – including having pilots help load baggage – as needed in order to meet customer service goals such as the 10 minute turn around time.
The question of how far Southwest could expand its network to meet the needs of its customers had been incrementally eroding the core principles ruling the brand identity.   By making all decisions thorough the lens of ‘low fares’, it led to ports in smaller, less congested airports
However, Southwest began to stray in 1984 from the original strategy of providing only short segment flights.  With the addition of more-than-three-hour flights, like between Los Angels and Houston, proving to be popular, the decision was made in 1993 to expand the region covered.  They added ports in the East Coast and utilized code-sharing agreements to take advantage of available ports in Chicago, all with the intent to meet their customers’ needs.
Increased capacity through technological advancements changed how Southwest was able to manage its organization: Prior to 2008, they lacked the technology that would enable them to be more flexible with staffing per flights, nor to take advantage of the code sharing.  With the technology change came the ability to consider different strategic initiatives.
The revolutionary change to plane boarding practices also set Southwest apart from its competitors.  The company is known for it’s first come first served approach to boarding, which helped to keep their turnaround time around half of the industry standard. As successful as this was, it didn’t always work with some of their customers who didn’t want to stand inline early to ensure seating.  Enter Boarding Select in 2007: for an additional fee, a customer can now ‘reserve’ a seat.
The question of expanding capacity to include LaGuardia can be answered by looking at the transition of acquiring ports in Philadelphia.  While a continued push to better serve travelers along the east coast is a smart move, the questions surrounding the constant three-hour delays are a significant deterrent to choosing that option.  Southwest’s position is one of low fares and quick turn around times, far less than the industry standard. By moving into LaGuardia, they are jeopardizing their reputation.



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