Question

Southwest Airlines case analysis identify a major problem and sub problem

I need to know what is a major and sub problems affecting southwest airlines and give a short paragraph as to why.

Answer 1

Southwest airline is one of the first successful low-cost carrier airline.Southwest airline is in USA where it operates all of its operation and as per case study the airline faced two issues with the company after it applied it new system of management in the year 2001.The problem arises in expansion of business of airline due to the change in southwest culture and increasing price in fuel.

1)First problem happen when the leadership changes in southwest airlines in 2001 when Herb Keller decided to give promotion to, two of his close ones, when vice-president promoted to president and general counsel to chief operator,this changed everything in the company and this was badly affected to internal management. This makes large distance between the teams and employees itself,no one worked as a team and productivity starts decreasing.Many employees started complaining about new management spends most of time in back offices only.

This all issues make the work culture unethical and become serious problem for south-west airline.

2)Sub-Problem was the cost of fuel were increasing at very high rate making it difficult for the airline to make profit and also increasing wages made hard for airline to manage.

Average cost Seat went to 808 cents in the year 2006 as compared to 7.07 cents in 1995.