INTRODUCTION
Every organization intends to create a culture that can produce a positive impact on the business process. Southwest company is facing several issues in the internal business process, and the leadership team has to play a prominent role in changing the culture. Naturally, it creates a good impact on the company’s outputs. Departing from the traditional culture and vision is a kind of evolvement of the company, which is good to address various business challenges.
MOLDING SOUTHWEST’S CULTURE
Kelleher’s early leadership has modeled the culture of the company. He took some bold moves in the company. Interestingly, the low-cost culture of the company was the most significant strength. The most significant change was, from bankrupt carrier, the daring acquisition of six gates at Chicago’s Midway Airport ATA. The code-sharing agreement with ATA was a remarkable change in the company that created the impact on the culture. Kelleher’s early leadership style maintained the strategic control on the contemporary basis. For Instance, he intended to integrate the strategy formulation with informational and behavioral control. The purpose of these acquisitions is to depict the new cultural experience and make some rapid changes. He relinquished power to his close aides. It seemed the power delegation, which changed the culture of the company. Also, it justified the behavior and informational control of the southwest company.
ENABLING THE FIRM TO PROVIDE HIGH-QUALITY SERVICES AT LOW PRICES
The new leadership change allowed the company to deliver high-quality services at cheap prices. The leadership team in this company has depicted the remarkable control on the low-cost strategies. Based on the information from subordinates and behavior of employees, the company is able to make the difference in the competitive airline industry. Southwest airline has portrayed its focus on the individual performance on the strategic priorities. For instance, the management, playing a role of the leadership, helped employees work on boundaries along with higher efficiency. The administration shaped the culture from top to bottom. Leadership efforts streamlined the encouragement among employees. Ultimately, effectiveness and efficiency of the company improved, which resulted in the low-cost services for customers. For instance, the cost of an average seat mile was quite lower than other airlines in the industry. Through controlling performance of employees at the workplace, the company looked to control cost. However, it was a complicated task, but strategic control helped to meet the purpose.
WAYS IN WHICH SOUTHWEST HAS DEPARTED FROM HIS INITIAL VISION
The primary vision of the Southwest Company is to offer the high-quality customer service to customers with friendliness, warmth, individual pride, and spirit of the company. It seems the traditional vision of the company. Customers, in the competitive airline industry, want the high-quality service along with the lowest cost. Thus, the idea has to be reshaped by the management, as the low-cost strategy has to be streamlined in the new vision statement. Interestingly, American airline is in the limelight due to its low-priced services for customers. Thus, it seems the price competition between American and Southwest airline. The departure of the initial vision was not only for domestic operations. Southwest airline is looking to increase international destinations with the same low-cost strategy. Apparently, due to change in the culture and leadership, the leadership team changed the vision altogether. Due to increase in the fuel cost and wages, it was tough to include the low-cost factor in the vision statement. However, this consideration was necessary to streamline different initiatives of companies for customers to gain and sustain the competitive advantage.
TWO ACTIONS THAT KELLY MUST TAKE TO DEAL WITH RECENT CHALLENGES
The company’s policy ‘Never Say Never” is the right decision. However, it creates a big problem for the company regarding the operational cost. Maintaining and sustaining the low-cost operations is a big challenge. To address this recent challenge, Kelly must initiate the activity-based costing. It can help to reduce the cost at each operational aspect. Abandoning the organic growth strategy and acquisition with the Airtran holding is a proper consideration. It can hit the business sustainability for a while. The appropriate action is to train and influence people to create cultural values. Addressing challenges of high cost and cultural differences is the main priority, and activity-based costing and development of people are two significant actions to make results or outputs predictable. The agency theory comes into the life when addressing these challenges. Southwest, when acquiring the company, can face contradictions between the management and stakeholders. An appropriate solution can be provided to solve problems. The company can gain the benefit of international business expansion to reach targeted destinations.
Importantly, Kelly has to take actions along with a pertinent rationale. The reason behind the activity-based costing is to reduce the cost and improve the process. Kelly may direct all departments to develop some practical cost measures and justify this action plan to produce good outcomes. Training and development of people is a right decision. It seems to make people capable of decision making. Kelly has to make some changes to review some aspects of employees and operations differently and strategically. The implementation of these actions needs some improvisations. Kelly has to keep an eye on the business conditions and make some changes in the implementation process as well. The airline business needs these action plans to emerge strongly in the presence of other airlines. These actions plan can help the company to differentiate the process and gain the competitive advantage in the bloodthirsty airline industry.
CONCLUSION
In the end, it is to conclude that the southwest company is looking to change its culture and vision. This evolvement is essential for this company in the competitive airline industry. The most important thing is to identify issues or challenges early and propose some action plans to enable the long-term business sustainability. Kelly’s leadership has changed many things in the company. From the structure of the company to employee behavior, changes helped the firm to meet some new targets in the industry. These changes are helpful for healthy future direction, and all key stakeholders have been engaged in the management of the company.
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