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SOUTHWEST AIRLINES – ORGANIZATIONAL CULTURE
Bandaru Chaitanya Krishna
Anbarasan R
Sai Trilochan Chintakunta
Mukilan Sugumar
Mahima Karve
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SOUTHWEST AIRLINES – ORGANIZATIONAL CULTURE
Introduction:
Organizational culture is an integral part of company’s internal environment because it
provides common goal that gels the entire network within the organization together. The
analysis of management and leadership style, employee empowerment degree, employee
motivation, level of communication, human resource selection and training, organizational
structures and conflict management help us arrive at the organisational behaviour of it.
Southwest Airlines began its service in 1971. Since then the killer-whale painted planes have
become familiar to their customers and to corporate America. Besides being profitable,
expanding constantly and defending its high place on the Fortune 500 list, southwest has a
very special trait: attitude. The Southwest perspective stems from CEO Herb Kelleher and
Southwest’s employee motivation. The purpose of this article is to discover the sources of
success of Southwest Airlines as a company with high employee motivation.
Three factors will be addressed:
(1) Southwest as an ―excellent‖ company;
(2) the source of employee motivation in this ―excellent‖ company; and
(3) whether lessons learned can adequately address potential future problems for
Southwest.
The airline industry has been in the forefront of the economic and ecologic turmoil in which
the United States and the world have been involved. This paper directs its concerns to the
organizational behaviour strategy practices of Southwest Airlines. Through an assessment of
Southwest’s overall design approach (mission, strategic overview of the leadership, glance at
the organizational structure, corporate culture and people systems), this paper will provide an
evaluation of the short and long-term effectiveness of the strategy, and the impact on
environmental, political, sociological, psychological and fiscal arenas on behaviour. The
ways in which Southwest illustrates theories of organizational design and behaviour will be
explored. This paper also explores how behaviour will influence Southwest Airlines‟ future.
The airline industry in the United States and all around the world has suffered severe losses
during the last decade due to increasing fuel prices, incremental overhead costs, a dramatic
reduction in the amount of passengers and the extraordinary events caused by the 9-11
incident which paralyzed flights for days. To survive, many companies have been forced to
fire employees, reduce the number of flights, close routes and the most recent action taken
was the merger between the British and Spanish giants British Airways and Iberia, becoming
the third largest airline of the world.
Nonetheless, there is an airline company that has demonstrated a steady growth, although the
majority of US airlines in the industry are just trying to maintain their operations. Southwest
Airlines, remembered for its slogan ―Come, fly the friendly skies‖, is an example of a well-
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executed business strategy working together with a strong organizational culture. ―Whereas
most U.S.-based airlines suffered extraordinary losses post-9/11, Southwest has prospered
and, more remarkably, grown. Much of the company's success is directly attributable to its
enduring corporate culture‖.
Southwest Airlines is not just a recent success story. ―Probably the most significant
development in the U.S. airline industry during the past decade has been the continued
expansion of Southwest Airlines and the resurgence of low-fare entry generally‖. The
company has a long and positive track record. ―Since its first flight in 1971, Southwest
Airlines (SWA) has captured new passenger traffic through timely and prudent entry into
markets where full-service carriers have historically accounted for a majority of the flights‖.
While the major airlines like American Airlines and Delta hub in the largest and most busy
airports, Southwest created a strong base offering accessible rates to commuters flying non-
stop from or to smaller airports. ―SWA has found a way around this problem by using
airports on the urban fringe of the metropolitan centres it does not serve‖. This strategy
helped Southwest Airlines develop, giving the strength necessary to compete and even
surpass major competitors.
The ability to fly has been one of man’s greatest achievements. From Leonardo
De Vinci to the Wright brothers, from Lindbergh to John Glenn’s orbit around the earth,
flight has fascinated and riddled humans. This paper explores the organizational design
behaviour that has allowed for the success of Southwest Airlines. According to Jones
organizational behaviour is a product of organizational design. ―Organizational
design is the process by which managers select and manage aspects of structure and
culture so that an organization can control the activities necessary to achieve its goals.
Organizational structure and culture are the means the organization uses to achieve its
goals; organizational design is about how and why various means are chosen. How have the
design components of mission, leadership, structure, culture and job design been a driving
force in the behaviour of Southwest Airlines with respect to external and internal influences?
What does this author think of Southwest’s ability to stay competitive and what
recommendations can he offer to better the organizational design that may provide for future
success to Southwest Airlines? Through an analysis of design theories this author will
evaluate if Southwest Airlines conducted research to develop its organizational behaviour
strategy. These are questions that will be answered in the forthcoming paper.
Autonomy and entrepreneurship:
Companies encouraging autonomy and entrepreneurship are characterized by innovators and
risk takers on all levels. Internal competition is encouraged, not suppressed, and management
fosters leaders on all levels.
―Southwest is a company that encourages its people to express their individuality. . .
Southwest’s culture also de-emphasizes hierarchy‖ At Southwest, every employee can
express opinions freely and make suggestions. For example, Southwest encourages
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leadership. As Jaffe explains: ―We want everyone to be a leader in his job; you’re a leader not
just in what you say, but in the way you listen and respond to others, in what you do, and
most importantly, how you do it‖. Internal competition at Southwest exists in a friendly and
motivating way. ―Departments shower one another with free ice cream, pizza, or other
goodies as tokens of customer devotion – or simple in appreciation of a job well done‖
Southwest also accepts failure as a natural and forgivable occurrence. ―A special attribute of
the success oriented, positive, and innovating environment is a substantial tolerance for
failure.
Southwest Airlines’ co-founders and subsequent leaders did not just establish and administer
an airline; they created a new travelling experience for the passengers and their employees.
―More than 38 years ago, Rollin King and Herb Kelleher got together and decided to start a
different kind of airline‖. According to Southwest.com from the beginning the purpose of
King and Kelleher was to offer passengers the lowest possible fares, on-time schedules and a
good time during all the travelling planning, buying, flying, and getting to the desire
destination process ―The source of Southwest’s caring and fun-loving culture is Herb
Kelleher‖.
King and Kelleher innovate and use their creativity to penetrate a complicated and an already
competitive industry. Tubbs and Jablokow ,indicate the results of a recent survey performed
by Business Week in association with the Boston Consulting Group, which ranked Southwest
Airlines among the world’s twenty-five most creative companies.
In contrast, Arnoult describes Skip Barnette, a thirty year Delta veteran in charge of another
commuter called Atlantic Southwest Airlines, as a more traditional and cautious leader.
Barnette’s vision was to become the best regional airline, basically by improving the
customer service. Although, improving customer service is a must in today business, his
major barrier was to inspire confidence between the management team. The problem was that
even Atlantic Southwest Airlines executives were not sure. ―Watts agrees, citing Southwest
Airlines, known for its cheery employees who spread the gospel of customer service
according to charismatic leader Herb Kelleher.‖Skip is not Herb," says Watts‖. Robbins and
Judge include Herb Kelleher (Southwest Airlines) as an example of a contemporary founder
and leader who has had a significant impact on their organizational culture.
Organizational Culture:
―There is a significant Indian proverb relevant to this issue: yatha raja, tatha praja (like
leader, like follower)‖. After reading this citation it seems so simple to understand why
Southwest Airlines’ organizational culture reflects its co-founder values and ―servant’s heart‖
attitude. ―The company´s relaxed culture can be traced directly to its CEO and co-founder
Herb Kellerher‖. Southwest culture is characterizes by its fun and enjoyable organizational
environment. Gary Kelly, actual CEO, as cited by Bryant explains that fun comes as a by-
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product after achieving success, working in an enjoyable place, with good people that value
the employee´s dedication.
While other airlines are focus in the economic issues of the operation, Southwest Airline’s
main concern is how to maintain a formal operation structure that offers flexibility,
empowerment and a notion of fun regarding the employees’ work environment and customer
service. ―By placing employees on an equal plane (no pun intended) with customers,
Southwest Airlines has built a culture that facilitates employee retention and satisfaction‖.
For Southwest Airlines’ employees, their work is not an eight to five job. The organizational
culture encourages employees to be prepared to offer their help at any moment. For
examples, pilots will help flight attendance check the passengers and off-duty employees, like
a foreman of ground equipment assisted a flight attendant tend a food poisoning passenger
and later helped her claim the baggage.
Southwest Airlines’ organizational culture seems more like a family oriented business, where
everybody is part of the family. Southwest Airlines is a different company that focus in
―business techniques‖ and more important, ―… on loving its employees, recognizing them
and having fun playing games and celebrating success along the way‖. A working
environment, like this, where the employee is consider as well as the customer will built, in
the long run, an emotional bonding and a strong organizational culture. ―Over time a
dominant set of norms will emerge, guiding the way in which work is accomplished within
the organization‖. Another of the benefits of Southwest Airlines’ organizational culture is the
incremental effect in productivity. The employees work better in a better environment.
Organizational Practices:
Hofstede and Bond ―suggest that the power behind the economic rise of the East Asian's
economy, which outperforms its Western counterparts, has more to do with its cultural
practices‖. Some of the Southwest Airlines’ organizational practices include
a) implementing an informal and fun atmosphere encourage by the CEO
b) recognizing employees’ special dates, duties, and personal activities
c) encouraging employees to pitch in where needed
d) a rigorous screening process for the selection of new employees.―They have found that
techniques and recognition must work together‖
Other practices that differentiate Southwest Airlines from the others include
a) its willingness to promotes a free to move philosophy between its employees
b) a workplace spiritually
c) high level of empowerment
d) selective hiring
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Free to Move philosophy :
―One way to ensure a consistent employee experience is to encourage employee development
and movement within the company‖. The organizational structure is a high formalization one,
similar to the other airlines due to the regulations and security measures after 9/11.
Nonetheless, Southwest Airlines strong organizational culture permits a high degree of
flexibility, especially, in matters related to consumer service. This strategy builds strong
leaders and improves the retention strategy.
Workplace Spiritually :
―An active spiritual life can help individuals find meaning and purpose in their lives and live
out deeply-held personal values. Employees demonstrate a high level of teamwork and a
natural desire to serve and act in the best interest of the company and its consumers. ―First,
SWA has a strong emphasis on community. ―There is a strong feeling among the employees
that they are part of a family and that the employees take care of each other as well as their
customers‖ ―Second, SWA employees feel they are part of a cause. Employees feel that being
part of an airline with the lowest airfares, personalize service, and characterized by a
humorous environment gives the opportunity to people that could not afford it to fly. ―A
sense of being a "rebel," independence, and liberty are associated with SWA's cause or
mission of offering low-cost, fun air travel‖
Design Strategy:
―An organization’s behaviour is the result of its design and the principles behind its
operation. It is a task that requires managers to strike a balance between external
pressures from the organization’s environment and internal pressures from, for example,
its choice of technology. Looking outward, the design can cause organizational members
to view and respond to the environment in different ways. Looking inward, an
organization’s design puts pressure on work groups and individuals to behave in certain
ways‖ The environmental, political, sociological, psychological and fiscal
elements of behaviour are influenced by the success of the organizational design. When
discussing the organizational design of Southwest Airlines, this author has chosen to
focus on mission, leadership, structure, culture and job design as these elements have
direct impact on organizational behaviour.
Mission:
An organization’s mission has a direct impact on organizational behaviour. Southwest has
divided their mission into two categories; that of what the customer can expect, and that of
what the employee should expect. For the consumer, the mission statement is short and states
―The mission of Southwest Airlines is dedication to the highest quality of Customer Service
delivered with a sense of warmth, friendliness, individual pride, and Company Spirit‖. In
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addition, the leadership added a mission statement for employees of the airline that states
―We are to provide our Employees a stable work environment with equal opportunity
for learning and personal growth. Creativity and innovation are encouraged for improving
the effectiveness of Southwest Airlines. Above all, Employees will be provided the same
concern, respect, and caring attitude within the organization that they are expected to
share externally with every Southwest Customer‖ .These were written in 1988 and still hold
true today.
Strategic Leadership and Theories:
Leadership plays a key role in deciding what behaviours it wants the organization
to reflect. Over the past 3 decades Southwest has been in an expansion mode, growing
from a small business that served only three airports to the fourth largest airline in the
United States serving 64 cities. The current president is Colleen Barrett and the Chairman
of the Board and Chief Executive Officer is Gary Kelly. The decision making leadership
force is the Board of Directors. ―The Vice President of the People & Leadership
Development Department is responsible for establishing and monitoring the personnel
procedures to guide our Goals for Success. All Southwest Airlines Officers, Managers,
and Supervisory Personnel shall be responsible for affirmative action implementation
related to their individual departments. Providing Equal Employment Opportunity is an
important part of effectively managing people and successfully fulfilling our Leadership
obligations to our Employees, current and future, and the Company as a whole‖. The
leadership structure is rational. Scott (2003) tells the reader rationality resides in the structure
itself, not in the individual participants—―in rules that assure participants will behave in ways
calculated to achieve desired objectives, in cognitive decision-premises that guide individual
decision making, in control arrangements that evaluate performance and detect deviance, in
reward systems that motivate participants to carry out prescribed tasks, and in the set of
criteria by which participants are selected, replaced, and promoted‖
Organizational Structure and Theories:
The complex organizational structure of Southwest Airlines is a determining
factor in its organizational behaviour. Organizational structure is comprised of several
areas. Among the areas of structural concern are issues of authority and control,
communication, product division, team, geographic and market structure. Southwest
Airlines has defined all these areas and shows a strong capability in all issues. Jones
reminds the reader that all organizations start out as functional structures.
As Southwest Airlines expanded, so did its structure. The organization has a complex,
hybrid, multi-divisional structure that is based on increasing horizontal and vertical
differentiation, but also concerned with customer relations as a service driven business.
Southwest must contend with a number of factors that influence its design:
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different airports, consumer relations, different divisions (such as maintenance of
aircraft). One challenge Southwest faces in its structural design is taking into account
that airlines are a consumer driven industry. As Southwest operates in 64 different
locations, each location operates both as a business and as part of the corporate structure.
Jones affirms that each division is run separately and may use a product division
structure, while reporting to a corporate headquarters that uses a more diverse,
multidivisional structure. ―Each division in a multidivisional structure is essentially a
different business. Moreover, the responsibility of each divisional manager is to design
the divisional structure that best meets the needs of the products and customers of that
division‖. The positive aspects of multidivisional structure include
increased organizational effectiveness, increased control, profitable growth and an
internal labor market. In this structural theory, behaviour is controlled through internal
upward mobility. This means that divisional managers are often groomed to enter the
Southwest Airlines corporate world. ―Divisional managers have an incentive to perform
well because superior performance results in promotion to high office. A large divisional
company possesses an internal labor market, which increases managers‟ motivation to
work to increase organizational effectiveness .An additional challenge that
a business dominated by consumer demands is how to keep the customer’s happiness at
the forefront so revenue keeps flowing. One way to structure such an organization is to
put customers first and make decisions based on consumer reaction and satisfaction. A
structure that is consumer focused is unique in that the leadership makes many of its
decisions based on the reactions of the customers. Many airlines use this type of structure
as part of their design.
Corporate Culture and Theories:
Southwest is proud of the culture it has developed over the last 37 years. Culture
is a reflection of past behaviour. It has a history of innovation and growth. In 1987 the
Department of Transportation started a program tracking and rating customer satisfaction
as more people flew the different airlines. Southwest consistently led the industry with
―the lowest ratio of complaints per passengers boarded. Many airlines have tried to copy
Southwest’s business model, and the Culture of Southwest is admired and emulated by
corporations and organizations in all walks of life. Always the innovator, Southwest
pioneered Senior Fares, a same-day air freight delivery service, and Ticketless Travel.
Southwest led the way with the first airline web page—southwest.com, DING! the first-ever
direct link to Customer’s computer desktops that delivers live updates on the hottest deals,
and the first airline corporate blog, Nuts About Southwest. Our Share the Spirit
community programs make Southwest the hometown airline of every city we serve.
Southwest has succinctly defined their organizational culture. ―The Culture of Southwest
Airlines Co. (―Southwest‖) is often the yardstick for many American corporations.
Our Culture is unique because of the SOUTHWEST SPIRIT of our Employees.
Defining SOUTHWEST SPIRIT is difficult, but one of the important components
is an altruistic nature that places others before self. Our Employees are famous for
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their warm hearts and giving nature, which is what makes Southwest a Company
with a conscience. The Employees of Southwest are committed to ―doing the right
thing,‖ which is why giving back to the communities we serve and contributing
positively to our environment is simply the way we do business‖.
One could theorize that the culture very strongly linked to the missions that the leadership has
determined. To work for Southwest one must follow a vision that is customer service oriented
and therefore, pleasant in demeanor and family friendly. The leadership of Southwest has a
special loyalty and commitment to its employees recognizing the importance of a competent
staff when in a public service-driven business. Since beginning business in 1971, Southwest
has thrived on a Culture which encourages an entrepreneurial SPIRIT in its Employees, and
has emphasized personal responsibility, initiative, and the use of independent, good
judgment. The Golden Rule is one of our core values, and we have had a ―top-down‖
insistence on the highest ethical standards at all times.
Job Design:
How an organization defines job design from the individual employee to a broader cultural
aspect can have a large impact on how the individual divisions relate with each other and the
organization. Southwest has shown an unusual ability to accept diversity and promote
creativity within its job design. ―Job design involves envisioning and defining specification
of work system related to a particular job. It addresses issues like the methodology of doing
the job, the person responsible for doing the job, and the place of accomplishing the job. The
activity of job design helps in making the prevailing jobs and work systems more challenging
and exciting for the employees‖ Job design includes many elements. Southwest Airlines is
very involved with employees and sees employees as key to the organization. ―We are
committed to provide our Employees a stable work environment with equal opportunity
for learning and personal growth. Creativity and innovation are encouraged for improving
the effectiveness of Southwest Airlines. Above all, Employees will be provided the same
concern, respect, and caring attitude within the organization that they are expected to
share externally with every Southwest Customer.
The way in which the airlines has interacted and been influenced by external
environmental factors is very important when studying Southwest’s behaviour. Southwest
Airlines was started in 1971 by Rollin King and Herb Kelleher.
The original name was Air Southwest Co., but when the company incorporated in 1971,
it formally changed its name to Southwest Airlines. Southwest began as a small service in
Texas flying between Houston, Dallas and San Antonio. When the airline industry was
deregulated by the FAA in 1978, it allowed Southwest to expand its service to include
California. Southwest kept expanding from there. Now the Airline is the fourth largest
airline in the United States with over 500 aircraft serving 64 airports with over 104
million passengers a year. Southwest Airlines celebrated 37 years of service on June 18,
2008. In 2007 Southwest had a net income of $101.9 million with a total operating
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revenue $9.9 billion, so this expansion was not only geographical but financial, too.
―Southwest became a major airline in 1989 when it exceeded the billion-dollar revenue
mark. Southwest is the United States‟ most successful low-fare, high frequency, point-topoint
carrier. Southwest operates more than 3,400 flights a day coast to coast, making it
the largest U.S. carrier based on domestic departures‖ (Southwest Facts, About the
Company). When the stock market closed on June 20th, a share of Southwest Airline
stock (LUV) was selling for $14.11 with over 14 million shares on the market. (NYSE,
LUV).
Southwest must also contend with public opinion and preferences as the company is a
consumer driven business. The events of September, 11, 2001 are still affecting how the
public feels about the safety and security of air travel. The current rise in fuel prices is
having an added negative affect on the airlines industry as a whole. As fuel prices rise the
consequence is inevitable that customer fare will have to be increased. This puts pressure
to find alternative places where services can be curtailed so as not to lose business.
Evaluation of Effectiveness of Southwest Airlines Design:
This author has analyzed the design structure of Southwest Airlines and has
assessed that because of the willingness of the leadership to accept and listen to the
creative solutions and innovation proposed by employees, Southwest has been able to
stay successful and competitive. Leadership performed adequate research in developing
its organizational behaviour strategies. Imaginative administration and staff have created
many programs that have given Southwest a pricing edge over its competition and led to
a unique system of organizational behaviour. When analyzing environmental impacts,
Southwest Airlines favorably listened to the demands of the FAA and its customers. As
an example of how Southwest incorporated external influences into the design of its
aircraft, Southwest chose the colors of the aircraft (Apache Blue) because the colors are
representative of its western spirit and attract the eye of the consumer. Organizational
theories were properly incorporated and as a result innovative programs were created.
The programs offered included: frequent flyer programs (Rapid Rewards); purchase and
confirm flight online; removing first class seating and giving all flyers an equal chance to
sit in the front of the aircraft; and innovative ways to check baggage all offer the
customer an easier flying experience.
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A COMPARATIVE ANALYSIS OF SOUTHWEST
AIRLINES AND BRITISH AIRWAYS
The comparative analysis of organizational behaviour is carried out by taking into
account two companies namely Southwest Airlines, a leading American airline and British
Airways which is United Kingdom’s leading international airlines in British Airways.
Organizational Culture
Organizational culture is an integral part of company’s internal environment because
it provides common goal that gels the entire network within the organization together. The
analysis of management and leadership style, employee empowerment degree, employee
motivation, level of communication, human resource selection and training, organizational
structures and conflict management resolution in both the originations will help us carry out
the comparison.
Management and leadership style
The management style of Southwest Airlines is a key factor which enables them to
continue their journey of success. It was the CEO of the company who has inculcated positive
attitudes to cerate a unique environment which get reflected in within the organization in the
shape of employee satisfaction and outside the organization in the shape of customer
satisfaction. The management style that can be observed at Southwest Airlines is no one
style but affine mix of balanced management approach. It works on the basic premise of
behavioural approach, i.e. believe in the concept of strategy implementation as more
important than strategy devising for higher success rate. In this regard, acceptance theory by
Chester Bernard is at a pivotal point which argues that no matter how well a strategy or a plan
has been devised but it the executioners of the strategy which affect the success rate of the
plan. Therefore top managers should identify the factors that affect their employees’
performance, morale and satisfaction. The top management at Southwest Airlines believes in
being friendly with employees, having a concern for employees who can make them feel
wanted. However, in adopting this approach the management does not ignore the need for
results and hence can be at times very tough with employees to make them achieve the level
of performance which they are expected of. Therefore the leadership style is again a mix of
autocratic and participative. It has been kept in mind that the situations dictate the style of
leadership which can produce the required results. Moreover the management at Southwest
Airlines believes in future scenario generation which enables them to carry out a sensitivity
analysis for the uncertain situations. As a result, the leadership inculcates the need of being
innovative and proactive into the organizational culture.
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Management style at British Airways highlights the management’s inclination
towards instructions following and compliance with the rules. Autocratic style of leadership
is observed in the history of British Airways organizational behaviour. Their focus is mainly
on the customers but do not hold high regard or family like concern for their employees like
that in SW. the organizational culture at British Airways is regarded as authoritarian,
technically biased and the relationships within the networks are formal. This does not imply
that the management does not value its employees’ services but unlike SW the informality
within the networks is absent here. The management believes that instructions given and
followed in the appropriate manner has to be the bottom line of successful managerial
actions.
Southwest Airlines management believes in not only creating a positive culture but
sustaining it for the foreseeable future so that it translates into a competitive advantage. There
are various tools that Southwest Airlines management has adopted to achieve a healthy and
positive organizational culture. The following text will briefly highlight those:
1. Employee empowerment:
The management has decentralized system of decision making which allows the
employees to take initiatives which are innovative without having the fear of being punished.
However, the degree of freedom does not get into a shape of ignoring the strict airline
regulations and limitations of the industry. Employees are encouraged to make on the spot
decisions, particularly the managers and front line staff which is direct interaction with the
customers that can result in positive benefits to the company and in turn to the company.
They keep their focus on the fact that a satisfied and delighted customer base is the success
driver in this industry. Southwest practices POS policy that is Positive Outrageous Service
which encourages the employees to go out of their way to help customers A great and worth
mentioning example in this regard is the advent of September eleven, when the terrorists had
brought planes down and SW plan had to land on emergency basis, the management decided
to keep all the passengers in a hotel and the pilot took all the passengers out to the movie.
Examples like these fill in the organizational culture at southwest airlines to highlight the
degree of employee freedom and empowerment.
British Airways management however, does not support as high degree of employee
empowerment as that in SW. Undoubtedly it encourages its employees to be innovative but
the decisions have to be made in the board room with the three-fourth consent from the
majority. Its management believes that the more standardized the processes are, the better the
performance is. Unlike SW employees here are not highly supported to make abrupt or at the
spur of the moment decisions regarding any issue.
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2. Transparent and network wide communication:
The company believes that transparency is always beneficial because it translates in to
honesty and reliability. Hence a southwest airline has launched a blog known as ―Nuts about
Southwest‖ which is a forum where customers and employees communicate and discuss of
their issues. There is a cultural committee set which is comprised of 127 members from
different parts of the company. Through this the Top management makes it sure that a couple
visits each year are made to meet the employees. These meetings give management the
opportunity to learn about the concerns and problems being faced by their employees. This
action makes employees feel that the people they are working for care for them. A new city
committee is formed which is goes to every new city Southwest starts to serve and educates
its employees about company values and culture. ―Back to basics‖ was a team set to carry out
an essay contest to describe ―what makes Southwest work‖. These best written essays were
selected and compiled in to a book which is now given to every new employ of the company.
This initiative made the employees feel wanted and treasured. The basic channel for
employee input is the company’s open door policy which encourages employees to write to
the CEO about their concerns, issues, suggestions or questions. These are forwarded to the
top management on daily basis and appropriate responses are produced to each. Such a high
degree of ease in communication has resulted in outstanding employee satisfaction.
Southwest management also believed in making their employees act as owners. The company
provides daily news update on intranet, quarterly earnings performance in the shape detailed
financial information known as ―Knowing the Score.‖ It also publishes a 32-page magazine
every month and newsletter known as LUV line which not only rotates information within the
organization but also highlights outstanding employees’ performance which in itself becomes
a great source of motivation.
British Airways management focuses on the importance of communication within the
organization. It employs different tools to make communication easy and transparent for its
employees. Mainly, the news letters and meetings give employees a chance of
communicating their concerns. However, the focus of such meetings remains business and
unlike SW the management does not go out of its way to inculcate family like values. The
employees can not directly communicate their issues with the top management but are
allowed to put up issues in front of their immediate bosses. However, a major step by British
Airways to have a wider and more effective communication was to launch a program that
would make TV broadcasts to its employees daily.
3. Organizational structure:
The basic structure of SW is similar to that of the industry, which is highly
characterized by automated schedules, extreme emphasis on efficiency and consistency of
high performance, formalization and standardization of tasks and activities. The employees
are expected to behave like clocks and machines when it comes to flight preparation. The
bottom line to describe their structural strategy is termed as ―loose-tight policy‖ which
focuses on high degree of adherence to rules and procedures when it comes to operations but
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at the same time adopting a customer friendly approach to make customers feel relaxed and
secure. The organizational chart is a simple one with three executive vice presidents of
Corporate Services, Customers and Operations reporting to the CEO and all the lower levels
report to them. Such hierarchy enables the management to keep their efficiency consistent by
being able to recognize the responsibilities and rights of each element in the network.
The organization chart of British Airways is relatively flat with one level of hierarchy
which separates top from the bottom line employees. The organization is divided into ten