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Week 3 Strategic Management and Strategic Competitiveness Assignment
Ashley White
Strayer University
BUS499 Business Administration Capstone
Week 3 Strategic Management and Strategic Competitiveness Assignment
The selected public corporation company that will be used in the assignment is Southwest Airlines. It is a public corporation in the travel industry located in Dallas Texas. The company’s services include providing air transportation to its customers. The paper explores how globalization and technology changes have affected Southwest Airlines, how the organization could achieve above-average returns dependent on the resource-based and industrial-organizational model and how the mission and vision statement of the corporation affects its overall success. The paper also identifies how each type of stakeholder affects the overall success of the corporation.
Globalization
Southwest Airlines expanded its services globally in 2014. Its expansion allows it to offer its carrier services in international markets such as Mexico, the Caribbean and Central America. The corporation continues to expand globally by adding new destinations every year. While expanding globally, Southwest Airlines has experienced several effects of globalization (Michael, 2020). One of the effects is stiff competition from other organizations in the industry. Southwest airlines face stiff competition from other travel firms, especially from the big travel companies. The organization’s low-cost strategy has allowed it to achieve a greater competitive advantage and sustain the global market.
The other effect that globalization has had on Southwest airlines is improving the effectiveness and efficiency of its operations. Expanding to the global markets allowed the company to improve the quality of its services to meet the international standards required for operations (Michael, 2020). Globalization has impacted Southwest Airline’s style of operation depending on the culture and legal principles of the country in which the airport is operating.
Technology
Technological changes have had tremendous effects on Southwest Airlines. Technological changes have affected Southwest Airlines based on customer experience, costs of operation, managing data, marketing and monitoring and evaluation of employees. With the use of advanced technology in communication, the cooperation has improved customer experience in terms of booking flights and reservations and obtaining feedback from the customers (Airlines, 2018). Social media platforms such as Facebook, Linked In and Instagram have allowed the company to interact frequently with its customers. Advanced technology has enabled the company to minimize costs of operations by minimizing errors. The corporation uses advanced technology such as Artificial Intelligence to market its services. The social media platform is also used in marketing the company’s services. By application of advanced technology, the company has been able to improve the efficiency and effectiveness of its operations and therefore increase its revenue (Airlines, 2018).
Industrial Organization Model
The Industrial Organization Model involves the external factors that affect an industry. Some of the external factors that affect Southwest Airlines include economic, social-cultural, political and technological factors. When there is economic growth in the country, the purchasing power of the airline services decreases and this negatively affects the income of the business (Knorr and Arndt, 2018). When there is political instability in one of the corporation’s destinations, the flight operations are likely to be stopped. Economic and political stability in the country enhances performance and therefore allows Southwest Airlines to improve its performance.
Resource-Based Model
The resource-based model acknowledges that a company’s resources are essential for it to achieve its goals and improve performance. The key resources that Southwest Airlines have are employees, finances, equipment and brand name. The company’s employees make the daily operations of the company to be possible and successful. Southwest Airlines have highly qualified employees with great capabilities and experience; this is important in offering excellent services to the customers. The corporation’s financial resources are essential for paying for the expenses incurred (Knorr & Arndt, 2018). The corporation has adequate equipment that facilitates its daily operations. The organization’s brand name allows it to achieve a higher market share and maintain a greater competitive advantage.
Vision
The vision of Southwest Airlines is to be the world’s most loved, most efficient and most profitable airline (Airlines, 2018). The organization’s vision acts as a direction on where the company wants to go. It makes the goals and objectives clear to the stakeholder. The vision inspires the employees to work harder and help the organization to achieve its goals and objectives. The company uses the vision statement to provide and communicate the company’s aspirations to key stakeholders. The vision statement allows the leaders to make decisions that align with the organization’s goals and objectives. It also enables the corporation to determine the resources that should be prioritized in the organization. Southwest Airlines’ vision statement helps to define and establish the company’s norms and culture and this is important in promoting appropriate behavior among the employees.
Mission
The mission statement of Southwest Airlines is the dedication to the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride and company spirit (Airlines, 2018). The mission statement helps in developing an appropriate organizational strategy that helps in promoting the performance of the company. The mission statement clarifies the purpose and key measurable objectives of the organization. A clear mission statement helps the organization engage and retain its employees. The employees can determine the purpose of their work in the organization. Southwest Airlines’ mission statement is important in differentiating what it needs to work on from what needs to be left.
Stakeholders
The key stakeholders of Southwest Airlines include shareholders, leaders of the organization, employees, suppliers and the government. The shareholders involve individuals that own a stake in the organization and therefore are guaranteed a share of profit from the organization. The shareholders play a key role in making critical decisions that affect the operations of the business. They monitor the company’s management and approve or object to the actions that are made by the elected leaders or the employees (Knorr & Arndt, 2018). The leaders of the organization help in developing the strategies that will help to improve the organization’s performance and allow it to achieve its goals and objectives. The leaders supervise and monitor the employees to ensure that the daily operations of the company are performed appropriately.
The employees are important stakeholders of the business as they ensure that the daily activities of the company have been done. The employees’ actions should align with the goals and objectives of the company to allow it to achieve its vision. The suppliers provide the company with the necessary supplies and equipment that Southwest Airlines need for its operations. Maintaining a good relationship with the suppliers is important to promote effective logistic activities that will prevent delays (Knorr & Arndt, 2018). Customers are important stakeholders of the business. They are among the main reasons why the business is in operation. It is important to maintain a go relationship with the customers for the corporation to achieve a greater market share and competitive advantage.
Sources
1. Michael A. Hitt. 2020. Strategic Management: Concepts and Cases: Competitiveness and Globalization 13th ed. Cengage Learning.
2. Airlines, S. (2018). Southwest Airlines Co. 2017 annual report to shareholders. Retrieved from http://investors. Southwest. Com/financials/company-reports/annual-reports. https://www.academia.edu/download/29835026/swapa_cba.pdf
3. Knorr, A. & Arndt, A. (2018). Most Low-Cost Airlines Fail (ed): Why Did Southwest Airlines Prosper? In Competition versus predation in aviation markets (pp. 145-170). Routledge. https://www.taylorfrancis.com/chapters/edit/10.4324/9781351161404-8/low-cost-airlines-fail-ed-southwest-airlines-prosper-andreas-knorr-andreas-arndt
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