Team Members : Krystal Brown, Jasmine Cooley, Aretas Coleman, Jeremy Lewis, Terry Kerr

1. Team Members :Krystal Brown, Jasmine Cooley, Aretas Coleman, Jeremy Lewis, Terry Kerr

2. overview • Organization History and Life Cycle • External Environment • Mission, Goals, and Strategies • Organizational Culture and Management • Interorganizational Relationships

3. History 1967: Air Southwest Co. is incorporated; later in 1971 the company name was changed to Southwest Airlines Co. Rollin King and Herb Kelleher founded Southwest Airlines with one simple goal: To serve Dallas, Houston, and San Antonio with point-to-point flights. • “As company legend goes, the very first route map was drawn on a cocktail napkin during a meeting between Rollin King and Herb Kelleher.”

4. History Herb Kelleher, Attorney at Law (Co-founder) • 1967: Files application with TAC to serve DAL, IAH, & SAT. • Rival companies Braniff and Texas International serve the same areas; hence, they fought through the legal system to keep Air Southwest grounded. • Herb offers to represent Air Southwest’s appeal to the Texas Supreme Court. He charged no fees and paid any costs out of pocket. • 1970: Texas Supreme Court overturns lowers court ruling and clears Air Southwest for “take-off.”

5. history Lamar Muse: Joins Air Southwest in 1971 as President. • Sells promissory notes to raise $1.25M in funds for aircraft and startup costs • Makes agreement with Boeing to purchase three Boeing 737s (with Boeing holding 90% of the financing) • Hires “The Over the Hill Gang” (Dick Elliot, Jack Vidal, Donald Ogden, Bill Franklin) • Made initial public offering of stock (raising $6.5M in funds) • June 18, 1970: The “Love Airline” is born; starting service to DAL, IAH, & SAT.

6. history 1975: LUV made ticker symbol on American Stock Exchange 1976: Southwest Airlines expands service to 5 new cities in one year. 1978: Southwest Airlines purchases Midway Airline as a wholly owned subsidiary and enters the Northeast U.S. market 1978: Muse resigns as President; Herb is asked to step in as Interim President, CEO, & COB. 1981: Herb Kelleher assumes the permanent position of President and CEO

7. HISTORY • Herb Kelleher served Southwest Airlines from 1967-2007 • Profitable for 37 years • Largest U.S. based airline (by passengers) • 547 Aircraft (Boeing 737) • 3400 Flights A Day • One of first airlines to have a website • First airline to offer automated ticket services • “Southwest Effect”- term coined by the Department of Transportation

8. Life cycle

9. External Environment Uncertainty

10. External Environment • Air- Traffic Controller shortage • Competition • Fuel Prices • Air traffic disasters • Decline in customer demands • Economic downfall

11. External Environment External SWOT Analysis

12. External Environment Porter’s 5 Forces • Threat of New Entrants (L) • Capital Intense • Government Regulations • Excess to distribution channels • Economies to scale • Power of Buyers (H) • Switching cost • Differentiation of products • Information available

13. External Environment Porter’s 5 Forces Cont. • Power of Suppliers(H) • Switching costs • Substitutes • Difference between Products • Threat of Substitutes(M) • Rental Car Services • Rail • Bus • Ship

14. External Enviornment Porter’s 5 Forces Cont. • Rivalry of Existing Firms (H) • Mergers • Competition

15. Mission • 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. • To Employees: • 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

16. Goals • Low cost leadership • High customer service

17. Strategies • Low cost Leadership

18. Chart on pg 73 • http://www.nytimes.com/2010/11/21/business/21south.html • http://www.bloomberg.com/news/2010-09-27/southwest-airlines-agrees-to-buy-airtran-for-1-4-billion-in-cash-shares.html Strategies • Defender strategy

19. strategies • Internal process approach

22. Culture

23. Culture

24. Culture

27. Management

28. Management

29. Interorganizational Relationships

30. Population Ecology Organization Type Dissimilar Similar Organization Relationships Competitive Cooperative

31. Population Ecology

32. Interorganizational Relationships

33. Interorganizatl Re