Labor Relations Southwests Current Issues - 1425 Words

Current Issues Despite Southwest’s long standing reputation as an employer who makes their employees and customers happy, there have been storms brewing in the company’s labor relations and customer relations sector. As was mentioned before, Southwest recently acquired AirTran Airways and revealed plans to take its already successful domestic business international with flights to Mexico and the Caribbean (Martin, 2014). This organizational restructuring is causing Southwest to have what Time Magazine’s Brad Tuttle calls an â€Å"identity crisis† for the airline whose new advertisements have removed the humor they are famous for and the messages of â€Å"bags fly free† from commercials. Bob Jordan, a Southwest executive, explained the change as a†¦show more content†¦Another reason the airlines’ employees disagree about adding seasonal workers is because Southwest is also in another contract negotiation that may mean freezing pay scales to prevent company lay-offs. It seems unfair to add more employees who will also be looking for a piece of the monetary pie. These labor relations issues are new to Southwest, and for the first time the company’s problems, and not their great customer service, are putting them in the spotlight. To overcome this, the company will need to tread gently and find ways to successfully negotiate with their unions (Maher, 2014). Potential ways to manage and influence relationships to benefit all The success of Southwest Airline and their substantial growth are unquestionable, despite some of their recent setbacks, and they are even used as an example in American business colleges as one of the best organizations to work for. They have been often praised for their culture of going the extra mile for their employees and customers; and consequently they have a series of unions which historically they have had good relations with. As previously discussed in actuality southwest is having some internal disputes over the new union contracts and this is causing turmoil within the company (Maxon, 2014). These current issues they are facingShow MoreRelatedBusiness Strategy Of Southwest Airlines1633 Words   |  7 Pagescosts, keeping its unique culture intact, changes in the leadership of the company, and continually finding excellent talent. Southwest’s talent is selected very carefully, and at the same time is compensated very competitively, resulting in restively low labor cost for the company. The continued access to and availability of talents has a direct impact on Southwest’s operating strategy of being the cheapest and most efficient airline, which in turn depends on highly motivated employees whoRead MoreSouthwest Airlines11551 Words   |  47 PagesSeptember 11, 2001 were thought by some on Southwest’s management team to make it more difficult for the airline to maintain its distinctive competitive position. For example, industry bailout efforts by Congress were intended to help Southwest’s competitors that were in the worst financial condition. The need to respond to constantly changing security directives made it harder for employees to create and convey the Southwest SPIRIT. More recently, Southwest’s organization had increased efforts to maintainRead MoreSouthwest Airline Case Study15774 Words   |  64 Pagesairline industry in 1974 and offered it ever since. In 2000, Southwest offered its employees a record-setting $138M in profit sharing. This tax-deferred compensation represented an additional 14.1 percent of each employees annual salary. The current mission statement of Southwest Airlines does not satisfactorily address each component of the Evaluation Matrix of Mission Statements and therefore should be revised. I have revised the mission statement and believe the revision below better addressesRead More The History of Southwest Airlines Essay3823 Words   |  16 PagesSWA immediately began to expand. In 1972 all Houston service is transferred to Houstons Hobby Airport form Houston Intercontinental, that is make more convenient for people to fly. During the first year of operations the customers were the Southwests first priority. Five years after the first operated a twin-engine the SWA places its sixth Boeing 737 into service while flying over one and a half million satisfied customers to their destinations. Also at the same year SWA gets clearance toRead MoreSouthwest Airlines: a Strategy Perspective3414 Words   |  14 Pagesstrategy: â€Å"If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline.† This approach has been the key to Southwest’s success. Currently, Southwest serves about 60 cities (in 31 states) with 71 million total passengers carried (in 2004) and with a total operating revenue of $6.5 billion. Southwest is traded publicly under the symbol â€Å"LUV† on NYSE. Facts: Read MoreBest article11361 Words   |  46 PagesAirlines, was packing her briefcase at the end of a 17-hour day. Tomorrow was an off-site meeting with the top nine executives of Southwest Airlines. The agenda for the meeting was to review Southwest’s competitive position in light of recent actions by United and Continental, both of whom had entered Southwest’s low fare market. That day’s New York Times (September 16, 1994) had an article that characterized the situation as a major showdown in airline industry: No tC This is a battle royalRead MoreSouthwest Airlines Case3622 Words   |  15 Pagesairline industry, SWA financials have remained strong. * Currently has $3.3 billion in cash and short-term investments, and an available $600 million revolving credit line (Schlangenstein, Hughes, 2010). * Limited control over fuel and labor costs has their impacted their low-cost reputation * Salaries, wages, and benefits constituted approximately 29 percent of their operating cost in 2011 (SWA, 2010). * Jet fuel and oil constituted approximately 38 percent of theRead MoreSouthwest Airlines : The Most Important Airline3734 Words   |  15 Pagesairplanes, it is difficult to predict how and if changes are coming and how they may be affected. Demographics Airline travel has continued to increase over the years. As our economy continues to grow so will globalization which includes the trading of labor (people). The demand for air travel to countries around the world continues to increase and airlines like Southwest are continuously responding with more flights and purchasing of bigger airplanes to accommodate more passengers. It can be seen thatRead MoreSouthwest Airlines Motivational Profile3108 Words   |  13 Pagesenter mergers with other floundering legacy carriers. The latest bankruptcy announcement comes from American Airlines, the last of the legacy carriers to file for Chapter 11 protection (De La Merced, 2011). Heavy debt, inefficient aircraft, and high labor costs are forcing American Airlines to restructure just to compete. Profitable airlines are increasingly dependent on consumer fees, fewer routes, and sold out planes to maintain a positive cash flow. Background of Southwest Airlines SouthwestRead MoreSouthwest Airlines Case Study in 2010 Essay21106 Words   |  85 Pageseconomic power to squeeze us dry so we would collapse before we ever got into business. I was bound and determined to show that Southwest Airlines was going to survive and was going into operation.†3 In January 1971, Lamar Muse was brought in as Southwest’s CEO to get operations under way. Muse was an aggressive, self-confident airline veteran who knew the business well and who had the entrepreneurial skills to tackle the challenges of building the airline from scratch and then competing head-on