From SBR 1993 SWA HR Case Study Analysis The human resources (HR) department was renamed the “People Department” to change the overall company perspective of HR. Ann Rhoades was worried that the group was seen as an oversight and regulatory department, the corporate handbook was thrown away and they started from scratch. Bringing in new people with marketing backgrounds provided the capability to transform the existing view of HR. Since an employee ahs to have line experience to join the department, they have first hand knowledge of worker needs. The current charter of the people department is through informal teamwork, become information providers for the employees and to do whatever it takes to make the customer happy. As a result, the department now treats employees as internal customers and has aligned their image with the company culture.
Current Human Resources Strategy Southwest’s hiring policy is conservative, but the type of people they look for are outgoing team players that are fun to work with. Their hire for attitude and train for skill philosophy is evident throughout the case study. They look for people whose attitude fits into an existing culture that tells employees to break the rules if they need to. Training is also a key part of their strategy in that they can train people with the right attitude to the appropriate skill level.
The Research paper on Case Analysis: Employee Attitudes
1. Which of Schwartz’s 10 values are driving the behavior of managers at Bain & Company, Home Depot, and Best Buy? Provide examples to support your conclusions. Bain’s management is driven by he Schwartz’s values of power and self- direction. In a downturn, he chose to go against the grain and take advantage of the situation, hiring people instead of laying off which allows him to snatch up ...
Additionally, so that employees don’t get to satisfied with company success, training is provided at all levels within the company. Training is also utilized as a tool for internal customer feedback. Another part of the HR process is to feed performance metrics back to employees, keep them focused and make them aware of how their actions affect costs. This process is not usually a function of human resources, but Southwest apparently uses the HR department as an instrument for implementing or guiding company strategy. People The workforce is 89 percent unionized, ahs had only one walkout and no one has ever been laid off. With approximately 18, 000 employees, the airline has a young workforce with the average age being 34 years old.
The company is 23 percent minorities, and of those, 10-12 percent are in management. Women are well represented at all levels. The current president and chief operating officer and the vice president of the “People Department” is also a woman. Because of the company culture and profit sharing, turnover is less than half industry average.
Compensation Compensation at Southwest is low compared to other airlines and in some areas, less than the industry standard. As a result, many employees took a pay cut to work at Southwest. Executive compensation is modest. The CEO was one of the five lowest paid in 1994. Pilots and stewardesses are paid by the trip. Seniority is a factor in each job class, where the salary variance can be as much as 20, 000 per year.
Benefits Profit sharing covers all employees with the firm for at least a year and 25 percent of profit sharing money is required to be put into a retirement account. In 1993 (year previous to the article), employees received 8 percent of their salary in bonus. The company also has a discount stock purchase program, and 80-90 percent of employees own stock in the company. Recruiting Strategy Southwest has identified effective performance and behavior as the primary characteristics they seek. The recruiters primary role is to make sure potential hires are a good cultural fit. Therefore, Southwest is very selective in recruiting.
The Essay on Airline Industry: A History of Southwest Airlines
In 1967 Southwest Airlines was a vision by and investment adviser Rollin Kind and his lawyer Herb Kelleher, they wanted to start a different kind of airline. Rollin King already had a small charter that ran between the smaller Texas cities. This new airline at first was to fly between the three largest cities in Texas, Dallas, Houston, and San Antonio. The company was first names Air Southwest ...
Of 98, 000 applications submitted in 1993, only 16, 000 were interviewed and 2, 700 hired. Customers and employees are often a part of the hiring process. Again, the focus is on the right attitude, disposition and behavioral characteristics. In essence, they look for people who have or can easily adopt the Southwest spirit. Human Resource Problem Identification: In 1993, the airline industry had poor labor relations and controlling managers.
Airlines were driven out of business due to numerous strikes and wage problems. Several airlines were undergoing employee buyouts and employees were exchanging percentages of ownership for wage concessions. These problems were not significant for SWA. The industry force that got their attention was the direct imitation of their low cost strategy by United and Continental airlines. Both airlines adopted the “airline within an airline ” concept by developing a low cost, short haul operation within their companies.
Continental’s low cost short haul operation was called Continental Lite or CALite. CALite started operations on the east coast in October 1994 with dramatically cut fares. However, other airlines responded to the fare cuts and their profits did not meet expectations. In 1994, they were flying with only 59 percent of the seats filled and customers didn’t enjoy the loss of priority boarding and meal service.
CALite also depended more heavily on one-stop and connecting passengers than SWA did. In July 1994, United started its low cost short-haul operation called “The Shuttle.” United offered low cost routes with advance seating, a first class cabin and a frequent flyer program. Summary Southwest views people as their most important asset and does a very good job of motivating employees. From the top down, the company knows the direction and image they want to sustain and their hiring practices reflect that position. The atmosphere of culture, teamwork and mutual respect makes the airline a good place to work.
The company culture also determines their recruiting philosophy. However, wages do not make the jobs attractive, but profit sharing and bonuses make up for some of the pay deficiencies. There is not a lot of lateral or cross training. Most training is directed toward primary work tasks. This strategy enables employees to become very f proficient at what they do and results in a high level of company performance, customer service and profitability. Southwest first based itself on being a people company.
The Term Paper on Southwest Airlines Company Airline Aircraft
... millennium brought renewed commitment from the Southwest Airlines Company to continue low-cost fares at unbeatable quality performance from its employees and executive management teams. It ... their company strategies upon the basics of Southwest. Today, there are two other low-cost air carriers (the other two airlines are considered national airlines and ...
Taking this belief and gearing it to increase employee motivation has made Southwest successful. The primary key to Southwest’s success has been communicating the value of their employees, while also giving them the freedom to learn, make a difference, be innovative, work hard and have fun. The distinction Southwest enjoys with it customer base is safe, efficient, low-cost, regional airfare. Another is their attitude the culture enjoyed by their employees.
The companies’ main competitive weapon is their fun-loving, customer service reputation. The employees come first and this attitude promotes loyalty, high productivity, and allows the company to maintain a lean staffing levels. Southwest is one of the most benchmarked companies in America and has become a model for other airlines to follow. They have accomplished this by focusing on what they do best. Although the company has explored becoming a long haul carrier to compete with other airlines, Southwest does not consider other airlines as major competitors. Instead, they view ground transportation like the automobile and the bus as their competition..
