Write a 4–6-paragraph analysis of SOUTHWEST AIRLINES external environments, as w

Question

Write a 4–6-paragraph analysis of SOUTHWEST AIRLINES external environments, as well as the interrelationships among its internal businesses.

External Environment: Analyze SOUTHWEST AIRLINES external environment for the conditions and factors surrounding it that influence its activities and choices, including its business strategies. External forces the organization does not control include the following:

Future trends—in the field or the culture.

Economy—local, national, and international.

Funding sources—foundations, donors, legislatures.

Demographics—changes in the age, race, gender, culture of those served by the organization.

Physical environment.

Legislation.

Local, national, and international events.

Explanation / Answer

The external environment of Southwest airlines includes the factors that cannot be controlled by the internal management but affects the internal business. The future trends, economical factors, funding sources, legal factors, physical environment, demographical and local, national and international events affect the external environment of Southwest Airlines and affect the business strategies. The Southwest management cannot control these attributes and need to adjust their strategies to make competitive advantage in the market.

The future trends in the airline field include the opportunities that may benefit Southwest Airlines. They are developing new flights and are planning to expand its market and many are under development. The technology also gets upgraded with the trends in the industry and the reservation system in Southwest also getting upgraded to meet the future trends in the field. As Southwest airlines is concentrated into no frills travel they have not much explored the opportunities related to business travelers and Southwest can develop its strategies for attracting business travelers in the future while planning expansion. Southwest’s culture gives most importance to the employees and hires right people to ensure best customer service in the industry. This attitude is going to help Southwest Airlines in the future also as the employee plays an important role in the organization’s success.

The economical factors include the fuel price and the economic conditions prevailing in the country. When the fuel price goes up the airline business gets affected. The airline industry needs to increase the ticket price to meet the fuel price hike. During economic slowdown people try to avoid air travel to save cost and this again affect the operations of Airlines. Southwest is known for providing low cost travel to the customers and they avoid certain amenities to reduce the cost of travel and ensure that company does not undergo loss due to its low cost travel model. The cancellation policies and rewards offered by Southwest Airlines is much attracting to the customers and create competitive advantage in the market.

The Physical factors include the employees, the customers and the environment. According to southwest culture employees greet the passengers happily while boarding. Southwest make much efforts regarding environment protection. Southwest provide more importance for reducing emissions and conservation of fuel. Southwest has signed an agreement for purchasing low carbon renewable fuel in 2014 as a part of its environment friendly efforts.  

The legal factors include the government regulations which control the airlines and Federal Aviation Administration is the main authority to control airline activities. There are laws which prohibit airlines from flying nonstop. Southwest has tried to fly nonstop to make profit and these regulations affect Southwest activities and lead to many legal battles.

The demographic factors have great role in the expansion of airline services and Southwest Airlines is affected by the population density on the area while expanding its operations. Demography with low population does not need much expansion as the number of passengers might be low. Southwest entertain all cultures in similar way without any difference and their attitude towards employees do not show any discrimination.

Southwest comes up with discounted rates to attract more customers during local, national or international events and choose appropriate strategies so that customers prefer Southwest airlines for travel during the events and festivals. Southwest also tie up with various funding agencies in the market to provide scholarships and participate in charitable programs which helps to increase its reputation in the market.

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