North American University: Southwest Airlines CSR Report

This report provides an in-depth analysis of Southwest Airlines' Corporate Social Responsibility (CSR) practices in 2016. It examines the airline's commitment to sustainability, employee welfare, and community involvement. The report explores Southwest's policies, including its no-layoff policy and people-centric management approach, highlighting how these contribute to its strong organizational culture and competitive advantage. It also discusses the airline's technological developments, strategy-making, and strategic decisions related to globalization and operational efficiency. The report evaluates Southwest's stakeholder engagement, including employees, customers, and the community, and offers recommendations for further enhancing its socially responsible practices, emphasizing the airline's unique approach to balancing profit, people, and the planet.

1Running head: MANAGEMENT
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Name: Oluwatobi Olugbenga
course: MBA 5317 (Business Policy and Strategy).
School: North American University.
Instructor Name: Dr. Tawfiq Abu-Raqabeh
Author note:

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Executive Summary
CSR is connected to any achievement which a company ensures in order to take advantage of
on the connection between corporation and the community as well as to create positive
difference in the community where it functions with inclusive employee participation,
monetary support and volunteerism. Southwest Airlines has been taking CSR and sustainable
practices to highly efficient level. Southwest practices people-centred method which posits
precedence on employee welfare and offering to its clientele. Southwest can perceive the
company’s low cost, employee-driven tactics and also its internal strategy which mainly
sheds light on differentiation. Southwest Airlines management is considered as the Operation
Kick Tail Initiative as practice of have integrated involvement as well as incentivize staffs to
reinforce their exhibition of the personalities in ‘Living the Southwest Way’ and successfully
attain competitive edge aimed to customer service. Southwest has been introduced as well as
underlined as it has the capacity of reinforcing the organizational culture and enhance
employee morale. The following report has analysed the case of Southwest Airlines in 2016
and its operating practices. Additionally, the paper has evaluated its policies, practices and
ways in which it has involved its actions in socially responsible and sustainable business
practices to its stakeholders. Lastly, it has offered relevant resolutions for its effective
socially responsible practices.

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Table of Contents
Introduction................................................................................................................................4
Discussion..................................................................................................................................4
Southwest engaged in sustainable activities with its stakeholders.........................................4
Southwest Airlines Policies and Practices.............................................................................5
Right Recruitment Practices...............................................................................................5
No-Layoff Policy...............................................................................................................6
Southwest People Management Practices..........................................................................6
Southwest Incentives and reward practices endorses adept strategy execution.................6
Corporate Culture driving high organizational excellence................................................7
Southwest Technological Development and Sustainable Development............................7
Southwest Strategy-Making and Strategy Executing Approach........................................8
Southwest Strategy and Globalisation...............................................................................8
Strategic Decisions of Southwest Airlines.........................................................................9
Conclusion................................................................................................................................10
References................................................................................................................................11

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Introduction
For several organizations, considering the environment well is vital to business
practices and this is reflected in the Corporate Social Responsibility (CSR) initiatives. Not
only is it considered as socially accountable practice, but it seen as a good and moral business
practice. The term CSR has a varying definition tends to differ across diverse corporate
programs that value the community (Warrick, 2017). In other words, CSR is related to any
action which a corporation does in order to capitalize on the connection between corporation
and the community as well as to make positive difference in the community where it
functions with comprehensive employee participation, financial support and volunteerism.
While environmental sustainability is typically a part of CSR, it does not simply focus on
sustainability. For number of organizations, considering the environment thriving is dynamic
and this importance probably will be mirrored in CSR ingenuities. The following report will
analyse the case of Southwest Airlines in 2016 and its operating practices. Additionally, the
paper will evaluate its policies, practices and ways in which it has involved its actions in
socially responsible and sustainable business practices to its stakeholders (Peters, 2019).
Lastly, it will offer relevant resolutions for its effective socially responsible practices. The
Southwest Airlines has been established in 1966 by Herb Kelleher in the name of Air
Southwest Co. and adopted its present name that is Southwest Airlines. As per studies, since
the foundation of Southwest Airlines, the airline has developed as one of the leading and
major airlines in the United States.

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Discussion
Southwest engaged in sustainable activities with its stakeholders
CSR is considered as business practices which primarily involve programs which
value the society. Southwest Airlines has been taking CSR and sustainable practices to highly
efficient level. Southwest, with an employee base of around 46,000, chiefly attributes major
part of its achievements to its triple bottom line approach by citing equivalent value on
people, the planet as well as profit as it demeanours its business practices. As per reports, the
company follows triple bottom line method that bears in mind the environment and assurance
towards efficiency and the planet (Warrick, 2017). The company’s fuel efficiency programs
lessen its costs and reducing ecological impact. The major factor of its high customer
retention is owing to its robust commitment in establishing employment secured setting
wherein employees receive prospects of developing and making positive difference.
Moreover, Southwest Airlines has been connecting to people through approachable, reliable
and low fare air travel. In the view of Endrizalová, Novák and Kameníková (2017), likewise
to other airlines since it tends to use and produce waste, it has been shedding light on the
initiatives which reduce the use and further lessen or repurpose what has been formerly
considered as waste. These practices have been directly contributing to its financial bottom
line. Furthermore, Southwest practices people-centred method which posits precedence on
employee welfare and offering to its clientele. As per reports, one of the ways in which
Southwest reinforce its culture is by means of the Corporate Culture Committee that
constitutes nearly 157 active associates who serve 3 years terms along with over 170 alumni
members. The Culture Services Team aims in ensuring are dynamic and mirror its corporate
culture.

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Southwest Airlines Policies and Practices
Right Recruitment Practices
Although Southwest Airlines business model has great value, questionably the most
valuable competitive gains have been on its recruitment of right candidates. According to
studies, the organization employs people-centric approach that operates with approachable
and responsive staffs (Cote, 2018). Under this approach, Southwest recruits employees who
exemplify Southwest’s strategic purpose and aiding customers.
No-Layoff Policy
Southwest has gained considerable recognition in never dismissing its candidates
since the inception of its business operations in 1971. As per the case of Southwest in 2016, it
has been noted that the company has recognized substantial benevolence with its staffs as
well as unions over the years by circumventing redundancies (Atallah, Hotle & Mumbower,
2018). Furthermore, the company’s senior management and its employees referred to the
three currently procured offers as improved method to workforce reduction as compared to
involuntary layoffs.
Southwest People Management Practices
While, several companies tend to focus on customers, Southwest on the contrary,
places its operative principle on employees and then on its customers. The supreme strategic
precedence engaged on staffs has mirrored management’s principle asserting that offering
supreme services necessitated staffs that showed passion and concern towards the
organization (Peters, 2019). Meanwhile, additionally to enthusiastic personnel, Southwest has
been offering flexible business model which promotes rapid change.

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Southwest Incentives and reward practices endorses adept strategy execution
Southwest Airlines management is considered as the Operation Kick Tail Initiative as
practice of have integrated involvement as well as incentivize staffs to reinforce their
exhibition of the personalities in ‘Living the Southwest Way’ and successfully attain
competitive edge aimed to customer service (Cote, 2018). Furthermore, the company offers
points for procuring flights which clienteles are able to use in order to acquire forthcoming
flights. With its collaboration with Chase Bank and offers customers with Southwest credit
card that sanctions them to gather points which they are able to use for future flights
(Endrizalová, Novák & Kameníková, 2017).
Corporate Culture driving high organizational excellence
Leaders are identified at all levels of the organizational hierarchy rather than only
being on the top. Southwest Airline’s leaders are enthused to gather awareness of their
employees and their needs external to the workplace and are provided financial help to care
for members by sending gifts after any demise along with sending its trademarked baby items
to workers’ new-borns. Furthermore, it empowers and appreciates staffs by enabling them to
use social media or other sources of communication in order to compliment any employee.
Additionally, an imperative way of reminding employees of its culture is through “Culture
Blitzes,” whereby Culture Services team typically visits airport. According to Atallah, Hotle
& Mumbower (2018), customers of Southwest can perceive the company’s low cost,
employee-driven tactics and also its internal strategy which mainly sheds light on
differentiation. Such a strategy is highly interesting as it tends to be seen in high price or
exceptional product companies. An important way in which Southwest Airlines stimulates
staff acknowledgement is by means of peer to peer recognition. This has led the team to
create a system which stimulates staffs to offers ‘points’ to colleagues. Such a corporate

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culture has resulted in organizational excellence whereby employees can buy a range of items
which the company offers.
Southwest Technological Development and Sustainable Development
In Porter’s opinion, cost leadership strategy is related to the creation of unique as well
as significant position which includes varied range of actions. Organizations which are
strategic in approach tend to find a way to distinguish them from its competitors. According
to Endrizalová, Novák and Kameníková (2017), Southwest has tailored its performance
related to its strategic focus on low cost travel. It further reduces turnaround time at the
entrances by avoiding seat arrangements and diligently dealing with queuing issues for
aircraft boarding. Additionally, it has eased its operations by using particular type of aircraft
known as the Boeing 737 (Atallah, Hotle & Mumbower, 2018). This implies to the fact that
every pilot as well as mechanic is proficient of working any aeroplane in the fleet. The
technological development and competitive advantages have assured that no full-service
airline can compete with Southwest on its costing strategy.
Southwest Strategy-Making and Strategy Executing Approach
Southeast has made significant changes to its processes to reduce the impact of its
operations on the environment. As per reports, irrespective of its aircrafts, major proportion
of its changes revolves around rising fuel efficiency with around 29% increase since 2005.
Cote (2018) has cited instance of case whereby Southwest has redesigned its galley and has
been fixing lighter seats on its first-hand airplanes to radically cut the general weightiness of
its aircraft. Furthermore, Southwest has reassured to focus on reusing the overabundance of
resources used up in-flight such as paper and aluminium cans. While, Southwest has
employed major steps to advance sustainability, several scientists are of the opinion that
continuing sustainability in air travel will necessitate additional radical technological
adoption. However, while considering its current positive trajectory in lessening its carbon

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footprint, there has been observed tactical changes to the company’s operational practices
which possibly will drive efficiencies in short term (Warrick, 2017).
Southwest Strategy and Globalisation
With the current situation of Globalisation whereby major parts of airline sector has
been experiencing fluctuating economy, non-US companies have been significantly getting
impacted. Southwest has been operating either point-to-point services similar to bus service
with the opportunity as well as scale economies getting generated from significant factors by
uniting a range of brief segments or radial facilities with the carrier functioning a set of routes
and has obstructed unfavourably on the feasibility of hub-and-spoke workers (Peters, 2019).
Furthermore, Southwest has focused on developing its operations and further strategizes to
improve its operational performance via number of initiatives. One of the important
initiatives is the single reservation system that has been instituted in 2016. However, as per
reports, the management has shed light on the reservation system has aligned with the
airline's expectation, yet failed to offer any timeline for its promotion. Hence, the company
has expected to start a new system to allow Southwest in generating rapid code-sharing
contracts with other airlines as well as cause revenue augmentation of revenues.
Strategic Decisions of Southwest Airlines
It is important to take into consideration that spirituality and culture in organization
like Southwest has been introduced as well as underlined as it has the capacity of reinforcing
the organizational culture and enhance employee morale (Cote, 2018). Thus, such an
affirmative setting is necessitated to the workforce of Southwest to put greater effort and
show high resilience and in return retain substantial level of pride to play decisive role in
culture of Southwest. Southwest tends to dominate the short haul sector which is considered
as one of the most lucrative amongst other airlines. According to reports, Southwest has
refurbished its organizational system in order to facilitate its members to successfully redeem

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their pints for all accessible seats for yearly period. Furthermore, Southwest has witnessed its
new rewards plan dismissal by meeting as well as accomplishing all probable growth
objectives (Warrick, 2017). Moreover, they have elevated their business and existing
customers to align with the needs and requirements of the clientele. These strategic decisions
have led the company to outshine and successfully align its purposes with clientele needs.
Meanwhile, Endrizalová, Novák and Kameníkova (2017). have claimed that Southwest has
predominantly excelled as yardstick in the U.S airline for its operational excellence.
Southwest Airlines has been considered as most appropriate example which shows immense
commitment to its key competencies linked to efficient operations in order to drive its low
cost structure, exceptional delivery of customer service in addition to innovative human
resource management practices. Thus, in the view of Cote (2018), organizations must become
more strategic if they are willing to survive and sustain as well as succeed in the existing
business environment.
Conclusion
Therefore, from the above discussion it has been concluded that Southwest’s culture
acts as a role model for other companies. It has been noted that the airline’s achievements
since its inception exhibits the need for dynamic and vibrant corporate culture which
positions its personnel at the top. Furthermore, the company has shown its progressive
approach by promoting flexible business model which supports rapid change and
development. Customers of Southwest can perceive the company’s low cost, employee-
driven tactics and also its internal strategy which mainly sheds light on differentiation. Such a
strategy is highly interesting as it tends to be seen in high price or exceptional product
companies. Thus, considering the recent acquisition of Air Tran by Southwest it can be noted
that such an acquisition has helped the company to attain market shares and successfully

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expand its services. Such an affirmative setting is necessitated to the workforce of Southwest
to put greater effort and show high resilience and in return retain substantial level of pride to
play decisive role in culture of Southwest. Southwest has employed major steps to advance
sustainability; several scientists are of the opinion that continuing sustainability in air travel
will necessitate additional radical technological adoption. Southwest through its sustainable
practices have put efforts on increasing its revenue as well as profit capacity.

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References
Atallah, S., Hotle, S. L., & Mumbower, S. (2018). The evolution of low-cost Carrier
operational strategies pre-and post-recession. Journal of Air Transport
Management, 73, 87-94.
Cote, R. (2018). Leadership Analysis: Southwest Airlines-Herb Kelleher, CEO. Journal of
Leadership, Accountability and Ethics, 15(1).
Endrizalová, E., Novák, M., & Kameníková, I. (2017). Development and trends in airlines
business models. In New Trends in Process Control and Production management (pp.
119-123). CRC Press.
Peters, L. (2019). Corporate Culture: It Takes More Than Donuts!. In The Simple Truths
About Leadership (pp. 63-72). Palgrave Macmillan, Cham.
Warrick, D. D. (2017). What leaders need to know about organizational culture. Business
Horizons, 60(3), 395-404.