Southwest Airlines in Baltimore Case Study

07/05/15

Southwest Airlines in Baltimore

Problem/Opportunity: Baltimore is one of the largest stations for Southwest Airlines. The airline plans to expand its operations in Baltimore over the next few years. The challenge at Baltimore is to accommodate the additional growth when its operational performance is still lagging behind the system-wide average of the airline.

Key issues in Baltimore:

• Connections. Connections are a challenge to Southwest in Baltimore. Baltimore station has a disproportionate number of connecting passengers. % of connecting passengers in Baltimore is around 30% compared to 20% companywide.  If plane arrival is delayed, a lot of work has to be done in order to accommodate connecting customers.
• Holding flights. Southwest employees have the authority to hold the flights in order to accommodate connecting passengers. Holding off flights has a ripple effect on the entire system.
• Labor market and understaffed operations. Company is running short on trained and qualified personnel. Mandatory overtime decreased the morale of existing employees and increased employee turnaround.
• 15 minute turnaround. Challenge in completing a 15 minute turnaround due to lack of understanding overall work process and poor coordination across difference functions.
• Bag sorting area bottleneck. Bag sorting area in Baltimore has reached its capacity. This can also result in a bottleneck for the company, as it slows down the entire flight process.

Alternatives:

• Training program. Implement a more efficient training program for new employees. Create an employee rotation program where more experienced employees work at BWI and mentor new colleagues. Also, new employees, after they finish their training in Dallas can be transferred to work at less congested airports to get the grip of all functions. The training time might lengthen and training expenses will go up, yet employee turnaround time might decrease and employee morale might increase.
• Passenger accommodations. Instead of holding flights to accommodate customers, Southwest employees can accommodate employees by offering next flight even if it’s from the competitor, or offer accommodations for overnight stay at the hotel. These accommodations will result in increased expenses to Southwest, yet they will reduce customer dissatisfaction. Southwest should consider partnering up with local hotel chains to provide overnight accommodations and other airlines to offer customer next flight in order to reach final destination on time.
• Expansion of bagging system. An investment in a new and more efficient bagging system should be made. This would alleviate connection problems.

Recommendations/ Plan of Actions:

• Unhappy employees deliver poor service! In the short term, company will need to boost the morale of employees. Southwest should implement a new training program by placing experienced employees to Baltimore location.  This program will allow new employees to gain experience and expertise from already experienced employees. This program can be temporary, until Baltimore station gains necessary skilled labor and morale. The implementation of this program will lead to increased relocation and housing expenses. Yet this program could significantly reduce complication during connections and passenger accommodations costs.
• With new training program, Southwest would improve morale of employees and perhaps attract new applicants to fulfill the labor demand. Gradually, Southwest needs to cut the amount of overtime employees are currently working. There is a direct correlation linking current employee overtime with the amount of complaints coming from customers about bagging.
• Seek advice from Phoenix station, as based on data provided in the exhibit 7, Phoenix location has successfully implemented a more efficient connecting system.
• In the long run, Baltimore station should expand the bagging station. Bagging station is a bottleneck that will slow down the explanation of the Baltimore operations. As mentioned in the Goal, the bottleneck determines the capacity of operations. In case with Baltimore, if this station cannot handle increased number of bags in will have operational issues such as longer connection times.  

Southwest Airlines

1. Southwest Airlines is a marketing driven company. It views cars and busses as its main competition. They use less congestive airports that provide easy access to metropolitan areas. A focus on hiring and controls is implemented. Only one operating platform, the Boeing 737, is used. Costs are cut though limited flight services being offered. A chief focus for Southwest is providing quick turnaround, directing traffic swiftly through the gates. They have a commitment to offering cheap fares and frequent flights.  Employees are given the freedom to make decisions, keeping a focus on customer service at all times. Employees are cross-trained, and encouraged to change jobs within the company.

Advantages Southwest Airlines has are lower costs, quicker turn-around, open and single class seating. The work environment is fun –filled with a focus on family and team and service orientation. Each agent is assigned only one flight, allowing the agent to give complete focus to ensuring the success of this flight.