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Case 7

I believe the low operating cost strategy is the most crucial in accounting for the success. Because at that time southwest airlines management aware, low cost forced the company actively pursue low operating costs. These years, the company has made many rules make cost under the competitor:

1. The company operating only type of plane---the Boeing 737,to simplified cataloguing minimum spare maintenance and repair personnel training, improve proficiency and speed to complete the regular inspection and simplify the plane for special flight arrangements.

2. Southwest airlines encourage customers on the company's website, this book and purchase tickets for the travel agent can be from tickets, and pay its commission procedures and reduce southwest airlines nine ticket booking center required number of employees. 2000 southwest airlines 30% of revenue from travel agents sell tickets (1998 is 40%), and in the end of 2002 more than 50% of ticket sales occur on the company's website. 2002 total sales trip without tickets, 85% of paperwork and ground activity decreases in great quantities

3. The Company managed to avoid crowded airport, focusing on major metropolis in more recent airport or medium-sized cities in the airport for business. This helps to produce higher than normal level of punctual performance, reduce because taxiway congestion in one line or the plane circled to wait at the airport landing clearances brought by fuel costs; And it makes companies from pay the higher of the high passenger airport landing fees and terminal gate fee

4. Southwest airlines point-to-point flights scheduling than competitors use centralized operation center system more benefits.

5. Southwest airlines flight attendants will be responsible for clearing up the plane passengers with...