Strategic Audit Report Template

INTERNAL ENVIRONMENT 6

Internal Environment

James Goggans

Embry Riddle Aeronautical University

MGMT 436, Strategic Management

Prof. Robert E. Rue

8 August 2021

Internal Environment

Operations and Logistics

Southwest Airlines produces its goods and services both internally and externally. However, most of their products are made externally, and they maintain an ethical relationship with the suppliers. They partner with suppliers to produce the equipment they use to offer transportation services to their customers. The company has a diverse supplier base consisting of women, the LGBT community, the disabled, and the disadvantaged. Most of its equipment is customized, helping in maintaining the identity and building its brand.

The company uses several resources to offer services to its esteemed customers. The first resource is its fleet of aircraft that form the main part of the company resources. It would not be possible to offer services without the aircraft. The company also has a service and maintenance infrastructure that attends to emergencies whenever one arises, ensuring that customers get services all the time with minimal disruption. Southwest Airlines has a network of partnerships that enhances its community outreach and boosting its corporate social responsibility. It has an IT infrastructure whereby some of the services have been automated. IT infrastructure also improves the quality of services and minimizes delay (Dias, 2020). Lastly, the company enjoys a team of dedicated employees whose customer services are unmatched.

The company operates by offering point-to-point flights between cities and connecting to secondary airports in larger cities and other countries. The company maintained frequent departure and implemented automated ticketing. Automated ticketing reduces congestion at the gate and also increases revenue due to the reduced cost of production. The company's customer service phone line is reachable 24/7, and this enhances customer convenience.

Human Resource Management

The company currently has 54 448 employees who have enhanced a positive corporate culture and have contributed to the company's success. The employees enjoy various benefits that make them committed to the company's strategic goals. The company offers health benefits in medical, vision, dental, short-term disability, and accidental coverage. The company has exceptional retirement plans where employees can pay as they prepare for a comfortable future after retirement (Harvey & Turnbull, 2020). There are well-being rewards that enhance better living among employees, including time off for personal development. Employees also have access to free counseling services so that they have good mental health. They also have paid vacation and leaves depending on job group and years of service.

Reports indicate that about 83% of the company's employees are unionized. The goal is to make sure parties maintain the collective bargaining agreements to take care of employees by offering them the best working conditions and payment environment. For example, NEXSTAR represents flight attendants and ensures they are working in a very comfortable environment. Employees review the company as a good workplace with favorable conditions. However, recently, employees complain of stressful demands caused by the pandemic. There are also concerns that the management and culture of the organization have to be worked on for better results.

There are no records concerning government fines or human rights protests against the company for mistreatment of employees. However, unions have raised the alarm over frequent abuse and violence from passengers. In May 2021, a flight attendant lost two teeth after a passenger punched him. Reportedly, the passenger had ignored inflight instructions and became furious. The union says that flight hostility is unprecedented and wants the company to be consistent in barring unruly passengers (Wood, 2021). The union also calls for increased air marshals on planes to tame the behavior.

Information Technology

The company implemented automation of some administrative tasks that are considered burdensome to reduce costs and time. The company has automated its recruiting process to create a personalized and efficient approach to candidates' selection. According to the company website, automation is projected to reduce the selection time from 42 days to 21 days. The company has deployed an automated chatbot that answers questions from potential candidates and connects recruiters with these candidates. Most of the customer care services are also automated. For example, the company allows customers to book flights online and be checked in automatically. The complaints process is not automated, but customers must call the customer relations department to tweet to launch complaints.

The company has registered a swift transition from a paper-based environment to a complete technology-based structure. The company has automated logistic processes and can easily track contracts, making it easier and transparent to review operations. The company automatically emails insurance brokers and companies when updating specific fields. Using Risk connect software, the company has integrated different business units, easing supervision and service delivery.

Today, passengers are wary of touching services, and Southwest Airlines offer a contactless experience through an inflight entertainment portal that allows customers to stream content without downloading an app. The change is driving a real-step change regarding connectivity and quality of services (Tansitpong, 2020). The automation of customer services at the company made it easier to transform to the new normal where employees work from home and there is minimal physical contact. The company has bid goodbye to antiquated systems, and a new reservation system has been implemented to tighten flight timing and accept foreign currency. Mechanics and other employees have access to real-time information to address emergencies within the shortest possible time.

References

Dias, R. S. (2020). Southwest Airlines Co.: consistency for the future (Doctoral dissertation).

Harvey, G., & Turnbull, P. (2020). SOUTHWEST AIRLINES. Case Studies in Work, Employment and Human Resource Management, 80.

Tansitpong, P. (2020, January). Identifying key drivers in airline recommendations using logistic regression from web scraping. In Proceedings of 2020 the 3rd International Conference on Computers in Management and Business (pp. 112-116).

Wood, D. (2021). Flight Attendant Union Sends Letter to Southwest Airlines CEO After Vicious Assault.