prof Hopkins

Running Head: COURSE PROJECT WEEK 3 1

COURSE PROJECT WEEK 3 7

Course Project Week 3

Management of Human Resources – 1

Everest University

Course Project Week 3

1. Integration and Application. Read the case at the end of this book regarding Southwest Airlines. Then, using Exhibit 1.1 as a guide, make a summary that identifies the stakeholders and shows the relative importance of each stakeholder to each company.

The stakeholders for Southwest Airlines are the employees, customers, shareholders, the communities or society, and suppliers. “Stakeholders are individuals or groups with interests, rights, or ownership in an organization and its activities.” (Jackson, 2012, pg. 4) The relative importance of employees is employee ownership which has helped retention and maintain job satisfaction. Southwest Airlines is known for being an appealing, growth-oriented, and fulfilling business to be employed with. Customers’ importance is first and foremost at Southwest which is basically a low-fare and no-frills airline. Customers enjoy a high frequency of flights which are on-time as scheduled as well as friendly knowledgeable employees. Shareholders contain important investors and owners which enjoy tangible and intangible assets of the company. They are most interested in profit and long-term survival with the aid of efficient equipment and talented and loyal employees. The importance of the served community or society are legal compliance and community relations. Southwest Airlines’ social responsibility includes Green Ambassadors. (Jackson, 2012) “In 2008, we set a goal to recruit a Green Ambassador in each of the 64 cities served by Southwest Airlines at that time. Today there are nearly 150 active Green Ambassadors across our system representing almost 50 percent of our destinations. Green Ambassadors help implement recycling procedures, identify eco-friendly practices at individual work locations, and find ways to promote living and working green to local stakeholders.” (Southwest One Report, 2010) The relative importance of suppliers is to provide environmentally acceptable material and equipment plus trustworthiness and reliability. (Jackson, 2012, pg. 8)

1. Integration and Application.

b. Describe the relevance of the following possible events for Southwest Airlines’ approach to managing human resources:

The U.S. unemployment rate declines, putting more pressure on wages.

The relevance of a U.S. unemployment rate decline in regard to Southwest Airlines’ approach to managing human resources would be economically feasible. Southwest Airlines compensated their workers a market rate that is less than average. They have a discounted company stock purchase plan which is offered to its staff. Southwest Airlines provides their employees with recognition for their excellent service by maintaining company-wide special activities such as holiday parties. They promote having a business environment which shows employment pride by through cheerfulness, laughter and delightful behavior which results in satisfied employees and customers. Also, Southwest provides full health benefits to all its employees at a minimal fee. Therefore, having an innovative approach to human resource hiring, training, and maintenance of Southwest Airlines’ employees, have made them a successful and sustainable company. (Jackson, 2012, pg. 579)

A change in the tax law makes it more difficult for business travelers to treat airfare as a deductible expense.

The relevance of a change in tax law which makes it more difficult for Southwest Airlines’ business travelers to treat airfare as a deductible expense would be an inconvenience to customers. But due to the low-fares/ no-frills policy, it is a manageable inconvenience. Business travelers on Southwest Airlines have low costs and convenient reliable flights. With the addition of Southwest’s business class, frequent business traveler can also access priority in the areas of checking in and boarding. Their simplified fare organization permits the majority of customers to do online booking of flights through their company website (www.southwest.com). (Jackson, 2012, pg. 579) Per the IRS.gov website, “Travel expenses are those incurred while traveling away from home for your employer. You can deduct travel expenses paid or incurred in connection with a temporary work assignment. Generally, you cannot deduct travel expenses paid or incurred in connection with an indefinite work assignment.” (IRS, 2015)

A new agreement creates a regional trade zone that covers all of the Americas, and business travel throughout the region skyrockets.

The relevance of a new agreement creating a regional trade zone that covers all of the Americas and causes business travel throughout the region to skyrocket is a time-sensitive issue. “By forming regional trade zones, smaller countries can reap the benefits of economies of scale in consumer markets and gain easier access to a large labor pool.” (Jackson, 2012, pg. 42) Based on the territories being served, Southwest differs in how their routes are structured. There are point-to-point and hub-and-spoke airline routes. Point-to-point is a direct service from one point to another. Hub-and-spoke is a multifaceted and synchronized route system which by schedule moves passengers from several out-reaching airports, known as spokes, through a central airport, known as the hub. “For companies that rely on a network, like a hub-based airline or a telephone company, competitive advantage accrues from economies of scope (i.e., the geographic reach of the network). Economies of scope do not necessarily complement economies of scale, and in fact, they are often achieved at the expense of economies of scale, and vice versa. Thus, although the hub-and-spoke system is driven by economies of scope, either strategy—hub-and-spoke or point-to-point—has its own inherent costs and organizational implications.” (Jackson, 2012, pg. 575)

1. Integration and Application.

a. What evidence exists to demonstrate that Southwest Airlines manages its employees fairly and legally?

The evidence that exists to demonstrate that Southwest Airlines manages its employees fairly and legally is justified in the very low employee turnover rate of only five percent. As a commitment to training quality employees, Southwest pledges to compliance with such organizations as the Federal Aviation Administration, the U.S. Department of Transportation, and the Occupational Safety and Health Administration. To educate employees, they offer local outreach programs, diversity summits, the Southwest Airlines’ University for People, the manager-in-training programs, leadership summits, learning alliances, and safety and security trainings. Additionally, Southwest Airlines offers its employees various benefit programs in health, stock purchases, and retirement plans. (Southwest One Report, 2010)

b. Are there company practices at Southwest Airlines that you would consider to be unfair? If so, which ones? Why?

Southwest Airlines’ mission statement concentrates on its loyal to customers and commitment to its employees. Incidentally, I cannot find any company practices at Southwest Airlines that I disagree with. Overall, it is an amazing company for work for and I approve of its policies. I tried to do an internet search for negative reviews of the company and all I could find was union contract negotiations. As stated in our textbook, “Indeed, Southwest proudly proclaims, “We are a company of People, not planes. That is what distinguishes us from other airlines and other companies.” (Jackson, 2012, pg. 577)

References

Jackson, S.E., Schuler, R.S., & Werner, S. (2012). Managing Human Resources, (11th Ed.). Mason, OH: South-Western, Cengage Learning.

Southwest One Report. (2010). “Stakeholder Involvement.” Retrieved on May 3, 2015 from http://www.southwestonereport.com/2010/planet_gf_sta.php

IRS. (2015). “Publication 529-Main Content.” Retrieved on May 3, 2015 from http://www.irs.gov/publications/p529/ar02.html#en_US_2014_publink100026950