Group Assignment Application of Eight Best Practices in Southwest Airlines Success MBAT/20/243. W.C.M Perera MBAT/20/223. A.K.C.P.Akurugoda MBAT/20/224: P.K.De Silva MBAT/20/238; JA.D.D.Maliga MBAT/20/252; HLA.R.Shyamini MBAT/20/254: D.D.R.P.Wanigasekara MBAT/20/256: N.W.B.Welikada MBAT/20/259: M.G.N.B.Gunarathna Sub Group No: 04 Course MBAT 513: Management Decisions & Implementation Instructor Mr. Champal de Costa Term October — December 2020 Postgraduate Institute of Management University of Sri JayewardenepuraSTUDENT'S DECLARATION “We are fully aware of the content under plagiarism stated in PIM Student Hand Book, and we hereby declare and affirm that we have strictly observed the law relating to intellectual property, copyright and plagiarism in this exercise” MBAT/20/243 W.CM Perera al ss MBAT/20/223 AK.CP.Akurugoda Ore MBAT/20/224 P.K.De Silva Ape MBAT/20/238 J.A.D.D.Maliga Dales MBAT/20/252 H.A.R.Shyamini € age MBAT/20/254 D.D.R.P.Wanigasekara Reuben MBAT/20/256 N.W.B.Welikada MBAT/20/259 M.G.N.B.Gunarathna c Date: 30.11.20201. Introduction With instigation of 21" century we are stepping into a more competitive world in every aspect. The business world remarkably challenge with development of technology, human resource, frastructure, economy etc. Along with this development challenges, implementing best practices is very crucial in an organization. As per Philip Zimbardo, “Companies that model best practices, that model most upstanding principles, end up as most profitable. It’s not a trade of profits versus principles”. According to him, best practices allow organization to become success, One small company formed in 1967 in USA adopted these strategies and achieved excellence within short period of time. It was Southwest Airline. This assignment evaluates “Best Practices” followed by Southwest Airline with respect to eight best practices introduced by Tom Peters and Waterman. 2. Best Practices Best practices encompass of set of guidelines, practices, ideas or ethics that requires increasing performance of functions of organizations. By following best practices industries can operate with smooth running and sustainability of businesses which ensures to face challenges with their competitors. Implementing best practices evolve better solutions by focusing different and new ways of arriving at things. One objectives of using best practices is to do some work or provide a service better, efficiently with minimum problems or mistakes. Organizations are able to win their targets, through best practices by maximizing efficiency of employees. This can be achieved by developing both hard and soft skills via trainings and attitude development. Confidentiality improvement among employees, entrepreneurs and customers can create through best practices is a great benefit to an organization. Right decision making creates a firm profitable, Best practices are driven factors of converting a normal business in to an excellence business,Decisions on ne Decsions on ~“BestPractices” Management Early stage Profitablestage Thriving-stoge “Normal Fem” “Profitable Firm” “excellent Firm’ Best practices challenge the normal lifecycle and declined points can’t be seen with sustainability, Grow Development omept Tom peter and Robert H, Waterman are famous giants of this field and they instituted “Bight Best Practices” from their studies based on sample of best 143 companies from six different companies. 3. The Application of Eight Best Practices in Southwest Airlines Success ‘The Southwest Airlines have been successful in achieving its prominence in US domestic operations, It is evident that it had used many strategies and practices towards same, which are also in line with “excellent eights”,1. A bias for action — Active decision making; getting on with it Bias for action is reacting fast, effectively and being innovative. Had a quick response to Baniff intemnational’s 60-day “half-price sales” of tickets (S13) between Dallas and Houston, Southwest’s counter strategy was a marketing campaign with a slogan of “nobody is going to shoot southwest out of sky for a lousy $13”, They offered an unusual alternative to pay either $26 or $13 for same seats. Purchasing $26 tickets were rewarded with gifts such as ice buckets or fifths of whisky. Strategy worked and 80% of customers requested for $26 tickets. 2. Close to the customer — Learning from customers This about bs ng close to customers by going an extra mile, providing reliable & quality service ata low cost, They adopted “love” theme for attracting passengers. Drinks served on board called “love options”, ticket machines called “love machines”, and cabin hostesses were sexy with seductive voices. Their low-cost fares were below than cost of driving a vehicle over same route. This made airline exclusive and exceeded expectations of its client base. On early flights, passengers who could produce largest holes in their socks were recognized and rewarded, Holidays were celebrated with costumes and giveaways. Frequent departures provided opportunity to business flyers to catch a later flight if missed one, being a user-friendly process. All processes were very efficient, standardized and low-cost, allowing for quick tumaround and low fares. Tumaround time had grown to an average of 24 minutes, from industry norm of 30 minutes. Frequent trips, direct flights, not assigning any seat to passengers, family work culture, flying only Boeing 737 jets (recognized as most reliable air craft's), un-congested airports, and selling tickets through internet made process quick and efficient. 3. Autonomy & entrepreneurship — Fostering Innovativeness This is about welcoming new innovative ideas from team members, while tolerating failures.Employees were given liberty to do whatever is necessary to get a plane tumed around in targeted time of 15 minutes. ‘There was emphasis on fun for employees and travelers, Ground and In-flight employees were encouraged to be © ‘ive in way they delivered required announcements to passengers. This has resulted turnaround time to 24 minutes, well below industry norm of 30 minutes. 4, Productivity through people — ‘reating rank employees as a source of quality This explains respecting employees, train smart expectations of employees, freedom to take initiative and more importantly setting a family feeling within organization. Flexibility at work place, recognition and appreciation for outstanding performance as well as for length of service, group decision making, team building approach, training, profit sharing, stress on positive attitude rather than skill, taking home satisfaction than salary, low labor turnover and involving customers in process were some of attributes that helped Southwest airlines to achieve success Main event of year was annual awards banquet, for which employees from all over system were brought to Dallas and honored for their length of service; stress was placed on value of “family” in organization. Employees’ total compensation was similar to other airlines but productivity was high. After six month probation, all employees became members of profit-sharing plan. Basic principles was; focus on situation, issue or behavior, not on person, maintain self- confidence and self-esteem of others maintain constructive relationship with your employees, peers and managers, take initiative to make things better and led by examples. ‘The walls of three-story building were covered with literally thousands of framed photos and awards, many of them showing employees in their party cloths ranging from black tie and formals to jeans, creating a family feeling for employees and fliers too. 5, Hands-on, value-driven — Guided by everyday practice with management commitment This is about walk and talk about values by employees.All ground operations employees had one to two weeks of technical orientation at individual stations before going to class in Dallas for a week to study everything from use of company systems to organization’s values. This is an evidence to confirm respecting for organizational values. 6. Stick to the knitting — Stay with bu ess that you know This is mainly on focusing core business, without diversifying into unknown areas In 1993, southwest acquired Morris Air, hence increased number of operating stations. Acquisition was with reference to core business and has become a success. 7. Simple form, lean staff — Reduce unnecessary activities This explains having minimum staff with a simple, few layered organizational structure, processes and rules. Ground and In-flight employees were encouraged to be creative in way they delivered required announcements to passengers; this is being a very simple & flexible rule, Southwest engaged in joint problem- solving exercises with those supplying everything from fuel to peanuts served on planes. Works were assigned in groups. Failure to do so according to schedule resulted in a “team late”, Rather than assessing individual responsibility, teams were then tasked to figure out how to avoid problem in future. Pilots sometimes handled baggage or helped cabin attendants in picking up cabin while gate attendants might be seen putting provisions on board for departing flight. The main spirit was to do everything that was required to complete a task rather than having mentality that it is not my job. 8. Simultancous loose-tight properties — Autonomy in shop-floor activities & centralized values This is having a proper co-existence of central direction while having individual freedom.Freedom and flexibility is given for employees, all work towards a single direction of delivering best service at all time at a much cost. All employees are made aware of values and rules of organization, though they are simple, 4, Conclusion The assignment discussed how Southwest Airline practically applied “Eight Best Practices” and achieved sustainable growth in their business.References hutps:/www.research gate.net/publication/268718329_Southwest_Airlines_Success_A_Case_Stu dy_Analysis. https://www.slideshare.net/sarangbhutada/southwest-airlines-case-study. https://www-ukessays.com/essays/management/strategic-analysis-of-southwest-airlines-case- study-management-essay.php. Michel, L. (2007). Understanding decision making in organizations to focus its practices where it matters. Measuring Business Excellence, 11(1), 33-45. Ng, L. C. (2011). Best management practices. Journal of Management Development, 30(1), 93- 105. Peters, T., & Waterman, R. (1982), In Search of Excellence. New York: HarperCollins.