Porter’s competitive strategy For Southwest Airlines

Question

In this case study, you will research an organization and determine how their business strategy differentiates them from ther organizations in the same industry using Porter’s four competitive strategies model

Write a one- to two-page (250-500-word) paper to include the following:

A brief explanation of Porter’s four competitive strategies.

A brief explanation of how competitive strategy determines value chain structure.

Identify and discuss the competitive strategy that the organization you researched utilizes in order to differentiate them from other organizations in the same industry.

Sample paper

Porter’s competitive strategy For Southwest Airlines

The first Porter’s competitive strategy is cost leadership. This involves attaining the lowest per unit cost of production among rivals in the industry (Porter, 2008). Although the returns may be low, they could still be higher comparing to those of rivals. The second strategy is differentiation, which means developing unique products to those of competitors. The third strategy is focus or niche strategy. This involves concentrating on particular markets or groups of consumers, and understanding their specific needs (Porter, 2008). The last strategy is differentiation focus. This strategy involves the firm establishing differentiation with the target segment. A competitive strategy determines the value chain structure by enhancing the integration of activities in the value chain. The value chain is a network consisting of value-creating activities. The competitive strategies helps in ensuring there is interconnectedness among various firm activities such as production, marketing, research and development, and others.

The organization in focus is Southwest Airlines, a regional carrier with its headquarters in Dallas, Texas. Southwest Airlines employs a cost leadership competitive strategy in its operations. Southwest Airlines prides itself as a low-cost carrier, suitable for families and tourists going to various destinations in the United States (“Southwest,” 2017). Southwest Airlines operates on a no-frills policy in order to keep costs low. The airline does not give passengers meals. However, the airline provides passengers with snacks in flights longer than two hours. Southwest has the lowest turnaround time, which is on average 10 minutes (“Southwest,” 2017). This is meant to keep planes on air and reduce operational costs. The cost leadership strategy has been effective for southwest Airlines, which has achieved a remarkable streak of profitability since its inception.

References

Porter, M. E. (2008). Competitive strategy: techniques for analyzing industries and competitors. Simon and Schuster.

Southwest. (2017). About Southwest. Retried from https://www.southwest.com/html/about-         southwest/

 

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