Southwest Airlines began in Texas, providing service between Houston, Dallas and San Antonio. Service between these cities was only available as part of a leg of a longer flight. Rollin King, who served as the company’s first chairman, president, and CEO, had a vision of serving the three largest, and rapidly expanding cities in Texas. He also wanted to offer “low fares, convenient schedules, and a “no-frills” approach that was completely contrary to the standards of the established airlines” (Flynn, 2010, para. 1). Southwest continues its “no frills” approach and has become a leader in the airline industry. The leadership within the organization has developed and refined the Southwest Low Cost Carrier (LCC) business model (Raynor, …show more content…
According to Raynor, disruptive innovation has two main components: a unique business model that appeals to a population of customers that dominant incumbents typically ignore and some sort of technology that allows the model to appeal to more mainstream markets (2011). By operating in smaller airports and using solely Boeing 737’s, Southwest was able to manage significant cost advantages, which in turn allowed the company to offer prices others could not match (Raynor, 2011). The incorporation of the 737-500 was a technological advantage that allowed Southwest to save even more on operating costs (Raynor). Because of this, they were able to expand and add more routes of greater length. Operating in more cities further drove up …show more content…
Other airlines may consider themselves in the transportation business; Southwest is in the people business (Sturgess, 2012). Some of their policies, such as open seating and no baggage fees are a direct reflection of their unique brand reputation. These innovative policies have allowed Southwest to create “a more meaningful and enjoyable relationship with customers” (Sturgess, 2012, para. 3). Two creative ways that Southwest has marketed to its customers is the “Nuts about Southwest” blog and the “Rapid Rewards Program” (Sturgess, 2012). Many companies have blogs, but few connect customers in a meaningful and deep way. The stories of employees and others who travel have increased brand loyalty. The rewards program, unlike some other airlines, is easy to find when navigating the website. While some make it difficult to earn and use mileage points, Southwest encourages