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Southwest airlines: A case study linking employee needs satisfaction and organizational capabilities to competitive advantage
Author(s) -
Hallowell Roger
Publication year - 1996
Publication title -
human resource management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.888
H-Index - 94
eISSN - 1099-050X
pISSN - 0090-4848
DOI - 10.1002/(sici)1099-050x(199624)35:4<513::aid-hrm5>3.0.co;2-z
Subject(s) - competitive advantage , business , shareholder value , service (business) , value (mathematics) , shareholder , customer value , marketing , customer satisfaction , industrial organization , process management , knowledge management , computer science , economics , microeconomics , corporate governance , finance , profit (economics) , machine learning
This article analyzes the sources of Southwest Airlines' competitive advantage using an integrative approach, employing economic analysis tools to illustrate the roles of commitment and organizational capabilities in delivering competitive advantage at Southwest. A framework is presented illustrating that much of the value Southwest generates is (1) created through employee needs satisfaction, (2) converted to customer and shareholder value via organizational capabilities, and (3) captured by the firm as a result of its cost advantage and superior service. This three‐part framework may be applicable to other labor‐dependent service organizations. © 1996 by John Wiley & Sons, Inc.