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Southwest Airlines began operating in 1971 with only four planes and serving three cities Now they have over 2100 flights per day carry over 44 million passengers a year and are the fifth largest airline company in America Southwest Airlines 2004 In their 33 years of business they have been awarded numerous awards for the best airline in the business and are currently the highest profit showing company in the industry Stanley 2003 Much of Southwest Airlines success is due to their organizational strategic planning In this paper we will analyze the SWOTT analysis strength weaknesses opportunities threats and trends Bateman and Snell 2003 factors that influence the organizational strategic planning process at Southwest Airline which has helped them grow and become the most profitable airline in America Barrett 2004 Our analysis will include marketing strategies no first class services their employee incentive program losses in their market and E-business at Southwest Airlines Strength Due to Southwests strong strategic planning team they are the only major airline to make a profit during this years second quarter Torbenson 2004 This is partly due to a contract signed between Southwest and their fuel distributor Southwest was able to hedge buy fuel in advance at a set price more than 80 percent of their jet fuel requirements Southwest Airlines 2004 Although it costs upfront money to hedge they were able to reduce their fuel costs by 171 million in 2003 and 63 million in first quarter 2004 and their hedging program is in effect for 2005 Barrett 2004 Another strength in Southwests strategic planning which reduces costs and saves money is the installation of blended winglets to their 737-700 aircraft This will result in a three to four percent annual reduction in fuel use per aircraft Barrett 2004 Although that does not sound like a big savings consider this It only takes a penny increase in the price of a gallon of jet fuel to raise their annual
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