Company Background
Southwest Airlines Company is an airline company that provides point-to-point flight services across various parts of the US. The company reported $9048 million in revenue in December 2020 (“Southwest Airlines Co SWOT Analysis, 2021”). That was a decrease of about 59.7% compared to 2019, where the net loss was due to the uncertainties brought by lockdowns due to COVID-19 (“Southwest Airlines Co SWOT Analysis, 2021”). The company has recruited more than 8000 employees and compensated them by profit sharing while training many of them to maintain high standards of aviation services. Southwest can be said to have applied a specific human resource strategy. The implications, in this case, comprise boosted human operations due to strong employee morale, high productivity, and improved company reputation.
Analysis of Current Strategies and Issues
Integrating various human resource management (HRM) practices centered on employees is important for the business’s success. In 2021, the company planned to hire more than 8000 employees in what was seen as targeting efficiency in performance during airline operations (Southwest Media, 2022). By 2022, there were more than 10,000 new staff that was hired by the airline (Southwest Media, 2022). Elizabeth Bryant, one of the executives, said, “Our recent hiring milestones represent incredible progress with aligning staffing to support our flight schedule, Customers, and Employees…” (Southwest Media, 2022 par. 5). That means the company understands and respects the employee’s contribution towards reaching their objectives.
The second current HR strategy is training to equip employees with effective skills that can help them deliver without business workflow constraints. The company has been training thousands of its employees, with most of them hired to operational roles, which complements the main strategy seen in the previous part above (Southwest Media, 2022). The trainees comprise flight attendants, pilots, technical teams, and customer care assistants. Since 2021, the number of employees has increased in each department as one way to better the working environment.
The last strategy is employee compensation which means attending to employee financial welfare. The company shared some of its profit in 2020 with employees, where 60000 employees were among the $667 (Valinsky, 2020). Eligible employees received 12.2% of their annual salary, equivalent to six weeks of additional pay (Valinsky, 2020). Other employees got their contributions added to their retirement package. Those moves were made to encourage workers to be motivated while they attend to their daily tasks.
Type of Human Resource Strategy Southwest is Using
Human resource strategies can be categorized into overarching and specific strategies. Southwest uses a specific human resource strategy since hiring and compensation are based on the subsets of human resource management. When employees receive extra pay and get trained, it specifically addresses their needs, not the general spectrum of human resources (Eaton, 2017). Therefore, the concept of recruitment and standard remuneration, as well as training, means specific elements are considered. Therefore, there is a likelihood that the company may succeed in the future due to implementing the above strategy. Southwest should expand its strategic decisions on human resources to fit the modern transformational models that drive the workforce to better their services in the airline industry.
Human Resource Implications from Strategies Used
Hiring extra employees means that the company will not be understaffed and that human operations will be boosted. Workers will not be expected to leave the company, citing work pressure and lack of employee recognition (Eaton, 2017). The advantage, in this case, is that Southwest Airlines will have a strong manpower that is comprised of a team that can work collaboratively towards improving aviation and hospitality services. Additionally, new employees come with new skills, which results in high productivity since there is an incorporation of fresh concepts from the expertise brought by the recruits (Eaton, 2017). Therefore, the innovative aspect of the company might go higher than before due to the wide array of experience and skills that the human workforce will have. Many employees working on a particular goal means all the required tasks will be completed on time (Eaton, 2017). As a result, the company will boast of simultaneous progress that is perfected by filling all departmental gaps in the airline firm.
The aspect of compensating employees for the company’s profit is translated to improved worker morale and a feeling of recognition that makes workers more productive. For instance, cabin crew who earn 12% extra from their annual income are likely to be lively during work which means the customers will receive spectacular services from the employee (Eaton, 2017). When workers are focused on delivering professionally and effectively, Southwest Airlines will grow its business reputation, boosting its ability to compete in the US and globally.
Training new workers is a human resource concept that guarantees maintaining talents within the firm. When different levels of employees are taken through advanced skills in their work, they can find the company relevant since the mode of operations tallys with the changing work dynamics. Therefore, Southwest will have the potential opportunity to grow its competitive advantage due to increased staff proficiency in its lines of specialization.
Business Strategy for the Implications
Hiring employees to fall under business strategy with staff experience. That means it is more of how workers will explore and undertake their duties. One of the key issues in hiring is the prevention of large workloads that can demotivate staff hence, lead to a turnover. After the company hired 10000 workers as of 2022, the operations have yielded fruits as the recorded revenue in the first quarter of 2022 had a 10.3% increase (Southwest Media, 2022). Training is transformational, meaning that workers get new skills or improve their working formulas, boosting their results in each airline department. The training enhanced Southwest’s hospitality as many customers reported having experienced value in the company’s airlines. Compensation of employees falls under operational strategy since they get motivated to do their work (Hooper, 2020). Basing these strategies on employees was a phenomenal move that increased their proficiency in the aviation industry across the world.
Human Resource Strategy
For Southwest to move forward, it needs to have key strategic decisions incorporating transformation in its business. This report recommends the company consider real-time communication for feedback with appreciation and competitive remuneration and benefits. First, employees need to forgo performance reviews for real-time evaluation in the corporate sector, which includes the aviation industry (Hooper, 2020). The strategy is important because it offers accountability to learning, meaning that there will be more work up-front in the aviation business (Eaton, 2017). The management of Southwest Airlines should introduce a culture of staying connected with all employees, which adds appreciation, creating tangible business sustainability.
Regarding competitive salaries and benefits, Southwest must ensure that whatever compensation is made to work meets the current economic scales. Staying up to date in terms of salary for all job descriptions is important. It drives employees’ satisfaction and gives them a feeling of belonging to the firm (Hooper, 2020). Benefits increase employee loyalty to the airline since they will give hope to staff in terms of insurance, medical coverage, and other incentives.
References
Eaton, J. (2017). Globalization and human resource management in the airline industry. Aviation, 3(4), 2–5. Web.
Hooper, E. (2020). Southwest Airlines CEO pushes back on M&A speculation. Bizjournals.com. Web.
“Southwest Airlines Co SWOT Analysis.” (2021).
Southwest Media. (2022). Southwest Airlines achieves hiring milestones by increasing its employee count beyond pre-pandemic 2019 levels. Southwest Airlines Newsroom. Web.
Valinsky, J. (2020). Southwest is giving its employees six weeks of extra pay. CNN. Web.