Identify Southwest Airlines’ product, target market, and whether they are providing superior customer value and offering the customer desirable benefits.



Southwest Airlines Internal Analysis


Part 1:

Capabilities Assessment


Right Arrow: Step 1

 Current Market Profile

Identify Southwest Airlines’ product, target market, and whether they are providing   superior customer value and offering the customer desirable benefits.


Right Arrow: Step 2

 Sources of Competitive Advantage

Identify specific cost, product, and service attributes that would make customers    choose Southwest Airlines over other airlines.


Right Arrow: Step 3 

Organizational Capabilities

Identify Southwest’s organizational capabilities and competencies (routines and    processes) that lead to a competitive advantage.  


Right Arrow: Step 4  

Strategic Importance of Core Capabilities

Right Arrow: Step 5Rank the organizational core capabilities (found in Step 3) in order from most important to least important.


Key Core Competencies and Capabilities

Based on your rankings, what are Southwest’s key competencies and capabilities?



Right Arrow: Step 6  Strengths and Weaknesses

Identify Southwest’s strengths and weaknesses for each key core competency or capability, using the criteria to judge organizational strengths and weakness, Figure  

  4.5 on page 107.




Part 2:

Financial Assessment




Past Performance Trends

1.  Provide a historical financial analysis Graph/Chart (two years of data).


2.  Provide the comparative financial ratios for the last two years (Current Ratio, Acid Test, Debt-equity ratio, Return on Equity (ROE), Return on Assets (ROA), Profit Margin).  How do they compare?  For instance, are liquidity ratios going up or down? 


3. What do the data say about Southwest’s use of its resources and capabilities?

What are the indicators of internal strengths for an identified core competency or capability? Weaknesses?


Specific Goals or Targets

How does Southwest’s Performance measure up against its stated goals? (Note that you were required to find out company goes in the first section of your comprehensive case analysis.)  What strengths and weaknesses can be identified?


Comparison Against Competitors

How well is Southwest doing compared to at least two other top competitors in the industry? (Fortune, BusinessWeek, Morning Star, business or general news articles, and investment research companies are some places you may find this information.) What strengths and weakness can be identified? 



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