Step 1

Using the case information only, assess Southwest Airlines’ operating environment along the dimensions of:

customer, technology, socio-cultural, political, global, environment

Not all dimensions will be relevant. For those you identify as relevant, state if it is an opportunity or a threat and a brief explanation of why.

Assess Southwest’s industry environment according to Porter’s Five forces. State whether the pressures are high or low for each force and provide one paragraph on each explaining why.

Conclude if the industry is attractive or unattractive and provide justification based on the five forces.

Use section 1 of the “SWOT analysis template” to guide your analysis.

Step 2

Conduct an internal analysis of Southwest Airlines by identifying all the resources you can. Use these resources to form capabilities.

Include insights you have gained from your prior value chain analysis of Southwest Airlines. Place areas of the value chain under resources or capabilities as you deem suitable.

Use section 2 of the “SWOT analysis template” to guide your analysis. Identify and rank order capabilities the firm possesses that can aid competitiveness. The most competitive capability is ranked #1.

Step 3

Use the results of Steps 1 (the external environment) and 2 (the internal environment) from the prior assignment component to complete a SWOT table.

Take all external elements and categorize them as “O” or “T” in the table

Take all internal elements and categorize them as “S” or “W” in the table

Conduct “SWOT matching” keeping in mind this is used to formulate strategy in Step 4.

Use section 3 of the “SWOT analysis template” to guide your analysis

Step 4

Use the ‘Strategy Analysis template’ to recommend a cost or differentiation strategy for Southwest Airlines. Use only the information from the case. Do not incorporate any outside information. In your analysis be sure to:

Incorporate all your prior insights from prior modules (eg: resources, capabilities, industry analysis, etc)

Use the SWOT matching approach in section 3 to justify your recommendation of a cost or differentiation strategy

Provide at least 3 key areas of execution needed to implement the strategy you recommended. You may find the value chain useful in thinking of execution areas.