Culture and Innovation.edited (1)

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1 Culture and Innovation: Southwest Airlines Student’s Name Institutional Affiliation Course Instructor Date

2 Culture and Innovation: Southwest Airlines Abstract A company's culture is fundamental to its success. Southwest Airlines has thrived because of its unique culture, which has helped it to adapt over time and thrive in a highly competitive market. This paper analyses key attributes of Southwest Airlines' culture and how it enables innovation. The paper also discusses how the company has leveraged the attributes to gain competitive advantage, adapt, and grow in the changing business environment. The analysis identifies five key attributes of the culture present at Southwest Airlines: A fun and friendly work environment, employee motivation, favorable work ethics, well-organized operation procedures, and a robust management structure. Introduction Culture is the central factor in how innovative a business can be. Southwest Airlines is one of America's most distinguishing airlines, and its culture does everything to foster innovation. Culture influences innovation by setting the tone and direction for an organization (Nobles, 2019). Culture will either foster or suppress innovation among its members. Southwest airlines' culture has been conducive to innovation in many aspects, including engineering, management structure, and operational procedures (Rotondo et al., 2019). Southwest has a culture that promotes innovation and leverages it to gain a competitive advantage and adapt and grow in the changing business environment. Southwest Airlines' culture and how it promotes innovation. Southwest Airlines has a unique culture dedicated to enabling innovation. Fun and Friendly Work Environment

3 One of the main reasons for Southwest Airlines' success is its employees' passionate spirit for improving the company's performance. Employees pride themselves on working for a company they can be proud of, as they know that their efforts contribute greatly to their success as a company (Nobles, 2019). As Southwest Airlines have grown bigger and bigger, the company prefers to hire team players who are highly motivated rather than those who are a cut above others. Employee Motivation Southwest Airlines has built a fun, friendly, and low-cost culture, making its employees passionate about the company and their job. The benefits of this culture are that it gives Southwest Airlines an edge over its competitors as it manages to attract and retain enthusiastic employees who want to do their best (Hnatek, 2015). The company's morale is very high as everyone knows they are working for the customers' best interest. Ethic of Teamwork Southwest Airlines has a culture where innovation is encouraged and rewarded. Employees are valued as they provide the best service they can give every customer. This approach inspires every employee to go beyond their limits to achieve what they set out to achieve. Everyone in the company works closely together as a team focused on delivering superior service to others (Nobles, 2019). The team spirit enables employees to learn different things from each other, which helps the company grow along with them. Robust Management Structure Southwest Airlines has a management structure that enables it to flexibly meet its challenges and opportunities in the business environment. As the company grows, the management structure is also changing to meet its employees’ needs. This change has enabled

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4 the company to maintain its growth over the years. The management structure consists of two parts which are “decision authority and accountability” (Rosenberg et al., 2015). The decision authority is held by individuals who occupy a key position in the company and have full control over their decisions. The accountable part of the management structure contains those responsible for making decisions without any control over them. Operational Procedures The operational procedures developed by Southwest Airlines also contribute to innovation in the company. The company has tried to adopt excellence in all its operations (Nobles, 2019). Southwest Airlines have developed different policies for the employees so that they can learn from each other and achieve what they are aiming for. Leveraging culture to gain a competitive advantage. The company has utilized these attributes very well to gain a competitive advantage. Southwest Airlines have built a strong customer base over the years, which is the key factor to its success. The company has fostered its culture of innovation and has been able to attract experts in many aspects of the business that can help it innovate in different dimensions. Southwest Airlines has used their employees' strong spirit and attitude that helps them innovate by developing "feel-good" products such as highly personalized souvenirs, additional check-in counters for those with heavy luggage, and more frequent departures (Rosenberg et al., 2015). The company has also been able to keep its employees on top of technology innovations which is important in today's changing business environment. Southwest Airlines has been able to adapt and grow in the business environment by implementing new technologies into its operations.

5 The company also leverages its culture through a very detailed culture manual tailored according to Southwest Airlines' culture and how it can be used in the work environment (Rotondo et al., 2019). The manual helps employees improve their performance in their work environment. Southwest Airlines has leveraged its team spirit to bring in experts from different fields of expertise who want to be a part of the company as they are an integral part of the company's success. The robust management structure that Southwest Airlines has adopted enables people at all levels to make decisions and implement them without having to follow strict rules. This flexibility helps the company keep its competitive edge in the business environment (Nobles, 2019)). This structure also helps Southwest Airlines' employees realize their potential and grow with the organization. Southwest Airlines' operational procedures are very flexible, which helps the company to avoid high costs because of unnecessary over-staffing or under-staffing (Nobles, 2019). This helps the company to meet its requirements while keeping service standards high at all times. As a result, Southwest Airlines has maintained a high level of customer service throughout all its operations and services. Using culture to adapt, change, and grow in the changing business environment The different attributes that Southwest airlines have been able to leverage have helped the company adapt to changes in the business environment. The company's competitive advantage is built upon its people, and this base of competitive strength does not change even as the business environment changes (Hnatek, 2015). The company's adaptability is made easier by Southwest Airlines' culture of openness and informality (Pathiranage, 2019). As employees gain experience

6 and get more specialized, they can take on greater roles in helping them adjust to changes in the business environment. The culture of innovation that Southwest Airlines has fostered amongst its employees can enable it to cope with changing markets easily. This is because innovations are developed by those closest to customers (Pathiranage, 2019). The culture of innovation, along with the spirit and attitude of the employees, has helped Southwest Airlines be flexible enough to develop new services, products, and delivery methods to meet changing customer needs. As Southwest Airlines' management structure is built around accountability and authority rather than hierarchy, quick decisions can be made when changes occur in the business environment. This enables Southwest Airlines to react quickly to changes in its business environment. The company's operational procedures are also geared toward flexibility and efficiency, which makes it easier to learn from its mistakes and eliminate them systematically (Nobles, 2019). Changes in the business environment allow for greater operational efficiency and greater learning from mistakes, so they never happen again. Conclusion Southwest Airlines has a strong culture and team spirit of improving customer service and remaining competitive in the industry and, for that matter, the industry as a whole. The prominent traits of the company's culture include its determination and drive, willingness to innovate to adapt quickly, openness and informality, strength of spirit, and teamwork. The company also implements a highly detailed Code of Ethics that motivates employees to improve customer service. The robust management structure that Southwest Airlines has adopted enables people to make decisions efficiently without following strict rules. This flexibility helps the

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7 company keep its competitive edge in the business environment while being able to increase its performance levels.

8 References Hnátek, M. (2015). Entrepreneurial thinking is a key factor of family business success. Procedia-Social and Behavioral Sciences , 181 , pp. 342-348. https://doi.org/10.1016/j.sbspro.2015.04.896 Nobles, B. (2019). Use hierarchy for “liberating servant leadership” instead of controlling employees. Journal of Organization Design , 8 (1), 1-7. https://doi.org/10.1186/s41469- 019-0061-x Pathiranage, J. (2019). Organizational culture and business performance: an empirical study. International Journal of Economics and Management , 24 (2), 264-278. Rosenberg Sr, N. O., Chauvet, M. C., & Kleinman, J. S. (2015). Leading for a corporate culture of design thinking. Design thinking: new product development essentials from the PDMA , 173-186. https://doi.org/10.1002/9781119154273.ch12. Rotondo, F., Corsi, K., & Giovanelli, L. (2019). The social side of sustainable business models: An explorative analysis of the low-cost airline industry. Journal of Cleaner Production , 225 , 806-819. https://doi.org/10.1016/j.jclepro.2019.03.345

Culture and Innovation.edited (1)

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