In guiding Southwest to preserve its competitive advantage they should uphold a policy of constant vigilance on two fronts, externally and internally. I would caution Herb Kelleher against making any rash decision such as increasing routes to directly compete with United simply to drain revenue. Kelleher himself quoted Churchill saying, "Success is never final ... it must be earned over and over again." Kelleher must maintain the spirit of fighting the underdog's fight without making risky moves based on emotion rather than strategy. This means, continuing to operate a low cost airline which offers low simple fares with frequent flights. Sometimes a policy of non-action can be just as effective, if not more effective as implementing change. United's Shuttle may appear promising, but the rifts that exist between levels of employees will ensure trouble in times ahead. Watching the competition make radical changes that their internal culture is ill-prepared to handle, will inherently aid in adding value to Southwest, thereby creating a sustainable competitive advantage.
Internally, Colleen Barrett should implement a new series of team meetings in locations most directly impacted by the arrival of the new competition. She has shown a gift in her ability to rally the troops in regards to the culture committee and has the ability to inspire double loop learning and keep the workers of SW internally motivated to help the success of the company. She has even encouraged others to break the rules if necessary and think outside the box if the situation is warranted. The shared values at SW Airlines will be the driving force to usher the Airline into another decade of dominance over its competitors.
New York Times, September 16 1994.
Case Study: Southwest Airlines: Using Human Resources for Competitive Advantage (A), Case Study: A Note on the 7-S model.,