Wednesday, September 10, 2014

The ‘Lean‘ Southwest Airlines

A lean methodology or process is a philosophy that considers the expenditure of non - value add resources to the customers in any aspect as wasteful. The process then aims on eliminating such wastages from the system which would improve the efficiency of the organization as a whole. The main goals of a lean system can be briefly stated as to eliminate waste, improve quality, reduce time and total costs.
What makes the Southwest Airlines lean?
Southwest is one of those airlines who has seen profits consistently despite the problems the airlines industry face. They have been also been associated with delivering efficient and on time service.  Having a low amount of cost in their operations is one of the contributing factors in their success. This low cost model is brought out by the strategy in place.  Is this strategy lean?  Below are the factors that make suggest so:

-          A customer centric approach to the operations.
Southwest Airlines  introduced the “bags fly free” concept. While the competition charges approx $120 round trip for baggage, they don’t charge anything for the first and second bags. This has been well received by the public as it had addressed one of their biggest problems with airlines. This showed that Southwest was listening to the customer complaints.  The airlines also introduced ticketless travel which addressed another main issue the passengers faced at the airports. They anticipated that the huge lines would decrease customer satisfaction and in turn decrease the turnaround time standard set by the airline.
-          Eliminate waste in the value stream :

Airline industries face wastage in the form of idle time due to congested airports. Southwest minimize idle time with faster airplane turnaround. All employees contribute towards ensuring timely take offs and landing . The entire crew works together as a smooth system and ensure that there is very little rework in the form of reticketing or rescheduling. Also they use the hub and spoke system to distribute passengers in the airport and concentrated on point to point routes.

-          Provide affordable service without compromise in the quality
The reason for Southwest’s  low cost model lies in its use of one type of aircraft –the Boeing 737. Apart from being fuel efficient, this strategy keeps reduces the variable maintenance cost. The airline do not serve meals on board and there are on luxury seats offered. Due to all these things, they were able to  offer lower ticket process to the customers.

To summarize, Southwest Airlines conforms to the process steps required by a lean system. Furthermore they are working to improve the processes continuously finding ways to decrease wastage and optimize process flows.
I think the main challenges faced by a general airline has been addressed in a lean manner. But will it prove successful even in the long run? Southwest are clearly reducing the cost by sticking to the Boieng 737 and cutting luxury  services. If tomorrow , say a competition does the same or even improves on the process ,should the lean system be re-engineered or  just tweaked?


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