Airline System(I2)

I N T E R A C T I V E S E S S I O N : O R G A N I Z AT I O N S
SOUTHWEST AIRLINES TAKES OFF WITH BETTER SUPPLY CHAIN MANAGEMENT
“Weather at our destination is 50 degrees with some broken clouds, but they’ll try to have them fixed before we arrive. Thank you, and remember, nobody loves you or your money more than Southwest Airlines.”
Crew humor at 30,000 feet? Must be Southwest Airlines. The company is the largest low-fare, highfrequency, point-to-point airline in the world, and largest overall measured by number of passengers per year. Founded in 1971 with four planes serving three cities, the company now operates over 500 aircraft in 68 cities, and has revenues of $10.1 billion. Southwest has the best customer service record among major airlines, the lowest cost structure, and the lowest and simplest fares. The stock symbol is LUV (for Dallas’s Love Field where the company is headquartered), but love is the major theme of Southwest’s employee and customer relationships. The company has made a profit every year since 1973, one of the few airlines that can make that claim.
Despite a freewheeling, innovative corporate culture, even Southwest needs to get serious about its information systems to maintain profitability. Southwest is just like any other company that needs to manage its supply chain and inventory efficiently. The airline’s success has led to continued expansion, and as the company has grown, its legacy information systems have been unable to keep up with the increasingly large amount of data being generated. One of the biggest problems with Southwest’s legacy systems was lack of information visibility. Often, the data that Southwest’s managers needed were safely stored on their systems but weren’t ”visible”, or readily available for viewing or use in other systems. Information about what replacement parts were available at a given time was difficult or impossible to acquire, and that affected response times for everything from mechanical problems to...