In 1966. while sitting in a little diner. Rollin King. a Texas man of affairs presented his lawyer. Herb Kelleher with an thought. The thought entailed making a new air hose. one that would offer low menus to riders and would wing rapidly between three metropoliss: Dallas. Houston. and San Antonio. Together. they formed Southwest Airlines. Initially. the air hose battled a figure of obstructions from assorted rivals of that clip. as the other air hoses did non desire to see a new rival in the market who offered low cost flights to local countries. Despite assorted efforts made to maintain Southwest a mere vision. they lawfully won the right to wing through the Supreme Court and began offering air service in 1971. AirTran Airways. once known as ValuJet Airlines. foremost began runing October 26. 1993. The Airline was renamed after the 1996 clang of ValuJet into the Florida Everglades. killing all 110 riders and crew members on board. Since that clip. AirTran has grown to be one of the most profitable air hoses in the industry. offering service to more than 60 finishs across the United States. every bit good as to Mexico and the Caribbean.
On September 27. 2010. AirTran Airways made a public proclamation that they entered into understanding leting Southwest Airlines to get them. Numerous entities report the grounds behind the acquisition are: to do Southwest a dominant rival in the air hose industry. “Southwest is following the tendency in the industry: merge or get in order to remain alive and competitive” ( Mouawad. 2010 ) . In add-on. the acquisition would let Southwest to tag its presence in markets they were antecedently unable to perforate. “The trade would spread out Southwest’s web by 25 per centum and give it its first international finishs in the Caribbean and Mexico” ( Mouawad. 2010 ) . As relayed in a statement made by Bob Fornaro. AirTran Chairman. President and CEO on AirTran’s functionary web site. “Joining Southwest Airlines will give us chances to turn. both professionally as persons and as a group. in ways that merely would non be possible without this understanding.
Together with Southwest. the world’s largest rider air hose. their fiscal resources. enormous trade name. legendary client service. corporate civilization and decades-long record of success. we will hold the chance to travel topographic points neither company could hold gone entirely. ” As a consequence of the acquisition. which was completed on May 2. 2011. Southwest has experienced several unexpected bugs during the transitioning phases. One major issue has been with the ticketing and reserves systems. “Southwest Airlines agents struggle with AirTran Airways tickets and frailty versa. sometimes go forthing riders who have been delayed and need rebooking in the lurch” ( McCartney. 2013 ) . It is reported that monetary values and place handiness are inconsistent on both web sites when trying to book a ticket online. Customers. who purchase early embarkation base on ballss for their paths. are limited to utilizing them merely for the Southwest leg of the trip. as it is non recognized by AirTran. This has caused legion ailments with clients who pay full monetary value for early embarkation. but are merely able to utilize it for half of the path.
Southwest has been diligently working to unite both air hose systems. but has non successfully completed the undertaking to day of the month. “Southwest. for now. have agents of both air hoses seeking to work two reserve systems on different Windowss of their computing machine screens so one air hose can look into in clients from the other. Southwest says it will hold a incorporate system. new to both air hoses. in topographic point by the terminal of the year” ( McCartney. 2013 ) . A outstanding issue that has resulted in the acquisition is that one time AirTran has been to the full integrated into the Southwest Brand. upgraded seating will no longer be available. as Southwest merely offers coach category with unassigned seating. In add-on. Southwest has been in the plants to transition all aircraft from AirTran’s 717 aircraft. which it inherited. to its bing 737 theoretical account. “AirTran had first category. they had assigned seats. and Southwest has no first category. no assigned seats. doesn’t sell through planetary distribution systems-a really different merchandise than what AirTran offered in the market. It is really distinguishable” ( Boehmer. 2010 ) .
Delta Airlines and other major rivals feel they will be able to capture former AirTran clients. who find the riddance of upgraded seating unacceptable. Prior to the acquisition. Southwest Airlines had an organisational construction which was instrumental in the company going a taking rival in the air hose industry. Founder Herb Kelleher’s leading manner allowed for everyone. including front line employees to play a major function in concern planning and operational budgeting. Herb believed that “management determinations are made by everyone in the organisation. non merely the caput executives” ( Advance Business Consulting Website. 2013 ) . As a portion of their organisational construction. Southwest maintained over 35. 000 employees. had 568 Boeing 737 theoretical account aircraft. and operated in 67 domestic metropoliss coast-to-coast. Whereas AirTran. who operated with a similar organisational theoretical account. listed assets of 8. 500 employees. 86 Boeing 717’s and 52 Boeing 737’s. operating in about 37 markets. Southwest Airlines has non made major alterations to their organisational construction as a consequence of the amalgamation. The new Southwest air hoses assets contain: “43. 000 plus employees. over 700 aircraft. operating in over 100 markets. functioning 100 million customers” . ( Bomkamp. 2010 ) .
Southwest continues to work with three primary degrees of direction: Executive Vice Presidents. Senior Vice Presidents. and Vice Presidents. all places subordinate to Chairman of the Board. President. and CEO. Gary Kelly. Since the acquisition. Southwest has taken a slow attack to incorporating AirTran systems. processs. and employees into the Southwest household. Southwest appears to believe they will be able to seamlessly integrate 8. 500 AirTran employees into the organic structure of Southwest’s bing 35. 000 employees. However. industry analysts feel Southwest’s outlooks are hazardous at best. “It will be slippery for Southwest. Southwest’s whole concern theoretical account is built on a peculiar attack to pull offing employees. It’s a large stake they are doing that they can get down AirTran” ( Cappelli. 2010 ) .
Harmonizing to Southwest Airlines Announcements for Reporting Structure of AirTran and Leadership Changes. Human Resources Practices were modified in attempt to encompass the leading squad coming from AirTran. Almost all AirTran leaders were placed in places with Southwest that were commensurate to places antecedently held. The other leaders who were non placed in commensurate places were hired on as full clip advisers to guarantee the integrating of the two air hoses went good. Southwest air hoses have maintained a case in point that was established in 1971. when the company foremost began carry oning concern. Southwest Airlines began with four planes and less than 70 employees. During its first twelvemonth of operation. the company experienced fiscal problem. coercing the executives to do the determination to sell one of its planes or put off employees. In attempt to keep the relationship with its employees. Southwest opted to sell the plane.
In return. the employees were asked to cut gate turn-around from 55 proceedingss to 15 proceedingss. The employees obliged. assisting to set up one of the friendliest management/labor relationships in the air hose industry. as reported by PBS. org. Harmonizing to Atlanta Business Chronicles. the undermentioned statement was issued to AirTran employees in the signifier of a Question and Answer sheet in attempt to turn to their concerns sing occupation security. “The combination of the two air hoses will ensue in extra employment chances as the combined air hose continues to turn and spread out the Southwest web. In its about 40 twelvemonth history. even during the most recent fiscal crisis. Southwest has remained profitable and has ne’er had layoffs. ”
This statement was in effort to quiet frights that the acquisition would convey environing occupation stableness. As in any industry. when employees are confronting major alterations in the workplace. particularly as it relates to amalgamations and acquisitions. it is of import to pass on programs for the way of the company and the employees involved. This scheme allows clip for the employees to treat the information they have been given and adjust to the alterations to come. It is imperative that companies model this pattern as non-communication consequences in insecurity. pandemonium. and hostile work environments where uncertainness is present.
Progress Business Consulting Website ( 2013 ) . Retrieved from hypertext transfer protocol: //www. advancebusinessconsulting. com/advance! /strategic-alignment/strategic-alignment-business-cases/the-rise-of-southwest-airlines. aspx
AirTran Airways Official Website. ( 2014 ) . Retrieved from hypertext transfer protocol: //www. airtranairways. com/about-us/history. aspx
Atlanta Business Chronicle. ( 2010 ) . Q & A ; A on the Southwest-AirTran amalgamation. Retrieved from hypertext transfer protocol: //www. bizjournals. com/atlanta/stories/2010/09/27/daily2. hypertext markup language
Boehmer. Jay ( 2010. November 08 ) . Delta Sees Opportunity In Southwest. AirTran Merger. Business Travel News. ( 15 ) . 4. Retrieved from hypertext transfer protocol: //elibrary. bigchalk. com
Bomkamp. S. . ( 2010 ) . Huff Post Travel: Southwest Airlines Buys AirTran for $ 1. 4 Billion. Retrieved from hypertext transfer protocol: //www. huffingtonpost. com/2010/09/27/southwest-airlines-airtran_n_739975. hypertext markup language? view=print & A ; comm_ref=false
Cappelli. P. ( 2010 ) . Strategic Management North America: By Geting AirTran. Will Southwest Continue to Spread the LUV? Retrieved from hypertext transfer protocol: //knowledge. Wharton. upenn. edu/article/by-acquiring-airtran-will-southwest-continue-to-spread-the-luv/
McCartney. S. . ( 2013 ) . The Wall Street Journal: Southwest and AirTran Airlines: Amalgamations and Aggravations. Retrieved from hypertext transfer protocol: //online. wsj. com/news/articles/SB10001424127887324448104578611980670019710
Mouawad. J. . ( 2010 ) . The New York Times: Southwest. Determined to Expand. Buys AirTran. Retrieved from hypertext transfer protocol: //www. nytimes. com/2010/09/28/business/28air. hypertext markup language? _r=0 & A ; pagewanted=print
PBS. Org ( day of the month non available ) . Chasing the Sun: The History of Commercial Aviation Seen Through the Eyes of Its Pioneers. Retrieved from hypertext transfer protocol: //www. phosphate buffer solution. org/kcet/chasingthesun/innovators/hkelleher. hypertext markup language
Southwest Airlines Official Website. ( 2014 ) . Retrieved from hypertext transfer protocol: //www. sou’-west. com/html/about-southwest/index. html? int=GFOOTER-ABOUT-ABOUT