Individual Assignment OM 248

Southwest Airlines (SWA) turning around Baltimore

Submitted by
Harsh Chandaliya
0161/52

Analyse SWAs turnaround processes in Baltimore and determine the factors which are fitting
SouthWests business strategy of focused segment of customers. Also notify the factors which
are hampering Baltimores progress. Suggest few measures for turning around Baltimore.
SouthWests Business Strategy
The original Low Cost Carrier (LCC) Southwests business strategy revolves around high utilization & productivity of
asset (both Aircrafts & Human Resources) coupled with low cost no-frills services to a focused segment of
customers.
Operations strategy derived from this simple business strategy lends to the following:1) Minimizing airplanes on ground time; Decentralized coordination High Utilization of the most crucial
asset, the aircraft itself gives way to minimizing their on ground time quite logically. However quick
turnaround at gate requires involvement of 12 stratified & spatially separated teams. Unlike most other
airlines which centrally coordinates these teams for an HQ, Southwest decentralizes it ground operations.
Rationale being, on ground teams have a much better view of all complexities & uncertainties, and hence are
in better position to coordinate complex operations in a flexible way.
2) Personnel training & work culture Effective HR selection process & practices. Strong commitment to
human capital development with extensive trainings, cross training to prevent job disillusionment for ground
operations fleet & introduce flexibility in operations. Culture of empowerment & flexibility to ground
operation employees promoting on ground innovation & enhancing the sense of belonging to SouthWest.
Mentorship from seniors from same & upstream airports.
3) Use of less congested metropolitan airports Use of less congested airports with easy access to metros
saves time for aircrafts as well as passengers as landing strips are not bottlenecks, and are much cheaper
than airports that are in city and congested.
4) Single fleet of aircrafts Saves money on maintenance, spare part & personnel training. Reduces complexity
of operations. Relatively young aircraft fleet deployed to ensure reliable performance.
5) Use of IT SouthWest aims to boost efficiency & save cost by using IT extensively in operations. Use of OTIS
to plan and prepare for delayed flights & reduce impacts of weather & technical faults on ground time.
Constant monitoring of fuel prices & quantities to fill also allows for more tactical cost savings. Robust
central IT which adjust schedules for even a low volume of passengers so as to make flights convenient for
all.
Analysis of Turnaround at Baltimore
Background Information:
Baltimore started as SWAs first east coast gateway in 1993. In 1994, airport announced a $28 million expansion plan
& SWA signed up for all new terminals & domestic gates. Through 1990s, SWA added more connections (eventually
exceeding more than 100 flights per day) from Baltimore, resulting in SWA dethroning US Airways to reach 34%
market share.
Challenges:
Due to explosive passenger growth SWAs gates started reaching capacity as early as 2001. Major reason for this was
status of Baltimore as a connection hub, where more than 25% of passengers (around 80000) made connections
from Baltimore. Such a high a volume of connection passengers posed an operational challenge as station
performance and customer experience both deteriorated. Baltimores operational performance lagged SWA wide
average. Constant work pressure and lacking support from experienced ground crew led to higher turnover among
employees and missing learning on job which was strongly associated with SWA.
In summary, the main challenges were:1) Resource Constraints Gates & bag sorting area reaching capacity limits
2) Operation Challenge Delayed flight created ripple effect due to high number of connecting flight
3) Lacking Employee Morale & Work Culture Due to large number of new hires and tough working conditions

Turnaround:
The operational turnaround at Baltimore revolved around
1) Improving staffing level & hiring process: Due to tough operational conditions, the ground crew was over
worked and low on morale. In order to fix this SWA changed their long hiring process to on spot one. In
order to manage such a large number of new employees, experience managers & employees were borrowed
from other stations to inculcate the culture & practical learnings. With increased staff strength individual toll
on employees decreased, leading to fewer overtimes & other stress situations.
2) Increasing Flexibility 15 minute turnover: Removal of fixed gate allotment to ensure no ramp supervisor is
dealing with 2 contiguous gates at the same time and other similar areas of balancing workload. In order to
deal with delayed flights with significant connection spill over, a 15 minute turnover plan was designed
which tagged both passengers & baggage as hot, allowed for faster unloading/loading (9-9.5 minutes) &
further reduced cabin cleaning & other activities. Such a resource intensive but effective response to
delayed flights help reduce the spill over of delays among connecting fights.
3) Formal & Informal process improvement: In order to further improve the operations SWA turned to both
formal & informal methods of process improvement. Under the formal process a formal flagging mechanism
was developed to identify the cause of errors, codify the root cause & include them in normal improvement
mechanism. Under the informal process staff was encouraged to come up with suggestion to improve
service levels. Promising suggestions were piloted on Tuesday & again on Friday to identify & remove nay
kinks.
Factors hampering Baltimore progress
The following three were the main factors hampering Baltimores progress
1) Stricter Labour Market Regulation: It is much more difficult to hire & keep employee when compared to
other Mega-Stations. SWA & other airlines could lobby for more liberal regulations, however a lot shot out
of control external factor.
2) Bottlenecked facilities: Gates & Baggage sorting area have reached full capacity for SWA. Baltimore
Washington Airport is planning to renovate concourse A & B. This is an in control factor for SWA and given
the importance of Baltimore they should explore opportunity post renovation.
3) Marketing driven scheduling: Currently, the scheduling of flights is marketing driven and as a result of which
connecting flights with limit of 35 minutes or more can be made. This is an aggressive target matching SWA,
however for a highly utilized Mega-Station with significant connection, the limit of 35 minutes can be looked
into. An internal factor that should be looked at again post cost-benefit analysis.
Measures for turning around Baltimore
1) Improve Employee Morale & Boost Innovation: SWA should continue to build upon the on job learning that
place because of decentralized coordination & further promote it by incentivizing or recognizing the
contributors. Further the role of mentorship by ops supervisor should also be recognized more formally.
2) Increasing Flexibility: Capabilities like 15 minute turnover should be continuously improved, additionally
teams that are relatively less occupied can takeover jobs on critical path. (Refer Exhibit 1)
3) Increasing Capacity at Baltimore: Given the importance of Baltimore to SWA, it should actively work to get
more gates at renovated concourses, and remove its capacity constraints.
4) Rethinking scheduling practices: For a highly utilized Mega-station with significant connections, rethinking
on scheduling connection flights within 35 minutes should be actively considered. This would amount to
leaving money on the table, but would improve both employees working condition & customer satisfaction.
5) Improved Decision making for holding a flight: SWA should see the financial implication of holding a flight at
Baltimore against cost of providing overnight accommodation to customers or another airlines ticket.
6) Lobby for lenient labour laws: SWA can work with other Airlines & lobby together for lenient labour laws
For airport employees.

Exhibit 1:

Exisiting Workflow

F110 Ops Agent

7:30-7:45
7:45-8:45
Notice Delay
of F110
CargoBin
Nashville
Loading
Incomplete Schedule, Fuel
Data of F110 Invoice

Dallas Office

Decision to
Hold F232

Ops Coordinator

8:45-8:55
Arriving
Late Call

8:55-9:03

9:03-9:05

9:05-9:12

F110 Arrives

9:12-9:15
F110 Departs

Deplane
Inform flight
Finish
Attach FI & crew,
StartOnCBLS on clip trandfer gates Boarding

Finish
Boarding,
Farewell to
Passenger

Report to
Dallas

Send out
allowed fuel
amount

Ramp Supervisor

Baggage to
Manchester Idnetify Hot
ready
Bags

Ramp Agent

Take the
CBLS

F110 Crew

Pilot Calls
Alice

F232 Ops Agent

F232 Board
Passengers

Put back
CBLS
Notify Lost
Luggages

Clean Cabin
F232
Departs

New Workflow

Ops Coordinator

F110 Ops Agent

Dallas Office

Ramp Supervisor
Ramp Agent
F110 Crew
F232 Ops Agent

7:30-7:45
7:45-8:45
Notice Delay
of F110
Nashville
Incomplete
Data of F110 Fuel Invoice
Send out
Decision to
allowed fuel
Hold F232
amount
CargoBin
Loading
Schedule

8:45-8:55
Arriving
Late Call

8:55-9:03

9:03-9:05

9:05-9:12

F110 Arrives

F110 Departs

Deplane
Inform flight
Finish
Attach FI & crew,
StartOnCBLS on clip trandfer gates Boarding

Baggage to
Manchester Idnetify Hot
ready
Bags
Take the
CBLS
Pilot Calls
Alice
Clean Cabin
F232 Board
Passengers

9:12-9:15

Finish
Boarding

Report to
Dallas

Farewell to
Passenger

Notify Lost
Luggages

Put back
CBLS

F232
Departs