Table of Contents
Marketing Recommendation 1: Improve operations and employee relations
The importance of these two elements to any company is crucial to sustaining a competitive advantage its internal environment. The goal of this recommendation is to make the implementation of these procedures and services be perceived as positive for the sustainability of its employees and the airline itself. Making this awareness will require the distribution of content to organization members about the process and procedures for sustainable growth. The expansion of the RNP program to include all service sites is critical for cost saving measures and Full Corporation of staff members is critical for its success.
Product/Service: In this recommendation the product and or service is a set of procedures known as the RNP program that seeks to conserve fuel, improve safety, and reduce carbon emissions and the overall improvement of the flight operation. This will be performed in conjunction to the implementation of new employee’s service options to combat any hesitation to the new program and overall negative feelings towards management. This includes financial services performed at a subsidized rate by Fidelity investments and tax preparation services by H&R Block.
Price: The cost of the RNP program will be measured in terms of time taken and energy diverted from current operations but the long-range benefits will overrun the initial cost. The prices for the new employee services will be negotiated by Southwest legal and financial teams, but with Southwest’s 35,000 members collective bargaining will the reduce cost. H&R block offers tax at different levels of preparation fees but costs for Southwest are estimated to be in the 20-30 dollar range. The Fidelity program will include the case by case analysis of the extent of the advice needed free retirement planning will be offered to employees at the cost of airline to a max of 500$ and subsidized rates provided by Southwest will be offered at a discount rate for further planning if needed.
In terms of change in cost, the accrued costs will increase from the current $2,000 to $2,650 annually.
Placement: The placement of both programs will be at each operation facility; this includes the training of staff members on the necessary operation procedures. The information seminars and scheduled meeting will be held at the work site for ease of access to staff members.
Promotion: The commitment to these programs is something that the company needs to make aware to all levels of the organization and announcements by management along with emails; memos and promotion material will be handed out.
Reduce carbon emissions
Overall improvement of the flight operation
Higher revenues will be realized.
Analysis and Recommendations
The idea of Southwest airlines expanding to new markets is a good idea of expansion because the existing market niche in those locations will allow it to realize its objectives. Being an entrant, the company will require to advertise widely about the idea so as to create market popularity and to notify potential customers about the new services.
Though the idea calls for time to peak and achieve the targets, the first year will be accompanied by few earnings since much will be spent on expenses. As time progress and more customers are realized, the profits will start to be realized. This is shown by the little forecasted profits for the years of 2011 and 2012. After this period, we assume that the company has already settled in the new markets and that operations are being carried out normally and as planned. Hence the set targets will be achieved.
From the forecasted costs of the three years, the projected trend ratio will be; 2.3:3:2.5 for 2011, 2012, and 2013 respectively. This means that the costs are rising with that ratio. The high costs for the first two years will be as a result of the high expenditure compared to income.
The forecasted revenues present a trend with increasing revenue and profits for 2011, 2012, and 2013 respectively. This shows that incomes in 2011 and 2012 will be low due to the high costs incurred. The final year’s ratio is high since we expect the airline to be achieving its targets and the costs will be low.
From the above analysis of the two cases, the most recommendable case is the second one because it has better and more impacts on the future of the business. In my opinion then, I recommend Recommendation Two.