1. Culture, Value, and Operating Practices Barry Cynthia Dedy Fitrie Indah Made Novita Rival Presented by : MBM Group 3

4. Company History ... Southwest goes public on the American Stock Exchange 1975 Company is renamed Southwest Airlines Co. 1976 Shares migrate to the New York Stock Exchange 1977 Herb Kelleher becomes Southwest's outspoken new chairman 1978 SWA flies outside Texas to New Orleans 1979 SWA posts first profit and begins RUSH cargo service 1973 Airline launches first route, connecting Dallas, Houston, and San Antonio 1971 Company is incorporated as Air Southwest Co. 1967

5. Company History ... Morris Air and Arizona One are acquired 1994 Online booking site is launched 1996 SWABIZ corporate booking tool is introduced 2000 SWA enters first ever code share arrangement, with ATA Airlines 2005 Revenues exceed $1 billion, making SWA a major airline 1990 SWA begins flights to West Coast 1982 Kelleher is named company president and CEO 1981

12. Building Capable Organization ... Staffing the Organization Core Competencies and Competitive Capabilities Matching the Organization Structure to Strategy Southwest ’ s Capability

20. Five Forces Analysis ... Rivalry among Competitor (High) Substitute Products (train, bus) Customers Potential New Entrants Suppliers (fuel, snacks, beverages) Low Low Supplier’s bargaining power LOW Customer’s bargaining power MEDIUM

21. Market Share ... Year 2006 : Market Share

22. Financial Performance... Financial Summary 0.67 0.31 0.56 0.40 0.70 EPS 511 241 442 313 548 Net Income 631 417 483 554 820 Operating Income 4,924 5,105 5,454 5,976 6,764 Operating Expenses 5,555 5,522 5,937 6,530 7,584 Revenues 2005 2004 2003 2002 2001 (In millions, except EPS)

23. Financial Performance... Stock Chart

25. 9/11 Impacts ... Many scrambled to institute a host of security measures Many scrambled to institute a host of security measures Fare sales in January, March, April, July, August, October and December 2002 Speculation on how much to cut fares to induce passenger to fly and on low long traffic might stay depressed Negotiated a revised delivery schedule for the 132 Boeing 737 jets on order The delivery of new aircraft on order deferred or cancelled no employees were laid off Temporary freeze on hiring until Jan 2002 Employees laid off No flights were cut The number of flights were cut by around 20 percent Southwest Airlines Airline Industry

28. Key People of SWA...

29. By: Barry, Cynthia, Dedy, Fitrie, Indah, Made, Novita, Rival Thanks … Dedicated to the fallen victims of 9/11, 5 years ago September 11, 2006