SOUTHWEST AIRLINES: NAVIGATING WINTER TURBULENCE
CASE STUDY SOLUTION
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SYNOPSIS
The December 2022 holiday season was anticipated to mark the first “post-COVID” holiday. However, an
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unusually severe storm hit at the end of December, causing widespread flight cancellations. Most airlines
recovered within a day or two, but Southwest Airlines Co. (Southwest) was disproportionately affected. By
December 28, 2022, Southwest had cancelled 59 per cent of its flights, compared to an average of 1–2 per
cent for other airlines. This led to a total of 16,700 cancellations between December 21 and December 31.
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The crisis was exacerbated by Southwest’s outdated crew management software, insufficient ground crews,
and its unique point-to-point route network. Unlike hub-and-spoke networks, which concentrated resources
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at major hubs, Southwest’s point-to-point system offered more non-stop flights but lacked flexibility in crisis
response. Previous minor disruptions had occurred, including one in 2021 with over 2,000 cancellations.
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Of the three factors, the software issue was the most significant in the short term. Southwest relied on two
So
The Case Solution Starts From page 7
,OBJECTIVES
• Technical debt—This case provides a real-world example of how an organization’s various systems
may interact. There are opportunities to discuss how different technology systems can address parts of
a problem, and how the organization may outgrow these systems over time.
• Strategic IT and operations alignment—An organization’s IT department should be aligned with its
operational structure. This case discuss how IT systems can be scaled with the organization to address
the types of problems that are likely to be encountered, although IT systems may not be able to resolve
fundamental or unworkable issues.
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• Operational fragility and resilience—This case considers how an organization can work well under
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normal conditions but could fail when disruptions occur. The discussion covers how likely disruptions
are to occur, the likely impact (i.e., how fragile the organization is), how well the organization can
m
recover (resilience), how technology contributes to fragility, and the degree to which technology can
aid resilience. In terms of Southwest’s situation, operational fragility was a key factor for sustaining its
point-to-point model.
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• Public relations in a technology-driven crisis—Southwest made deliberate efforts early in the crisis to
communicate with the public over video statements by executives, and contacted the United States
Department of Transportation to acknowledge responsibility. However, some critics felt that this was
not enough to resolve individual problems.
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So
The Case Solution Starts From page 7
,ASSIGNMENT QUESTIONS
1. What was the root cause (or causes) of Southwest’s December 2022 meltdown?
2. What specific technical debt did Southwest accumulate?
3. What specific actions should Southwest take to reform its technology infrastructure?
4. How should Southwest change the culture around IT upgrades to prevent future meltdowns?
5. How could Southwest evaluate the argument from critics that technology investments were not enough
and that it should switch to a hub-and-spoke model? How can its systems be made more resilient?
6. Who should have been the focus of Southwest’s apology? Which people were reached and which
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needed more engagement?
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The Case Solution Starts From page 7
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pl
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ANALYSIS
1. What was the root cause (or causes) of Southwest’s December 2022 meltdown?
The weather certainly caused the initial period of flight delays and cancellations. However, a systems
meltdown was not necessarily a direct result from the winter storm, proven by the fact that no other airline
suffered the same impact as Southwest. One argument is that the weather precipitated the systems meltdown
or strained the organization to its breaking point. Working with the airline consultant firm Oliver Wyman,
Southwest identified three main causes for the crisis: insufficient ground crews and equipment for winter
operations, close-in cancellations, and cross-team collaboration.
The Case Solution Starts From page 7
, e
pl
m
Sa
5. How could Southwest evaluate the argument from critics that technology investments were not
enough and that it should switch to a hub-and-spoke model? How can its systems be made
more resilient?
n
This question does not have a clear answer but is a critical issue for Southwest to consider, which the pilots
tio
union have been urging. The benefit from technology can be limited. The “optimal” or “least bad” solution
provided by fully integrating and modernizing the three systems—The Baker, SkySolver, and CrewHub—
may not be acceptable for many customers. Southwest’s point-to-point network will still leave some routes
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without service for some time after a major outage.
This is an opportunity to discuss the concept of reserve capacity, or excess capacity that is not allocated to
So
The Case Solution Starts From page 7
, EXHIBIT -1: INFORMATION FLOW BETWEEN SYSTEMS
AT SOUTHWEST AIRLINES CO.
Flight Schedule
e
Plane Assignment
Crew
pl
Hub
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Sa
n
tio
lu
So
The Case Solution Starts From page 7
CASE STUDY SOLUTION
e
pl
m
SYNOPSIS
The December 2022 holiday season was anticipated to mark the first “post-COVID” holiday. However, an
Sa
unusually severe storm hit at the end of December, causing widespread flight cancellations. Most airlines
recovered within a day or two, but Southwest Airlines Co. (Southwest) was disproportionately affected. By
December 28, 2022, Southwest had cancelled 59 per cent of its flights, compared to an average of 1–2 per
cent for other airlines. This led to a total of 16,700 cancellations between December 21 and December 31.
n
The crisis was exacerbated by Southwest’s outdated crew management software, insufficient ground crews,
and its unique point-to-point route network. Unlike hub-and-spoke networks, which concentrated resources
tio
at major hubs, Southwest’s point-to-point system offered more non-stop flights but lacked flexibility in crisis
response. Previous minor disruptions had occurred, including one in 2021 with over 2,000 cancellations.
lu
Of the three factors, the software issue was the most significant in the short term. Southwest relied on two
So
The Case Solution Starts From page 7
,OBJECTIVES
• Technical debt—This case provides a real-world example of how an organization’s various systems
may interact. There are opportunities to discuss how different technology systems can address parts of
a problem, and how the organization may outgrow these systems over time.
• Strategic IT and operations alignment—An organization’s IT department should be aligned with its
operational structure. This case discuss how IT systems can be scaled with the organization to address
the types of problems that are likely to be encountered, although IT systems may not be able to resolve
fundamental or unworkable issues.
e
• Operational fragility and resilience—This case considers how an organization can work well under
pl
normal conditions but could fail when disruptions occur. The discussion covers how likely disruptions
are to occur, the likely impact (i.e., how fragile the organization is), how well the organization can
m
recover (resilience), how technology contributes to fragility, and the degree to which technology can
aid resilience. In terms of Southwest’s situation, operational fragility was a key factor for sustaining its
point-to-point model.
Sa
• Public relations in a technology-driven crisis—Southwest made deliberate efforts early in the crisis to
communicate with the public over video statements by executives, and contacted the United States
Department of Transportation to acknowledge responsibility. However, some critics felt that this was
not enough to resolve individual problems.
n
tio
lu
So
The Case Solution Starts From page 7
,ASSIGNMENT QUESTIONS
1. What was the root cause (or causes) of Southwest’s December 2022 meltdown?
2. What specific technical debt did Southwest accumulate?
3. What specific actions should Southwest take to reform its technology infrastructure?
4. How should Southwest change the culture around IT upgrades to prevent future meltdowns?
5. How could Southwest evaluate the argument from critics that technology investments were not enough
and that it should switch to a hub-and-spoke model? How can its systems be made more resilient?
6. Who should have been the focus of Southwest’s apology? Which people were reached and which
e
needed more engagement?
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 7
, e
pl
m
Sa
n
tio
lu
So
ANALYSIS
1. What was the root cause (or causes) of Southwest’s December 2022 meltdown?
The weather certainly caused the initial period of flight delays and cancellations. However, a systems
meltdown was not necessarily a direct result from the winter storm, proven by the fact that no other airline
suffered the same impact as Southwest. One argument is that the weather precipitated the systems meltdown
or strained the organization to its breaking point. Working with the airline consultant firm Oliver Wyman,
Southwest identified three main causes for the crisis: insufficient ground crews and equipment for winter
operations, close-in cancellations, and cross-team collaboration.
The Case Solution Starts From page 7
, e
pl
m
Sa
5. How could Southwest evaluate the argument from critics that technology investments were not
enough and that it should switch to a hub-and-spoke model? How can its systems be made
more resilient?
n
This question does not have a clear answer but is a critical issue for Southwest to consider, which the pilots
tio
union have been urging. The benefit from technology can be limited. The “optimal” or “least bad” solution
provided by fully integrating and modernizing the three systems—The Baker, SkySolver, and CrewHub—
may not be acceptable for many customers. Southwest’s point-to-point network will still leave some routes
lu
without service for some time after a major outage.
This is an opportunity to discuss the concept of reserve capacity, or excess capacity that is not allocated to
So
The Case Solution Starts From page 7
, EXHIBIT -1: INFORMATION FLOW BETWEEN SYSTEMS
AT SOUTHWEST AIRLINES CO.
Flight Schedule
e
Plane Assignment
Crew
pl
Hub
m
Sa
n
tio
lu
So
The Case Solution Starts From page 7
