MGT599 – Strategic Management
Module 2 – Case
External Environment Analysis

Background

A reminder that the Case in this course is an ongoing exercise, which means that we will be taking an intensive look at a single company over the course of 5 modules. This session, we will be conducting a strategic analysis of Southwest Airlines. In order to be best prepared and perform well on the case assignments, you should complete the background readings and the SLP before writing the case.

The objective of this case is to complete an external analysis of Southwest Airlines using Porter’s 5-Forces Model and a PEST Analysis. Ultimately, this analysis will lead to some conclusions about opportunities and threats facing the company (the first part of the SWOT analysis).

Required Readings

Please refer to the following readings:

PEST analysis. (2009). Retrieved on August 15, 2011 from: http://www.valuebasedmanagement.net/methods_PEST_analysis.html

Porter’s Five Forces: A model for industry analysis. (2007). Retrieved on August 15, 2011 from: http://www.quickmba.com/strategy/porter.shtml

Assignment

An environmental analysis can be a very extensive undertaking, requiring far more time and resources than we have for this course. So you will want to limit your analysis to the identification and evaluation of one or two key items in each element of the two models, as described in the background readings for this module.

Keys to the Assignment

Step One: Using the sources you identified in the SLP, collect some data to support an industry analysis of each of the 5-Forces in Porter’s Model.
Step Two: Using the sources you identified in the SLP, collect some data to support an analysis of each of the 4 elements in the PEST analysis. When considering economic data, use the most current data you can find.
Step Three: In a 4-5 page paper, write up the results of your external analysis, and be sure to label each of the 5-Forces as high, moderate, or low. Taken together, the 5 Forces analysis and the PEST analysis should lead to conclusions about the opportunities and threats facing Southwest Airlines as revealed by your research. The data you report from the 5-Forces and PEST analysis must be properly cited using APA style.
Step Four: Consider the Case as a formal business report that you are developing for the Board of Directors and CEO as Southwest Airline’s company consultant. This is a professional document. Follow the format below:
Executive summary: a synopsis of the main points, conclusions and recommendations made in the longer report. If you have never written an executive summary before, or would like a refresher, check this website: http://www.highendfinance.com/CommercialLoans/Docs/07-4%20ES%20Guidelines.doc
Introduction: State the main purpose of the paper (thesis statement), what you hope to accomplish, and how you will go about doing it.
Main Body: The “meat” of the paper. By all means, please emphasize analysis, not just description. Delineate separate topics or sections with headings.
Conclusion: Summarize your paper in the light of your thesis statement.
Assignment Expectations

Your paper will be evaluated on the following seven (7) points:

Precision – Does the paper address the question(s) or task(s)?
Breadth – Is the full breadth of the subject, i.e., all the keys to the assignment, addressed?
Depth – Does the paper address all elements of the topic in sufficient depth? Does it include and apply the background readings and other background resources? Are they included as references?
Critical thinking – Are the concepts of the module applied accurately, logically, and relevantly?
Organization – Is the paper organized in a coherent and systematic manner? Are headings included in all papers greater than 2 pages?
Clarity – Is the writing clear and the concepts articulated properly? Are paraphrasing and synthesis of concepts the primary means of response to the questions, or are thoughts conveyed through excessive use of quotations?
Referencing (citations and references) – Does the paper use citations and quotation marks where appropriate? Are all references listed in the bibliography used and referred to via citation?
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