Instructions: Read Case 3, Southwest Airlines: Is "LUV" at the limit? on page C8-C13 of your textbook and answer the questions in the table below. The case discusses about Southwests changing business strategy and business model. It talks about both original and new business strategies. Southwest has been successful with its original strategy. But the airline is making a few changes to its business strategy and business model. Your task is to identify and conduct a comparative analysis of Southwests original and new business strategies following the prompts in the table below. Keep your answers short, simple, specific, on topic, and to the point. Be sure to review the rubrics and grading criteria.

Basis of Competitive Advantage 1. What is the basis of competitive advantage of Southwests old strategy? o Overall cost leadership o Differentiation o Focus o Integrated

2. What is the basis of competitive advantage of Southwests new strategy? o Overall cost leadership o Differentiation o Focus o Integrated

Bundle of Resources 3. Discuss what internal resources, capabilities, value chain activities, and assets of Southwest may have given Southwest a competitive advantage.

4. Discuss what internal resources, capabilities, value chain activities, and assets of Southwest would most likely give Southwest a competitive advantage.

5. Which of the trends or events in the commercial airline industrys general environment might have prompted Southwest to make changes to its business strategy and business model. Identify and discuss two trends or events (political, economic, sociocultural, demographic, technological, global). 6. What forces in the competitive environment could have been the strongest for Southwests original strategy? Please explain.

7. What forces in the competitive environment would be challenging for Southwests new strategy? How? Please explain.

8. What type of diversification strategy has Southwest pursued in its original operation model? How was synergy achieved?

9. What type of diversification strategy is Southwest pursuing in its new business model? How will synergy be created?

10. What type of innovation (product or process) have most likely supported Southwests original strategy? Please explain why and how.

11. What type of innovation (product or process) will most likely support Southwests new strategy? Please explain why and how.

12. Southwest had remained profitable throughout its history through organic growth. With this new strategy and in the face of new and larger competition in the new markets, will Southwest be able to maintain its excellent profitability record?

13. Which existing or new resources, capabilities, and assets of Southwest do you think will play strategic role in the companys continued growth?