5 Lesson's Your Company Can Learn from Southwest Airline's Meltdown

We’ve all seen (& some personally experienced) the effects of the recent Southwest Airlines meltdown in the news this week. It’s an unfortunate example of what happens when senior leadership detaches themselves from the daily operations of the business & fails to understand the impact that their decisions & their lack of involvement have to employees and customers.?

They ignore warning signs & feedback from their managers & employees & shield themselves against any accountability behind a balanced budget sheet & stock price that pleases the board of directors & Wall Street.?

Sure, those are very important to the success & profitability of any business, but they are also very fragile. They depend on the long term reputation, credibility and trust that customers and employees put in your business.?

Once that trust is broken, it’s a very long and expensive road to rebuild it.?

I don't believe that anyone regardless of their role or title goes to work thinking about how to intentionally screw things up or do a bad job, everyone is doing what they believe to be what's right or best for the business. The danger comes in when they fail to surround themselves with a diverse group of people with perspectives different than their own to call out their blindspots, or critical dangers to the business that if not addressed with a sense of urgency, could lead to devastating outcomes. It starts out slow, a few slow weeks here and there, followed by a few slow months, then you begin to notice an increase in turnover, then you begin to lose your best people, the one's you thought would never leave and before you know it the meltdown you never saw or thought would ever come happens and just like that your company went from Cash to Crash on Wall Street & you have a lot of explaining to do to members of the Board.

Here are 5 Lesson's from the Southwest Airlines meltdown that can prevent your company from a Crash & Burn.

1. Surround yourself with a Diverse team of people with experiences different than your own to help you to see blindspots that you wouldn't otherwise notice.
2. Get out of the office and into the field - often! The plans you put on paper from your desk in your corner office are every accountant and board members dream, but how will you know how effective they really are unless you go out there to see them in action?
3. Ask your employees for feedback regularly! Make it a part of your leaderships regular conversations and topics for meeting discussions. Create special task forces by topic made up of employees who have consistently demonstrated success and are eager to make a difference. Employees always notice when feedback is taken seriously and action is taken. They also notice when they give the same feedback over and over again and nothing is done about it. It doesn't take long before they come to the conclusion that the company doesn't care about them, so why should they care about the company? Employee apathy is one of the most dangerous and costly impacts to any business!
4. Reframe your thinking from COST to VALUE. Instead of making decisions of where to spend your company's resources based solely on cost, assess the need based on the value that it brings to your internal customer and daily operations and your external customer experience. Large expenses like technology upgrades may come with a heavy price tag initially, but can you afford what it will cost you down the road if you don't spend a little now?
5. Evaluate your Company from your Customer's Perspective, literally! Jump on the phones at your customer support call center to take live calls from actual customers to hear their feedback directly, not what has been filtered and reduced to charts and graphs being presented to you at your next staff meeting. Know your competition intimately! In the example of Southwest Airlines, try booking a flight with a competitor, is it easier, harder, more or less expensive, more or less options etc. Actually do this yourself, don't rely on reports or data to do the work for you. I promise, the insights you glean will be will be eye opening and it will go a long way to building your credibility and trust with your employees.

Keep reading to see the Article originally posted by Linda Claire Willits and written by Southwest Airlines Senior Pilot?Larry Lonero: It's a Long read but worth it!

Begin Article:

What happened to Southwest Airlines?

I’ve been a pilot for Southwest Airlines for over 35 years. I’ve given my heart and soul to Southwest Airlines during those years. And quite honestly Southwest Airlines has given its heart and soul to me and my family.?

Many of you have asked what caused this epic meltdown. Unfortunately, the frontline employees have been watching this meltdown coming like a slow motion train wreck for sometime. And we’ve been begging our leadership to make much needed changes in order to avoid it. What happened yesterday started two decades ago.?

Herb Kelleher was the brilliant CEO of SWA until 2004. He was a very operationally oriented leader. Herb spent lots of time on the front line. He always had his pulse on the day to day operation and the people who ran it. That philosophy flowed down through the ranks of leadership to the front line managers. We were a tight operation from top to bottom. We had tools, leadership and employee buy in. Everything that was needed to run a first class operation. When Herb retired in 2004 Gary Kelly became the new CEO.?

Gary was an accountant by education and his style leading Southwest Airlines became more focused on finances and less on operations. He did not spend much time on the front lines. He didn’t engage front line employees much. When the CEO doesn’t get out in the trenches the neither do the lower levels of leadership.?

Gary named another accountant to be Chief Operating Officer (the person responsible for day to day operations). The new COO had little or no operational background. This trickled down through the lower levels of leadership, as well.?

They all disengaged the operation, disengaged the employees and focused more on Return on Investment, stock buybacks and Wall Street. This approach worked for Gary’s first 8 years because we were still riding the strong wave that Herb had built.?

But as time went on the operation began to deteriorate. There was little investment in upgrading technology (after all, how do you measure the return on investing in infrastructure?) or the tools we needed to operate efficiently and consistently. As the frontline employees began to see the deterioration in our operation we began to warn our leadership. We educated them, we informed them and we made suggestions to them. But to no avail. The focus was on finances not operations. As we saw more and more deterioration in our operation our asks turned to pleas. Our pleas turned to dire warnings. But they went unheeded. After all, the stock price was up so what could be wrong??

We were a motivated, willing and proud employee group wanting to serve our customers and uphold the tradition of our beloved airline, the airline we built and the airline that the traveling public grew to cheer for and luv. But we were watching in frustration and disbelief as our once amazing airline was becoming a house of cards.?

A half dozen small scale meltdowns occurred during the mid to late 2010’s. With each mini meltdown Leadership continued to ignore the pleas and warnings of the employees in the trenches. We were still operating with 1990’s technology. We didn’t have the tools we needed on the line to operate the sophisticated and large airline we had become. We could see that the wheels were about ready to fall off the bus. But no one in leadership would heed our pleas.?

When COVID happened SWA scaled back considerably (as did all of the airlines) for about two years. This helped conceal the serious problems in technology, infrastructure and staffing that were occurring and being ignored. But as we ramped back up the lack of attention to the operation was waiting to show its ugly head.?

Gary Kelly retired as CEO in early 2022. Bob Jordan was named CEO. He was a more operationally oriented leader. He replaced our Chief Operating Officer with a very smart man and they announced their priority would be to upgrade our airline’s technology and provide the frontline employees the operational tools we needed to care for our customers and employees. Finally, someone acknowledged the elephant in the room.?

But two decades of neglect takes several years to overcome. And, unfortunately to our horror, our house of cards came tumbling down this week as a routine winter storm broke our 1990’s operating system.?

The frontline employees were ready and on station. We were properly staffed. We were at the airports. Hell, we were ON the airplanes. But our antiquated software systems failed coupled with a decades old system of having to manage 20,000 frontline employees by phone calls. No automation had been developed to run this sophisticated machine.?

We had a routine winter storm across the Midwest last Thursday. A larger than normal number flights were cancelled as a result. But what should have been one minor inconvenient day of travel turned into this nightmare. After all, American, United, Delta and the other airlines operated with only minor flight disruptions.?

The two decades of neglect by SWA leadership caused the airline to lose track of all its crews. ALL of us. We were there. With our customers. At the jet. Ready to go. But there was no way to assign us. To confirm us. To release us to fly the flight. And we watched as our customers got stranded without their luggage missing their Christmas holiday.?

I believe that our new CEO Bob Jordan inherited a MESS. This meltdown was not his failure but the failure of those before him. I believe he has the right priorities. But it will take time to right this ship. A few years at a minimum. Old leaders need to be replaced. Operationally oriented managers need to be brought in. I hope and pray Bob can execute on his promises to fix our once proud airline. Time will tell.?

It’s been a punch in the gut for us frontline employees. We care for the traveling public. We have spent our entire careers serving you. Safely. Efficiently. With luv and pride. We are horrified. We are sorry. We are sorry for the chaos, inconvenience and frustration our airline caused you. We are angry. We are embarrassed. We are sad. Like you, the traveling public, we have been let down by our own leaders.?

Herb once said the the biggest threat to Southwest Airlines will come from within. Not from other airlines. What a visionary he was. I miss Herb now more than ever.