The Southwest Effect The Ultimate High-Performance Workplace

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The Southwest EffectThe Ultimate
High-Performance Workplace
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The Emergence of Southwest

• Consumers, particularly corporate travel depts,
  became more price-sensitive in the late 80s
• Consumers began to redefine quality more in terms
  of reliability
• After about 20 years of operation, Southwest
  gained national attention in early 90s by
  winning California intrastate markets from other
  majors
• During Gulf War crisis, Southwest expanded while
  other airlines shrank

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1993 Department of Transportation report on
The Southwest Effect

• Southwest is having a profound effect on the
  airline industry. Southwests much lower
  operating costs are making it the dominant
  airline today in the sense that Southwest, more
  than any other airline, is causing the industry
  to change. Other airlines cannot compete with
  Southwest in the same manner as they do each
  other.

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Continued Growth

• Since then, Southwest has grown to encompass all
  regions of U.S.
• Even since Sept. 11th, in the midst of the
  industrys worst crisis, Southwest continues to
  grow at 4 to 5 per year
• In the U.S. domestic market, Southwest is fourth
  largest in passenger miles flown, fourth largest
  in passengers flown, first largest in flights per
  day

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Continued Growth

• While other airlines struggle to achieve 3 or 4
  consecutive years of profitability, Southwest has
  been profitable every year since 1973
• Southwest has been called the most successful
  airline in history (Fortune)

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Since 9/11, SWAs stock is worth more than all
the U.S. majors put together
Market capitalization
Source New York Stock Exchange
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Brand Drivers

• Most Loyal Southwest Customers will say
• Low Cost
• Efficient Operations
• Reliable Service
• Fun and Enthusiastic Employees
• Customer Friendly Service

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The Southwest Effect
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Building Relational Coordination
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Relational Coordination
Task Tension
People Tension
50
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X
X
X
X
X
X
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Relational Coordination
Task Tension
People Tension
95
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The Southwest Effect
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Culture Cycles
Startup
Growth
Maturity
Decline
Change
Learning Culture Lets not lose our edge! Can
we learn our way to the next level?
Innovation Culture Heated Competition New
products? New strategy? Whats next?
A Change Culture
Startup Culture Risk-Taking
Growth Culture Building Recruiting Managing
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Culture Change

Renewal
Comfort Zone/ Equilibrium
Denial/ Resistance
Confusion, Trial Error
Change is inconvenient even when its for the
better.
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Change Stress
STRESS DEFINED Webster Constraining force or
influence. A physical, chemical, or emotional
factor that causes bodily or mental tension and
may be a factor in disease causation. Selye W
ear and tear. A nonspecific response of the
body to any demand made upon it. THE DEGREE
OF STRESS
Eu-Stress
Normal Stress
Dis-Stress
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The Southwest Effect
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The Southwest Effect

• Areas of Focus
• Vision Values

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Southwest Airlines Vision
The vision of Southwest Airlines is dedication
to the highest quality of Customer Service
delivered with a sense of warmth, friendliness,
individual pride, and Company Spirit.
To Our Employees We are committed to provide our
Employees a stable work environment with equal
opportunity for learning and personal growth.
Creativity and innovation are encouraged for
improving the effectiveness of Southwest Airlines.
Above all, Employees will be provided the same
concern, respect, and caring attitude within the
organization that they are expected to share
externally with every Southwest Customer.
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The Southwest Effect

• Areas of Focus
• Vision Values

• Accountability Engagement

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Accountability
Responsibility
0
100
Empowerment/Influence
100
0
Victim/Blame
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Victim Mentality at Work
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Accountability
Responsibility
0
100
Empowerment/Influence
100
0
Owner/Control
Victim/Blame
Freedom/Success
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Employee Engagement Research by Marcus Buckingham
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Desired Behavior
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The Southwest Effect

• Areas of Focus
• Vision Values
• Accountability Engagement
• Gallup Best Practices Research

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The Gallup Research First Break all the Rules
by Buckingham Coffman

• I know what is expected of me at work.
• I have the tools and materials I need to do my
  job right.
• At work I have the opportunity to do what I do
  best everyday.
• In the past seven days I have received
  recognition or praise.
• My Supervisor, or someone at work seems to care
  about me as a person.
• There is someone at work who encourages my
  development

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The Gallup Research First Break all the Rules
by Buckingham Coffman

• At work, my opinions seem to count.
• The mission and purpose of my company makes me
  feel my job is important.
• My colleagues are committed to doing quality
  work.
• I have a best friend at work.
• In the last six months someone has talked to me
  about my progress.
• I have had opportunities at work to learn and
  grow.

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The Southwest Effect

• Areas of Focus
• Vision Values
• Accountability Engagement
• Gallup Best Practices Research
• Teamwork Alignment

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TEAM Model

• T
• E
• A
• M

(Rely on)
rust
(Strengths Abilities)
xpertise
(Commitment)
lignment
(Accountability)
easurement
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Team Motivation
Team Motivation
Measurement Accountability
Motivation
Alignment Commitment
Buy-in
Expertise Trust
Relationship
Task People
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Team Alignment
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Thank You!