Southwest

Connect people to what's important in their lives

Deliver the highest quality Customer Service with a sense of warmth, friendliness, individual pride, and Company Spirit

Create values that put People first

Me: How I show up

• Pride
  Have a strong work ethic. Take initiative. Be accountable.
• Integrity
  Act like an owner. Choose to do right. Be courageous.
• Humility
  Don't take yourself too seriously. Keep perspective. Don't be a jerk.

We: How we treat each other

• Teamwork
  Practice civility. Embrace Team over self. Be inclusive.
• Honesty
  Speak up. Be transparent. Tell the truth.
• Service with LUV
  Practice Hospitality. Live by The Golden Rule. Don't be rude.

Southwest: How Southwest succeeds

• Efficiency
  Don't make the easy hard. Keep costs low. Stay agile.
• Discipline
  Be safe. Be focused. Be reliable.
• Excellence
  Get results. Win the right way. Kick tail.

Provide friendly, reliable, and low-cost air travel

Good neighbors with a Warrior Spirit and a Servant's Heart

These good neighbors are filled with warmth, positivity, and compassion—they are never corporate. Empathetic and completely uninhibited, they "believe that the business of business is to make a profit by serving people and making life more fun."

They are mavericks with an invincible spirit of courage and perserverance. They believe that if they just work hard enough, if they are just different enough, and if they just care enough, they can overcome any adversity.

Not following conventional rules is in their DNA, and they are here to make legacy airlines uncomfortable. They are smart, provocative, bold, modern, energetic, innovative, and guide every decision by living out these three promises:

• I will demonstrate my Warrior Spirit by striving to be my best and never giving up.
• I will show my Servant's Heart by delivering Legendary Customer Service and treating others with respect (following The Golden Rule).
• I will express my Fun-LUVing Attitude by not taking myself too seriously and embracing my Southwest Family

Friendly, smart, genuine, and bold

At Southwest, when speaking, they want it to sound like they're smiling. When making a joke, they make them clever and fun using insightful observations. When connecting with people, they are casual, real, and relatable. And lastly, they always dare to do things differently by "giving people something to think about, to smile about, and to remember."

Low-cost fares

When Southwest started in 1971, their founding vision was to democratize the skies. At that time, less than 15% of Americans had ever traveled by air. In fact, to Southwest, their biggest competitor was not other airlines, but instead ground transportation.

With a committed focus to always keeping fares as low as possible, Southwest has become the largest low-cost airline in the world with an unprecedented 47 consecutive profitable years.

Their secret? Southwest has always been willing to abandon conventional wisdom and implement untested ideas, like:

• Never raising prices in times of high demand, but instead adding more flights
• Primarily utilizing secondary airports that have cheaper landing costs
• Avoiding inflight meals, no matter the flight length
• Letting bags fly free
• Cutting fares on off-peak hours to fill more seats, resulting in higher revenue

Reliable air travel

For Southwest, reliable air travel means providing on-time flights without any major disruptions. This includes striving to be the airline that cancels the fewest flights, loses the least amount of luggage, and has the fewest customer complaints.

When the Department of Transportation started measuring airline performance based on these three measures monthly in 1987, Southwest was the first airline to rank number one in all three categories. Dubbing this the 'Triple Crown,' Southwest ranked number one in all three categories 31 times over the next ten years until co-founder Herb Kelleher retired the award in 1997.

Positively Outrageous Service

Southwest describes themselves as the airline with Heart. Founded on The Golden Rule, Southwest believes in giving their employees the freedom to do outrageous things for their customers, even if that means having to break a company policy now and again. This has inspired some of their better known outrageous acts like rapping safety instructions or hiding in overhead luggage compartments but has also lead to many heartfelt stories, like:

• A service agent, after finding out a passenger was homeless, inviting her home and allowing her to stay until she could get back on her feet
• A pilot renting a bus and taking all of his passengers out to dinner and a movie after their flight was grounded on 9/11
• A flight attendant flying an extra leg because she befriended a passenger who was afraid to fly alone
• A service agent letting a passenger borrow his suit because the passenger had forgotten his at home and needed one for an award ceremony
• A manager chartering a plane at the cost of $10,000 to take a customer who had missed their flight to Houston for a kidney transpant

Cost-conscious, no-frills travelers

What started out as an airline dedicated to short haul passengers, Southwest further segmented their audience into two distinct groups:

• Time-sensitive business travelers: These travelers value convenience and reliability, over savings, and want lots of business-hour flights. They want to be able to leave for work at 7am, attend an out-of-state meeting at 9am, and be back home by dinner.
• Dollar-sensitive leisure travelers: Made up of mostly families and young adults earning under $100,000, these travelers value lower fares and more flexibility above all else.

Limit your customer reach in order to keep costs low

Sites like Priceline, Travelocity, and Kayak, used to account for 35 to 40% of Southwest's business. However, today you cannot find Southwest on any of these sites because of these three C's:

• Cost: Computer reservation systems started charging commission which would have increased the cost of Southwest flights.
• Commoditization: Search engine sites have commoditized the airline industry with price comparison tools that devalue the brands that are on them.
• Control: If a search engine site publishes a rate different from what is on Southwest's website, it lowers the customer's trust in the brand.

As a result, Southwest developed their own system that enabled travel agents and customers to connect directly with them and cut out the middleman.

Sacrifice market share for profitability

Southwest founder Herb Kelleher does not see how market share has anything to do with profitability. He believes that "market share says we just want to be big; we don't care if we make money doing it. That's what misled much of the airline industry for fifteen years, after deregulation. In order to get an additional 5% of the market, some companies increased their costs by 25%."

Herb attributes Southwest's 37 years of uninterupted profits to their ability to pass up market growth opportunites in order to keep costs low and profitability high. Instead, Southwest's strategy has been to grow very conservatively. They expand into only one or two cities each year, which allows them the time and attention they need to infuse their strong culture into each new location.

Don't be distracted by the next shiny object

When co-founder Herb Kelleher was approached by a European billionaire to establish a Southwest low-fare carrier in Europe, his reply was a simple 'No.' While this partnership would have grown Southwest's market share, expanding out into a different continent would have meant navigating different cultures, currencies, and regulators. It would have also meant needing to use different types of airplanes. To Herb, this would have been too much of a distraction away from Southwest's core strategy.

For this same reason, Southwest also sold off Muse Air, an airline they had acquired that offered longer-haul service and more amenities. It didn't fit with their core strategy and as a result, became a liability.

Don't follow the industry

Southwest co-founder Herb Kelleher used to say: “Conventional wisdom put a hell of a lot of airlines out of business.” In order to stay true to being the low-cost, reliable, fun airline, Southwest remained disciplined in avoiding popular trends and strategies used by competitors. Unlike other airlines, Southwest:

• Serves no meals, just snacks. Instead they added more seats in the empty spaces where meals would have been stored.
• Does not charge for the first two checked bags. They did the math and found it would take the fees of five or six bags to make up the revenue from one lost customer.
• Does not assign seats to travelers. This cuts down on boarding time by one to four minutes.
• Does not interline with other carriers. They avoid spending extra time and money on the ground waiting for passengers from delayed connecting flights.
• Avoids congested airports where flights can be unnecessarily lengthened or delayed by traffic.
• Does not use a hub-and-spoke model where planes and crews are always on standby. Instead, they use a point-to-point model that keeps planes flying as much as possible for more frequent flights.
• Broke away from stuffy uniforms and was the first airline to dress flight attendants in hot pants, which was later replaced by polo shirts and shorts.

Increase productivity and reduce costs by using only one type of equipment

By sticking with one type of plane, the Boeing 737, Southwest has been able to:

• Simplify training requirements enabling crew members to become experts of the plane inside and out
• Quickly and efficiently substitute aircrafts, reschedule flight crews, and transfer mechanics
• Reduce their inventory of parts which simplifies their record-keeping
• Negotiate better deals when purchasing new planes

Don't over plan

Southwest's philosophy has been to "not endlessly plan, discuss, and study in an effort to avoid the risk involved in actually making a decision." Instead, they gather the available facts as quickly as possible, make the necessary analysis, discuss it with the appropriate people, execute, and clean up any mistakes later.

• When Southwest was about to begin offering longer flights outside of Texas, there was concern that customers would want inflight meals. CEO Herb Kelleher's response was "Let's start flying and see."
• When Executive Vice President Gary Barron wanted to completely reorganize the management structure of Southwest's $700 million maintenance department, he presented CEO Herb Kelleher a 3-page proposal. After raising one concern that Gary addressed, Kelleher replied: "Then it's fine by me." The whole conversation took 4 minutes.
• After announcing service to San Diego, Southwest's construction permits got caught up in red tape. Instead of waiting, Southwest crew went ahead and put up a drywall screen, and started construction behind it. Their thought was they would either be granted a permit or have to tear it all down.

Create a culture of tenacity, LUV, and fun

From the day Southwest was founded, they were in a fight for survival. In those first years, Southwest was in a "David-and-Goliath battle with bigger airlines just to earn the right to fly." While these legal battles almost bankrupted the company, they emerged victorious with an enduring culture rooted in having:

• A Warrior's Spirit: Work hard, mount a good offense, and never surrender.
• A Servant's Heart: Put others first and live by the Golden Rule.
• A Fun-LUVing Attitude: Be a passionate team player who doesn't take yourself seriously.

Take the competition seriously but not yourself

If you want your staff to bring joy into the lives of your customers, you first have to bring joy into the lives of your staff. Southwest's co-founder and former CEO, Herb Kelleher, was a firm believer in leadership cutting through the tensions of work by being humble and never taking themselves seriously. He embodied this value most of all, and was completely unconcerned about looking foolish in front of his staff. During his time as CEO, he:

• Showed up at one of the company's hangars on Halloween dressed in drag with a feathered boa
• Appeared in print ads as Elvis Presley
• Was escorted to the stage in a straight jacket to celebrate Southwest's 25th anniversary
• Rapped in the employee produced video, "Southwest Shuffle," which became part of employee orientation

"Herbie Goes Bananas" Ad (1989)

Herb Kelleher: Maverick, Friend, and Founder of Southwest Airlines

Don't ask employees to do something you wouldn't do yourself

Southwest employees are always willing to help out beyond their job description because their leaders do that every day. Co-founder Herb Kelleher didn’t believe in asking anyone to do something he wasn’t willing to do himself. Throughout Southwest's history, Herb and all other Southwest leaders have demonostrated their 'we're-all-in-this-together' mindset by:

• Spending Thanksgiving days helping load bags
• Helping out at ticket counters and gate areas
• Handing out snacks on flights
• Giving out ice cream to employees at their headquarters
• Bringing donuts to mechanics on the overnight shift at 4am
• Painting the walls of their headquarters and hanging photos
• Cooking Christmas dinner at a Ronald McDonald House
• Spending 25 to 30 hours flying each month to work with employees and talk with customers

Learn the job of your employees

It is part of Southwest's culture for leaders to get out and create shared experiences with their staff. Usually this takes the form of spending days helping out or spending nights having drinks with their employees. Greg Wells, who retired as Executive Vice President Daily Operations in 2021, took it one step further.

In 1999, Greg was put in charge of Flight Dispatch operations and quickly realized that "if I want to have these People accept me, and if I want to show them respect, then I really need to understand exactly what they do for a living.” He spent the next eight weeks studying at night to get his Dispatch license, even though he never intended to work as a Dispatcher.

Greg would later say that “the acceptance I got from the group after that, the respect and the gratitude they showed...made a big difference in my success and my Leadership there.”

Keep your organizational structure flat

Southwest believes that when you minimize the layers of management, you are able to streamline communication channels and eliminate miscommunication and red tape. That is why at Southwest, they:

• Do not have more than four layers of management between a front-line supervisor and the CEO.
• Do not have assistants, as they only add layers to the hierarchy, increase overhead, and create more formal communication channels.
• Limit the number of committees as they overcomplicate decision making structures and waste time.

Reserve the first 10 minutes of a meeting to have fun

Whether its talking about your weekend, making jokes, holding a team building exercise, or even lovingly "razzing" somebody else, Southwest likes to take the first 10 minutes of a meeting to have some fun and to build a stronger culture. Southwest CEO Bob Jordan believes that "the 10 minutes of fun serves to build relationships, and there's a camaraderie that comes out of that that is an accelerant to doing the business."

This doesn't mean that nothing serious gets done. Every meeting is expected to have an agenda and end with clearly assigned next steps for each person to take action on. No one should walk away from a meeting saying "Let's study that more."

Step outside your role to get the job done

The phrase, "That's not my job," doesn't exist at Southwest. Attitudes like that undermine productivity and prevent companies from being nimble and quick. Instead, Southwest lives by a 'whatever it takes' mentality where there are no rigid job descriptions and employees are expected to help out in anyway they can, no matter their actual role.

• Mechanics help ramp agents load bags.
• Pilots help customers board planes, take boarding passes, and clean up cabins.
• Leaders, including the CEO, help ramp agents load bags, help out at the ticket counter, and pass out peanuts on flights.

Co-founder Herb Kelleher would famously say: "We can’t rest on our laurels. Our Employees must rise to the challenge. If we don’t work harder, and if we don’t make sure that there is a legacy beyond us, our airline won’t be here."

Allow employees to make mistakes, even big ones

When newly promoted manager Matt Buckley proposed a door-to-door cargo product called RUSH PLUS to Southwest CEO Herb Kelleher, Herb said 'Let's try it.' When manager Bob Montgomery made a verbal commitment to the amount of $400,000 with the city of Austin, Herb honored the deal.

While both of these employees' Hearts were in the right place, both of these projects turned out to be complete failures. However, no one was fired or reprimanded.

To Southwest, the cost of making a mistake is insignificant compared to "the benefits that come from people feeling free to take risks and be creative." Secondly, with every failure comes an opportunity for personal growth and maturity.

To continually inspire this entrepreneurial spirit, Southwest limits company bureaucracy and the need for Board or senior management approval for even some of the biggest projects like negotiating million dollar deals and constructing ticket gates.

Encourage staff to change positions...and departments

Laurie Barnett started at Southwest in the Purchasing Department. Four years later she was asked to oversee the Emergency Response Program. The only issue was that she didn't know anything about emergency response.

At Southwest, that didn't matter. They encourage their staff to change positions and departments within the company so they "don't become complacent or resistant to change." Southwest also believes that:

• Disciplines can be taught and job functionalities can be learned.
• Great leaders should be able to move around and do anything.
• Broader experiences make for better leaders.

As for Laurie Barnett, after leading the Emergency Response Team, she later became the Vice President of Communications & Outreach.

Celebrate everything

Besides large-scale celebrations, like their annual X^th and last Chili Cook-off and their annual Halloween party, Southwest also has many small and spontaneous celebrations. If an employee is having a professional or personal milestone, Southwest celebrates it—even if it is a personal loss. But there is a method to this celebration madness, every celebration follows these unwritten but "commonsense guidelines:"

• Be authentic. Employees know fake initiatives when they see them, especially if they are done in place of pay or benefits, or try to mask hard times.
• Raise people's dignity and self-esteem.
• Do it right. Every Southwest celebration, no matter its size, has three roles: The Imagineer envisions the celebration and its potential impact; The Artist brings the vision to life; The Evocator gets people excited about the celebration.
• Appeal to all the senses. This includes balloons, flags, floats, costumes, live music, and video montages.
• See them as an investment, not a cost. While it may be difficult to draw a direct link between celebrations and profitability, Southwest sees celebrations having 8 key benefits.
• Be cost-effective. Instead of outsourcing, Southwest relies on the talents of their people. If a vendor is absolutely necessary, they will barter flight passes for services.

Increase resourcefulness, motivation, and accountability through profit sharing

Through their profit sharing program, Southwest has directly connected the well-being of their employees to the well-being of the company. As each employee's profit sharing account grows with their tenure, their concern for the health and longevity of the company grows as well.

Staff become more resourceful, more motivated to step up and assume ownership, and more aware of how their decisions affect the bottom line:

• When looking to maximize speed and minimize fuel burn rate, pilots request more direct headings and altitudes and learn shortcuts in and out of airpots, as well as, which runways can be safely taxied to on a single engine.
• When 800 new computers were needed, employees bought them in parts and put them together in an assembly line cutting costs by 50%.
• Even when Southwest ticket agents let other airlines borrow office supplies, they will go so far as to follow the borrower until the item is returned.

In 2020, Southwest shared $667 million through their profit sharing program, which equated to more than 6 weeks of pay for each employee or roughly 12% of their salary.

Use group interviews to find the most compassionate candidates

Southwest hires for empathy by looking at the interaction candidates have with each other during group interviews. Each candidate is asked to prepare a five-minute presentation about themselves. As the presentations are shared, Southwest will not just listen to the speaker but watch the audience to see who is "enthusiastically cheering on and supporting their potential coworker" and who is using the time to think about their own presentation. Only candidates that unselfishly show their support for their peers go to the next round.

Evaluate the character of a candidate by asking behavioral questions

At Southwest, the character of a candidate is valued much more than their skillset. Even when interviewing pilots, highly qualified candidates have been dismissed for being rude to receptionists. For that reason, Southwest interviews focus on finding individuals who care about others, who want to be a part of a team, and who genuinely want to help the team succeed.

One-on-one interviews are treated more like conversations and can last as long as two hours. Interviewers ask open-ended behavioral questions to best judge the candidate's character:

• Tell me how you recently used your sense of humor in a work environment.
• Tell me how you have used humor to defuse a difficult situation.
• Describe a time when you went above and beyond to help a co-worker succeed.

Find people that don't take themselves seriously

To maintain a culture that nourishes joy, pride, and fun, Southwest is very selective when hiring. Their hiring process has been crafted to find and hire only people that do not take themselves seriously.

• Make recruitment ads that reflect your fun culture. One ad showed a drawing of a dinosaur that had been colored outside the lines by a student with a caption that read: "Brian shows an early aptitude for working at Southwest Airlines." Another featured the co-founder and former CEO dressed in an Elvis suit with a tagline that read: "Work in a place where Elvis has been spotted...Send your resume Attention Elvis."
• Expect more from resumes. "Really tuned-in applicants have sent in applications filled out in crayon, delivered in cereal boxes, mounted on top of pizzas, packaged with confetti and noisemakers, and even done up as labels on bottles of Wild Turkey (Herb's favorite liquor)."
• Test applicants to see how serious they take themselves. In Southwest's group interviews, even pilots are tested on their ability to loosen up and have fun. Pilots have been asked to change out of their suit pants and into Bermuda shorts while still wearing their suit coats and dress shoes. The candidates who declined were asked to leave.

Southwest's Recruitment Ad

Southwest Airlines Recipe for Success

Increase empathy by putting yourself in another employee's shoes

Southwest builds empathy among staff and accelerates their development by finding ways for employees to understand the job roles of other staff through shared experiences:

• The Cutting Edge Program: Throughout the year, Southwest pilots will work side-by-side with Ramp Agents to learn first hand about what goes on underneath the plane when it's at the gate. Pilots help with unloading bags, dumping lavatories, and fueling the jets.
• Customer Relationship Training: New Customer Relations Representatives go through four weeks of training which includes firsthand experience in all things customer service, like selling tickets, issuing boarding passes, and tagging bags. They also shadow senior Representatives as they take calls and work on the computer for a week before they even can answer a call themselves.
• Walk a Mile in My Shoes: For six months one year, employees and leaders were asked (not required) to come in on their day off and visit a different department or other station and spend six hours "walking in the shoes" of another employee. Over a 6-month period, 75% of employees participated. Read the experience of one Ramp Supervisor.
• A Day in the Field: This experience is practiced all year long, and is specifically for Officers and Directors to spend several hours and sometimes days working alongside staff to better understand their roles and to say that they can truly "walk the talk."

Ensure the freedom to explore and enjoy life's opportunities

Air travel at first was reserved for the elite—those who could afford "the freedom to go, see, and do at a moment's notice." With a founding vision to democratize the skies, Southwest wants to ensure that no one ever misses out on any of life's opportunities that travel has to offer.

While Southwest's commitment to low fares makes flying accessible, their hospitality makes the adventure enjoyable. People were now free to do and enjoy what matters most in life—they were now "free to move about the country."

Win price wars by knowing your audience

In 1973, as a young airline, Southwest's low cost frequent flights were posing a threat to the market share of the larger well-established Braniff Airlines. Having deep pockets, Braniff launched a campaign that undercut Southwest's $26 flight from Dallas to Houston by half.

With the strong possibility of losing all of their business to Braniff's cheaper flights, Southwest fired back with an ad that read: 'Nobody's going to shoot Southwest Airlines out of the sky for a lousy $13.'

Within the ad, Southwest offered their customers a choice: Southwest would either match Braniff's $13 fare or customers could buy a regular $26 ticket and receive a complimentary fifth of vodka, whiskey, or scotch.

And the result? Besides Southwest becoming the largest distributor of those liquors in Texas during that time,:

• Three quarters of Southwest passengers chose the liquor over the half priced fare.
• Southwest's passenger count went up by 66%.
• Southwest turned its first ever profit that year.

Braniff, on the other hand, reinstated their original higher rates and would eventually cease operations in 1982.

Southwest's victory was a result of the company understanding their audience. Their core customers were business travelers who expensed their trips, and would much rather have a free bottle of booze than help their company save a few dollars.

Southwest's 'Nobody's going to shoot Southwest Airlines out of the sky for a lousy $13' Ad

Fare Play: $13 Bottles of Booze and The Two-Tier Fare System

Don't use scripts or techniques

Southwest has learned that there are no catch-all scripts or techniques that can effectively deal with a wide variety of customers—what one customer expects may annoy another. Also, by defaulting to a script or technique, interactions become "nothing more than a sophisticated method of manipulating people to act in ways that accomplish organizational objectives."

Instead, Southwest's philosophy is to allow staff the freedom to create highly individualized experiences with a high dose of personal attention. Former CEO Colleen Barrett would tell staff that “I am never going to call you and ask you why you did too much for someone, but I will likely call you and ask you why you didn’t do enough.”

Have your customer's experience mirror your culture

Southwest's co-founder Herb Kelleher "deplored the class mentality" and was set on creating a culture and a customer experience where everyone was treated as equals. While other airlines assigned seats and created cabin classes with tiered fare structures, Herb created an experience where no one had an assigned seat, everyone paid the same fare, and everyone had the same snack and drink choices. This experience helped speed up boarding time and kept prices low which brought them closer to their founding vision of democratizing the skies for everyone.

Make waiting fun

Whether waiting to board a flight or waiting to land, Southwest employees are empowered to find any creative way to make flying fun. Besides their well-known singing safety announcements, Southwest employees:

• Give $25 gift cards to anyone with a hole in their sock or a humiliating driver's license picture.
• Hold snack races to help determine which snack will be given out on the plane.
• Hold paper airplane throwing competitions and scavenger hunts in waiting areas.
• Build LUV Carts, made out of anything with wheels, to hand out snacks and Southwest swag while also giving customers a chance to win toys for kids or donuts for early-morning travelers with a wheel of fortune.
• Demonstrate the power of the airplane's lavatory technology by unraveling a roll of toilet paper down the aisle and flushing it to see how fast it gets sucked down.

Turn a legal issue into a PR event

In 1990, Southwest revealed their new slogan 'Just Plane Smart.' Stevens Aviation, who had been using a similar tagline, 'Plane Smart,' for years, contacted Southwest with a proposition: Instead of getting lawyers involved, the two CEOs would determine the rights to the slogan over an arm wrestling match.

Southwest took Stevens Aviation up on the offer and the two CEOs battled it out in front of 4,500 spectators and several news outlets. Southwest's CEO, Herb Kelleher, would end up losing the match but Stevens Aviation CEO allowed Southwest to continue to use the slogan. In the end, Southwest earned as much as $6 million in publicity and Stevens Aviation saw a 25% annual growth for the next four years.