I’ve just gotten into Jody Gittell’s The Southwestern Way. So far I like what I’m reading. It’s not a new book – it came out in 2003. But somehow we over looked it when doing our research for Firms of Endearment. Southwest, of course, is an FoE.
Ms. Gittell does a fascinating comparison between American Airlines and Southwest. American, like the other legacy airlines, has tried to copy in at least some regard the “Southwest Way.” The only problem they’ve encountered is that they don’t get the Southwest Way.
They have tried to copy the mechanical aspects of the Southwest Way – ramp procedures, baggage handling, reduction of types of aircraft and so on. But none has altered their culture.
While pilots and baggage handlers look at and talk to each other, no such thing happens at the other airlines that are socially organized by status position based on one’s job.
Gittell sums up the Southwest culture early in the book by saying the company’s social organization is based on shared goals, shared knowledge and mutual respect. At Southwest, the goals to which everyone subscribes are few and simple: on-time departures and arrivals, no lost luggage and smiling, happy customers. The other airlines may say they have the same goals, but no team identity exists to make them realizable.
At Southwest, every employee has a basic understanding of everyone else’s job and knows how they fit into the total picture. Legacy airline employees are pitifully ignorant of what employees not in their own line of work really do.
At Southwest, everyone talks to each other with respect. The people who clean the p[lanes are literally regarded as being just as important to the realization of shared goals as the pilots are.
One might think that with Southwest’s enviable record of 36 years of unbroken profits (some legacy airlines have been in bankruptcy two or more times), that someone in the other airlines would have figured out how Southwest Airlines does it. It’s not complicated. One word accounts for Southwest’s becoming the most successful airline in aviation history: “It’s the CULTURE, stupid,” as Bill Clinton’s leading political strategist James Carville might say.
Einstein famously said, “Not everything that can be counted counts, and not everything that counts can be counted.” Business managers are generally so accustomed to discounting what cannot be measured that they fail to take into account what really makes for success.
How does one measure culture? Certainly not with the certainty one measures ROI or ROE. Yet, in our research of companies we hold out as exemplars of the stakeholder relationship management business model, we came to the conclusion that culture is more accurately predictive of future performance than last year’s financials.
Ms. Gittell says that the real reason Southwest has been so successful is that it uses the power of relationships to achieve high performance. This is how it has created a cohesive, single culture. Most companies have multiple cultures. There is an executive culture and a product development culture. Then there’s a marketing culture and a sales culture. The, like so many stands of “junk” DNA tiny microcosmic cultures surrounding cliques of only a few people swirl around in company venues.
In short, most companies don’t have a culture. They are socially fragmented agglomerations of individuals, all looking out for themselves as priority number one. Few realize that a socially cohesive organization is the best way to serve everyone’s interests. Just ask the maintenance people and flight attendants at Southwest who became millionaires working for the company they LUV (Southwest’s ticker symbol).