Southwest Airlines has been in business since 1967 and has recorded 47 consecutive years of profitability. The company flies 737 Boeing 737 aircraft with 380 more on order. Southwest pioneered low-cost air travel and has grown to be one of the largest airlines in the world. United Airlines launched Ted, its low-cost brand in 2004 with 56 Airbus 320 aircraft. It folded operations in 2008. Delta Airlines launched Song, its low-cost brand in 2003 with 47 Boeing 757 aircraft. It folded operations in 2006.
How is it that two enormous legacy air carriers failed to challenge Southwest with similar low-cost service? Just like Southwest, they flew point-to-point routes. They used a single type of aircraft, just like Southwest. And they charged low fares, just like Southwest. What’s more, they had massive financial backing from well-established parent companies. All three companies were playing a commodity game. So why did Southwest win the game?
There was one aspect that neither Ted nor Song could replicate. Southwest had developed a unique culture that was friendly, whimsical, and borderline radical at times. Customers were attracted to this culture. Southwest passengers enjoyed corny songs sung by flight attendants and the overall attitude of the Southwest team. Ted and Song were simply offshoots of United and Delta and reflected their respective cultures. It’s true that there are other low-cost airlines that are profitable today, but they haven’t made serious inroads into Southwest’s market share or customer base.
What’s fascinating about all of this is how a Winning Culture can be so elusive. I’ve said many times that I’m not particularly concerned about sharing my playbook with my competitors. It’s not the design of the plays that necessarily wins the game. It’s how well those plays are executed that makes the difference. There are a multitude of sports metaphors in this respect. Think of all the professional football teams that are stocked with amazing athletes possessing world-class talent. And every single team has a playbook full of intricately designed plays for the offense and the defense. Yet, a dropped pass here and a missed block there can be the difference in whether a team wins the Super Bowl or watches it at home on TV.
What exactly is a Winning Culture? As entrepreneurs, it is something we may not think much about, but it can be the difference between success and failure. Far too often, entrepreneurs may not pay enough attention to creating and nurturing a Winning Culture, opting instead to focus more exclusively on operations and metrics. Southwest infuses the following into every employee it hires:
- A warrior spirit.
- A servant’s heart.
- A fun-“luving” attitude (Southwest’s stock ticker symbol is LUV).
At Southwest, the warrior spirit is “being fearless in terms of delivering the product,” according to Ginger Hardage, the now-retired chief communications officer. The servant’s heart is based upon the Golden Rule and the need to treat everyone with respect. It’s obvious what the “fun-luving attitude” is all about. Southwest looks to hire people who don’t take themselves too seriously and always have a smile on their face. There’s no question that Southwest pays a great deal of attention to operations and metrics, but its cultural foundation is rooted in these three values.
When a company stops winning and starts losing, the first place to look is to see if it has strayed from its Winning Culture. If the culture’s not right, the operations may be off kilter and the metrics will look bad. I believe that we must fix the culture first and then make the technical adjustments from there. And one more cogent point needs to be made. A Winning Culture is different than just plain culture. An organization may have a culture that has been intentionally cultivated but doesn’t necessarily lead to winning. To win, we must be extraordinarily positive about it. Our entire team must be convinced that we are going to win, and they must completely embrace the notion.
A Winning Culture is not replicable. It is unique to each company or organization and must be developed organically. It enables us to execute our playbook effectively in ways that our competition can’t.
This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.