Organizational Culture at Southwest Airlines and Koch Industries

There are many different pathways to success for companies, and as a result successful organizations can have distinctly different cultures. This paper will examine a couple of different companies – Southwest Airlines and Koch Industries, to examine their different cultures, and how those cultural differences have emerged, and support the overall business objectives of those two organizations.

The Southwest Airlines culture is one of the more celebrated organizational cultures in business. The company is based around \\" A warrior spirit, a servant\\'s heart and a fun-loving attitude.\\" A focus on fun-loving is more to the day-to-day, as the servant emphasis, but the warrior heart showcases that employees at Southwest are expected to rise to the challenges that they face, and overcome obstacles in their service (Makovsky, 2013).

These values are even reflected on the company website. For example, this month the Star of the Month is a pilot, and the quote in the feature story is \\"his love of serving others helped him fit with in the culture from the start\\" (Southwest.com, 2017) This indicates that servant mindset is a critical component of the culture, and that this extends even to workers like pilots who might not have a lot of direct contact with the customers.

The value of this culture to Southwest is simple. Aa a B2C company, it serves consumers, and thus needs to appeal to the needs of consumers in the course of its business. Southwest therefore need people who will demonstrate an ability to go the extra mile, to always empathize with the customer, and generally to have a great attitude towards their work. The company saw that these would in each in turn be differentiating factors in the airline business. Southwest also knew that if it was going to undercut other airlines, it would need to deliver service at a higher level in order to make customers overlook other service elements that were lacking, when Southwest was compared with other airlines.

The company works hard at its culture. Southwest has recognized that attracting the right talent is critical to its business. There are a lot of jobs that airlines perform that are basically low-skill jobs, doable by anybody. But Southwest figured out that getting people with a certain service mindset into those position was optimal, but that those people would only be attracted by a team-oriented service-focused culture. As such, Southwest sought to build that culture as a means of attracting the right people over time. Having a sustainable culture was important to the company\\'s founders and continues to be important today, to the point where the CEO is working actively on maintaining the culture (Harder, 2016).

All told, these elements of organizational culture help to differentiate Southwest from other airlines. Even when Southwest started in the 1970s, the other airlines were not focused on culture, or on making their airline a great place to work. Today, that difference is even more obvious. So Southwest wanted to create a different flying experience, one that was pleasant and positive, and thus was differentiated from the other airlines. For Southwest, this works well with its pricing. The company will offer lower prices than other airlines and better service, and that makes Southwest a compelling proposition for many flyers. The result is that Southwest has slowly, gradually, begun to become one of the most successful airlines and market leaders in America.

Koch Industries has a very different approach to organizational culture. As with Southwest, it asks that employees buy in to the culture, but the culture at Koch is quite different. It follows the principles of market-based management, which is a philosophy expounded by co-founder Charles Koch (Charles Koch Institute, 2017). There are several different elements to this philosophy: integrity, compliance, value creation, principle entrepreneurship, customer focus, knowledge, change, humility, respect and fulfillment. This is a lot of different elements to work with. Of these, customer focus is shared with Southwest, but many of the others are fairly overt calls to value creation for the organization. Interestingly, a lot of what Southwest does is based on creating value for the company, but it is not overtly expressed; at Koch, this value is overt.

A study of changes at Georgia Pacific after it was bought by Koch Industries revealed a few distinct elements of the corporate culture. First, there is a focus on the long-run that doesn\\'t exist in publicly-traded companies. Management wants high returns, but they are willing to wait to get it; this is different from a company that takes more of a short-run, transactional approach to its business (Leonard, 2017). This manifests in a number of ways, including reinvestment in the business versus paying dividends, but it is also something that has been baked into the culture at Koch Industries.

There is a strong sense, judging by reports, that Koch Industries lives up to its values. The people working for the company believe in those values, and implement them; they are not just empty talk. So in that respect, these values have been significant at driving success for Koch Industries.

The Koch organizational culture has allowed for a couple of things to happen. First, the culture serves as a unifying element between the disparate businesses that exist within Koch Industries. The Koch brothers see the organizational culture as something that adds unique value to each company that they acquire. All businesses within their empire, whether there are any synergies with other Koch businesses or not, benefit from being part of this organization because of the way that the Koch culture helps to transform these organizations.

The second key thing is that for the most part, Koch business produce commodity goods. These are organizations where people are expected to operate at a high level of performance, and as such, the market-driven philosophy is something that compels only the most talented people to work with this company; Koch wants to weed out floaters. One of the most important consequences of this is that Koch Industries has a culture that is highly motivated towards results. With commodity businesses and a long-run take on these results, the company is able to build strategy that works over the long run. The culture therefore supports the business strategy, and allows that strategy to flourish. It helps to differentiate Koch from other companies that are in the same businesses.