People Are the Main Focus of Southwest's Business Strategy

Investing in Each Other: Southwest's People-Management Strategy

Southwest Airlines' overall people-management strategy is focused primarily on achieving good customer relations (Gallo, 2013). The basis of good customer relations, however, is good employee relations. When employees feel valued by employers, that value is passed on from employees to customers, so goes the theory according to Southwest founder Herb Kelleher (Gallo, 2013). It is, in effect, a top-down strategy of appreciation and "spirit of mission." The spirit of mission at Southwest Airlines is defined as a "warrior spirit" -- a cumulative effort by the entire workforce designed to facilitate a family-like atmosphere all the way around, from management to subordinates to customers: all are treated like members of one big family -- such is the basic environment in which the airline's people-management strategy is situated (Gallo, 2013). However, as researchers reveal, there is even more to the Southwest story. At the heart of the company is a "secret sauce" that allows it to thrive (Gittel, 2003). This paper will discuss the people-management strategy that Southwest uses to make that "sauce" or "spirit" or whatever one chooses to call it.

Southwest's approach to employee rewards and motivation is generous to say the least. The company offers terrific benefits, such as 401(k) savings plan, a profit-sharing plan, medical insurance, prescription, vision and dental insurance, pre-tax commuter benefits, life insurance, long-term disability, and various spending accounts. Southwest believes that its "greatest asset" is its employees (Southwest Report, 2010, p. 45). So there is a reason that Southwest trades on the NYSE under the ticker symbol LUV. It truly aims to be have a loving environment in which employees are valued more than anything else.

Southwest's company culture is familial and is founded upon hiring individuals who possess the right attitude. It creates an environment that is essential communal. There are shared goals, there is shared knowledge, and there is mutual respect among managers and employees (Gittell, 2003). One of the most appealing aspects of Southwest's culture is its mission to treat employees the same way that it expects employees to treat customers. Indeed, its mission statement reads: "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" (Srinivasan, 2014). In other words, Southwest cultivates a "pay it forward" type of mentality. If there can be any one aspect of the airline's culture that concerns me, it would be the quickness with which Southwest expects its employees to move. The rapid speed and focus needed to get planes out of the gate requires a great deal of energy and precision: so keeping everyone's stamina at optimum levels might become taxing after a while. The company might do well to focus on ensuring that everyone gets a proper amount of "down" time during a shift. After all, happy employees are helpful employees.

Southwest's ability to attract and retain employees is significant to say the least. It may drive away a certain "type" of worker (one whose talents are more IQ or intellectually-related than customer service-related), but it attracts another "type" -- one who is committed to solid customer-relations and establishing a positive culture. Its great benefits are one of the key reasons employees come to Southwest -- but it is not the only one. Other reasons employees are attracted to the airline are the fact that the workplace is not tyrannical or too rigid: everyone is encouraged to have fun, make jokes, enjoy their job and enjoy interacting with customers. The workplace is a place where Southwest wants people to be. That sort of environment can be very attractive to individuals who are tired of being in a workforce that is mentally and emotionally draining. In the environment that Southwest cultivates, employees can feel rejuvenated, fresh, free, and happy. The fact that Southwest encourages its employees to let loose is one reason it has such a competitive edge when it comes to hiring workers.

That said, the company also aims to be responsible. However, with the "LUV" atmosphere that it wants to cultivate, the airline might find that responsible workers shy away from the airline. Then again, the company has shown no signs of irresponsibility yet -- so this fear may be unfounded. What is certain is that Southwest does attract a very specific type of employee and so not everyone fits the bill. This is a unique airline that emphasizes human qualities over technical ones. This in effect will limit its pool from which to draw workers. Nonetheless, the focus with which it strives to meet its objectives helps the airline to collect the workers it deems most appropriate.