The SWA debacle explained…

Or, chickens coming home to roost, thanks to beancounters…

Senior Pilot Larry Xxxxx:
What happened to Southwest Airlines?
I’ve been a pilot for Southwest Airlines for over 35 years. I’ve given my heart and soul to Southwest Airlines during those years. And quite honestly Southwest Airlines has given its heart and soul to me and my family.
Many of you have asked what caused this epic meltdown. Unfortunately, the frontline employees have been watching this meltdown coming like a slow motion train wreck for sometime. And we’ve been begging our leadership to make much needed changes in order to avoid it. What happened yesterday started two decades ago.
Herb Kelleher was the brilliant CEO of SWA until 2004. He was a very operationally oriented leader. Herb spent lots of time on the front line. He always had his pulse on the day to day operation and the people who ran it. That philosophy flowed down through the ranks of leadership to the front line managers. We were a tight operation from top to bottom. We had tools, leadership and employee buy in. Everything that was needed to run a first class operation. When Herb retired in 2004 Gary Kelly became the new CEO.
Gary was an accountant by education and his style leading Southwest Airlines became more focused on finances and less on operations. He did not spend much time on the front lines. He didn’t engage front line employees much. When the CEO doesn’t get out in the trenches then neither do the lower levels of leadership.
Gary named another accountant to be Chief Operating Officer (the person responsible for day to day operations). The new COO had little or no operational background. This trickled down through the lower levels of leadership, as well.
They all disengaged the operation, disengaged the employees and focused more on Return on Investment, stock buybacks and Wall Street. This approach worked for Gary’s first 8 years because we were still riding the strong wave that Herb had built.
But as time went on the operation began to deteriorate. There was little investment in upgrading technology (after all, how do you measure the return on investing in infrastructure?) or the tools we needed to operate efficiently and consistently. As the frontline employees began to see the deterioration in our operation we began to warn our leadership. We educated them, we informed them and we made suggestions to them. But to no avail. The focus was on finances not operations. As we saw more and more deterioration in our operation our asks turned to pleas. Our pleas turned to dire warnings. But they went unheeded. After all, the stock price was up so what could be wrong?
We were a motivated, willing and proud employee group wanting to serve our customers and uphold the tradition of our beloved airline, the airline we built and the airline that the traveling public grew to cheer for and luv. But we were watching in frustration and disbelief as our once amazing airline was becoming a house of cards.
A half dozen small scale meltdowns occurred during the mid to late 2010’s. With each mini meltdown Leadership continued to ignore the pleas and warnings of the employees in the trenches. We were still operating with 1990’s technology. We didn’t have the tools we needed on the line to operate the sophisticated and large airline we had become. We could see that the wheels were about ready to fall off the bus. But no one in leadership would heed our pleas.
When COVID happened SWA scaled back considerably (as did all of the airlines) for about two years. This helped conceal the serious problems in technology, infrastructure and staffing that were occurring and being ignored. But as we ramped back up the lack of attention to the operation was waiting to show its ugly head.
Gary Kelly retired as CEO in early 2022. Bob Jordan was named CEO. He was a more operationally oriented leader. He replaced our Chief Operating Officer with a very smart man and they announced their priority would be to upgrade our airline’s technology and provide the frontline employees the operational tools we needed to care for our customers and employees. Finally, someone acknowledged the elephant in the room.
But two decades of neglect takes several years to overcome. And, unfortunately to our horror, our house of cards came tumbling down this week as a routine winter storm broke our 1990’s operating system.
The frontline employees were ready and on station. We were properly staffed. We were at the airports. Hell, we were ON the airplanes. But our antiquated software systems failed coupled with a decades old system of having to manage 20,000 frontline employees by phone calls. No automation had been developed to run this sophisticated machine.
We had a routine winter storm across the Midwest last Thursday. A larger than normal number flights were cancelled as a result. But what should have been one minor inconvenient day of travel turned into this nightmare. After all, American, United, Delta and the other airlines operated with only minor flight disruptions.
The two decades of neglect by SWA leadership caused the airline to lose track of all its crews. ALL of us. We were there. With our customers. At the jet. Ready to go. But there was no way to assign us. To confirm us. To release us to fly the flight. And we watched as our customers got stranded without their luggage missing their Christmas holiday.
I believe that our new CEO Bob Jordan inherited a MESS. This meltdown was not his failure but the failure of those before him. I believe he has the right priorities. But it will take time to right this ship. A few years at a minimum. Old leaders need to be replaced. Operationally oriented managers need to be brought in. I hope and pray Bob can execute on his promises to fix our once proud airline. Time will tell.
It’s been a punch in the gut for us frontline employees. We care for the traveling public. We have spent our entire careers serving you. Safely. Efficiently. With luv and pride. We are horrified. We are sorry. We are sorry for the chaos, inconvenience and frustration our airline caused you. We are angry. We are embarrassed. We are sad. Like you, the traveling public, we have been let down by our own leaders.
Herb once said the the biggest threat to Southwest Airlines will come from within. Not from other airlines. What a visionary he was. I miss Herb now more than ever.
This matches with ‘rumors’ that have been percolating around the DFW area for the last five or so years…


The SWA debacle explained… — 15 Comments

  1. And yet Gary Kelly now sits on the Board of Directors, the very body that is responsible to ensure that the various C-level executives are doing their job well to maintain the health of the company – the same body that let Kelly steer the company into the position it’s in today for 22 years.

    What was the Board doing when the complaints and pleas from the employees were increasing in frequency and intensity in response to more and more problems? Why weren’t they thinking of keeping the tools, equipment, processes and procedures properly modernized like every other airline? This must be accounted for, and corrected for, or it will happen again.

    If Bob Jordan can right the ship, then he’ll have pulled off nothing short of saving Southwest Airlines from an eventual bankruptcy. I just hope the Board has had their “Come to Jesus” moment now and supports him in his decisions, and doesn’t undermine him.

  2. Publicly traded companies are run to keep brokerage firms and stock analyst happy. They are not run to keep customers much less employees that way.

    I was flat out told by a VP at big defense company our only job was to keep share prices high. F-bomb customer satisfaction! If the price of shares or the dividend dropped, institutional investors would sell and buy some other stock.

    This is why companies put CFO’s in charge to the damnation of their business. Milk the operation to the maximum amount allowable and then 10% more.

    It’s a shame it happened to Southwest. It was my prefered airline when I was working.

  3. That fits what I’ve heard through the ramp rumor mill, and from recently retired SWA pilots and cabin crew. You have to have someone who sees what’s going on ramp-side, so to speak, and who understands what needs to change.

    (I recall Uncle Jimbo at BLACK FIVE talking about a trusted NCO-type position, someone who could wander, mingle, talk to the working side of the business, then report back to the CEO and say, “This works, this is a disaster about to happen, and one of the rampers tried doing this and great things ensued. We need to see if we can do more of that.”)

  4. Bean counters should only count beans. I’ve only worked with one that looked at operational impact first.

    Another bean counter victim in our future is the Union Pacific. They now are going to one man crews in their locomotives and relying on ground based “conductors” driving to disabled trains. Several videos on YouTube lay out the problem.

  5. Reminds me of …

    Larry Pournelle’s Iron Law of Bureaucracy states that in any bureaucratic organization there will be two kinds of people”:

    First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.

    Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers union officials, much of the NASA headquarters staff, etc.

    The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization

  6. This is a copy of my comments on a friends timeline when he posted this story yesterday

    Unfortunately, SWA IS NOT a cherry here. Look at the history of the airline industry. What happened to TWA after Jack Frye, Continental after Bob Six, Delta after C.E.Woolman, Eastern Rickenbacker, Pan Am Trippe, Western, Braniff, Alaska and damn near every other airline. Pretty much same can be said for the trucking, rail industries, and yes even the military, once the operators retire (or are moved out) and turn over to the bean counters everything goes to hell.

  7. I spent over 35 years at a shop that melted metal for the investment cast industry, as well as the aerospace industry. We started out as a small job shop, only melting a small amount of things for a small number of customers. Over time, we continually grew.
    We got too big for the one private owner to invest the money needed for the next step, so he sold us to a firm from England, who invest money but only to take as much out as they could, when we started to grow. Then they did the same thing.
    The next owner was better, they kept us, and took us to another level, allowing those of us who had been there awhile to grow the business by our technical innovations, made over time, by a core group of guys my age, who all came in within 2 years or so of each other.
    We got to where we were selling to everyone in the industry, and one of our bigger aerospace customers was big into ground based turbines. So big, in fact the rather than keep buying alloy from us, they bought the entire business lock, stock, and barrel.
    Again, they invested money into our business, adding furnaces and such, but mostly for the aerospace side of the business. They already owned a meltshop that worked selling to the investment casting industry. So they shipped much of our ferrous based alloy sales to that shop, cutting our air melt business by a large amount.
    I left there in 2013, but after that, from all I have heard, the entire network of businesses was bought by Berkshire Hathaway. I don’t know what they are up to now. I do know that before I left, the place had gotten much less friendly to it’s employees. Especially the ones who had been there for a long time. We were typically paid more than new employees, of course, based upon a number of factors, including a failed union drive that they basically bought us off, with money to those who had been there for over 20 years, and whose votes were needed to pass a union vote.
    But over the 35 plus years I worked there, I saw the progression just like Southwest Airlines has, with it’s management changes. And how bad leadership up top always makes things worse for the ability to serve your customers. To the point where it was more important for the last management for us to sweep the floor than to make quality product. The Toyota management system. Which is a workable system of course, only management has to buy in completely, instead of only the parts of it that they like.

  8. Yet another instance confirming an ugly reality. Given control over ANYTHING beancounters will ALWAYS destroy whatever they control.

  9. Bean counter explanation seems to be one aspect of a more general observation.

    It is hard to do things.

    You can build and maintain an organization that does a thing, so long as the leadership is attentive to doing the thing, and getting it done.

    Organizations always get into the hands of folks who aren’t chasing whatever goal built the organization. If for no other reason than turn over, and folks interested in whatever goal being a subset of available humans.

    Chasing anything but whatever main thing of the organization, will distract you, and then you build up potential trouble.

    There seem like there may be a lot of organizations with such built up.

  10. Ed- Of course…

    George- On the money, as always.

    pigpen- Oh, that sucks. But it’s also what is going on pretty much everywhere.

    Dan- True.

    Bob- And it’s usually money… grrr…

  11. The article fails to mention one thing:

    The truth is that the start of the Meltdown was at Denver, where folks were told that if they called off sick they had to have a doctor’s note to return, and/or they would be fired.
    Some quit, some simply did not show up, others took additional sick days.
    With over 200 ramp folks not working (in near blizzard conditions) that portion of Southwest shut down, stranding planes both at Denver and then, since they could not be accommodated, at other airports when those flight to Denver were cancelled because there was no place for them to unload passengers.
    Once it began, it snowballed, with planes without crews and crews without planes. Then the scheduling software got overloaded and the crash happened.

    But it began with a bunch of ramp workers being mistreated/ fired or kept from working in a very busy holiday rush time. Policies that led to a lack of workers essential to the operation.
    Be sure and tell the whole truth.

  12. Be nice to hear from a SWA IT guy and get that side of the story. And why didn’t “Herb Kelleher was the brilliant CEO of SWA until 2004” have a planned replacement for the 1990s operating system? Software is lucky to have a 10 year lifecycle. Sounds like much more to the story.