If you’re old enough to remember a time when Southwest planes could only fly in the State of Texas, then you certainly will remember how Herb Kelleher changed the way Americans flew. He passed away this previous Thursday at age 87, but his story should continue to inspire those who want to learn from it. There are MANY lessons that orthodontists can learn from the way Mr. Kelleher ran Southwest Airlines.
Risk: Mr. Kelleher was an attorney who had no history of wealthy parents or dreams of running an airline. He was simply smart (or crazy) enough to take the bait when one of his clients suggested that he join him in opening an airline that flew exclusively in Texas and from 1971-1978, that’s exactly what they did. He competed with much larger established companies and figured out how to become profitable doing more with less (at first, they served only 3 cities in Texas and focused on doing it well).
In today’s competitive orthodontic market, we can learn many lessons from Mr. Kelleher related to taking on calculated risk and serving needs that may be right in front of all of us. The term “core competency” is overused, but finding ways that we can take calculated risks to grow our practices should be something we strive to do.
Profitability: Southwest airlines remains the only major US carrier to never file bankruptcy and has been profitable every single year after their second in business. After 9/11, Kelleher had the foresight to lock in contracts for fuel when the prices were low. Kelleher added just a few routes at a time, growing in a way that allowed the company to remain solvent and profitable.
Southwest is a great example of a company that grew within its means and used every possible strategy to protect its financial viability. Be smart with your finances. It’s not what you produce, but rather, what you “take home” that matters.
Commitment to Employees: Early in their history, when finances were tight, Mr. Kelleher chose to sell off a plane instead of laying off employees. Can you imagine what kind of message that sent to his employees? Under Kelleher’s reign as CEO, employees were well paid and a spirit of fun was instilled in the company. He was so well liked that when he stepped down as CEO at their annual meeting in 2008, not only did he get “an ovation usually reserved for rock stars” but the Southwest pilots’ union, in the middle of negotiating a new contract, took out a full page ad in USA today thanking him for what he had done.
The success of our practices is dependent on the culture we build, the loyalty of our team and the smiles on our employee’s faces. Don’t be “penny-wise & pound foolish” by skimping on your most valuable asset, namely, your team members.
Humility: Mr. Kelleher was famous for boarding random Southwest flights just so that he could chat with passengers. I have no doubt that when he introduced himself, he was “Herb” and not “the CEO for this airline”. Customers loved him and when asked by the media how he became CEO, he responded: “Because I am unable to perform competently any meaningful function at Southwest, our employees let me be CEO.” When Southwest and Stevens Aviation got into an argument because they both used “Just Plane Smart” as their taglines, Mr. Kelleher suggested that instead of a long legal battle, he and the other CEO, Mr. Kurt Herwald simply arm wrestle to see who could use the tagline. Kelleher lost the match, but Herwald felt that the publicity was so great and Kelleher’s approach so unique that Herwald simply let Southwest use the tagline.
Sure, we have graduate degrees and have made it through the crucible that is the orthodontic education process, but we need to remember that we serve the needs of our patients and we need to listen to what they want. We need to be in touch with our team members’ needs and care for them while being respectful to those around us.
Values: While there were many high end air carriers, Southwest’s niche was about efficiency over frills. All decisions were borne out of the set of values Mr. Kelleher infused into the company. He was quoted as saying: “If somebody makes a proposal, and it infringes on those values, you don’t study it for two years. You just say ‘No, we don’t do that.’ And you go on quickly.”
Define your set of values for your practice, write them down and use them as a guide for all future practice decisions. Be true to your vision and you and your team members will always feel great about your practice.
Herb Kelleher was a visionary who changed the way the entire US airline system worked. He opted out of the larger reservation systems and cut out the “hub” concept, allowing a fledgling operation to be profitable when no other carrier could make money. He did all of this while respecting his employees and loving and serving his customers.
Think of that. Making money while laughing and having fun, surrounded by customers and employees who loved him.
We can learn a lot from Mr. Kelleher’s legacy. May he rest in peace.
All the best,
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