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Episode 47:

Love as a Business Strategy with Southwest Airlines

In this week’s episode, we sit down with Former Managing Director of Culture at Southwest Airlines, Cheryl Hughey. We had an incredible conversation about how love permeates every facet of business at Southwest and how it has become their competitive advantage.

Speakers

Feel the love! We aren't experts - we're practitioners. With a passion that's a mix of equal parts strategy and love, we explore the human (and fun) side of work and business every week together.

JeffProfile

Jeff Ma
Host

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Cheryl Hughey Southwest

Cheryl Hughey

Former Managing Director Culture at Southwest Airlines

MohProfile

Mohammad Anwar
President

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Transcript

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Jeff Ma
Hey folks, if you're enjoying the podcast, please be sure to check out our best selling book, we took all of our stories and learnings, the good, the bad, and especially the ugly and packed it into one easy read. Find love as a business strategy, the book on Amazon or at your favorite book retailer. Visit loveasabusinessstrategy.com for more info.

Jeff Ma
In this week's episode of love as a business strategy, we talked to the former Managing Director of culture at Southwest Airlines Cheryl Hughey, she shares some amazing stories and insights around the culture of love that permeates every facet of the business. It's an incredible conversation. And it was truly inspirational to see love as a business strategy operating at this scale. Hope you enjoy the conversation as much as I did.

Hello, and welcome to love as a business strategy the podcasts that brings humanity to the workplace. As you know, we're here to talk about business. But we want to tackle topics that most business leaders shy away from, we believe that humanity and love should be at the center of every successful business. As always, I'm your host, Jeff Ma. I'm a director at Softway, which is a business to employee solutions company that creates products and offer services that help build resilience and high performance company cultures. I'm joined today by president CEO of software, Mohammad Anwar, hey, Mo, how's it going?

Mohammad Anwar
It's going awesome. I'm glad to be here.

Jeff Ma
Yeah. And Mohammad, you're like visiting your seat, because we have been eagerly anticipating this episode for quite some time. Are you excited?

Mohammad Anwar
Absolutely.

Jeff Ma
Why are we excited? Well, it's because of our guests. Today's guest built a 40 year career at an organization that we at Softway have been admiring and looking up to for a very long time. And that is Southwest Airlines. And not only that, before he retired in her last role of Southwest Airlines was the managing director of culture. And so I'm just blown away and excited to welcome Cheryl Hughey to the show. As you can see, Cheryl, you're basically a celebrity to us already. So welcome. Welcome to the show.

Cheryl Hughey
Thank you. It is such an honor. just glad to be visiting with y'all today. Thank you for having me.

Jeff Ma
Awesome. We're gonna dive right in because we're still gonna have so much to ask you so much to talk about. But we have a tradition where we do a quick icebreaker before we begin and as an as an as a courtesy to you. I'll make Muhammad go first here. thematically, Mohammad, the question is very simple. window seat or aisle seat. And why

Mohammad Anwar
a window seat, any day, I love to look out the window and admire the skies. I personally also pursued my private pilot license, and I love flying. So any moment I'm on a passenger plane, I'm at the window seat, I'm looking at what's happening with the wings, you know, are the flaps coming out? You know, are the reverse thrusters going on? relining. Like, I'm thinking, what is the pilot doing? What's happening? What's happening to the ailerons? Like, I'm always observing those things. And in trying to think about what's happening in the cockpit, what conversations are happening with the air tower control? So I love sitting

Jeff Ma
right. All right. All right. That's enough flexing of your pilot knowledge. That's Cheryl, same question. This is coming from an expert Okay, window, or aisle seat and why?

Cheryl Hughey
Probably the window. And it doesn't take much movement, y'all honestly, for me to fall asleep so easily. Sometimes my husband says, Oh, my God, we didn't even get off the the taxi. And I'm asleep. So my head nicely. Leaning on the window is very helpful at times. And then when I want to look out the window, I can.

Jeff Ma
Absolutely, I'm also window but mainly because I will knock my knees 20 times of life and my height. So with that out of the way, I want to get into this. And this is going to be odd because as much as we want to talk to you, Cheryl, I actually wanted to open with Mohammad. Because Muhammad if you don't mind, I'd like you to first share for us the story about your visit to Southwest a few years back Do you mind?

Mohammad Anwar
Yeah, not a problem. So this is back in 2015. And it was in November of 2015. Actually. And just to set context 2015 was a very difficult year for Softway. And personally for me as a leader of the organization, and, you know, is going through a lot of, you know, turmoil, the business, we were almost bankrupt, and we had just laid off or 100 employees. And we did so in a very inhumane manner. And I was very guilty of that. And we fortunately had this opportunity go to Southwest Airlines to pitch for a project a month after the layoffs and where I was really introspecting the future of her organization. And as I was walking through the hallways of their headquarters, I came across this big sign that said servant leadership And in that moment in time, I looked at the sign and I was like, what I doesn't? I don't I don't understand how can you have servant and leadership on the same phrase, and you know, my family's from India. So, in India, we have huge divided classism in society. And the servants are the lowest level of society, and the leaders at the highest level of society and servants are serving the leaders. So for me to see this term servant leadership just invoked a huge amount of curiosity. And I started to explore and do research and learn more about Southwest Airlines story and servant leadership and how it played a huge role in their business. So much so that I was very inspired to go on the journey of servant leadership for myself, and create a culture of love inside of our own walls. And that was such a big impact on me personally, and our business that we not only ended up surviving through the crisis we were going through, but we ended up thriving. And we ended up you know, bouncing back and tripling our revenues and increasing our profit margins and becoming a very successful business. And I attribute all of that to that visit to Southwest Airlines and encountering that sign of servant leadership. And it I, you know, I'm indebted, to be honest to Southwest Airlines, to introducing me to that concept and allowing our organization that almost failed to succeed and survive and make a difference to the 200 employees that are still with us inside of our company. So that's my, that's my story.

Jeff Ma
Yeah, and we wanted to open with that, because if anyone's wondering, especially you, Cheryl, just to add context to why we're just so you know, disproportionately excited to talk to you is because it is the story of Southwest Airlines, being able to talk to you right now is going to be something that, you know, really helps connects for us, personally, our journey to be able to talk to you. So thank you, again, for being here with us. And I want to make sure also that we give you a chance to now introduce yourself. So you can we can jump right into it. So I know you have a high level. But Cheryl, tell us a little bit about yourself, and kind of what brought you here today.

Cheryl Hughey
Well, as you mentioned, I've been with Southwest, over 40 years, I just recently retired and had an unbelievable career. I started there right out of high school, honestly, I I wanted to travel and see the world and there was a little airline called Southwest Airlines that was hiring at the time. And I, you know, was so fortunate to land there. And also fortunate because we have an organization that was so great at allowing you to try different things. As long as you were working hard and displaying hard along the way, you could have just found any opportunity. So over the course of those 40 years, I just had an opportunity to do some amazing things working in the reservation side is what we call it then and then went into our ground operations. You know, I was right behind the counter, checking in our customers way in those early years, then went on into our training area. For leaders, we have an unbelievable manager and training program. That's still a great success story today went on into onboarding because we have such a focus on bringing in new employees and what that first year experience look like. And then really my final last decade was in culture, and it's a department. I like to always say we had culture before culture was even cool, because we had that term, we talked about that term in a very positive way for almost 50 years. So that role was just so, so rewarding. And it was really a focus on how we recognize and acknowledge and value our employees, when we know that it's the right thing to do. And it's a beneficial to Southwest that we do that as well. So that's my story. And I've loved it, loved it. I do miss it. Even though I still stay connected. You can't have you know that many years. You make a lot of wonderful friends, and I will forever be a cheerleader for Southwest.

Mohammad Anwar
Awesome. So Cheryl, I I've been very curious, I have quite a few questions for you to help, how give us insights, but also like, share with all of our listeners, you know, some more stories around Southwest Airlines. So something that's really fascinated me is the heart, the logo that's on the belly of the plane. And you know, I know it was unveiled in 2014 I believe. I'd love to hear your perspective like why the heart is How did that come about? You know, how does it relate to your culture?

Cheryl Hughey
Well, it's a great question. And we couldn't have come up with any better brand, or visual that really does align with what we stand for number one, you know, when we were formed 50 years ago, there were remnants of the heart, whether it was, you know, going into love field as our first home base, you know, love as, as our stock exchange sign to how we initially began to understand the value of treating each other with such unbelievable care and respect. So that word love was something we used very openly. That was in all of our commercials early on. In fact, I was privileged to be an early commercial back in the early 80s, called loving you is what we do. And that was our, you know, commitment to our customers. And that was our commitment to our employees. So the, the heart, and the, the those values started to form. And we did different icons and brands that we were using that had a heart, not the one that you're seeing today. But it wasn't as prominent as we knew it needed to be. So when we looked at a brand refresh, we really discovered we weren't really elevating it to the level that it needed to be and who we were at that time, we had those red belly airplanes. And that red belly was so easily seen from above. And that was a commitment to our employees and our, our customers of who we were what we stood for. So a lot of thought went into that. So the one that kept coming forward was this beautiful heart, something that was in our colors, you know, and that was going to be very precious. And we wanted to be very thoughtful on how we used it and what we aligned it with. And the one thing we ended up doing, when we rebuild it, and it was for our employees, was ensure that that heart was proudly displayed on the bottom of the aircraft, not on the side, when you're boarding even though there there is one there as well. But it was on the bottom of the aircraft so that it was in the air the same as the red valet that our employees could probably look up and say, that was Southwest Airlines. So the heart means a lot. And I think Gary Kelly says the only one else that could probably use it would be the Heart Association. But it was amazing, in a very short period of time. When customers, you know, we did a lot of surveys to see did they see and hear and think about Southwest when they saw that. And it grew rapidly because we demonstrate all those values that align with what love and heart means. So that was kind of our journey now our employees. And when we did rebuild it, even though they embraced it, it was so hard change is always hard. And when you have that many 1000s of employees who are so accustomed to a certain look. And plus we have it our uniforms and all of our various visual elements. Were a little scattered. And we call it logo soup at the time. So to really clear that up and really leverage what makes sense for Southwest the heart became the most obvious and now we I can't imagine it's not have anything else. Wow.

Jeff Ma
It's amazing. Can we find still on the internet this commercial that you're in? That's that's what I wanted. You know, I

Cheryl Hughey
don't know if it's on that. But it was a it was an interesting that customers dreaming onboard the aircraft and he's dreaming about his experiences southwest and I'm in the reservation scene. I'm in the clouds.

Jeff Ma
Okay, now I gotta go. I'm gonna Google this and we'll we'll find out

Cheryl Hughey
what the what the shame is. Nope. Everybody goes, who are who are you in this? Nobody recognizes? Yeah, going? Well, that's me right there haven't changed a bit.

Mohammad Anwar
Yeah. Very cool. So something else that I'm curious to hear about is how do you celebrate the employees or the culture of, you know, putting people at the center and recognizing them and respecting them? Can you give some examples of how Southwest Airlines takes care of their employees from that aspect?

Cheryl Hughey
Well, one thing we do extremely well and are very proud of is that word celebration and party is something that's been in our soul from day one. I know our then CEO Herb Kelleher in the very early years, and calling Barrett who was our president at the time, our evolved to that realize the importance of bringing employees together. And when you bring employees together, that you know, create some really great energy positive and fun, and you know, fun is certainly one of our certainly one of our values, which is somewhat unique in the business organization. Fun sometimes means not productive, but for Southwest Fun. Fun always meant being yourself in creating a really comfortable environment.

But the now I'm getting off. Sorry. Oh, the question was,was the fun?

Mohammad Anwar
No, no, it was about how I was telling you. Yes, yes, yes. Okay.

Cheryl Hughey
So okay, so we never, we have many, many reasons, we find reasons to want to bring folks together. It's just some examples of that. In the airline industry. One thing that's very important, and I think it should be important in all industries is years of service. And when you reach some of those huge milestones, 10s and 20s, and 30s, and 40s, and ourselves was 50. We make a big deal with our employees, and we ensure that their leaders make a big deal, and thank them for their commitment and service to our wonderful organization. We also have annual events. Now, unfortunately, with last year's 2020, COVID, some things were paused. And that was very difficult for us because we have large events to bring folks together, just to continue to build relationships give an opportunity for our leaders to communicate and convey those goals and, and the mission and everything that we have, you know, that may be challenging us and how we want to inspire our employees. So we come together on a very frequent basis, on a large scale. And then in all of our departments. There's continuous opportunities to celebrate milestones, whether it's department goals that have been reached, whether it's employees. And that's just something we do on a normal basis. Now a lot of people ask, Well, that's a lot of money to be spending. In fact, everybody was always curious to what my actual budget was in culture services. And really, when you look across, then what was 60,000 employees, that was just a small investment for such a big payoff on people really enjoying being together and valuing the organization and understanding first hand what was clearly needed of you, as an employee and what you need to contribute.

Mohammad Anwar
Very, cool. So from the sense of business, right, the business strategy, and so forth. You know, I noticed that by doing research in Southwest Airlines, that on the pyramid of importance, you put the your employees at the top, and then the customers, would you mind sharing with us? What's the rationale for that? And how does Southwest Airlines Look at that, and it's quite unique in a in a corporate workplace environment. So I'd love to hear your perspective there.

Cheryl Hughey
Well, obviously, your employees are what drive business right there, they're giving the customer service, they are coming up with those innovative ideas they are delivering on what the promises of your organization, it's the employees who make up what you stand for. So it only does make sense. And I'm so thankful that our leaders from day one, realize that and understood the value of what are the needs of the employees. And if we provide and we nurture a very positive work environment that in turn, they too, will deliver that what's being modeled internally, will be demonstrated externally. So if they are receiving the type of treatment, that is that positive, then that's what you're going to receive as a customer. And then when you've got happy customers that want that repeat business, then you have very happy shareholders, and then very happy shareholders, great, very happy employees. So it's a wonderful cycle to be in and by putting your employees at the heart of it.

Mohammad Anwar
Got it? It's, you know, I know that rationale, from a rational standpoint. You know, I think many organizations prioritize their shareholders to be the top of the pyramid. So it's very uncommon to see organization, especially if you're a size, you know, putting people at the top of the pyramid says in a very insightful guy, Jeff,

Jeff Ma
I think I think, you know, in our line of work we work with a lot of skeptics, essentially, like part of our job is converting skeptics, and that's one of the biggest sticking points is that people don't believe that culture can be a competitive advantage in business. And like, I'm curious, what would you say to those skeptics, as we've said a lot, and we've said Things that have worked, we've used Southwest as an example. But what would you say to those skeptics? Um,

Cheryl Hughey
you know, it's interesting, of course, I've only been in this organization. So I don't know what I don't know, sometimes, you know, because when you just live it, and you've grown up in it for me, when I've gone to visit others that don't have that understanding, it's a bit mind boggling to me. I'm like, how could you not think that way or feel that way? I remember an organization and they were a certain division of the IRS, actually, that came to visit us. And Mohammad, you mentioned earlier, when you visit Southwest, we get a lot of organizations that come to want to get our secret sauce, you know, to your question on on, will it make a difference, and we are always willing to share that, but what we usually receive in response is Oh, that's all it is, you know, that. So this division of the IRS was wanting to improve on their customer service, they knew that they had an opportunity to make a bigger difference with those customers. And they were looking more for the processes and the policies. And when we really focus more on the treatment and the environment of the employee base. They just had to pause. And this is something we've gotten from many organizations that, oh, they wanted more, they they felt that there was more to it than just the way you treat your employees. And actually, they they, their eyes were a little bit, I think more open. And understanding because we put a lot into that there is a lot of commitment. And to your question Muhammad about, you know, making sure you put your employees at the center. That's not just words, there's a lot of actions that have to take place to put to stand behind that. I mean, Southwest is a great example for 50 years has never furloughed or laid off any of our employees. And in the airline industry, I mean, probably any history, the amount of challenges that we have faced, over the years that have really put that to a test. But that has been a commitment that we hope to always make. That's our commitment as long as we can. And that's to me again, putting our employees at the center. So I think the question, Jeff, is, our history speaks to that. That's why it's hard for us not to understand when organizations don't get that or want to get that, because of our overall results. And again, always like to say even in the airline industry, and early on, when customer service was not it was not something that you really experienced in in in flying. When we brought that to life, by the way we treated our employees who then in turn took it upon themselves to take care of our customers in some of the most phenomenal ways because they know they can, and they know they should. And they know it makes a difference. And our profitability also Now, last year was our biggest hit. We had proudly boasted almost 49 and close to those 50 or 48, I guess. And that one was was a hard pill to swallow for to swallow for us. But I think it's just our history and our the the facts around Southwest that that speak to why we think it why we think it makes a difference. Yeah,

Mohammad Anwar
I would like to talk a little bit about how Southwest Airlines handle this recent pandemic, which you know, almost destroyed the aviation industry, it would like it was so devastating to the airline and transportation industry. And you know, all airlines faced this. But if you don't mind sharing with us, how did Southwest Airlines handle the pandemic, when it came to their employees? We'd love to hear a little bit about that.

Cheryl Hughey
Yes. You know, one thing that I thought really made a huge difference. And when there's any, especially to the magnitude of this pandemic, that one of the most important things is communication. Because there's fear, and there's uncertainty. And our employees were feeling all of those. And our CEO, Gary Kelly, who is a phenomenal communicator anyway. But what he committed to do was have a very frequent Gary's Ask Gary live is what it is. He used to do them. Weekly, pre recorded, and then he would do them throughout the years when we would have our selfless rallies, which is a large gathering kind of a message to our employees. And what he ended up doing was he knew how important it was to get the right information out to calm everyone. So every Week, employees would submit questions. And those questions would be presented to Gary, they he would record that in our studio, there they headquarters. And then that would be available via our small life intranet, for employees to say in touch, it was getting so many views. And he was, you know, trying to answer the best he could, those tough questions that we were getting job security was definitely a fear through all of that. And so communication was a huge part of that. And then communication with our customers then obviously, spilled over from that as well, in our promise to our customers, and what we were doing on board to help ease the fear. But internally, Mohammad, it was saying as much as we could, as often as we could, so that it was clear. And sometimes in social media, it can get a little fuzzy and misstated. And we wanted them to hear it straight from his mouth, and he was phenomenal.

Mohammad Anwar
Awesome. Something else that I looked through the financial reports of Southwest Airlines, as you mentioned earlier, like, almost four decades, or almost five decades, you guys were profitable, when many of the airlines are struggling, during those decades of operation Southwest always posted a profit. And this year 2021. I think quarter one, you're one of the very few airlines have already disclosed net profit again, it's like, well, what would you say are you want to explain to that, please?

Cheryl Hughey
Well, you know, Herb, was a genius in business. And in all things, he was just full of charm and charisma. And one thing he did teach us from very early on is to manage in the good times, because you're going to have some hard times, and we've had some hard times, but we have had a lot of good times. And that's where Southwest really makes sure that we're doing what we need to do to protect ourselves when those hard times come. So our employees, were always ingrained with cost savings, doing a smarter process improvement, that growth mindset that you speak about, always looking at how we can evolve and do things better. Now, we have a really great business model. And it's, we want to give our customers what they want, we want to provide a very low fare, so that everyone has an opportunity to travel and see the world and make connections. And enabled in order to do that we've got to keep our faders at a low. That's what we're about. We're low fare carrier, but the only way you can have low fares is low cost. And the only way you can have low cost is ensuring that our employees get that and manage it the best that we can have on an individual basis. A team and department, we give all sorts of great recognition acknowledgments, when we do that, we have an environment where employees are extremely comfortable coming forth with ways in which we could, you know, make that efficient change or process improvement. Because we know ultimately, if we keep those costs down, customers can afford to travel. And now that travels coming back. we sustain through that our employees are back and up and running fully. Now, we did have some that were able to take off for a period of time, that was another way we were able to save during that period. employee. We've had so many challenges over the 50 years when employees really step up to that and give up themselves. Because we know our organization is always there for so when we're able to do it back. We have so many that are willing to raise their hand to do that.

Mohammad Anwar
Yeah, I was reading that even during the Gulf War when the oil prices went up, I believe employees voluntarily gave up a percentage of their salaries to keep Southwest profitable. I mean, that's unheard of like you don't hear employees of organizations doing that.

Cheryl Hughey
It was called a fuel from the heart and employees felt passionate to make sure we were doing our part. We were doing similar type things during COVID whether it was I'll take an extra week off of them, you know, and not you know, that'd be an extra everybody was given back time to give back to the company. During 9/11. There was a ball a lot of volunteerism taking place to help and loaning Our love is what we called it. We have a catastrophic fund that takes care of our employees and there's so many times that we've had some wonderful initiatives that generate more funding so that our employees are taken care of so it's just who we are. And we step up in times of need, because our company has always been there for us as well. Awesome.

Mohammad Anwar
Something else that I think you just shared, is giving me a lot of things to think about. When you said that, you know, you're a low cost fare, you know, airline company. I think many times organizations don't get their employees involved in like the financial side of the business. It's usually like it's told to them what to do. Things are not transparent things are hidden from them. They're not involved are included in, you know, business decisions. And what I'm hearing is that your culture has also created an environment of transparency and ownership and inclusion, where people are willing to come forward with the ideas to help with the bottom line of the business.

Cheryl Hughey
Absolutely. You know, a few simple things. And I remember early on, are she Colleen Barrett, who's our president emeritus, first female president in the airline industry, and she helped to form up some wonderful customer service practices across Southwest Airlines. And remember, early on Mohammad, when I was an early leader, a very new leader. And I knew that I had the opportunity to do special things for our customers and for our employees, but not to the degree that I fully understood. And I remember making a few decisions that didn't favor go in favor of the customer. And I got a little note from calling. And the note was basically saying, and, you know, kind of redirecting me a little bit on really thinking about the situation, not the policy, because we get so stuck in policy, but think about the overall circumstance and situation to make sure you make the right decision. And she she ended up there was it back then before we had email or internet, that we would get those letters, you know, and we would get a letter and kind of explaining about our role not just as leaders, but employees, that we are able to come forward and create change and make a difference, and make exceptions when needed to and look at the bigger picture. And the entire scenario before we make some of those decisions. So I think that that's just a small example of how we were encouraged to think outside and not get stuck on just the the policy or the procedure. And then the ideas and thoughts that can be generated within your teams is amazing. We give out what we call kick tails. These kick tails are a way to think or acknowledge when a great idea has come forward or and has been put in place. We also have numerous awards that we have. Our employees do such phenomenal things on board, in the departments that our customers are writing about it all the time. And so all that gold comes into us. And we in turn, share those great stories and acknowledge our employees, and then highlight those stories I did that they did feats of heroism, acts of kindness, great customer service, you name it, they're doing phenomenal things that are making a difference. And we don't sit on that we, we do everything we can to share it with them, share it with their leaders, and then share it across the organization because we feel like if someone sees a great idea that may generate them to think of a similar idea, or even to realize, Oh, that's something I could do, or I could be thinking about it.

Mohammad Anwar
Very cool. I'm gonna take it a little bit to another perspective and how culture has helped you all. So first of all, aviation industry is heavy on high reliability, it requires safety to the highest standards, you know, because you know that the ramifications of an unsafe act could result in loss of life, and accidents and so forth. So most organizations that are very high reliable, are inundated with process, process control, control and structure to avoid, you know, errors. How do you see Southwest Airlines culture? helping with that? Because it seems kind of counterintuitive, for example, you you guys have this fun loving mission that employees must act with and you know, being fun and being serious and safe. Seems like they're polar opposites. So how does your organization balance that and how is that what have you seen or witnessed in terms of that those standards?

Cheryl Hughey
Well, you know, we do like to say we don't take ourselves seriously, but we are very serious about what we do. And I think those are two very different things. I think that when you have an environment and southwest certainly is committed to safety and reliability, we have the best on time performance. Unbelievable safety records. So it certainly shows that we are serious about what we do. Now, again, we don't take ourselves seriously in the way we deliver in our in our, to each other in our customer service, but we want to get it right. I think that our overall training is phenomenal employees deserve that. They need that they thrive on that. So you know, from our operational training, to our leadership training to ensure that we are up and running and feel good, about our delivering on our commitment to our customers. When we talk about the fun, I think when teams are comfortable, and also that transparency and feeling good about being yourself, you want to make sure that you're addressing things that could get in the way. And unless you're comfortable, and are able to have great relationships and not feel like you're going to get hit on the head or or jeopardize, then you're kind of limiting yourself. But if it's an environment where there's trust, then people will come forward and ensure you know what that particular process right there might need to look differently or, or admitting to mistakes. So we don't continue that same mistake knowing that it's not going to get you in trouble. Now, we may need to redirect. And those things happen all the time. And not to the level of a safety issue, but making sure that we are challenging ourselves and have a safe environment where employees can speak up so that we can make it better. So I hope that I hope that answered your question on that.

Mohammad Anwar
No, absolutely, absolutely. I think I think the lessons that we are seeing come out of culture and less than two other high reliability organizations. Number one, I think every other industry looks to the aviation industry as one of the most highly reliable industries on the planet. Because of the number of passengers you transport the to the ratio of incidences or accidents, right. It's, it's phenomenal. And so many industries, including healthcare organization that are trying to be highly reliable organizations, where they do have incidences and accidents that can occur in a hospital environment where there is loss of life or harm, are looking to the airline industry for inspiration to build their systems to be just as high reliable. I know there's data out there that shows that, you know, there are in the United States alone, there are almost 250,000 that's that could have been avoided from our healthcare systems. And I'll put this in context to aviation. That's like a 737 crashing every five and a half hours. Right? And, and so when you look at that comparison, it's mind boggling that okay, we there's the opportunity to create safe, and, you know, zero harm environments. But you could do so by allowing people to be human, let them be themselves, let them bring their full self to work so they can find opportunities to report the near misses the near incidences. The issues with the processes, or the systems that if they were afraid to speak up, probably would never get addressed could result in an incident. And what I'm learning from the Southwest model is when you create an environment where people feel trusted, can bring their full self, even if there are issues and problems instead of withholding or hiding that information, they will report it voluntarily leading to better transformation of those processes or systems to become more highly reliable. And so I you know, I've always tried to find the connection to culture and high reliability. And I think Southwest Airlines is a classic example of how that can exist.

Cheryl Hughey
You know, Mohammad when both situations even after 9/11 and somewhat with the pandemic, our customers were telling us, you know, they enjoy that easy light hearted humor onboard our aircraft even in some tense times. Because it created some calmness, you know, there's, there's some that are more fearful about traveling than others, especially when you've you know, gone through Those type of situations, but they were the ones telling us we want Southwest fat because it makes us feel more human. And it makes it feel more real. And it makes it feel more caring, to ease whatever situation it is. And by allowing our employees to do just what you said be their own selves. Because some people are saying, Well, do you train your flight attendants to tell jokes? Do you train your flight attendants to sing? How do you train your flight attendants to create those funny things they do with your, you know, your onboard services with there is no training for that. That's employees coming forward and bringing whatever gifts or strength or talent they have, and making the situation better. And our, our flight crews and I'll do some amazing things out of just what they're good at. And they know there'll be praise, and they know they'll get good response as a result of it.

Mohammad Anwar
Yes, totally, I, I can totally relate to the you know, the safety message that the that they do right before takeoff and stuff. Some of the most viral videos have been for Southwest Airlines, right, like the the attendance, bring singing a rap song or doing it in a way that's entertaining. But data has proven that those kind of safety related information actually garner better attention, retention from the passengers, which is, again, a high reliability trait. So by bringing yourself and bringing your talents and skills, you now have created a more safe environment for your passengers in the plane. But not only that, now, every other airline that I go into have tried to create their funny versions of their videos of like they have these videos that are like, you know, comedic in nature. Yeah, try and keep the attention. Yeah, but I've we've seen it live in Southwest Airlines, even before all of these videos came out.

Cheryl Hughey
Yeah, you you can't, you can't try to create it, it has to just happen or kick. And you can't ask people to be a certain way, you just gotta allow them to be the way that they are. And that's, that's what we encourage.

Jeff Ma
That makes me wonder that makes me wonder Cheryl, you know, it's amazing to see that all this organic kind of employee engagement and employees really believing and pushing. But, you know, the reality is like, as far as we've seen outside the walls of Southwest, the world operates in lots of different ways. And I'm curious, from your perspective, you know, when people come in, like, what is the common to Southwest? What is the hiring or onboarding kind of mentality to connect that because you know, not everyday people coming in, will still have certain expectations and certain barriers and maybe some personal blocks to get to this point. I know, you said you had amazing training, but like, Can you talk a little bit more about that hiring process in that onboarding process? I'm curious.

Cheryl Hughey
Yes, that's always a question for Southwest. How do you find these wonderful folks that you have in your organization. And certainly, it's as hard for us as it is to anyone to bring in those that align with your values. And then number one, it's you got to be clear on what those are, you know, as organization, you've got to be really grounded on who you are, what you stand for, and what those behaviors are. So that you can clearly communicate to those that are wanting to into your organization. Now we're in a good spot, because we do have such a very strong brand, that we get a lot of folks that would like to join us, that's a good problem. It's always a difficult problem trying to get to kind of sift through who those best candidates are. So, you know, first of all, obviously, it's basic qualifications that we all have to have that's in any organization, but what we're really looking at is, again, back to that heart and how you are how you treat your, you know, your fellow employees, what that look like in your previous history. We're overall work history. We've had some stories in our recruitment efforts that are pretty amazing, even in the early years about witnessing, how they treated those on the shuttle bus, you know, headed towards the, you know, to the actual interviewing location or the front desk, you know, receptionist, I mean, you start really getting a good idea of how employees are, how they potentially will be once they join your organization. We want to make sure to when our when new employees join that we're very clear. So again, what that mission is and what what the values are and what those expectations are, it's got to be clear. And we do that in so many ways. And I'm sure it's similar across whether it's, it's planted on every wall you have, it's an every bit of your orientation. It's In your performance appraisal, you know, you're you're visiting with your leader constantly about what that looks like and feels like. And then ensuring that there is accountability that now what's great about employees ownership to this, because we all own the culture, the culture is when we witness it, its employees holding each other accountable. Because when we know someone's not behaving or displaying, that we know is going to be damaging. And eventually, they either work themselves out, because they see they're not going to be a good fit. We are a big, Huggy. Now, that's been a little tampered a little. We're a big hugging, we always were funny, it's in there, big hug, side hug. We were very much in in touch. But we also were very thoughtful and respectful those that aren't. But that is our way. And we're, we're always laughing. There's people that have joined the organization or visitors that will come into a meeting. And they say, we've never heard so much laughing in just a general meeting. Because we just mess with each other. But we have, we have been running less than 3% turnover, for our especially for our first year employees for a number of years. So we work hard to get the right individual in, and then we work hard to keep them. And that first year is hard, because they're learning the job. They're trying to get, you know, am I a good fit for here. And they're learning from each other. And they're trying to determine Is this the right fit. And we've we've done a really great job on, you know, bringing in for the for the most part, those that are our ideal. Now, you know, we have leaders that have to make hard decisions, when somebody doesn't demonstrate that. And if you join an organization that is about hard work, which is what we call a warrior spirit, you got to show up to work. And you got to work hard, because if we all work hard, we're all going to share a bigger piece of that profit sharing at the end, right. And then if we all have a servant's heart, we're going to create a wonderful environment that everybody enjoys working in, who wants to not enjoy working with your employees? I mean, what a beating to come in every day and not have fun or enjoy the people that you work with. And then it understand that it is about doing it right and keeping that cost low. So we want to make sure they're by understands that we're, we're all going to be in it if we're all thinking smartly along the way.

Mohammad Anwar
That's awesome. That's something I was something I was reading was an interview with Herb Kelleher, from back in the day, and there are questions asked about his, you know, recruitment approach, if we, if Southwest Airlines looks for people who come with those attributes or behaviors, specifically, the behaviors of serving. But something he said in the interview really got me to think very deeply about this was that while not everybody may have had an opportunity to have the behaviors of serving each other or, you know, have that nature of serving. It may have been because they were working for organizations that forced them to shape behaviors that were not that a serving. So I almost felt like his answer to that question made it appear that while you aspire to look for people who want to serve naturally, but Southwest Airlines is also very open to recruiting people who may have not had the opportunity to experience those behaviors, or embody those behaviors, and hopefully, Southwest Airlines and helps, you know, bring out those behaviors of serving each other. And I thought that was very powerful. Because I mean, I mean, I haven't I've never thought about it that way. I don't know if you had anything to talk about that perspective.

Cheryl Hughey
You know, I remember a quote of his and it's along these lines, and I don't think I'll get it exactly, but it was something about is, if you're, if you're doing what you love, right, then you're going to make the biggest difference. So it's something along those lines. So if you allow somebody to be doing something that they just they're, they're bringing out their their talents and their strengths, and they love it, then you're going to obviously get the best of them, right, you're going to get the best of that person. And it goes back to your whole person. We get to know our employees on a personal level and some organizations. They think there's a very cut line in that that HR world and we really get to know our employees because how am I going to understand if I don't know what's what's hurting you. So if something's going on at home, maybe there's a loss Or a struggle or an illness. And I need to know how to better serve you and meet your needs. If I get to know you, and and we are so wonderfully guilty of doing probably over and above, sometimes what we need for our employees, anything they bring forward to us, we make sure we help them whether it's a simple little flower arrangement card that goes home, maybe it's a meal, you know, maybe it's a small gesture of a gift that provides comfort. I remember my dad being in the hospital, and a Southwest Airlines blanket showed up. That was my favorite dad's blanket. Throughout his illness, he had Parkinson's. And he wouldn't go anywhere without the blue Southwest branded blanket because he knew where it came from. And he knew what it stood for. There are millions of those stories where employees were just comforted. And then the celebration part, whether it's a birth of a child or graduation, we just get to know our employees really well. Now, I don't I'm not gonna say it's a downside. But the challenge to it is when you get to know your employees really well, those hard conversations can be a little difficult, because you care so much for them. But because you care so much for them, you want to make sure that we do it right, and that we are performing at the level that we need. And if there's anything I need to address with you, at least there's a relationship, and we can talk through it human to human,

Mohammad Anwar
amazing, amazing guy, Jeff,

Jeff Ma
I just I just never felt more aligned to a conversation in my life. Everything you're saying is like ringing the most resonant bell in my heart.

Mohammad Anwar
I if I if I if I retired from Softway, I'm gonna go to Southwest Airlines, I'm convinced. So I have one more question. There's, you know, you have a culture pillars are something around living the Southwest way that you want your employees to embody? Could you elaborate on that, for us the Southwest way?

Cheryl Hughey
You know, before we had the terms mission, and the values terms that have evolved over the decades in organizations, we had a really basic foundation of what we called the Golden Rule. All right, and you probably know, the golden rule, it still exists itself today. But it was a very, very foundational start to what we wanted from our employees. And that was, you know, treating others as you would want to be treated. And that was internally and externally. Now as we evolved, and Southwest wanted to formalize that more, and it was it was now almost 20 plus years ago, that we started looking at what what does that mean, what? how clear, we need to be clear than just that one statement of following the golden rule. And so we It started with our executives coming together and really trying to say, well, who are we what do we stand for? What are our values, and we came up with, you need to live the Southwest way. And we also laid it at add or added work the Southwest way. And so living the Southwest way, is a lot of things we've even kind of talked about throughout this session, and it was living the Southwest way is is caring and loving for each other. And that's what we continue to still point to the servant's heart. The the hard work, and being there that reliability that we need is is what we we've instilled in our employees called the warrior spirit that's live in the Southwest way. And then not taking ourselves too seriously. Seriously, that fun, loving attitude. And our customers love that when we live that Southwest way when you fly through on a Halloween holiday. You want to have fun with it. Valentine's Day, we love giving our employees an opportunity to show that fun side when when our customers are coming through. But we did add one more element Mohammad and I think as you evolve, you want to make sure you have the right words because sometimes words change a little bit and what they stand for what they mean, not the heart of what it is. But we began to also add to make sure a kind of a me a we and what Southwest kind of that commitment of what am I committed Do you know I'm not going to show up, be a jerk. And I'm going to, I'm going to show up more card. And then we have characteristics around, we are going to work good as a team. And we're going to respect each other in the way we approach things and include each other. And then Southwest commitment on providing a stable work environment, and unbelievable opportunity to have some of the world class benefits. You know, we're able to send our children to college and I was able to retire. That's all, that's all the all under the umbrella of living the Southwest way.

Mohammad Anwar
Awesome. I also, I would like to ask, how has it impacted you personally, living the Southwest way, for the last 40 years? Outside of work? Can you give examples of how it's influenced you in your day to day and interactions? And how much of an impact it's made for you? Oh,

Cheryl Hughey
you know, I've never had that question. Thank you. You know, I was only 19 when I entered this organization, and I remember early on getting opportunities to do some amazing things. We were I was put on what we called our social committee, then it is evolved in what we call our culture committees. And these committees, got to look at your your workforce. So we I was in a reservation center. And my role was to create fundraisers and those monies went back to some of our employees, when they had some challenging times, we put together our fun holiday and picnics. We did some random acts of kindness in the center. And I immediately fell in love Mohammad, through those type of activities. That's what drew me in was the doing for others. And I thought, wow, I can enjoy being at work, because we're doing some phenomenal things. So I do think, and I'm not just saying this, it has made me a better person. Also, working with great people, makes you a better person. I am inspired, we give out these winning Spirit Awards, Mohammad, these employees do amazing things, I don't even feel worthy. When I see these things that they've done for customers and each other. And we reward them by saying thank you and highlighting these tremendous stories, and you can't help but just feel like oh, I need to do better, I can do better, I can volunteer more, I can give more, I can be nicer, I can be kinder, I can think of others more, it has made me a better person. Without a doubt.

Mohammad Anwar
Awesome. No, I I can only imagine because, you know, we are who we are from our interactions in our environment, and it shapes our behaviors as well. And if there's such a loving culture of serving others, I can only imagine how much of an impact it's made to the community. And beyond just just your organization, how much you could rebuild, it's probably brought outside of the, you know, the airports and the aircrafts and your headquarters. And so yeah, that's why I was, I can see that. If they're more organizations, believing in this type of culture, where they put the people at the center and the humanity. I can only see it having macro scab, macro effects beyond just the walls of those organizations.

Cheryl Hughey
Oh, and Mohammad, when you were a Southwest Airlines branded item, a shirt a cap, it doesn't matter. It triggers the most amazing stories by our customers. I can't I mean, we all talk about it, you're so proud to wear it because you know somebody is going to come up and share something, something that they were so it's usually not even about themselves, they might have witnessed it. I mean, it's very rare that you have somebody that comes to you with a complaint. It's I would say 95% is a wonderful story they want to share with you and tell you what a great place. So that just makes you feel so good. That's why we're celebrating 50, 50 years this year. We're coming out with all this wonderful new gear. People just love to show off that they are Southwest Airlines employee, there's just such great pride in them.

Mohammad Anwar
Awesome, awesome. And I am going to I'm going to take this last portion of this because I you know I really I you know I'm really passionate about love as a business strategy, hence the podcast and our book and you know, since I you know our journey of operating You know, through love as a business strategy was obviously inspired by Southwest Airlines. There's something that Gary Kelly said that I think every business owner out there should listen to. And I'd love for you to comment on it. Number one was, you know, he said, no company can survive long, much less be great without great people and strong culture. And so with that, I wanted to ask you, do you believe that Southwest Airlines in this competitive airline industry? Do you believe that their competitive advantage today is clearly their culture?

Cheryl Hughey
Oh, with without a doubt, Mohammad without a doubt, and Southwest was so fortunate to have two unbelievable leaders. You know, at the helm, you've got Herb Kelleher, Gary Kelley, who embody what that our heart means. And it has to start there. It has to start there, if there's not belief there that that is our competitive advantage. It's not going to happen. And not just believe it, but demonstrated over and over again, they are the most transparent, good hearted, level five leaders, I think that was Jim Collins book where they know what they're going to give them themselves. And it's more important that the company survives, and the people survives above what their egos can be. That Yes, it is, our culture has been in the culture is our people.

Mohammad Anwar
Awesome.

Jeff Ma
Well, MohammAd, thank you for squeezing every last drop, he could he sees the timer. And he's he's just trying to milk it. So good job.

Mohammad Anwar
Thank you,

Jeff Ma
Cheryl, we could talk all day, I truly, truly been just smiling ear to ear this whole time just hearing all these things. And I want to close just just connecting the dots. I mean, I said it in the beginning. Southwest Airlines literally has been something we some organization we look up to. And something we modeled a lot of our beliefs after but you know, at, at Softway, our current mission, and our mission we've set out to do is to bring humanity back to the workplace. And hearing you talk today has been just inspiring, because I'm not only thinking about how this can work and seeing it, you know, proof in front of me all the things you're saying that make it possible. But I'm thinking about, you know, what drives me personally, is I'm thinking about all these employees, you have that now go home from work with, you know, you know, light hearted and spend time with their kids. They don't have the pressure of, you know, stressful work and, you know, pain in the butt boss in these types of things that, I mean, that's just what's become synonymous with work. For many people in the world. That's just work. When you say work, they're like, oh, Mondays, they're like, they wake up in the morning, and they just don't want to get up because it's work, it's work. And we truly believe that we can bring humanity back to the workplace where you're saving lives, you're actually affecting people's livelihoods. Because work is so much of our day, it's so much of our lives that if you suffer through work, you bring it home to your kids, you bring out the stress home, it gives you heart disease, it gives you all kinds of problems, like there's so much connected to it. So we're very, very passionate about it. And to see it at scale through Southwest and hearing you talk about it. And just further kind of gives us invigorates me, I know it's really driven Mohammad, to hear you so really, really, really thank you for taking the time today, to share with us and let us pick your brain on all these things. Because hearing it out of your mouth has been just I'm energized. I'm, like reinvigorated to go back out there. fight this fight is an amazing, thank you so much.

Cheryl Hughey
Oh. You're so welcome, Jeff. And you know, you did say ultimately, you provide a healthier, you know, healthy as in our minds and our bodies. And that's why we know if we could share whatever we could share with any organization, we're all going to be better as a result of it. Because we will be physically and mentally and spiritually happier. And isn't that what we all need and want?

Jeff Ma
Absolutely. Absolutely. And that's that's I just, I can't speak enough for for the appreciation I have right now. And just the it has been very, very, very awesome having you on the show right now. So thank you once again, Mohammad. I know you you've been waiting for those long times though. I'm glad I hope you got everything you wanted out of that. For our audience. We hope you enjoyed listening as well. And as always, thank you to our listeners and If you enjoyed this conversation want to join the conversation, please do check out our website for our book and our podcast lovers loveasabusinessstrategy.com, and you can find it in softway.com/laabs. And I love as a business strategy. We want to hear from you. We're posting every Wednesday new episodes. And we hope you enjoyed this conversation with Cheryl and Cheryl, thank you again. We hope to talk to you again soon. catch you guys later.




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