I really enjoyed the Southwest article this week - I had always thought of it as a newer carrier so I didn't realize it has been around since the 1970s. What struck me was how different the company was from the beginning - the culture allowed it to challenge the status quo in an industry so regulated that I suspect no one had ever dared to do so. I recall the fist time I flew on Southwest and was flabbergasted that the flight attendants were joking their way through the safety speeches, as I'd assumed there were terribly strict guidelines for what must be said, and when. The adherence to the root values of having Warrior Spirit, Servant's Heart and the Fun-LUVing attitude must have been hard to accomplish as times, and yet the company has survived and flourished amid industry challenges.
Southwest several times over avoided one of the Seven Ways to Fail Big: Staying the Course. While Southwest managed to stick to its values, it was able to adapt to change creatively. While the first come-first served model worked well in its startup days, newer passengers were uncomfortable with the model and loyal passengers loved it. The hybrid that Southwest created served both masters. I was on a Delta flight recently and has purchased Economy tickets, which I learned after the fact meant I didn't get seat assignments until I arrived at the gate. Because I was travelling with a small child, I was panicked about being seated together and Delta was not sympathetic. While reading this case I reflected on that experience - the Delta model was actually a replica of Southwest's, and yet I never experience that anxiety when flying Southwest because I have trust they will help me with what is a logical seat assignment for a 7 year old. Once a flight attendant held seats for me and wouldn't let anyone else sit in them! At the end of the day, they have a culture that allows that discretion as the case described.
On a related note, Southwest also seems to have avoided the failure risk of the Consolidation Rush by carefully and thoughtfully entering into partnerships with other airlines and with airports such as Philadelphia and LaGuardia. While they could have gone far very quickly, the company weighed every decision against how it might change their ability to deliver on the basic customer promises on which Southwest was built.
As long as Southwest continues to hold to its core mission and values, it seems poised to continue to thrive in what can be a very volatile industry.