Wednesday, April 12, 2017

How southwest made it work: Company culture in fast moving companies

In today’s agile economy, we have developed many tools to speed up processes and save on costs. Lean manufacturing, SCRUM development cycles and  fill the company training lists. However it is becoming more and more apparent that these tools by themselves don’t completely speed up processes. In order to offer quicker service, companies must focus on employee culture as much as they focus on cost saving methods.

The southwest airlines case shows how southwest created autonomous teams that had a shared responsibility for the gates that they worked at. They gave teams autonomy through union contracts that made them responsible for accomplishing their plane turnarounds within the promised amount of time. Alone, this strategy had the potential to cause blame and slow downs at every gate. If the baggage was taking too long to pack then the pilots would complain to HQ that they weren’t to blame causing unrest in every team. Jeff Lamb ensured this did not happen by imbuing a sense of ownership in every team. Collins says in Building your Company’s Vision that a company’s core purpose “reflects people’s idealistic motivations for doing company’s work.” Southwest did a great job of translating its LUV brand to its employees. This fostered an environment of teamwork and help that ensured quick plane turn around.
This use of branding to ensure speed is mirrored in today’s agile silicon valley environments. This environment has new startups and ideas becoming obsolete as fast as they are developed. Companies like Google and facebook work hard to ensure that their employees are generating new ideas fast. Though it is being regulated, Google operates on an 80/20 rule where 20% of your time can be spent on creative side projects. [1] Through this we can see how the innovative spirit gets passed to each and everyone employee. Great ideas like Gmail and AdSense came out of the employee side projects opening up the company to new industries outside of their search engine.

In conclusion, while we analyze how to create strategies for any market segment we must concentrate our efforts as much on the employees as the economics. Without their buy-in to the vision following the company cannot expect to pull off feats like southwest did.

[1] http://www.nytimes.com/2007/10/21/jobs/21pre.html

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