June 10, 2020
June 10, 2020
I took a ride from Houston to Dallas on a Southwest Airlines 737 a few months ago and found myself seated next to a smartly dressed and clean-cut 30ish young man wearing a Southwest Airlines polo shirt. I asked him how long he’d been with the airline. His response suggested he’d just won a $500 million lottery. With a big grin, he said he’d only been with the company for two years, but they’d been the best two years of his life. Naturally, I asked him why. He didn’t hesitate.
“It is so great to be with a company that knows what it stands for, what its purpose is, and how I fit in.”
He went on to say that Gary Kelly, Southwest’s CEO, reinforces Southwest’s purpose at every turn. He also pointed out the Southwest is the only airline on the planet that has been profitable for over 190 straight quarters and has a remarkable culture that compels this kind of workforce pride and employee engagement.
Herb Kelleher began the Southwest journey four years before its first flight took off on June 18, 1971. He knew the journey would never end. From the very beginning, Southwest’s purpose was to democratize the skies, to connect people to what’s important to them through friendly, reliable, low-cost air travel. Their vision is to be the most loved, most efficient, and most profitable airline on earth. Their promise is to provide a stable work environment with equal opportunity for learning and personal growth. Gary Kelly and his team continue the journey today. They lead the company with purpose, a balanced stakeholder approach, unified leadership, discipline hiring practices, clarity in everything, measuring what matters, cost leadership, relentless improvement, and a commitment to great customer experiences. These are the principles that lead to a culture of peak performance.
Unfortunately, these principles go unrecognized in many businesses. This is despite the fact that companies driven by these principles outperform their next best peers by at least 25%. There have been zillions of books written on leadership, strategy, and execution, and I’ve read most of them. In his books Good to Great and Built to Last, Jim Collins did a good job of broaching the subject. Roy Spence’s It’s Not What You Sell, It’s What You Stand For, and Barry Schwartz’s Why We Work are also very good examinations of the power of purpose-driven organizations. However, just reading great material won’t get results.
No amount of reading will take the place of committing to your own journey and spending time with those who have lived and experienced the benefits of practicing these principles. The things we’re learning from incredible leaders who have led their own transformations are astounding. And what’s more amazing is that this group of phenomenal leaders has been eager to share their “secret sauce.” These leaders are willing to help others in order to make the world a better place.
Leaders of peak performing organizations have committed to begin a journey that never ends. They’ve instilled vision, mission, values, and strategy that energizes and engages the entire workforce, not just the shareholders. They’ve figured out ways to measure the things that matter most, including employee engagement and customer delight. They’ve committed to being the best in their sector, and they’ve removed cost from their enterprises where the customers and employees can’t feel it.
Why then, are these principles not taught in most mainstream business schools? Stew Friedman, leader of the Work/Life Integration Project at the Wharton Business School and host of Work and Life on Wharton Business radio, asked Barry Schwartz the same question six years ago. Barry Schwartz is a 1971 Wharton Ph.D. and organizational psychologist whose practice focus is the workplace. Barry says – and I agree – that “the mainstream business community has been heavily influenced by two individuals – Adam Smith and Frederick Winslow Taylor.”
Barry’s workplace research asserts that as much as 90% of the world’s workforce is disengaged, and Gallup says 70% of the U.S. workforce is disengaged. Barry says the world has been heavily influenced by Adam Smith, who wrote in Wealth of Nations in 1776 and to Fredrick Winslow Taylor, who came along 100 years later and is seen by most as the father of the modern hierarchy and business processes. Both had views of a workforce populated by people who require extrinsic motivation and careful supervision; and both have had a profound effect on global business.
John Maynard Keynes said: “The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist.”
We reject the notion that people work only for pay and extrinsic rewards; that they need close monitoring, constant supervision, rules, and confining policies. We know, through our research, observation, and study, that when organizations share a purpose greater than just making money, and engage their stakeholders, they produce substantially higher returns for their shareholders and have a lot more fun doing it. They lead with values and standards, not rules and policy manuals. They measure things that matter and lead to superior shareholder returns.
Peak performing organizations look and feel good; the deeper you look, the better the view. Beyond exceptional returns, you’ll see trust, smiling faces, exceptionally low turnover, spirited and healthy debate, systems that are driven by purpose, frontline employees who sound like company spokespersons, and delighted, evangelistic customers. They have frontline employees and customers who tell stories about them and are, in fact, their most effective evangelists.
How do you define diversity in 2020? For decades, we’ve been told that organizations that employ diverse teams perform better. But what does that really mean? Certainly, diversity includes gender, race, and nationality. But a more comprehensive …Read more
This article features paraphrased content from Marcus Buckingham’s September 29th article in Harvard Business Review. Psychology Today defines resilience as “that ineffable quality that allows some people to be knocked down by life and come back stronger …Read more
Southwest Airlines is a company to which we’ve paid close attention for decades. Herb Kelleher, the airline’s co-founder and first CEO, practiced all nine principles we observe in organizations that perform at the very top of their …Read more