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Keep Managers Focused

By Tom Steinert-Threlkeld  |  Posted 2005-04-10 Print this article Print

Southwest Airlines is the only U.S. carrier to be profitable every year since 1972. Baseline spoke to CEO Gary Kelly about how he uses technology to help keep the airline turning planes around quickly and maintaining its primary advantage: low costs.

Q. How do you manage the process?

A. First of all, our executives are close to the projects. They know what they're doing, but they also know why they're doing it. And there are frequent updates from the people doing the work and the business leaders, as well as Tom Nealon and his team.

Q. What kind of "cockpit" do you have? And talk about the importance of Tuesdays.

A. We have a scorecard with all the major projects. We try to group them in terms of broad initiatives, and then we try to track the benefits that should flow back from these investments.

We've designated Tuesday as our day to manage ourselves. One Tuesday, we'll focus on customer operations. The next Tuesday will be more on aircraft operations, and then the next Tuesday could be on the back office or what we would call enterprise management. We actually bring in the entire executive team every other Tuesday, when we have more specific update sessions. These meetings are where I get my reports.

Q. So how do you track results?

A. We have a different approach to make sure the process changes are taking place once the technology is implemented, to make sure that indeed we are realizing the [gains] we were expecting. We're finding that's far more difficult. We can build the stuff, but now we're trying to get better at [tracking] all the change that flows from there. It's just another element to be added to our management agenda.

Q. When will you do that? Wednesdays?

A. Wednesdays the technology group [already] has what they call "toll gates." This is basically a five-step process, where you get approval, you design, you build, you test, you deploy. In the toll-gate [system], the programming staff can't proceed from one step to the next until everything is trued up. So if customers are lagging in defining the requirements for the design stage, you can't begin construction.

Q. How are you planning to get a better sense of who your customers are? How will you keep track of all flights a person takes with Southwest, and what that person wants?

A. Heading toward 80 million boardings a year, there's a lot in there to know and manage. So, yeah, we're pursuing customer relationship management techniques, and we've got applications to get insight on our customers' wants and dislikes. In the end, we're simply trying to improve their airport experience and their in-flight experience. That's our two primary focus areas.

Q. How, for instance, does information technology helps you solve the "fat passenger/two tickets" problem-and avoid possible customer antagonism? Shouldn't you be able to know every time an overweight person wants to get on a plane and allow for it ahead of time?

A. That's a wonderful example. If you know your customer and you have exactly the information you need, it's just customers with special needs [you're dealing with]. Everyone wants to travel on time. But we'll be better prepared to have an on-time departure and, therefore, arrival if we know we have, say, 15 wheelchair needs on a given flight. So, improving the information and putting it in a form that helps make for fast, accurate decisions absolutely will improve customer service.

Q. How does I.T. play a role in your "10-minute turn" of airplanes at airports?

A. It plays a big role. In terms of specific planning for a turn, having all the right information helps us achieve a lot of efficiencies. It's a big priority for us, to make better decisions. One of the things you have to do with an inbound flight is make sure you can handle the 12 wheelchairs or what-have-you, and marshal the right resources to move out again.

Q. You're considering reserved seating, a sea change for Southwest. Why? What systems will you need to support that?

A. From a technology perspective, we want to be prepared for assigned seats if we are ready to make that choice. All the infrastructure would need to be in place. We want to be sure that if someone went to a kiosk, they could get their seat assignment. It's not rocket science.

Tom was editor-in-chief of Interactive Week, from 1995 to 2000, leading a team that created the Internet industry's first newspaper and won numerous awards for the publication. He also has been an award-winning technology journalist for the Dallas Morning News and Fort Worth Star-Telegram. He is a graduate of the Harvard Business School and the University of Missouri School of Journalism.
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