Southwest’s holiday meltdown was decades in the making
Done with Southwest Airlines after your Christmas and New Year’s trip was ruined by the busiest airline serving Las Vegas?
You don’t have to be. Southwest is expected to undertake a technology upgrade that would fix some of its long-standing operational problems.
While a massive winter storm was initially blamed for canceling nearly 16,000 flights over a four-day period, the airline’s problems run much deeper, according to a Southwest pilot who took to Facebook to explain the meltdown that occurred last month past, and an aviation expert who has tracked the Southwest for decades.
“It’s really simple,” said Mike Boyd, president and CEO of Boyd Group International, an Evergreen, Colo., aviation consultant. “They have a crew scheduling system that was not adequate for the meltdown. Southwest could not manage its crews and aircraft in this meltdown. That was all there was to it.”
Boyd’s comments corroborate statements made by Southwest pilot Larry Lonero, whose social media post went into great detail about his theory on what happened.
“Many of you have asked what caused this epic meltdown,” Lonero said on Facebook. “Unfortunately, frontline workers have seen this coming meltdown as a slow-motion train wreck for some time. And we have pleaded with our leadership to make the necessary changes to avoid it. What happened started two decades ago.”
The good news from Boyd is that he’s not only optimistic, but confident that Southwest will turn things around in two months. But it will take hundreds of millions of dollars to fix the problem, he said.
Restoring customer confidence
Of course, Southwest CEO Bob Jordan made a public announcement last week that the airline has begun efforts to restore the trust of its customers.
The first step is to compensate customers for their losses and reunite checked bags with their owners. Next will be technological upgrades to Southwest’s operating software.
Southwest was co-founded by the legendary Herb Kelleher in 1967.
Kelleher, one of the most brilliant airline executives I’ve ever interviewed, was a hands-on operations person. He spent time in the trenches with his frontline workers and earned their admiration and respect.
“He always had his pulse on the day-to-day operation and the people running it. This philosophy trickled down the leadership ranks to front-line managers. We were a tight-knit operation from top to bottom. We had tools, leadership and employee buy-in. Everything that was needed to run a first-class operation,” according to Lonero.
He said Kelleher always said the biggest threat to Southwest would be from within, not from competitors.
When Kelleher retired as CEO in 2004, the reins were handed to Gary Kelly, an accountant by training and a person focused more on the financial aspects of the airline than its operations.
“They all unbundled the operation, unbundled the employees and focused more on return on investment, buying back stocks and Wall Street. This approach worked for Gary’s first eight years because we were still riding the strong wave that Herb had built,” according to Lonero.
Kelly didn’t ignore operations, but he certainly paid more attention to keeping the airline’s stock — LUV, on the New York Stock Exchange — in a strong position.
Lonero explained in his post: “But over time the operation started to deteriorate. There was little investment in improving technology (after all, how do you measure return on investment in infrastructure?) or the tools we needed to operate efficiently and sustainably. As front-line workers began to see the deterioration of our operation, we began to alert our leadership. We have educated them, informed them and made suggestions. But to no avail. The focus was on finances, not operations.”
After a few scratches with operational problems in the late 2010s, some of the software’s shortcomings became apparent.
With the outbreak of COVID-19, airlines, including Southwest, scaled back operations to save it from a major meltdown. As travel began to return, Southwest began to ramp up, promising more flights than ever before at Harry Reid International Airport.
Kelly retired in 2022, handing over the airline to Jordan, a more operations-oriented leader. Jordan knew about the technological shortcomings the company faced and began to strategize how to fix them.
Boyd said he was impressed with how Jordan handled the meltdown mess.
Jordan’s statement last week referred to some of that strategy.
“Our leadership team is focused on a full review of the outage with all necessary resources involved, and I expect that work to be completed expeditiously,” Jordan said. “We have already taken immediate action to mitigate the risk of this happening again, and the review work will also inform further action and investment. We have asked our unions to participate in this review effort as well, and we are also in regular communication with our board of directors.
“As a company we spend about $1 billion a year on technology. And we’ll continue to improve the tools and processes our employees use to serve you, our valued customers, and make sure those items fulfill our mission: to connect people to what’s important in their lives through friendly, reliable and low-cost air travel. . We have a proud 51-year history of doing just that, and I am confident that we will continue to deliver on this very important promise.”
A big apology
Jordan adopted the all-important crisis communication strategy to show the public how badly the airline had failed the public.
In the meantime, it is up to our local airport and the Las Vegas Convention and Visitors Authority to continue recruiting additional services to compete with Southwest.
Frontier Airlines has taken steps in that direction, and Boyd says to keep an eye on JetBlue, which recently bought the assets of Spirit Airlines and could increase competition.
As for South West, the nation will watch if they deliver on their promises.
Perhaps the airline should adopt a slightly modified version of the “Love Story” movie catchphrase that was popular when Southwest was taking off: “‘LUV’ stands for never having to say you’re sorry.”
Contact Richard N. Velotta at [email protected] or 702-477-3893. Follow @RickVelotta on Twitter.