Human Resource Management International Digest

Employees come first at highflying Southwest Airlines: Model contrasts with the Ryanair approach to lowcost
aviation
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, (2007),"Employees come first at high#flying Southwest Airlines", Human Resource Management International Digest, Vol. 15 Iss 4 pp. 5
- 7
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http://dx.doi.org/10.1108/09670730710753870
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Dawna L. Rhoades, (2006),"Growth, customer service and profitability Southwest style", Managing Service Quality: An International
J ournal, Vol. 16 Iss 5 pp. 538-547
Dawna L. Rhoades, Blaise Waguespack, (2008),"Twenty years of service quality performance in the US airline industry", Managing
Service Quality: An International J ournal, Vol. 18 Iss 1 pp. 20-33
Erdener Kaynak, Orsay Kucukemiroglu, (1993),"Successful Marketing for Survival: The Airline Industry", Management Decision, Vol. 31
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Employees come rst at high-ying
Southwest Airlines
Model contrasts with the Ryanair approach to low-cost aviation
I
t is widely known in the airline industry that before Ryanair boss Michael OLeary took
over the leadership of Tony Ryans sideline business and set about squeezing out costs
and driving up performance, he spent time in the USA studying how the original
low-cost airline, Southwest, achieved its stellar performance.
OLeary himself concedes that many aspects of the model that has made Ryanair such a
success story in European aviation able to challenge such established carriers such as
British Airways, Lufthansa, Air France-KLMand Alitalia in their own backyards were copied
directly from Southwest Airlines. For example, both companies:
B sell tickets directly to the customer, mostly over the internet, cutting out commission to
travel agents;
B price their seats dynamically, charging most at periods of peak demand and almost
nothing during less popular periods;
B abandon the frills of ying, such as reserved seats and free meals and drinks on the
plane, and turn them into revenue-generating opportunities;
B forgo revenue opportunities that would disproportionately raise costs;
B y point-to-point, and so avoid the complications of hub-and-spoke operations;
B operate only one aircraft type, so that crew and maintenance-staff training is simplied,
operational exibility achieved, and economies of scale created for both aircraft and parts
purchasing;
B avoid large, crowded airports in favor of smaller, cheaper, secondary airports, without
problems of congestion;
B turn aircraft around quickly at their destination, to keep them in the sky (and therefore
earning revenue) for more of the day; and
B offer a single-class cabin, with all passengers receiving the same level of service.
Main differences between Southwest and Ryanair
There are, however, major differences between the two airlines in the way they treat their
passengers and employees.
Ryanair pledges simply to get its customers safely from A to B, on time, and at the lowest
price. The company does indeed have one of the youngest eets in European aviation, and
an impressive record for on-time arrivals. Some of its seats are sold for as little as 1 or e1.
But if your Ryanair ight is delayed, do not expect free refreshments. And if it is cancelled,
DOI 10.1108/09670730710753870 VOL. 15 NO. 4 2007, pp. 5-7, Q Emerald Group Publishing Limited, ISSN 0967-0734
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HUMAN RESOURCE MANAGEMENT INTERNATIONAL DIGEST
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arrange your own hotel for the night. A refund on the cost of the ticket, or a seat on the next
days plane (if one is available), is the most you can expect.
Ryanair is similarly tough with its own employees. Their working hours often get close to the
legal limits, and their trade unions receive no ofcial recognition.
Like Ryanair, Southwest Airlines has some of the most productive employees in the business
but Southwest also has an impressive record on customer service and employee
satisfaction. The airline delivers on basic customer expectations about on-time arrivals,
baggage delivery, ticketing and check-in with a smile as well as a prot. The airline
believes that customers deserve respect, dignity . . . and a little fun.
Surprisingly, though, customers do not come rst at Southwest. That place is reserved for
employees, in the belief that you treat your employees the way you want them to treat your
customers. Employees are rewarded according to their teamwork, exibility and willingness
to go the extra mile to provide good customer service. These are not merely empty words.
Superior performance ratings and the recognition that goes with them must be backed
up with actual examples of this behavior in action. But the company is prepared to measure
performance broadly, rather than through a narrow set of indicators.
Selecting the right people for the job
The companys selection procedures which include a number of tests to ensure that new
employees have the right attitude for the airline heavily favor people who like others and
are willing to work with others to get the job done. Southwest has no time for rigid job
descriptions, functional hierarchies or a culture of blame. When a ight delay looms,
everyone from pilots to ight attendants and from customer-service agents to baggage
handlers pitches in to help to ensure that the aircraft leaves on time.
Operations agents have overall responsibility for coordinating the ight-departure process.
At most airlines, these agents coordinate a number of ights simultaneously. Southwest
operations agents, in contrast, work on each ight individually. This ensures that they are
able to be anywhere in the departure hall, at the gate, in the baggage hall, on the tarmac or
aboard the aircraft that glitches occur. Operations agents are recognized as performing a
vital role at Southwest Airlines, and employees work their way up to this job. They also get
extra training and mentoring for the role.
Lifelong learning is part of the Southwest Airlines culture. Supervisors are expected to work
with each employee on a career-development plan and suitable training.
The airlines people department has a key role in communicating brand values to the
employees. It emphasizes the importance of employee brand image the image
that employees project to those around them. Covenants set out what is expected of
employees, who are regularly made aware of the importance of good customer service
and of the impact that losing customers can have on the company as a whole. The
companys advertising and public relations are directed towards employees as well as
customers. The corporate newsletter, LUV Lines, is an important vehicle for celebrating
outstanding employee performance.
Southwest Airlines is highly unionized, but a high level of trust exists between trade unions
and management. The company also tries to build close and trusting relationships with its
suppliers.
Customers do not come rst at Southwest. That place is
reserved for employees, in the belief that you treat your
employees the way you want them to treat your customers.
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While Ryanair and Southwest Airlines share many common characteristics, then, there are
major differences between them, particularly in the areas of customer service and human
resource management. There is evidently no single answer for success in the low-cost airline
sector and so plenty to challenge the aspiring aviation entrepreneur.
Comment
Some of the information about Southwest Airlines, contained in this article, is drawn from
Growth, customer service and protability Southwest style, by Dawna L. Rhoades, in
Managing Service Quality. The article outlines the history of Southwest since 1967 and how
the airline established new standards in customer service and employee satisfaction while
setting records in unbroken protability. The article, written in a lively and accessible style,
considers what quality means in the airline industry, how the Southwest low-cost model
emerged and the keys to the airlines continued success disciplined growth, cost focus,
customer service and people focus.
Keywords:
Airlines,
Employee relations,
Human resource
management,
Job satisfaction,
Customer service
management
Reference
Rhoades, D.L. (2006), Growth, customer service and protability Southwest style, Managing Service
Quality, Vol. 16 No. 5, pp. 538-47, ISSN 0960-4529.
VOL. 15 NO. 4 2007
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