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Open Posted By: nikiedward Date: 14/08/2020 Academic Level: High School Paper Type: Report Writing

 It is quite common for leaders and executive coaches to educate and influence constituents on topics that have relevance for good performance and organizational functioning. Early in the quarter, you will form groups of 4 to 5, name your group, and pick an article via a lottery from the additional readings list. You will be assigned to present that article to the class orally on the date scheduled on the syllabus. You will have 20-25 minutes for your presentation. You may use Powerpoint to convey the key aspects of the article, or any other method that promotes student engagement and involvement in your presentation. Consider your colleagues as your business constituents and use your skills as orators and scholars of leadership to enlighten them on the key concepts discussed in your article. Be prepared to present: 1. A thorough discussion of the key premises/main concepts in your article 2. Why that topic is important in our understanding of leadership 3. Relevant research findings on your topic 4. Organizational implications of your topic (i.e., why should we care?) 5. An application of aspects of your article to an actual organization 

This is a team project, i just need finish one part of the presentation, my part is question 2 (Why that topic is important in our understanding of leadership). I need you help me do 2 slides, and do a 300 words paper(speech draft) for presentation.

Category: Accounting & Finance Subjects: Finance Deadline: 24 Hours Budget: $60 - $90 Pages: 2-3 Pages (Short Assignment)

Attachment 1

Some companies succeed and grow in the midst of industry turmoil. Is culture the element that explains this phenomenon?

Crafting an Organizational Culture: Herb's Hand at Southwest



H ow ^an we begin to define the contribu-tion i that culttire makes to an organiza- tion's economic success? In "The Confucius Connection: From Cultural Roots to Econom- ic Growtlji" {Organizational Dynamics, Winter 1988), Geiert Hofstede and Michael Bond ar- gue that the recent surge in several East Asian economies may be rooted in the cultural tenets of Kong Fu Ze (named Confucius by Je- suit missi(|)naries). Differences in national cul- tures, theiy suggest, offer important clues to understanding policy conflicts and other as- pects of organizational Ufe.

Hofst̂ ede and Bond may well be correct that some! portion of economic success is root- ed in cultural values and beliefs. It seems ten- uous, hoy/ever, to suggest that culture is the only (or ^ven prime) explanatory variable. The orgaijuzational scientist sees a range of possible variables, each with a varying degree of influenjce on a firm's vitality. Within this perspecti\|'e, it is sounder to argue that culture

is the connective tissue knitting together an organization's people so that they can sijc- ceed in the face of environmental challenges and opportunities.

In this regard, the $50 billion plus U.S. air- line industry provides a prime area for study of the interplay between a company's culture and its environment. Success in this indusicry depends on major external factors, such as the price of jet fuel and the national economy (which influences passenger travel dedsio|ns), as well as internal factors, such as routing S3̂ s- tem designs (e.g., "hub-and-spoke"), comput- erization, and personnel competence.

Moreover, fare wars and intense compe- tition, bordering on a free-for-all, have fol- lowed in the wake of the 1978 Airline Deireg- ulation Act, which restricted federal regulation to such areas as safety and an- titrust laws. Since that time, survival has been a prime concern. Nineteen ninety-one alone saw the downfall of three carriers. Proud, old

The atifhor would like to thank Edgar Schein, Debra L. Nelson, and Michael A. Buckmanfor their helpful comments on an earlier draft of this article, as well as Dusty Orman, Susan Yancey,

Beverly A^tilley, and Mary Gowanfor their assistance, comments, and suggestions. He also expresses 'his thatiks to Terry Maxon and David Donithenfor their assistance in constructing Exhibit 3.


James Campbell Quick is a professor in the department of management, University of Texas at Ariington. He earned an A.B. from Colgate University, where he was awarded a Harvard Business Schooi Association Internship to Xerox Corpora- tion. He earned an iVI.B.A. and a Ph.D. at the University of Houston. He has completed post-graduate work in behavioral medicine and in training for psychic trauma. Along with Debra Nelson and his brother, Jonathan D. Quick, he received the 1990 Distinguished Professional Publication Award from the UTA College of Business Administration for the Organizational Dynamics article, ''Corporate Warfare: Pre- venting Combat Stress and Battle Fatigue." He has coauthorea or coedited six books and over forty journal articles on stress. His latest. Stress and Weil-Being at Work (American Psychological Association, 1992), was coedited with Lawrence R. Murphy and Joseph J. Hurrell, Jr., of the National Institute for Occupational Safety and Health (NIOSH). The book is one outgrowth of the American Psychological Association (APA)/NIOSH's Work and Weil-Being Pro- ject. He is a member of the Academy of Management, American Heart Association, Air Force Association, and the Society of Behavioral Medicine, as well as the Divisions of Industrial/Organizational Psychology and Military Psychology within APA. He is mar- ried to the former Sheri Grimes Schember.

airlines such as Eastern and Pan Am fell from the sky, skidding through bankruptcy into liquidation. (The Eastern demise was partic- ularly bitter and contentious. According to some reports, the breakup was a contributing factor in at least 50 suicides.) TWA also sought protection from creditors in early 1992. Other carriers, such as Braniff, Conti- nental, and America West, limped across the runways, fighting for survival. Only a few airlines, such as American and Delta, ap- peared to grow stronger through the fray. Southwest Airlines has carved for itself a vi- tal niche, maintaining an enviable record of profitability and service quality. In fact, the past three years have been for Southwest a period of continual national recognition. The deregulation era may not have been easy on the airline industry as a whole, but South- west in particular not only endured, but managed admirably.

Southwest has managed so well for many reasons, among them a special cultural philos- ophy. What, exactly, are the cultural distinc- tions that allowed this carrier to knit its people together iri the face of extreme challenges in- dustry-wide? A close look at the people who have shaped the airline industry provides a first step toward answering this question.


In his book Organizational Culture and Leader- ship, Edgar Schein defines an organization's culture as the mechanism by which an orga- nization and its members learn to both man- age external challenges and achieve internal integration. In "The Role of the Eounder in Creating Organizational Culture" {Organiza- tional Dynamics, Summer 1983), Schein ana- lyzes the role of the founder in creating cul- ture. Founders are key figures both in the formation of the culture and in its integration throughout the organization over time. Or- ganizational cultures do not spring full- blown and mature onto the corporate land- scape. Rather, they begin as new, young


cultures manifesting the vision and imagina- tion of the organizations' founders. Over time, cultural values and beliefs become em- bedded in the formal and informal fabric of the organization.

The extent of success that individual air- line industry leaders have had in carirying out cultural agendas can be compared and con- trasted. Robert Crandall of American Airlines, Frank Lorenzo from Texas Air, and South- west Airlines' Herb Kelleher are among the prominent industry figureheads of the past decade. Lorenzo has subsequently bowed out of the industry, one of a number of casualties of industry-wide warfare. While apparently successful in the financial markets as he built Texas Air Corporation, Lorenzo could not forge the internal coalitions necessary to make a real success. In particular, he had bit- ter, strained relations with a number of inter- nal constituencies, including a large number of Eastern Airlines' dislocated workers. They loved their work and their airline, but hated Lorenzo. The animosity characterizing many of Lorenzo's relations stands in sharp contrast to the rapport Crandall and Kelleher have with their internal constituencies. Crandall appears to have highly functional, if some- times conflicted, union relationships, and Kelleher enjoys excellent relations with his company's unions.

While Crandall and Kelleher have both been successful during deregulation, their styles differ as markedly as the cultures of their airlines. A fierce visionary with competitive anger, Crandall hammered out for himself a position of leadership among the major carri- ers. Temperamental, obsessive about details, and super-aggressive, Crandall has nonethe- less managed to meld functional relationships with his many internal stake-holders. While these relationships, as with the pilots in late 1991, may at times be testy and stormy, Cran- dall directs most of Ws aggression toward cor- porate achievement, not toward damaging key internal relationships. His approach has result-

ed in the development of a highly profession- al airline vnth a consistently respectable profit record. While CrandaU's vision and financial acumen have been instrumental to American's success, it is important to remember that he has had a big SABRÊ to rattle at his competition. Kelleher, on the other hand, has not needed a sabre.

As a founder of Southwest Airlines, Herb Kelleher has been pivotal in crafting one of the most distinctive organizational cultures in America today. For decades the names of IBM, Johnson & Johnson, and the United States Marines have elicited diverse yet dis- tinct images. Each of these organizations has a well-defined culture founded on a set of core values and basic assumptions. This is also true for Southwest Airlines—at its core are the three values of humor, altruism, and "luv"— and, for Southwest Airlines, this has been tiue from day one.


While Southwest Airlines celebrated 20 years of in-flight service during 1991, the company, founded several years earlier, will mark the 25th anniversary of its incorporation during 1992. Southwest Airlines' growth and develop- ment during the past quarter of a century neat- ly breaks down into four distinct periods (see Exhibit 1). The Period of Lift-Off was a time of hard-fought legal battles; the Proud Texan Pe- riod saw the establishment of a city-serwee network within Southwest's home state of Texas; the Period of Interstate Expansion opened service to fourteen other states; and the National Achievement Period has been a time of distinguished recognition and success.

The Legal War

During the first three years of its history, rto Southwest planes were flown. Battles we:ce fought not in the skies, but within the legal

^ SABRE stands for Semi-Automated Business Research Environment and is American Airlines' advanced reservations system for airline travel.



1967-1971: THE PERIOD OF LIFT-OFF • Air Southwest Company incorporated (1967) • Texas Aeronautics Commission certifies Air Southwest (1968) • Braniff, Trans Texas, and Continental fight Southwest (1968-1969) • Texas Supreme Court and United States Supreme Court support Southwest (1970)

1971-1978: THE PROUD TEXAN PERIOD • Inaugural service between Dallas, Houston, and San Antonio (1971) • Service opened to:

• Rio Grande Valley (1975) • Corpus Christi, Lubbock, Midland/Odessa, El Paso (1977) • Amarillo(1978) • Beaumoni/Port Arthur/Orange (1978)

1978-1986: THE PERIOD OF INTERSTATE EXPANSION • Interstate service opened to:

• New Orleans, Louisiana (1979) • Oklahoma City and Tulsa, Oklahoma; Albuquerque, New Mexico (1980) • Kansas City, Kansas/Missouri; Las Vegas, Nevada; Phoenix, Arizona; San Diego,

California (1982) • St. Louis, Missouri; Chicago, Illinois (1985) • Nashville, Tennessee (1986)

1987-1992: THE NATIONAL ACHIEVEMENT PERIOD • Interstate service opened to Birmingham, Alabama (1987) • Winner of the first Triple Crown Award (1988) • Winner of the second Triple Crown Award (1989) • Winner of third and fourth Triple Crown Awards (1990) • Only airline with an operating profit (1990 & 1991) • Honored with Air Transport World's Airline of the Year Award (1991) • Ranked #1 in customer satisfaction among all major U.S. airlines (1991) • Winner of fifth Triple Crown Award (1991) • Winner of sixth Triple Crown Award (1992) • Winner of seventh Triple Crown Award (1992)

system, and as Air Southwest fought to get it- self off the ground, rival airlines battled to keep it on the tarmac.

The fact that Kelleher was a New York University law school graduate was undoubt- edly an advantage for Southwest during this period. With the support of the Texas Supreme Court, and ultimately of the United States Supreme Court, Air Southwest was able to begin 1971 with full authority and cer- tification to fly. The U.S. Fifth Circuit Court of

Appeals and the United States Supreme Court would hear additional cases targeting Southwest during the 1970s, but the key legal issues were resolved by mid-1971. At last, the legal war was won.

Choosing the Next Battlefield

While it was clear that Southwest was in a le- gal war with some rivals in the airline industry, it would not be accurate to say that the com-



pany engaged in an air war with its competi- tors during the next two periods of its growth and development. Southwest strategically tar- geted groifind transportation, not other air- lines, as it̂ key competition. In fact, Kelleher has enjoye î healthy and strong (even jocular) relationships with other leading airline execu- tives. His antics and humor are legendary. For example, while presenting his friend Bob Crandall of American Airlines with the 1990 Distinguished Business Leadership Award from the College of Business Administration at the University of Texas at Arlington, Herb in- fused the evening with humor:

BO|D, it is a real pleasure to be here tonight to present you with this award. True, ij: would be an even more de- lightful evening if you were presenting me witfi this award. But.. .1 can forgive the deqri his error in judgment.

With Ijhe stage set, then Secretary of . Transport^ion Samuel Skinner joined in with a jok4 about having just left President Bush at tlje White House that afternoon, When the I President asked where he was

headed. Skinner said he was going to Texas to honor the airline industry's most distin- guished executive. :

Bush's response: "Oh, say 'hi' to Herbf Although Kelleher may be an executive

more likely to crack a joke and Crandall an ex- ecutive more likely to crack a whip, based ion their respective companies' high levels of per- formance, both executives are equally cple- manding. American Airlines and Southwj^st Airlines are testaments to that fact. (And, sifti- sequently Herb Kelleher did receive the 1992 Distinguished Business Leadership Award.]

Successful Achievement

While this kind of humor and joking charac- terizes Herb Kelleher and his interactioirns with other people, he does not treat the p(̂ r.- formance of Southwest Airlines as a joke. By combining an innovative niche strategy wijth solid work performance and a unique organi- zational culture, the company has achieved an enviable record over its quarter-century of existence. Exhibit 2 traces Southwest's service growth, beginning with service to just


Net profits (loss)/employee Operating profits (loss)/employee Passengers per employee Employees per aircraft Available seat miles/employee Revenue passenger miles/employee

Based on 1991 data from the American Transport Association


$2,753 $6,436 2,318

79 1,891,082 1,155,265


($3,505) ($3,230)

848 131

1,339,995 839,252

100,000 passengers during 1971 and achieving a 1991 milestone of service to more than 22 million travelers.

This achievement is even more remark- able given the context of Southwest's nation- al recognition and achievements, as shown in Exhibit 1. For example, in March 1988, South- west Airlines became the first and only airline to win the coveted Triple Crown—Best On- time Record, Best Baggage Handling, and Fewest Customer Complaints in a single month—based on U.S. Department of Trans- portation data. In September 1989 and Febru- ary 1990, Southwest had repeat winning performances. In March 1990, Southwest achieved a quadruple Triple. In December 1991, March 1992, and May 1992, Southwest had a fifth, sixth, and seventh repeat perfor- mance—still the only airline to earn even one Triple! Far from being one of Kelleher's jokes, that is solid work performance.

Southwest Airlines has grown to a busi- ness with a billion dollars in revenues annu- ally and a fleet exceeding 100 aircraft. It is the seventh largest airline in the country in terms of passengers boarded, and arguably the most profitable airUiie over the past twenty years. The airline gets a big bang for the buck in terms of its employee productivity, again ar- guably better than the industry average, as shown in Exhibit 3.

While still recognized as the State Bird of Texas, as well as flying "Shamu One" and "Lone Star One," Southwest Airlines now serves thirty-four cities in fifteen states. And,

even though it is a unionized airline. South- west enjoys the lowest turnover rate and the best labor relations in the industry.

Herb's public image may be that of a prankster full of jests and humor, but he is also an astute executive. A review of his cor- respondence to employees reveals a serious- minded businessman who can be honest and forthright about the financial and humanitar- ian aspects of the company without being harsh or negative. This tough-taUdng, reality- based honesty may appear a paradox in jux- taposition xvith his public image, but only at first glance.


In talking about managing the stresses and demands of the workplace, we all too often "blame the victim" when difficulties arise. De- bra Nelson and Charlotte Sutton illustrate how CEOs can use a variety of ceremonies, stories, rituals, and symbols to build a healthy corporate culture, one that doesn't "blame the victim." The organization's culture can be the vehicle through which individuals are able to better manage or overcome the challenges of the work environment and the industry in which they operate.

Culture begins with the values and be- liefs that people hold. When tested, these val- ues prove to form a system of basic (albeit pre- conscious) assumptions. According to Edgar Schein, an organization uses these assump-


tions to cope with its problems of external adaptation and integration. As noted earlier, Schein views founders and leaders as critical in shaping an organizational culture. In talk- ing about Southwest from its founding through the first few years, Kelleher says:

We were always very colorful and somewhat promotive of a sense of hu- mor. We have always had that ap- proach, in an informal way.

As founder and leader. Herb Kelleher was and is instrumental in shaping the culture of Southwest Airlines. Herb's own antics are what Schein would label the "artifacts" or "cre- ations" that spring from a leader's values, be- liefs, and assumptions about people and about work. When Rhode Island native Crandall asked Herb what he was going to do with all the whale droppings from Southwest's fresh- ly painted "Shamu One," Herb responded, "I am going to turn it into chocolate mousse and feed it to Yankees from Rhode Island." Kelle- her followed up the next day with a tub of chocolate mousse delivered to Crandall's of- fice with a king-sized Shamu spoon.

There appear to be three pillars of belief at Southwest Airlines which are reinforced, promoted, and elaborated on by Kelleher through his words and deeds:

VALUE 1: Work should be fun.. .it can be play.. .enjoy it.

VALUE 2: Work is important .. .don't spoil it with seriousness.

VALUE 3: People are important .. .each one makes a difference.

The first two values might be subsumed under the notion of humor and the third val- ue captured in the notion of altruism.


Humor should not be confused with simple laughter and joking. Jack Duncan and Phil Eeisal show how humor, giving rise to joking in the workplace, leads to a cohesion and bonding among workers. They are also sensi- tive to the down side of humor, which may lead to bad feelings if an individual is made

the butt of the humor. Specifically, joking may become offensive or destructive when used in a manner at odds vnth the organiza- tion's culture. Hence, humor is most appro- priately defined as the frank expression of ideas and feelings without individual discom- fort and without unpleasant effects on others. This characterizes humor at Southwest Air- lines. In discussing the role of humor in the workplace, Kelleher says:

I crystallized the importance of a sense of humor in a more formal way in 1978 when I became chairman. I charged our personnel department, as it was then called (now called the peo- ple department), with the responsibili- ty of hiring people with a sense of hu- mor. We look for it in the interactions people have with each other during group interviews.

For Kelleher, humor never excludes peo- ple, nor does it create joy at the expense of oth- ers. Using a sense of humor as one of the hk- ing criteria at Southwest Airlines is at the ccire of the organization's culture. Kelleher looks for people with a certain attitude (an approach to life, a way of Kving, or a set of values) that is not narrow, rigid, tightly defined, or restric- tive. As Kelleher puts it, "Tolerance for human beings, their peculiarifies or eccentricities, and their differences is very important."

This does not mean that Kelleher has no limits in his toleration of others. He will not hesitate to fire someone who does not treat his fellow Southwesterners as they should be treated. ¥ou might say he is intolerant of intol- erance. But he is always on the lookout for good people:

We can train people to do things where skills are concerned. But there is one capability we do not have and that is to change a person's attitude. So, we prefer an unskilled person with a good attitude rather than a highly skilled person with a bad attitude. We take people who come out of highly struc- tured, hierarchical, dictatorial corpo- rate environments if the}^ have the at- titude potential. They may have just

molded their mannerisms to conform to that rigid environment. When we have them here for a while, they learn they can relax. . .and let their real selves come out.

For Duncan and Feisal, it is wrong to think of humor and work as mutually exclu- sive activities. Too frequently, Americans cre- ate a false dichotomy which says, in effect, "If it's fun, then it can't be work. Or, if it's not fun, then it must be work/' The American tax courts may be ahead of many of us in ruling 70 years ago that a man's profession and his pleasure may be one and the same:

[A] business will not be turned into a HOBBY merely because the owner finds it pleasurable; suffering has never been made a prerequisite to deductibility. "Success in business is largely obtained by pleasurable inter- est therein."

-Wilson V. Eisner, 282F.38(2dCir.l922)

It is not uncommon for outrageous hu- mor to be vented within the Southwest work- ing environment. After finishing the new cor- porate headquarters building at Love Field in Dallas, all of the staff except the dispatchers moved into the new facility. The dispatchers' mock outrage began an uproarious little war:

Employees petitioned not to have the dispatchers come over at all for the open house at the new headquarters. The dispatchers arrived and set up their own valet parking. , .just valet parking for dispatchers. J hoy had got- ten flags and screened off part of the parking lot. Everyone in the headquar- ters building then got together and decorated their offices like a funeral parlor. We got old flowers with wilted heads. Tlic dispatchers then sent a let- ter oadining their "bitter" resolve to carry on the struggle forever.

These sorts of shenanigans are a regular element of Southwest's corporate culture. Employees place them in perspective, realiz- ing that the antics are the lubricant that greases the engine of the business. A second


pillar of the Southwest culture is caring for and giving to other people, expressed in the tens of millions of passengers served each year. A number of other expressions of caring are embodied in Southwest's third corporate value^altruism.


The importance of people—caring for them and cherishing them—is a corporate value that begins at the top and trickles downward. If altruism is the vicarious yet constructive and instinctively gratifying service to others, then Kelleher is very clearly altruistic:

We are interested in people who externalize, who focus on other peo- ple, who are really motivated to help other people. We are not interested in navel gazers, regardless of how lint- free their navels are.

At Southwest Airlines, altruism begins at home in caring for one another in the "fami- ly." Consider, for example, employees' re- sponses to an event that occurred in the mid-1980s when the two-year-old son of a Midland, Texas agent was dying of leukemia:

About 3,000 people went out and sent cards to him on their own when they heard the story. That was at a time when we only had about 5,000 people. So, about 60 percent of all our people at Southwest Airlines bought this little boy cards. That's impressive.

Another way Southwest Airlines people care for each other is through a relatively new catastrophe fund, initiated and worked on over the past couple of years by people at Southwest:

The people contribute on a regular basis just to help others who run into some catastrophe in their lives that all of the sick leave, medical benefits, and other systems we may have cannot cir- cumvent or supervene. That our em- ployees would be sufficiently motivat- ed by humanitarianism, given ali the


government and company help avail- able these days, is impressive to me.

This informally initiated effort reflects the concern, caring, and warmth people have for each other in the company. And it's not just talk—they are willing to back it up with their money and resources. They give for the col- lective well-being of each and aU.

The people at Southwest Airlines have at other times created new ways to show appre- ciation for each other. For example, the provi- sioning department is responsible for provid- ing the drinks, peanuts, and other provisions for each flight. As such, their direct customers are the flight attendants on each aircraft:

The provisioning people select.. .a flight attendant who is named the cus- tomer of the month. This is done by the board of directors of the provision- ing department. They really set up a company within a company. I am in- vited to their board meetings and I go, as does Colleen Barrett, our vice presi- dent of administration.

This is not to sa]̂ that the Southv^^est cul- ture is somehow ingrown. The people at Southwest Airlines not only care for their own, they also care for others in need. The most concrete illustration of their charitable spirit is the extent of personal and corporate giving to the Ronald McDonald Houses with- in the Southwest city network. Southwest Airlines chose the Ronald McDonald Houses as their primary corporate charity, and in the late 1980s, the McDonald's Corporation rec- ognized Southwest as one of the five compa- nies tlvat hhd done the most for its program. But Southivest employees gave more than their money:

The public relations executive for McDonald's said a somewhat astonish- ing thing to me at the time the awards were presented. He said Southwest Airlines was very special because they gave not only their money but their time. That was something to say in front of these other four companies who had been financially generous.

About 25 percent of Southwest's people volunteer some of their time and talent cook- ing, playing, or in other ways helping in the Ronald McDonald Houses. That is a signifi- cant gift of caring and giving in the service of others. And, as a result, the holiday message on the television read:

From the house that love built and the airline that luv built, have a Merry Christmas.


Every organization encounters economic, in- dustrial, or corporate challenges at varicjius times in its life history. And it is during these periods that a company's cultural vahties contribute to an enabling mechanism jfor venting constructive and positive responses. In The Heart and Spirit of Transformational Leadership, Kevin Freiberg argues that Hferb Kelleher is a transformational leader in adjdi- tion to being the entrepreneurial foundeij of Southwest Airlines. He suggests that Kelle- her is able to facilitate the transformation] of challenging events so as to create positive outcomes. Thus, work is transformed iiito play; challenge leads to achievement; enjvi- ronmental threats become opportuniti^jg; and individual strengths are transformled into collective power. By instilling his lead- ership into the culture of Southwest, Keljle- her enables many Southwesterners to ftn- gage in a similar form of transformatio][ial coping. :

This was recently illustrated in the casej of Operations Desert Shield and Desert Storpi. Between August and November of 1990, |et fuel prices doubled, posing a real challenge! to all in the industry. About a quarter of the e:JT!- ployees at Southwest banded together to cjre- ate a "Fuel from the Heart Program" in whi|ch they donated a specified number of gallons! of fuel from each of their paychecks, with the price of jet fuel pegged at $1.10 per galkiry. This was then set up as a payroll deduction and continued through the Persian Gijili War—about six months. The program was ijri-


strumental in allowing employees to feel a part of the solution to a pressing problem.

Thus, cultural values become the plat- form for specific and concrete actions de- signed to meet difficulty and challenge. We cannot think of organizational culture as a substitute for responsible, problem-solving behavior on the part of leadership. Culture becomes the vehicle through which problems and challenges become addressed, defined, reframed, and ultimately solved. When cul- tural values do not work in this fashion, they must be modified or jettisoned. The culture is not the end or goal but rather the means. It may be the focus of attention, but as in the case of the magician, something quite sub- stantive and important may not be meeting the eye.

In The Hardy Executive, Salvadore Maddi and Suzanne Kobasa describe transforma- tional coping as the active transformation of an event into something less subjectively stressful in one or more of three ways:

• Viewing the event with a broader life perspective.

• Altering the course and outcome of the event through action.

• Achieving greater understanding of the event's process.

I he cultural values at Southwest aid peo- ple in transformational coping, which turns or aiters the person's experience of the event. For the airline industry as well as for many other sectors of the economy, the 1990s are competitive and challenging times. During such times, hardiness and transformational coping help people maintain health and well- being.

Johnson & Johnson Health Management provides a parallel example of transforma- tional coping. Although J&J operates in a very different industry, it also faced chal- lenging times and its own unique culture served the organization well in trying times. For exiimple, crisis hit in the early 1980s when the McNeil TYLENOL acetaminophen products were sabotaged. The cultural val- ues delineated in the J&J credo helped shape the corporate response to the challenge. Johnson & Johnson concluded in their 1986

Centennial report: "We believe the consis- tency of our overall performance as a corpo- ration is due to our unique form of decen- tralized management, our adherence to the ethical principles embodied in our credo, and our emphasis on managing the business for the long term."

After 100 years of success, it is not sur- prising that Johnson & Johnson has formal- ized their cultural values in their credo. After 25 years of success. Herb Kelleher is helping Southwest Airlines along the same path of formalizing and embedding cultural values to serve the company well over the long term.


Two key points to remember with regard to organizational culture are: (1) what you see is not always what you get, and (2) that is not necessarily bad. The underlying values and elements of an organizational culture are rarely immediately apparent. They are usual- ly buried beneath a wide range of social be- haviors and artifacts. For example, attention- grabbing antics may mask a deep-seated seriousness about the success of the business. Or, the persona of a tough-talking executive may mask a fundamental respect and appre- ciation for people. Therefore, it is virtually im- possible to accept some aspects of the organi- zation at face value. However, that does not mean that the cultural elements below the so- cial surface are necessarily unsavory or unac- ceptable.

The airline industry in the United States has been highly competitive, challenging, and stressful since the 1978 deregulation. It is an unusual industry, given its capital intensive nature and service orientation toward the public. It would be difficult to argue that a particular organizational culture would en- sure financial success in the current industri- al context. There are too many other strategic and corporate considerations, such as jet fuel prices and computerized reservation systems, which impact the bottom line. However, it is not unreasonable to view corporate culture as


the connecting tissue which weaves an orga- nization together and facilitates its fit within its environment.

Herb Kelleher has done a remarkable job of crafting a unique culture at Southwest Air- lines through a combination of humor, altru- ism, concern for other people, and good, old- fashioned straight talk. The underdog quality of the Southwest Airlines culture, combined with its innovative niche strategy, are the ke)̂ factors which enabled Southwest to achieve the degree of nafional recognition it has during the fourth era of its twenty- five-year history. They are also key factors in the financial success the company has en- joyed during the industry's economic diffi-

culties. Southwest's success has industry gi- ant Bob Crandall of American Airlines talk- ing to his employees during 1992 about learning from and modeling elements of the Southwest strategy.

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articles in ORGANIZATIONAL DYNAMICS, please refer to the special reprint service instructions on page 80.


In "The Confucius Connection: From Cultural Roots to Economic Growth" {Organizational Dy- namics, Winter 1988), Geert Hofstede and Michael Bond build the case for the importance of Confucian cultural values in the remarkable economic growth of Singapore, Taiwan, South Korea, Hqng Kong, and Japan for the period from 1965 through 1985. The authors use annu- alized growth rate in GNP per capita as their key economic indicator. Their argument is one of the few in the literature that attempts to trace a di- rect connection between culture and economic success.

1X1 "Th^ Role of the Founder in Creating Or- ganizational Culture" {Organizational Dynamics, Summer 1^83), Edgar Schein examines the ways in which fbunders embed cultural values into the organisations they create. He also differenti- ates founder/owners from professional man-

agers. His book Organizational Culture and Lead- ership (Jossey-Bass, 1986) uses three case exam- ples to illustrate the role of the founder in shap- ing the culture of an organization. In "ElemeiHts of the Cultural Network: The Communicators oi Corporate Values" {Leadership and Organization Development, 1990), Charlotte Sutton and Debra Nelson examine the communication medium through which CEOs transmit cultural values. For those interested in more quantitative ap- proaches to examining organizational cultuile, Denise M. Rousseau has written an excellejit chapter entitled "The Quantitative Assessmiqnt of Culture" for Benjamin Schneider's Frontiers 'tn Industrial and Organizational Psychology, VoL;3 (Jossey-Bass, in press). However, one must Jse mindful of the inevitably soft nature of this cqih- struct we call "organizational culture."

Southwest Airlines has a complete Culture


Package available which includes: (1) "Spirit" ma- terial on Kelleher and Southwest's personality and leadership style; (2) the "People Mission"; (3) LUV Lines and UPDATE (internal newslet- ters); and (4) the Southwest Shuffle video; among other items. "Herb and His, Airline," a nineteen-minute video produced for "60 Min- utes," is available from both CBS and Southwest.

For a careful examination of Kelleher's lead- ership style at Southwest Airlines, see Kevin L. Freiberg's doctoral dissertation at the University of San Diego, The Heart and Spirit of Transforma- tional Leadership: A Qualitative Case Study of Herb Kelleher's Passion for Southwest Airline. It is an in- formative, intensive study based on phe- nomenological and ethnographic research proce- dures. Freiberg's theoretical framework is that of James MacCregor Burns, who distinguishes transformational from transacdonal leaders in his original book Leadership (Harper & Row, 1978). Abraham Zaleznik's "Managers and Leaders: Are

They Different?" {Harvard Business Review, May- June 1977) makes a similar distinction between the basic personalities of managers and leaders in terms of their orientations to goals, their work, their relationships with others, and the relation- ships with themselves.

Jack Duncan, Larry Smeltzer, and Terry Leap's "Humor and Work: Applications of Jok- ing Behavior to Management" {Journal of Man- agement, June 1990) reviews the accepted theo- ries of humor, with implications for management. It also summarizes the research on humor in management and the behavioral sciences and examines the legal aspects of spe- cific applications of humor at work as it relates to employee relations. Duncan's article "No Laughing Matter: Patterns of Humor in the Workplace" {Organizational Dynamics, Spring 1989) focuses more specifically on how joking behavior affects employee relationships and performance, with guidance for management.