You are here
Herb Kelleher, co-founder and chief exec of Southwest Airlines, dies at 87
HERB Kelleher, the charismatic and colourful co-founder of Southwest Airlines, was hardly a cookie-cutter chief executive. He showed up at company parties dressed as Elvis Presley, invited employees to a weekly cookout, handled baggage during the Thanksgiving rush and brought doughnuts to a hangar at 4am to schmooze with his airline's mechanics. He once arm-wrestled an executive from another company to settle a legal dispute and never hid his fondness for cigarettes and bourbon.
Yet he was considered a visionary business leader whose record of sustained success at Southwest led Fortune magazine to ask on its cover: "Is Herb Kelleher America's Best CEO?"
Mr Kelleher, a one-time New Jersey lawyer, won a court case in 1971 allowing Southwest to begin operating in Texas. With its innovative, no-frills approach, Southwest became the country's most profitable and most imitated airline. Once a feisty upstart, it is now the largest domestic carrier in the US, with annual revenues approaching US$25 billion.
Mr Kelleher, who held top executive roles at Southwest for more than 30 years, died on Jan 3, at age 87. The Dallas-based airline announced his death but did not provide details on where he died or the cause.
Mr Kelleher's instinctive, self-taught management style has been studied in business schools and emulated at countless companies. "Herb Kelleher is arguably the most transformative figure and character in the history of modern aviation," Texas oil tycoon T Boone Pickens said in a tweet.
At Southwest, Mr Kelleher created what he called a "culture of commitment", in which employees - not customers - came first. The idea was simple: happy workers would lead to happy passengers, thus giving the airline a competitive edge.
Hiring the right people, Mr Kelleher believed, was a leader's most crucial task. When other companies emphasised education and skills, he put a premium on temperament. "What we are looking for first and foremost is a sense of humour," he said. Southwest flight attendants became known for telling corny jokes over the cabin intercom and for silly gags, such as awarding prizes to passengers with holes in their socks.
Mr Kelleher invited long-time Southwest customers to help screen job candidates. From pilot to baggage handler, attitude mattered. "If you don't have a good attitude, we don't want you, no matter how skilled you are," Mr Kelleher told Forbes magazine in 1991. "We can change skill levels through training. We can't change attitude."
Labour-union contracts were written to allow workers to move from one task to another. Pilots sometimes helped clean the cabin, ramp workers collected tickets, counter agents loaded bags. Mr Kelleher often worked alongside the baggage handlers on the Wednesday before Thanksgiving, the busiest travel day of the year.
Southwest was founded in 1967, when Mr Kelleher was working as a lawyer for Texas businessman Rollin W King. They sketched out a plan on a cocktail napkin, as legend has it, to open a short-haul airline with cheap flights connecting Dallas, Houston and San Antonio. Mr Kelleher chipped in US$10,000 of his own money.
In 1978, Mr Kelleher moved from corporate counsel to board chairman and later added the title of chief executive, assuming day-to-day control of the business. Southwest steadily expanded from Texas to Louisiana, Arizona, California and, ultimately, nationwide.
For all his joking and bravado, Mr Kelleher was a conservative businessman who understood that an airline could not make money if its planes were sitting on the ground. Southwest became renowned for its fast "turnaround" times, with ground crews beginning their work seconds after a plane arrived at the gate. One set of passengers filed off the aircraft while a second was waiting to board. Within 15 to 20 minutes, or half the time of most airlines, Southwest had its Boeing 737 back in the air. A Southwest aircraft spent 11 hours a day in flight, compared with the average eight hours at other airlines.
Herbert David Kelleher was born on March 12, 1931, in Camden, New Jersey. He was 12 when his father, an executive with the Campbell Soup Company, died. An older brother was killed in World War II. As the youngest of four children, Mr Kelleher became close to his mother, who helped shape his approach to leadership. "When I was very young - 11 or 12," he recalled to Fortune in 2001, "she used to sit up talking to me till three, four in the morning. She talked a lot about how you should treat people with respect. She said that positions and titles signify absolutely nothing. They're just adornments."
During high school, Mr Kelleher worked various jobs at Campbell's Soup, from cook to warehouse foreman, which he called "the best education I ever had". "You got to meet the people, see how good they are, how hard-working they are and see some of their eccentricities."
He graduated in 1953 from Wesleyan University in Middletown, Connecticut, where he studied English literature and philosophy. He received a law degree from New York University in 1956. After clerking for a New Jersey Supreme Court justice, Mr Kelleher practised law for several years in Newark. In 1961, he moved to his wife's home state of Texas, joining a law practice in San Antonio. Mr Kelleher was an effective trial lawyer, but "every day I went to work", he told People, "I felt my shoulders droop a little more."
Survivors include his wife of 63 years, the former Joan Negley; three of their four children; and numerous grandchildren.
Mr Kelleher retired as Southwest's chief executive in 2001 and stepped down as board chairman in 2008. WP