Core management philosophies are the DNA of a business. Having a crystal-clear set of core management philosophies is pivotal to a company’s growth and sustained success. They have a profound impact on an organization because they help define and describe the business model of the organization. Your company’s philosophies must drive every decision and action at all levels. Companies that invest the time and rigorous effort to detail their core management philosophies perform commandingly in the marketplace and leave their competition behind.
To understand better what core management philosophies are and how they impact an organization, let us consider the example of Southwest Airlines, which has carefully developed a set of such philosophies that have been central to the company’s success. Southwest’s core philosophies are high-value to customers, operational excellence and a progressive culture. These three philosophies work hand-in-hand and permeate every aspect of the company. They are the Southwest’s DNA.
To provide high value to customers, Southwest offers a number of features: low fares, quality service, on-time departures and arrivals, high frequency of flights and consistency. Southwest does not compete with other airlines — it competes with your car. Its customers ask themselves, “Is it cheaper to fly or drive between two cities?” Southwest is in the business of getting people to their destination reliably without fanfare. It has trained its customers to expect only a bag of peanuts and half-a-can of soft drink. When customers receive exactly what they expect, they rate Southwest high in customer service. Consistency is what endears Southwest to its customers. Consistency is the magic recipe.
To keep costs low and deliver consistency, Southwest focuses on the philosophy of operational excellence. It keeps its operations simple, and optimizes the use of its biggest capital investment, its aircraft. The airline keeps its fleet staffed with new airplanes, uses only one type of airplane to standardize operations (prior to the acquisition of AirTran last year), and limits in-flight services.
Southwest makes sure its planes spend more time flying than on the ground. To optimize the use of its assets, it provides short-haul flights (long-haul flights cause large gaps of idle time), minimizes gate-time turn-around, and uses less-crowded regional airports so planes can get in and get out quickly — no need for them to be in holding patterns to land or waiting on the runway to take off.
A company that does not rank its culture as a large part of its DNA needs to rethink that position. Southwest’s focus on its culture is legendary. It goes through extraordinary lengths to value and respect its employees. Employees in return understand and value the company’s management philosophies.
I don’t advise arguing with any airline gate agent, but especially don’t argue with a Southwest gate agent. Even if you are upset, she or he is likely to ask you to step aside as passengers board the plane. The agents know their No. 1 goal is to make sure the flight leaves on time. They cannot risk delaying 120 passengers to satisfy one. They do care about your specific complaint, but they understand their priorities.
As you study Southwest’s approaches, you begin to understand the degree to which they have developed their core management philosophies and how well they use it. Other airlines have tried to mimic Southwest’s model by offering “lite” versions. They have not succeeded because their core management philosophies have not been well developed. That is the biggest lesson from Southwest. Carefully select your core management philosophies, your DNA and pay rigorous attention in implementing them through every aspect of your business.
Quoted in The Wall Street Journal, Barron’s and WorldNews, Ravi Kathuria is a recognized thought leader. Featured on the “BusinessMakers” show, CBS Radio and “Nightly Business Report,” he is the author of the highly acclaimed book, “How Cohesive is Your Company?: A Leadership Parable.” Kathuria is the president of Cohegic Corp., a management consulting, executive and sales coaching firm, and president of the Houston Strategy Forum. Reach him at (281) 403-0250 or firstname.lastname@example.org
Your company has a critical aspect that could help it succeed extraordinarily or fail miserably — corporate culture. Your company may have the best developed mission, vision, goals and strategy, and yet it may fail without the right matching culture. Culture is a crucial part of the engine of your company. Without the right culture your organization will not move at the speed you need and want.
Culture is the culmination of how everyone in the organization from management to front-line employees behave and think. Culture reflects the combination of conduct and mindset in your organization and there are many different forms.
Companies have many different types of culture. Some companies are laidback and slow to change, while others are hyperactive and ready to move at the slightest change in the marketplace. Some companies have a fun culture, others a more serious culture. Look at the culture in startup companies. It is quite different than companies that have been around for 100 years.
Cultural differences exist in other ways too. Some companies are sales-driven. These companies are experts at deal making and thrive on it. Others are operationally driven, with sales competencies and processes taking a back seat. In some companies, various business units compete against each other for financial and human resources, while at other companies, business units work closely together to create a seamless entity. In some companies excessive office politics is part of the culture.
Lack of a conscious culture
Every company has a culture — either it is explicit or implicit. Most often companies develop a certain type of culture without conscious design. Companies focus on developing their mission, vision, goals and strategies, but rarely do they stop and think about the specific culture they want to cultivate. You as a leader, must realize the importance of cultivating the right culture, and then help your organization cultivate it.
Failure to change employee mindsets and set ways engrained by organizational culture is often the reason why mergers and acquisitions fail. It is also the reason many new CEOs fail to succeed. Cultural disconnect is a recipe for disaster. You have to take charge and make sure your people fit your culture or your culture fits your people.
You cannot develop culture by edict. A memo from the CEO does not establish the culture. How do you change the behavior and mindset of people, and change it in such a manner that behaviors do not revert back? I hope you can appreciate developing the right culture is a huge challenge. Culture is driven by the tone set at the top. The organization watches carefully and takes its cues from how the leaders think and act. Therefore leaders have to be mindful. If you have raised children, then you know, kids do not do what parents ask them to do, kids do what they see their parents do.
The right culture for your company depends on your mission, core management philosophies, vision and strategies. If your core business model is product leadership, then your culture has to encourage and celebrate innovation. If your new vision is hyper-growth, then your culture has to change to encourage risk taking in new products and markets. You cannot achieve a new hyper-growth vision without asking the organization to change its thinking and its mindset.
As a leader, you need to take the time to understand and crystallize the right culture for your organization that is in-sync with its mission, business model, vision and strategies. Then you need to lead by example, changing your behavior and mindset to reflect the desired culture. And, you need to follow through to ensure your management team and employees imbibe the new culture.
Ravi Kathuria is president of Cohegic Corp., a management consulting, executive coaching and sales coaching firm. He is president of the Houston Strategy Forum and is a recognized thought leader who has been quoted in The Wall Street Journal, Barron’s, WorldNews, and has also been featured on CBS Radio and the “BusinessMakers Show.” He is the author of the highly acclaimed leadership parable, “The Coherent Company: Drive coherence across mission, vision, goals, strategy, execution & culture to unleash performance.”