Herb Kelleher at Southwest Airlines

The airline industry is a tough place to make money because of its price sensitive customers, too many competitors, high capital intensity and boom-or-bust cyclicality. Even though with all these factors, Herb Kelleher, the cofounder and chairman of Southwest Airlines, created the sort of value that any company leader would envy. Herb Kelleher embraced servant-leadership as his style. Servant-leaders put their people above themselves, care about their employees, humble and empower their people. These were the kind of values that Herb Kelleher practiced in the aviation industry. From its start in 1971, Southwest has grown into the fourth-largest airline in the United States.
Southwest adopted Pacific Southwest Airlines model during the early years because it provided an excellent intrastate routes and offering low fares for frequent point to point travels. To be different and outstanding from PSA, Southwest offered offbeat services and great-looking stewardesses on their planes. Southwest was originally incorporated to serve three cities in Texas as Air Southwest on March 18, 1967. This whole idea was presented by Kelleher’s friend Rolling King, who worked as a lawyer in San Antonio. Some of the incumbent airlines of that time such as Braniff, Aloha Airlines, Trans-Texas and Continental Airlines and United Airlines initiated legal action against Southwest. This legal battle lasted for three years and thus keeping Air Southwest on the ground. Southwest eventually prevailed in the Texas Supreme Court, which ultimately upheld Southwest’s right to fly in Texas. Southwest’s secret to success was to stick to a winning formula. Some of the strategies for success had already been in use long before Kelleher had taken formal control of the airline. One of the strategies was flying same fleet of aircraft as a sole standard to reduce company’s operating and maintenance expenses. This idea was mainly used by the Southwest’s first CEO Muse. Southwest’s entire fleet consisted