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Limit Structure to Four Management Layers

How does structure fit into Kelleher's vision of a large company with a small-company spirit? Obviously, it isn't enough just to hire the right people, give them profit sharing, and have them crack jokes or pop out of overhead bins. In order to make sure that decision making does not get bogged down, the Southwest chairman insists on a maximum of four layers of management between the CEO and front-line supervisors. Kelleher's goal is to push responsibility down into the field as much as possible, so that people feel free to make decisions. The workers who perform best in Kelleher's company are self-starters who are confident enough to make their own decisions:

We've tried to create an environment where people are able to, in effect, bypass even the fairly lean structures that we have so that they don't have to convene a meeting of the sages in order to get something done. In many cases, they can just go ahead and do it on their own.... Our leanness requires people to be comfortable in making their own decisions and undertaking their own efforts.

Despite its success, Southwest has had its share of skeptics over the years, particularly on Wall Street. Most analysts agreed with Kelleher that Southwest's secret was its small, family-like culture. But many also believed that the culture could not survive if the company got too large. However, Southwest has succeeded in maintaining its culture while achieving meaningful growth (with close to 30,000 employees, and counting). Much of the credit belongs to CEO Kelleher, who steadfastly stuck to his original vision of the company:

The bigger you get, the harder you must continually fight back the bureaucracy and preserve the entrepreneurial spirit.... You've got to keep that spirit alive within the company, no matter how big it gets.

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