Wednesday, May 26, 2010

Herb Kelleher and James Carville

In their book, Buck Up, Suck Up... and Come Back When You Foul Up, James Carville and Paul Begala talk about Herb Kelleher, perhaps the best CEO of all time, according to Fortune magazine. On one occasion, Herb Kelleher told Paul Begala: "I can teach you the secret to running this airline in 30 seconds.  This is it:  Southwest is the low-fare airline.  Not a low-fare airline.  We are THE low-fare airline. Once you understand that fact, you can make any decision about this company's future as well as I can."

"Here's an example," Herb said. "Tracy from marketing comes into your office. She says her surveys indicate that the passengers might enjoy a light entrée on the Houston to Las Vegas flight.  All we offer is peanuts, and she thinks a nice chicken Caesar salad would be popular. What do you say?"

Paul Begala stammered (hesitated, paused, stuttered).  So Herd told him: "You say, 'Tracy, will adding that chicken Caesar salad make us THE low-fare airline form Houston to Las Vegas?  Because if it doesn't help us become the unchallenged low-fare airline, we're not serving any damn chicken salad.'"    

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