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CEO@Smith: Jim Parker

Feb 24, 2010
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Former CEO of Southwest Airlines Helped put the “Friendly” in Friendly Skies

On Feb. 24, 2010, CEO@Smith, a new speaker series designed to put students and top executives in an interactive lecture environment, kicked off the spring semester with Jim Parker, former Chief Executive Officer (CEO) and chairman of the board of Southwest Airlines.

Addressing a packed house of 275 students, alumni, faculty and staff, Parker advised attendees to create a culture that nurtures a positive and compassionate attitude, as there are no rule books that can accurately enforce kindness and civility. As an example, Parker pointed out that on many Southwest Airlines flights, off-duty employees will leave their seats to help on-duty flight attendants pick up trash or distribute peanuts. Parker himself did this when he served as CEO, and said mostly all employees, from off-duty pilots to corporate accountants, are known to assist colleagues with such in-flight tasks. This procedure is not found in any Southwest Airlines handbook, but is simply an action employees started out of the kindness of their hearts.

Parker served as CEO through the Sept. 11 attacks, and vividly described his drive into work on Sept. 11, 2001: the countless phone calls; the confusion after the second plane hit the tower and following reports of planes flying erratically in Pennsylvania and near DC; the 30-minute period where Southwest had to count their own planes to be sure none of them had been hijacked; and the small span of time in which the Southwest executives had to decide what to do.

In the end, they “did the right thing.” Southwest Airlines agreed to no-questions-asked refunds for any customer that cancelled a flight. They decided to keep all of their employees without forced furloughs or sweeping layoffs. They decided not to cancel any of their routes. Then they waited for the ramifications of their decisions – they expected throngs of customers to cancel flights, and for profits to drop severely. But that never came.

Southwest remained profitable when other airlines grounded their planes and filed for bankruptcy. Parker even spoke of opening mail from long-time customers to see a $20 bill flutter out – they wanted the airline that had been so good to them to stay in business.

For the duration of Parker’s tenure, Southwest remained ethical and profitable, and continues to thrive even in today’s economic climate. But that doesn’t surprise Jim Parker. He knows good things will come to those who do the right thing.

Jim Parker has joined the Smith School as an Executive-in-Residence with the new Center for Leadership, Innovation and Change, which will launch in Fall 2010. 

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About the University of Maryland's Robert H. Smith School of Business 

The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, online MBA, MS in business, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.